ENDING LOSSES IN MARITIME SECTOR

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MONDAY EDITORIAL

Government should implement existing laws for the benefit of stakeholders

At a period the country needs all the resources it could muster for economic development, it is losing billions of dollars annually in the maritime sector. In the last three years, importers and exporters in Nigeria have paid over $25.3 billion to foreign ship owners as freight charges on goods imported and exported out of the country. According to statistics from the Nigerian Maritime Administration and Safety Agency (NIMASA), Nigerian shippers paid a total sum of $9,0878 billion as freight for dry and wet cargo to foreign ship owners in 2015. In 2016, Nigerians also paid $7,55b to foreign-owned ships while a total of $8,602b fright charges were lost to foreign vessels in 2017.

The NIMASA data also shows that in 2016, a total of 2,047 vessels brought in dry cargo import; 987 vessels lifted dry cargo export while 2,468 vessels lifted wet cargo import and export cargoes. In 2017, 1,967 vessels of dry cargo import were received at the port; 1,145 vessels of dry cargo export while 2,294 vessels of wet cargo import and export were handled in Nigerian ports. Besides, between 2004 and 2017 Nigeria recorded total vessel traffic of 25,256 with gross freight of $39 billion but the country earned a paltry sum of $1 billion as levies for NIMASA.

This massive loss can be blamed on the failure of Nigerian ship owners to acquire standard oceangoing vessels in order to have the needed capacity to compete with their foreign counterparts. However, equally important is the failure of government over the years to implement laws put in place to protect Nigerians and ensure fleet development aside the fact that the Cabotage Act, the NIMASA Act and the Local Content Act are not being implemented. By the Local Content Act, indigenous operators are supposed to be considered for any job before foreigners but over the years, government agencies have been breaching this law without any consequence.

Meanwhile, a major obstacle to fleet development in Nigeria is the lack of national carrier by indigenous operators. The national carrier is supposed to carry 70 per cent of all the cargoes coming in and out of Nigeria. Even though cargo preference laws are embodied in NIMASA for indigenous players to play in lucrative fields such as oil and gas, no country without a national carrier benefits from such cargo preference. The operators are supposed to demand implementation of the laws or seek redress in the courts because they contributed to the funds meant for fleet development. Sadly, instead of seeking ways to enforce their rights, indigenous operators prefer running to Abuja and bringing politics into matters that are purely technical.

For there to be any meaningful change, the government must draw a line between the political and professional space and urgently take steps to implement existing laws for the benefit of stakeholders. The federal government must also allow experts to run the system efficiently for the benefit of the people of Nigeria. Besides, NIMASA must urgently design a well-thought out indigenous fleet development programme, which will not involve government ownership and funding of vessel acquisition. If the agency wants to make any difference, it must create the necessary atmosphere that would encourage local and private investors to invest in vessel acquisition with the assistance and cooperation of the Nigerian National Petroleum Corporation (NNPC).

Finally, there is need for the government to audit the three per cent benchmark rate of the value of goods for import and export which NIMASA collects from vessels calling in Nigeria to ensure accountability.