Confronted with myriad problems that have left many indigenous shipping companies comatose, the new Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dakuku Peterside, promises a new reform agenda that will open up developments in the nation’s maritime industry. Francis Ugwoke writes
For the indigenous shipping industry, there appears to be fresh hope. This is so with the leadership of the apex maritime agency, the Nigerian Maritime Administration and Safety Agency (NIMASA), making strong moves to give the organisation a new direction in its mandate. Apart from making the territorial waters safe for vessels, the major statutory role of NIMASA is to champion indigenous shipping development from the three per cent levy collected from ships trading in the country.
But the agency has over the years not performed up to expectations, according to stakeholders. At a recent stakeholders’ forum in Lagos, the Director General, Dakuku Peterside, while acknowledging that the agency appeared to have derailed, promised a change for the better. This is coming on the heels of lamentations by stakeholders about the failure of the agency in executing its core mandate. The stakeholders had voiced out their grievances on how NIMASA’s failure has impacted negatively on the industry. Many shipping companies have remained comatose, notwithstanding the Cabotage Shipping policy as well as the local content policy that were introduced to assist their growth.
Issues Affecting Indigenous Growth
Over the years, there have been concerted efforts by the federal government to ensure Nigerian companies participate in shipping trade. With the domination of the shipping trade by foreign firms, the federal government in 1987 decided to set up the National Maritime Authority (NMA ) to promote the development of indigenous shipping companies. NMA about nine years ago metamorphosed into NIMASA after its merger with the Joint Maritime Industrial Labour (JOMALIC) under a reform programme. The old NMA made serious efforts to develop local shipping by introducing the Cargo Sharing formula and Ship Acquisition and Ship Building Fund (SASBF) but the two policies were later suspended.
Cargo sharing policy was suspended as a result of abuse by some shipping companies who collected the allocation and sold them to foreign firms. On the other hand, SASBF was suspended following failure of the beneficiaries to pay back the loan. Many saw it as a national cake. However, in continuation of its statutory responsibility, the apex maritime agency came up with the Cabotage Vessel Financing Fund (CVFF) designed to correct the failure of SASBF.
But the fund has not been disbursed since it was established, even though it was handed over to four banks to administer. This has affected indigenous shipping growth. Part of the CVFF was the Cabotage Shipping Policy, which was signed into law in 2003; it was designed to boost operations of indigenous shipping companies. Under the policy, cargoes within the coastal waters are reserved for the local shipping companies. The provisions of the law are that no foreign vessel can engage in coastal trade, including crew members, except with a waiver to this effect. But this is not working as the Nigerian National Petroleum Corporation (NNPC) and oil majors prefer to deal with foreign vessels instead of using Nigerian-owned ships. This is despite the local content policy.
The argument from NNPC over the years is that most of the local shipping companies do not have the capacity for some of the cargoes given to foreign firms, a claim that has been denied by indigenous operators. There are also hundreds of vessels operating illegally on the territorial waters which NIMASA could not stop even with the Cabotage Act.
At the forum organised by NIMASA, the stakeholders, one after the other informed Dakuku some of their nightmares. They opined that the new management of NIMASA must be ready to address them as part of the way forward.
One of the participants and for the former Director General of NIMASA, Temisan Omatseye, was of the view that there was nothing wrong with the Cabotage Policy, but the enforcement. Omatseye who is also the President of the African Ship-owners Association (ASA) said no foreign ship is supposed to operate in the nation’s waters the way it is now. Noting that many of them do not operate with any waiver, he called on the management of NIMASA to demand the licences of the vessels currently on the territorial waters and engaged in coastal trade. According to him, many of the vessels would flee if NIMASA moves to enforce the issue of licence. Omatseye also observed that what was in place now in NIMASA was the old structure of NMA, adding that there is already a plan on how NIMASA could be made better.
He advised the DG to look out for the Nzewu Report, which according to him, would assist in repositioning the industry. Many agreed with Omatseye on the issue of enforcement of Cabotage Law as the way out. Others were also of the view that what the present management should do was to approach the NNPC and oil major to talk to the officials on the need to give jobs to local shipping companies. The participants told the DG that acquiring vessels could not be a problem if there were jobs. Other participants called for the status of the CVFF, which has been inactive since it was floated more than a decade ago. They drew the attention of the agency to the fact that CVFF was supposed to be used in indigenous shipping development, considering high cost of sourcing funds for ship acquisition from commercial banks.
