Editorial
Towards Achieving Fiscal Federalism
For the umpteenth time, calls for a Fiscal Federation reverberated in various parts of the Nigerian State recently, have the familiar disgusting ungainliness of some selffish politicians, not withstanding. This time, however, virtually all states within the South-South geopolitical zone, which resources largely account for the country’s economic survival are united in calls for a truly Federal System of government that guarantees them management of their endowments.
With the opportunity afforded by the recent public hearing convoked by the National Assembly towards reviewing the 1999 Constitution, the states have been agitating for a review of, among others, provisions under Sections, 44 (3) and 162-168 of the constitution.
Joining Rivers and Cross River States, Akwa Ibom and Bayelsa States, added their voices to the collective protest and demanded a constitutional relief that allows them control of their natural resources and the abolition of the current revenue allocation formula, enhanced by the vexatious provisions.
Section 44 (3) of the 1999 Constitution States, Notwithstanding the foregoing provisions of this section, the entire property in, and control of all minerals, mineral oils and natural gas in, under or upon any land in Nigeria or in, under or upon the territorial waters and the Exclusive Economic zone of Nigeria shall be managed in such manner as may be prescribed by the National Assembly.
By this singular provision, the oil producing states argue, they have been denied the inalienable right to manage their own economic resources, which, based on their persistent protests, negates the essence and spirit of a Federal System of government.
Even more worrisome are provisions in Section 162-168 which dwell predominantly on Federal revenue, and allocations.
Section 162 (10, a-c), for instance, states “For the purposes of subsection (1) of this Section,” revenue means any income or return accruing to or derived by the Government of the Federation from any source and includes
(a) Any receipt, however described arising from the operation of law;
(b) any return, however described, arising from or in respect of any property held by the Government of the Federation; (and) any return by way of interest on loans and dividends in respect of shares or interest held by the Government of the Federation in any company or statutory body.
Added to these is the obnoxious land use Act with its audacious annexation of all lands and resources there-in, there under and even above their land for the Federal Government, proceeds of which are distributed to all other states based on population, equality of states, internal revenue generation, land mass, terrain as well as population density.
Not only does the provision smack of natural injustice, it inadvertently appeals to communism as against the Federal System Nigeria today subscribes.
These protests are not new, but they have been overtly ignored by successive governments and the National Assembly, which membership, largely weighed in favour of the benefiting majority, who very frequently out-votes the Minority States whose natural resources are shared on daily basis.
But it must be said, and clearly too, that the refusal to heed to wise counsel has at various times threatened the peace and unity of the Nigerian State. Again failure to do the right thing has variously bungled the opportunity to correct obvious cases of injustice. The movement from Civil protest to armed militancy by youths of the Niger Delta area. Now, is yet another opportunity for the National Assembly to tinker with the statusquo and decide whether Nigeria needs the Federal System or not.
We are aware that a true Federation must be one of choice by all the Federating units who also work and agree on basis of such partnership. But sadly, since that is not the case with the Nigerian example, it will be everything but just to continue the way we have gone over the years, pretending that it was a consensus among all units in the first place.
The Tide believes that the right option is to embrace a Fiscal Federation that encourages healthy competition, research, ingenuity and hard work among the Federating Units and not the type of federalism that makes several units dependent on the spoils of a few.
This is why we support wholly the calls for resource control provided that the federating units pay to the centre, the prescribed taxes and earnings as may be decided upon by the National Assembly. We say so not because it affects Niger Delta more today, but that it could affect Kano or Ogun or any other state more tomorrow.
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Making Rivers’ Seaports Work
When Rivers State Governor, Sir Siminalayi Fubara, received the Board and Management of the Nigerian Ports Authority (NPA), led by its Chairman, Senator Adeyeye Adedayo Clement, his message was unmistakable: Rivers’ seaports remain underutilised, and Nigeria is poorer for it. The governor’s lament was a sad reminder of how neglect and centralisation continue to choke the nation’s economic arteries.
