MONROVIA: Latest report reaching this paper indicates “several internal and external risk factors to the port ecosystem that have the potential to disrupt the normal operations” of the National Port Authority (NPA).
According to the Bureau of State Enterprises Portfolio of State-Owned Enterprises Annual Aggregate Performance Report 2023 released recently in Monrovia, the lack of adequate terminal equipment, the cost of routine maintenance and upgrade of the ports’ infrastructure and equipment, and the lack of required energy supplies are among the operational challenges that have the potential to impact NPA’s revenue generation and/or expenditure levels.
According to the report, the operations of the National Port Authority (NPA) are mainly exposed to unforeseen rises in global fuel prices as well as electricity outages that may occur as a result of technical challenges to the national electricity grid.
“Lack of electricity supply increases the consumption of fuel or may disrupt the normal operations of the ports,” stressed the report.
Touching on the Financial Position of the NPA, the report indicated that the total balance sheet of the National Port Authority (NPA) “contracted” by US$4.89 million, or 3 percent, from US$177.68 million in 2022 to US$172.79 million at the end of 2023.
The non-current assets at the end of 2023 accounted for US$112.35 million, or 90 percent, of the total valued at US$60.44 million at the end of 2023, 8 percent down from the outturn in 2022.
According to the report, accounts receivable accounted for US$49.20 million or 81 percent, of the total current assets.
It added that the Port Authority’s total liabilities rose to 6 percent from US$74.35 million in 2022 to US$78.46 million at the end of 2023.
The increase in total liabilities can be attributed to the growth in NPA’s current liabilities, mainly driven by a US$6.00 million cash received in advance from APM Terminals.
The trend of the NPA’s debt from FY2019 to 2023 also shows a “compounded annualization” growth rate of 5 percent from US$60.39 million, or 77 percent, while current liabilities accounted for the remaining 23 percent.
The report, a copy of which is in the possession of this paper further asserted that NPA’s net worth fell by 9 percent from US$103.33 million in 2022 to US$94.32 million in 2023 and posted a compounded annualized growth of 7 percent from US$68.05 million in FY2019.
The NPA capital structure comprises the following: Capital Contribution-US$82.77 million; Contingent Liabilities-US$48.58 million; Kuwaiti Loan- US$5.92 million; Regional Service Charge/Dues-US$5.57 million; Accrued Interest on loans-US$0.29 million and Retained Earnings-US$1.64 million.
The National Port Authority (NPA), was established to manage all public port facilities in Liberia.
NPA currently manages four ports, including the Freeport of Monrovia, the Port of Buchanan, the Port of Greenville, and the Port of Harper.
The major services at the Freeport of Monrovia, such as general cargo, container operations, and storage were outsourced to APM Terminals through a public-Private Partnership (PPP) arrangement, and the revenue generated from those services under the agreement is shared monthly on a percentage basis.
The report says, NPA receives 18.8 percent for general cargo, 22.8 percent for container thru-port fee, 15 percent for marine services, and 50 percent on expected net profit.
APM Terminals’ partnership also places the NPA in a “landlord situation” with APM Terminals paying annual concession lease fees to the NPA, according to the report.
The ports of Liberia are the cardinal entries to the country’s marine transport system and the gateway to the country’s economy.
As its strategic objective, the report said, NPA remains focused on connecting the country’s economy to the global supply chains through the ports to ensure that needed goods are available to the rest of the country, while at the same time ensuring that its operation remain viable.
According to the report, “though the NPA is not exposed to any direct commercial competition locally from any private commercial business, the PPP arrangement with APM Terminals is a factor that negatively impacts the Port Authority’s full revenue generating capacity at the Freeport of Monrovia.”