Incidentally, the position of the federal government as indicated by the Transportation Minister, Rotimi Amaechi, is to use the fund to establish a National Carrier in partnership with private investors. Since the law does not appear to encourage this, and considering the threat by some operators to drag government to court if this happens, the federal government is looking for best options that are covered by the law. A committee set up by Amaechi, THISDAY gathered, is currently working on a report on how best to set up a national carrier using the CVFF. The idea by the government is that a National Carrier will fill the gap created by the liquidation of the Nigerian National Shipping Line (NNSL) 21 years ago. It will create employment for the teeming population of Nigerians as well as address the human capacity gap that the shipping industry is suffering now.
On other statutory roles of NIMASA, the participants pointed out the nightmare suffered by ships in getting certification from NIMASA. One of the participants, Emeka Ndu, criticised NIMASA for subjecting ships to delays in getting certification from surveyors when the same ships have certification from other classification societies. He said the vessels incurred a lot of costs as a result of such delays. Other speakers advised NIMASA to leave out ships bringing goods into the country since they have been certified by international classification societies and concentrate only on vessels operating in the coastal waters. Noting the issue of poor capacity in the area of certification, they called on the management to embark on aggressive training for surveyors. A former director with NIMASA, Oliver Ogbuagu, said the issue with NIMASA certification was one of corruption and not incompetence, adding “it is the issue of brown envelopes”. Ogbuagu called for more training of the surveyors.
NIMASA’s Reform Agenda
In a mood to appease the stakeholders, who were dominated by ship-owners, charterers, master mariners, maritime consultants, among others, the new DG raised their hope of giving NIMASA a new direction in its statutory role of impacting positively in the development of indigenous shipping. He assured the stakeholders that the agency would embark on its core statutory mandate for the development of the maritime industry. NIMASA, he said, was on a mission of self-recovery towards the actualisation of its core mandate for the benefit of the nation’s maritime sector. He called on the stakeholders to collaborate with the agency in order to return the maritime industry to its pride of place in the national economy.
Dakuku disclosed that the agency would come out with a Medium-term Maritime Growth Strategy to cover the next three years, assuring that the strategy would be stakeholder driven, which has necessitated the organisation of the forum. Pointing out that the agency was in the process of a structural, cultural and performance reforms, Dakuku said the focus of the agency’s performance would no longer be measured by how much revenue it derives but on how well it can stimulate the necessary growth of the sector for the benefit of indigenous operators and other Nigerians.
He said: “Our performance will be service based and not metric based, the focal point of which will be to create the enabling environment to gainfully engage as many stakeholders as possible with a view to creating wealth and generating employment for the overall good of the maritime industry and the national economy”.
Part of the moves, the DG said, would be to identify challenges and proffer solutions, adding that the agency would welcome every kind of suggestion that will assist it perform more than ever before in its area of statutory obligations. He promised to look at the structure of the agency and improve on the work culture, vowing that under the present dispensation, everyone in NIMASA must be made to perform. He also expressed concern that NIMASA has been doing things in the old ways, adding that under the present administration, he would bring about a change for the best.
He appealed to the stakeholders for cooperation, adding that the strength of the agency was in the people it serves. According to him, the current effort of the management was to lift the maritime industry to greater heights so as to make Nigeria the hub of maritime trade in the West and Central African sub-region. Noting that the agency appeared to have derailed over the years, Dakuku said the present administration would this time ensure that its core mandate is achieved. The transformation of the sector, he sounded optimistic, would attract more business to the country. Shortly after the stakeholders’ forum, the top management staff of the agency commenced a retreat to draw a roadmap for the development of the maritime sector. The roadmap is aimed at engendering a conducive atmosphere for the growth and development of the maritime industry.
The retreat was to develop strategies that would reposition NIMASA and indeed the maritime sector and draw a Medium-term Growth Strategy for the sector. The leadership of the agency focused on five areas of critical importance for the sector. They include survey, inspection and certification transformation programme, security, emergency and search and rescue transformation programme. The agency, among others, is also looking at capacity building initiatives, which entail growing indigenous tonnage, ship building and human capacity which have remained the concern of local shipping companies over the years.