Managers of the Tema Port Expansion Project, Meridian Ports Services (MPS), have downplayed suggestions that the project will lead to massive job losses.
The managers say when the project is fully completed; it will rather boost the country’s economy through the creation of thousands of direct and indirect jobs.
There have been protests by dock workers over impending job losses as a result of the port expansion project, with the Director General of the Ghana Ports and Harbours Authority, GPHA, Michael Luguje, recently confirming that about 1,200 employees of Inland Container Depots (ICDs) would be laid off after the operationalization of the Meridian Port Services (MPS) project later this year, 2019.
Mr. Luguje told Bernard Avle on The Point of View on Citi TV that the workers will no longer be needed adding that the ICDs had been served notice in that regard.
He said, “We licensed those [ICDs] just for 2019 because past 2019, we wouldn’t need to transfer boxes to them.”
The ICDs used to be essential because of congestion at the port “before container terminals came into being; before MPS terminal too came into being.”
Once the waterfront space wasn’t sufficient, the Authority encouraged private sector initiatives, Michael Luguje recalled.
“If you have any land of the waterfront, you could develop it and come and we will license you so that part of the containers that cannot go into the existing container facility can go into your facility and in doing so, you earn some revenue. But with the coming into being of this new terminal which is going to have excess capacity to carry all space, inland containment depots will have no consignments,” he noted.
MPS’ position
But the Legal, Licence and Permits Manager of MPS, Frank Ebo Brown, explaining the benefits of the project during a tour of the project site by journalists, said the platform that MPS would be handing over to the Ghana Ports and Harbours Authority, GPHA, is in itself an opportunity for GHPA to employ more people.
“MPS currently has about 460 permanent employees, which employees are going to be moved here [The new port]. We have about 450 contractor personnel who are also going to be moved here. This gives the opportunity for GPHA to have an area of about 427,000 square meters with waterfront two berths, to be able to employ people. So we’ve given them a whole area to be able to employ as many people as possible. Currently, we’ve got close to a 1,000 people in addition to even suppliers who come – that’s indirect jobs. So if we have this facility, I don’t see how we can lose a lot of jobs when there’s a golden opportunity to take advantage of this good facility.”
“In fact, there are companies who approached us MPS wanting to enter into negotiations with us to use those facilities, but we told them that no; because that facility is going back to be handed back to the GPHA.”
The Chief Executive Officer of MPS, Mohammed Samara, also dispelled claims that the MPS project will threaten the survival of the ports under the Ghana Ports and Harbours Authority.
According to him, that claim is flawed because GPHA is a thirty percent shareholder of the new port.
He says phase one of the project is to be completed in June this year for operations to begin.
“We’re progressing, and we’re gearing up to open by the beginning of July this year. The goal life date is the 28th of June, and we’re working on that target. We will start with two berths not four. Then the third one will come hopefully at the first quarter of next year, which is scheduled to be middle of next year, and the fourth one will come in the year 2022, but we are likely to push it to be ready in the year 2020. This isn’t a threat to GPHA in any shape or form because GPHA is a 30% shareholder in this company, so basically it cannot be a threat to them; it’s not a threat to the shareholders.”
Background
President John Mahama launched the start of the expansion works at Tema Port in 2016. The project is a public-private partnership between the GPHA, representing the Government of Ghana, and MPS for an upgrade and significant expansion of Ghana’s main seaport.
The port is expected to be the largest cargo port in West Africa, and one of the best in Africa, with a capacity of 3.5 million 20-foot equivalent unit (TEU) per annum.
Committee
An inter-ministerial review committee was set up by the Akufo-Addo government in January 2018, headed by a Deputy Minister of Transport, Mr Daniel Titus-Glover, to assess the proposals submitted by the GPHA for the review of the 35-year concession agreement.
The Daily Graphic reported earlier that the committee presented its recommendations to the government in February 2018, and a White Paper is yet to be issued on the recommendations.
But Mr. Titus-Glover according to the newspaper said the committee recommended a review of the entire work done because it was not in the interest of the GPHA and the country.
“This was an amended agreement signed under the previous government, it is a bad deal for the port and the entire country, and our hope is that we can correct the wrongs,” he said.
Contract agreement
The details of the amendment, according to Daily Graphic, grants the MPS the exclusive right to handle eligible vessels such as full container vessels carrying 200 twenty equivalent units (TEUs) or more, a situation many industry players claim had priced Ghana out of the arrangements.
Similarly, provisions in the agreement give MPS the right to charge and retain all payments made in respect of vessel dues, as well as berth occupancy charges. The agreement further grants MPS the right to charge and retain port dues until discharge date of all the concessionaire’s obligations under the financing agreements, as confirmed by the lenders.
“As such, 90 per cent of the dues retention goes to MPS, while the GPHA has a 10 per cent stake from year one to the 10th year,” it states.
When asked about purported meetings between GPHA and MPS over some provisions in the concession agreement, the Legal, Licence and Permits Manager of MPS, Frank Ebo Brown, said they cannot respond to such matters until the GPHA comes out officially on same.
“GPHA is our grantor, and GPHA has not come out publicly about these things. We respect our grantor, we respect procedures. If there are discussions, let’s leave it for GPHA to comment and then we can come out.”
Mr. Frank Ebo Brown says Ghana should ultimately concern itself with the long-term benefits of the project, just as the current ports have benefitted the country for several decades.
“Let us see where there’s a benefit in it for Ghana. Let us see whether this is an extractive industry or it’s an asset for the country. We’ve heard that this asset is built for 100 years. Look at the current breakwater in the old GPHA Port, it was built in 1962 but it’s still working. Look at the number of people who have benefited from the old facility since 1962, community One to 25 and more, look at the industries have come with it. What do you envisage that this will come with? You’re looking at positioning Ghana on the global map as a hub to link shipping lines, to link countries. We are looking at connecting Ghana not just to the traditional areas, but to areas that we’ve not been before.”
“There’s no direct shipping connectivity between Ghana and Liberia. If you’re shipping anything from Ghana like plastic chairs, when the ship picks that container, it will go to Europe or North Africa before coming back. What does it mean for Ghana? The people’s monies are locked up and there’s what we call multiple handling of containers and it comes with huge cost. So when you’re looking at all these things, let’s look at what there is in it for Ghana. If you cut out this, and there’s now direct connectivity between Ghana and Liberia, that factory person who’s initially disadvantaged by heavy freight cost, will now be able to get the opportunity to at least explore the market in Liberia”.
