A COMPREHENSIVE ANALYSIS OF THE PRIVATISATION OF NIGERIAN PORTS: EVALUATING ITS EFFICACY AND COMPETITIVENESS

Background of the study: The market environment in which ports operate has undergone tremendous transformation in recent years, particularly as a result of the growth of vertical and horizontal integration within the international marine transport chain. This development has been driven in particular by shipping corporations, which has led to a rise in the market strength of big shipping businesses in comparison to other service providers, such as port authorities. The authorities in charge of port operations have come to the conclusion that enhancing their competitiveness is essential if they wish to increase their share of the market and that the rate at which they process containers and the amount of time it takes for vessels to complete their turnarounds are important factors in this regard. In addition, a number of port authorities and port operators believe that an increase in the private sector's engagement in the ownership and management of container ports (terminals) may assist port authorities in improving the effectiveness of their operations (Aigner, 2021. As a result, port privatization has emerged as one of the most prominent trends in the global port business at the present time.

1.2 Statement of the Problem

It is widely believed that ports form a vital link in the overall trading chain and, consequently, port efficiency is an important factor for a nation to achieve international competitive advantage (Aigner, 2022; Baird, 2021). In addition, most port authorities think that increasing private sector participation in the ownership and operation of container ports (terminals) can help them improve their operation efficiency. These are the reasons that port privatization becomes one of the most obvious phenomena in current port industry. Therefore, it is indispensable to identify both the relationship between the ownership structure and port efficiency, and the relationship between port efficiency and port competitiveness.

1.3 Objective of the Study

The main purpose of this study is to investigation Nigerian port privatization its efficiency and competitiveness

1.4 Research Questions

Does Port privatization have effect on port efficiency and competitiveness?

1.5 Research Hypothesis

The following hypothesis were formulated for this study:

H0: There is no significance positive relationship between port privatization and efficiency

HA: There is a significance positive relationship between port privatization and efficiency

1.6 Significance of the Study

This study will be able to provide some policy implications for port authorities and port operators. First, it will tell us whether port privatization has a positive effect on port operation efficiency, and if has, what is the best extent of private sector participation in port functions. Secondly, the results will show the importance of port operation efficiency for port authorities and port operators to obtain competitive advantages. Finally, this study will also identify other significant factors that determine the port competitiveness.  

1.7 Scope of the Study

This study focuses on port privatization, efficiency and competitiveness using Grimaldi Shipping Line, Apapa Lagos as a case study.

It is worth noting that this study does not investigate the effects of three justified determinants of port competitiveness, cargo handling charges, reliability and products differentiation due to the unavailability of the data. Running short of these data must constrain the comprehensive analysis of port competitiveness. For example, cargo handling charge is a very common tool for port authorities and port operators to compete with their competitors. Incorporating this variable into the model will tell us how to balance the positive effect from high operation efficiency and the negative effect from high operation charges to achieve the maximum of port competitiveness.