The governor, in his remarks at Government House, Port Harcourt, expressed concern that the twin seaports — the NPA in Port Harcourt and the Onne Seaport — have not been operating at their full potential. He underscored that seaports are vital engines of national development, pointing out that no prosperous nation thrives without efficient ports and airports. His position aligns with global realities that maritime trade remains the backbone of industrial expansion and international commerce.
Indeed, the case of Rivers State is peculiar. It hosts two major ports strategically located along the Bonny River axis, yet cargo throughput has remained dismally low compared to Lagos. According to NPA’s 2023 statistics, Lagos ports (Apapa and Tin Can Island) handled over 75 per cent of Nigeria’s container traffic, while Onne managed less than 10 per cent. Such a lopsided distribution is neither efficient nor sustainable.
Governor Fubara rightly observed that the full capacity operation of Onne Port would be transformative. The area’s vast land mass and industrial potential make it ideal for ancillary businesses — warehousing, logistics, ship repair, and manufacturing. A revitalised Onne would attract investors, create jobs, and stimulate economic growth, not only in Rivers State but across the Niger Delta.
The multiplier effect cannot be overstated. The port’s expansion would boost clearing and forwarding services, strengthen local transport networks, and revitalise the moribund manufacturing sector. It would also expand opportunities for youth employment — a pressing concern in a state where unemployment reportedly hovers around 32 per cent, according to the National Bureau of Statistics (NBS).
Yet, the challenge lies not in capacity but in policy. For years, Nigeria’s maritime economy has been suffocated by excessive centralisation. Successive governments have prioritised Lagos at the expense of other viable ports, creating a traffic nightmare and logistical bottlenecks that cost importers and exporters billions annually. The governor’s call, therefore, is a plea for fairness and pragmatism.
Making Lagos the exclusive maritime gateway is counter productive. Congestion at Tin Can Island and Apapa has become legendary — ships often wait weeks to berth, while truck queues stretch for kilometres. The result is avoidable demurrage, product delays, and business frustration. A more decentralised port system would spread economic opportunities and reduce the burden on Lagos’ overstretched infrastructure.
Importers continue to face severe difficulties clearing goods in Lagos, with bureaucratic delays and poor road networks compounding their woes. The World Bank’s Doing Business Report estimates that Nigerian ports experience average clearance times of 20 days — compared to just 5 days in neighbouring Ghana. Such inefficiency undermines competitiveness and discourages foreign investment.
Worse still, goods transported from Lagos to other regions are often lost to accidents or criminal attacks along the nation’s perilous highways. Reports from the Federal Road Safety Corps indicate that over 5,000 road crashes involving heavy-duty trucks occurred in 2023, many en route from Lagos. By contrast, activating seaports in Rivers, Warri, and Calabar would shorten cargo routes and save lives.
The economic rationale is clear: making all seaports operational will create jobs, enhance trade efficiency, and boost national revenue. It will also help diversify economic activity away from the overburdened South West, spreading prosperity more evenly across the federation.
Decentralisation is both an economic strategy and an act of national renewal. When Onne, Warri, and Calabar ports operate optimally, hinterland states benefit through increased trade and infrastructure development. The federal purse, too, gains through taxes, duties, and improved productivity.
Tin Can Island, already bursting at the seams, exemplifies the perils of over-centralisation. Ships face berthing delays, containers stack up, and port users lose valuable hours navigating chaos. The result is higher operational costs and lower competitiveness. Allowing states like Rivers to fully harness their maritime assets would reverse this trend.
Compelling all importers to use Lagos ports is an anachronistic policy that stifles innovation and local enterprise. Nigeria cannot achieve its industrial ambitions by chaining its logistics system to one congested city. The path to prosperity lies in empowering every state to develop and utilise its natural advantages — and for Rivers, that means functional seaports.
Fubara’s call should not go unheeded. The Federal Government must embrace decentralisation as a strategic necessity for national growth. Making Rivers’ seaports work is not just about reviving dormant infrastructure; it is about unlocking the full maritime potential of a nation yearning for balance, productivity, and shared prosperity.
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