The Director General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Bashir Jamoh, has said the agency will aggressively push for the implementation of policies that would support fleet expansion in the country.
He also said NIMASA would ensure that financial bottlenecks that hindered ship acquisition and ownership in the country are eliminated.
Jamoh, who said this during an interactive session with journalists in Lagos recently, explained that the initiative would help improve economic activities and stimulate growth.
“We have to expand our fleets. Over the five years, we have looked at our ship owners to find out if there ship is increasing or reducing? Most of them are reducing,” he said.
Furthermore, he revealed that the agency would launch its floating dockyard that would earn N1 billion from repair ships every month.
Jamoh said NIMASA has been collaborating with the Nigerian Ports Authority (NPA) to launch the dockyard.
Jamoh said the floating dockyard would help stakeholders in cabotage trade that do not have facilities to repair their vessels.
He said: “You are aware the NIMASA took a proactive step and constructed the N17 billion floating dockyard last year.
“We entered into agreement with the Nigerian Ports Authority to give us its continental shipyard. Our plan is to create an arrangement where the NPA will provide its continental shipyard as the owner of the platform while NIMASA owns the floating dockyard.
“We expect that before the end of September we will be able to achieve this. The dockyard will earn a revenue of N1 billion per month with the capacity to employ 350 youths.”
The dockyard, according to Jamoh, would be a multipurpose facility with five essential sections that include “mechanical, electrical and surveying. We will also bring students from Maritime Academy of Nigeria Oron and the Nigeria Maritime University, Okrenkoko, for training within the facility. It is a multipurpose facility with bright future for Nigeria and younger generation.”
He also disclosed that NIMASA has commenced the revival of ship building in Nigeria and is currently understudying how many ship building companies we have in the country, their original capacity and how they have been operating till now.
“From our preliminary investigation, everything so far is negative. So, we are trying to know from research why things are so. It may not be disassociated from the general economic situation all over the world. But we will know how to address it when we get the report of the research,” he said.
He said the federal government suspended the Ship Acquisition and Ship Building Fund because many Nigerians that accessed it failed to repay their loans.
The director general said the fund was replaced with the Cabotage Vessel Financing Fund (CVFF), which was created by the Cabotage Act of 2003.
However, Jamoh noted that the guidelines contained in the Act made it totally impossible for stakeholders to appropriate the CVFF. “Now we are having problems. From 2003 to date we have not disbursed a single fund from the savings we have with the Central Bank of Nigeria (CBN) due to a lot of bottle necks.”
He pointed out that the directive that banks should contribute 35 per cent and at the same time guarantee the 50 per cent NIMASA contribution to the facility hindered the utilisation of CVFF.
Jamoh said: “The Act directed that we have to get primary lending institutions like the commercial banks. Its disbursement must be 50 per cent from NIMASA, 35 per cent from the bank and the 15 per cent from the beneficiary of that loan. From experience we have lost a lot of money to ship building and acquisition fund. So, the Act provided that banks must guaranty NIMASA’s 50 per cent in the event of failure. So, it became difficult to disburse the investment.”
He said that the Minister of Transportation, Mr. Chibuike Amaechi, requested and got President Muhammadu Buhari’s approval to disburse of the fund in November last year. “But we discovered that because of these technicalities, we cannot move forward,” he said.
Report: States, Firms’ Implementation of Wage Increase Unlikely
In view of the present economic condition, a full implementation of the approved minimum wage increase by state governments and the private sector is increasingly unlikely, a report has predicted.
Analysts at FBNQuest stated this in a report titled, “Consumer goods steering a COVID induced path,” obtained yesterday.
The report noted that presently, some of state the governments are already constrained and remain under pressure to clear backlogs of salaries.
The firm further disclosed that findings from an independent survey conducted by REACH Technologies which used a sample size of 100 adults in urban settings, also revealed drop in consumer confidence.
To complement REACH findings, the report also referred to a COVID impact survey recently published by the National Bureau of Statistics (NBS).
The referenced surveys indicated that consumer sentiments have turned sourer as only three per cent of the respondents stated that they were benefiting from the pandemic.
“Looking at macroeconomic indicators, relatively slow economic growth, high unemployment and rising prices will remain barriers to consumer spending this year.
“Given the cutback in fiscal spending on account of weaker oil prices and the slump in demand faced by the private sector, we see a shrinking job market hurting overall income levels in 2020.
“In view of the present climate, a full implementation of minimum wage increases across the state governments and the private sector is increasingly unlikely.
“At present, some of state the governments are already constrained and remain under pressure to clear backlogs of salaries.
“As such, managing recurrent expenditure with lower federal allocations over the coming months will be prioritised over salary increases,” it stated.
The analysts stated that they do not believe that the upside from the pay rise in December has filtered through to spending, adding that thus far, a large cross section of employees were left out of the increase.
“Apart from a few of the buoyant states (case in point Lagos), the increases have only been fully effected at the national level. “Implementation has even been worse in the private sector given that a large proportion of businesses in Nigeria are small and medium sized enterprises,” it added.
As the realities of the pandemic gradually materialises, it projected a six per cent depreciation of the naira/dollar exchange rates from current levels to $/N410 by year-end.
In addition, it stated that the planned increase in electricity tariffs in July would also potentially adds to inflationary pressure for the consumer.
“We particularly expect these to drive up prices of most essential items such as food, petrol and transport. Essentially, we see an overall downturn in spending this year with a fragile recovery going into next year, in line with our 2021 ending Gross Domestic Product growth forecast of 2.2 per cent.
“We also continue to see a greater display of price sensitivity than brand loyalty across goods and services,” it added.
The report stated that a downside risk to its outlook that could further drive spending lower was a potential reversal of the 14 per cent reduction in petrol pump prices to N125/litre. “Indeed, the group head of state-owned NNPC has been quoted recently saying the corporation will no longer resort to either subsidy or under-recovery of any nature.
“Going by this remark, a strong upswing in crude oil prices therefore translates to higher pump prices for consumers,” it added.
It stressed that consumers have seen little respite from inflationary pressures and growing unemployment since the 2014 collapse in oil prices.
For the most part, food and FX inflation continue to put upward pressure on living costs, it stated.