By Sisaa Agboh
The once burgeoning Lagos International Trade Fair Complex (LITFC) has
been in the news lately for the wrong reasons. It is apt to address the
dog whistle campaigns that have emerged in the wake of the recent
revocation of the concession of LITFC granted to Aulic Nigeria Limited by
the Federal Government.
At its meeting of August 22 and 23, 2017, the National Council on
Privatisation (NCP), chaired by Vice President Yemi Osinbajo, revoked the
concession over LITFC, and ordered its secretariat, the Bureau of Public
Enterprises, to commence another privatisation exercise that will lead to
the emergence of another concessionaire. Professor Nick Ezeh is the
promoter and Chairman of Aulic Nigeria Limited and has raised concerns and
pushed misleading information with his intervention over the revocation in
the media.
The Federal Government had to intervene because it could not afford to
allow a key national asset to deteriorate in the manner that it has since
Aulic Group took over as concessionaire. We, therefore, wish to apprise
the public of the facts that premised the government’s intervention.
The NCP approved the concession of LITFC in 2007 to Aulic (the
concessionaire). The concession of the 322 hectares of land in LITFC was
given at a lease fee of N40 billion to be paid over 30 years. The
Concession Agreement was signed with Aulic Nigeria Limited on June 29,
2007. Aulic Nigeria Limited paid an entry fee of N200 million in 2008 and
the sum of N12, 731,000.00 for the moveable assets. Since then, the
company has not paid any additional fees to Government, even though it
took over the complex nine years ago.
It is true that the entire complex could not be handed over to Aulic Group
owing to resistance by the Traders’ Associations that had subsisting
leases and the fact that Parcel B was not available for practical
handover.
However, the NCP, in January 2013, took some major decisions to address
the concession challenges, including a facility audit of the assets and
tenants at the complex as a prelude to excising the contentious portions
of the concession areas occupied by the Traders’ Associations, places of
religious worships and Parcel B. The key part of the NCP intervention was
that the concession contract was to be renegotiated for a new lease fee to
reflect the new area.
Despite participating in the process that gave rise to the NCP’s
decisions, Aulic Nigeria Limited immediately stalled the implementation of
the decisions via a petition to the House of Representatives Committee on
Privatisation and filing of a law suit.
In revoking the concession, the NCP noted that the concessionaire had no
standard management team in place and therefore, its corporate governance
standard was very weak. Council lamented that Aulic Nigeria Ltd had made
the implementation of the former’s decisions impossible while making money
from illegal leases without any effort to pay the annual lease fees to the
Federal Government since it took over the complex in 2007. It is apt to
point out that the concessionaire is currently indebted to the Federal
Government to the tune of N6, 542,172,000.
We also wish to draw the attention of the public to the fact that Aulic
had sub-leased to third parties the following areas of LITFC contrary to
the requirements of the Development Plan and without the approval of the
Management Board as enshrined in the Concession Contract:(a)The Lawn
Tennis Court, opposite Trade Fair Motel – sub-leased to private
individuals;(b)Land opposite Progressive Plaza – sub-leased to Motor
Dealers and Allied Products Association;(c)Land opposite ASPAMDA –
sub-leased to Old Mercedes Trucks Spare Parts and Scrap Metal Dealers’
Association;(d)Land opposite ASPAMDA – sub-leased to Coker Building
Materials Dealers’ Association; and(e)Land behind Trade Fair Police
Station – sub-leased to Chinese Engineering Construction Company (CCECC).
Aulic’s serial breaches of the Concession Contract include the following
cases:(i)Construction works that are taking place at the areas sub-leased
without the approval of the Management Board; (ii)Uncoordinated toll gates
manned by touts;(iii)The road network at the complex is in a deplorable
state; (iv)Aulic has no standard management team in place—the lessee’s
office/staff strength and structure do not show any sign of a standard,
ready-to-perform management team; (v)Refuse dumps litter the estate at all
times;(vi)At least three ‘Mammy Markets’ have sprung up in the complex
with a lot of miscreants and hoodlums operating there; (vii)Various
housing structures have been built in the complex without approval. Some
of these buildings were wrongly sited either on sewer lines or almost on
existing roads; (viii) A ramshackle mechanic village unbefitting the
international status of LITFC was operating in the complex; and (ix) Since
the handover of the complex to Aulic in 2008 till date, the exhibition
halls have been in a deplorable state, compelling the Lagos Chamber of
Commerce and Industry to relocate their yearly trade fair to Tafawa Balewa
Square.
From the foregoing, it is clear that the Concessionaire has been in breach
of the concession agreement; hence the government’s decision to revoke it
to save the Complex from further deterioration. Rather than explain why
his company failed to execute the terms of the Lease Agreement, Ezeh has
decided to play the ostrich.
It must be noted that the Bureau of Public Enterprises, which serves as
the secretariat of NCP, has handled concessions at Nigerian ports and most
of the port concessionaries are doing very well and are paying their lease
fees. Why is that of LITFC different?
Mr. Sisaa Agboh is of the Public Communications Unit of the Bureau of
Public Enterprises