Experts predict imminent boom for maritime industry
…as Dakuku confronts new challenges
A sense of optimism has slowly overtaken the Maritime industry as signs of an early recovery are becoming evident by the day.
Industry operators have begun to express hope as the sector begins to record increased activities as against the devastating lull that dominated the industry a year ago.
Analysts have hinged the positive change in the sector to the renewed energy the Federal Government has brought to fiscal policy to nudge the economy out of a yearlong recession.
With the economy on the path to recovery, many sectors will begin to regain vigour, the Maritime sector inclusive.
Mr. Olayiwola Shittu, the National President, Association of Nigerian Licensed Customs Agents (ANLCA), in a recent interview with Business Hallmark noted that there are clear indications that the Nigerian economy was turning around, adding that the Maritime sector would likely be among the first of many beneficiaries of an uptick in economic activities.
Economy watchers have noted that for the first time over the last five quarters, the country’s Gross Domestic Product(GDP) has was likely to post positive growth, after consistently falling throughout 2016.
‘’But in the last quarter of 2016, there was a marginal negative growth of less than one per cent, despite an overall annual contraction of -1.5 per cent’’, noted an economist, who explained that the road to Nigeria’s economic growth was becoming more discernible.
According to him, the International Monetary Fund(IMF) and the World Bank had also predicted a rebound in the economy from the first quarter of 2017 as both institutions see the economy wriggling out of recession by the end of the second quarter of the year.
Some analysts have predicted that the economy should record positive growths in the 2nd, 3rd and 4th quarters of the year given the massive funds being injected by the Federal government to reflate the economy.
These funds, experts believe, are part of the $1billion raised by government from the Euro bond issue, they believe that on raising further funds through the $500m from its saving bond and the additional $600m loan that has been borrowed from the African Development Bank with a second tranche of $400m expected in the second quarter of the year, the economy should begin to see visible expansion, especially in the areas of capital projects and civil works.
Interestingly, the World Bank has also promised additional assistance to the government of Nigeria to help it restore her economy and put on the part of growth.
‘’With these funds injected into the economy, there is no way the economy will not rebound before the close of the year and don’t forget that the Minister of Finance, Kemi Adeosun has said that the Federal Government will spend the country out of recession and this is what is happening’’, another economist declared.
It is instructive to also note that the economy has started to react positively to the massive injection of the funds as the inflation dropped marginally for the first time since 2015.
Inflation stood at 9.9 per cent in 2015 when the present government took over and since then, it has consistently been on the increase, hitting an alarming 18.77 per cent in January.
However, the National Bureau of Statistics said the inflation has marginally dropped to 17.78 per cent, which shows a sign of improvement in the economy.
However, maritime operators agreed that these positive signs in the economy will have a direct impact on the maritime sector as the sector will be lifted out of the lull it has sunk into in the last two years.
‘’It goes without saying that the sector will witness a boom. Importers will have access to funds to import and there will be increase in operations at the terminals, which will also increase revenue generations of government agencies. This will also impart directly on the freight forwarders who will now have job to do’’, disclosed Prince Shittu.
Conversely, the predicted boom in the sector has presented a new set of challenges to the Nigerian Maritime Administration and Safety Agency (NIMASA).
As the sector’s apex regulatory agency, NIMASA will record a boost in its revenue drive due to the anticipated boom in the sector.
At the resumption of duties as the Director- General of NIMASA a year ago, Dakuku Peterside agonized that more than 50 per cent of vessels have stopped calling at the Nigerian ports due to the global economic meltdown, but with the seeming improvement in the economy, the vessel call is expected to increase with the attendant improved revenue.
At the world press conference he addressed last week in Lagos, Dakuku also declared that the agency has expanded the scope of its revenue areas to billing of pipelines.
According to him, the agency has exploited the statutory provisions of the Sea Protection Levy Gazette by commencing the billing of pipeline, Oil Rigs and FPSO’s.
However, Dakuku is faced with increased agitation by indigenous ship owners for empowerment in Cabotage trade and increased participation in oil affreightment.
They lamented the gradual take- over of Cabotage trade by foreigners as well as non- participation in lifting Nigerian crude oil.
Another challenge facing the administration of Dakuku is how to secure a sea time training for about 2500 young Nigerian being trained under its capacity training programme called Nigerian Seafarers Development Programme (NSDP).
The previous NIMASA administration was short changed in the terms of agreement with the foreign maritime schools in UK, Egypt and Philippine involved in the training programmes as the critical sea-time practical experience needed by the cadets to be well grounded in their profession was not included.
This is despite the huge amount of money so far expended on the programme.
Dakuku himself acknowledged this when he disclosed that only five Nigerians are on board sea- going vessels while country like Philippines have over half a million seafarers.
However, the NIMASA DG said the agency has mapped out strategies to surmount these challenges.
According to Dakuku, NIMASA, as part of its statutory mandate to promote the development of indigenous commercial shipping in international and coastal trade, will commence deliberate and direct intervention to generated government cargoes for indigenous ship owners.
Also, the agency is in discussion with relevant authorities to change the terms of trade from FOB to CIF that will enable Nigerians’participate in cargo lifting, cargo insurance and create jobs.
The agency is also in discussion with the NNPC to ensure that Nigerians fully participate in crude oil affreightment.
In a bid to also provide the needed sea time experience to the 1045 cadets who have so far graduated out of the 2500 beneficiaries of NSDP, Dakuku disclosed that high level talks are on with the Arab Academy, Egypt, South Tyneside, Newcastle and other universities in Philippines where these cadets are being trained to afford them sea time experience.
However, both Chris Asoluka,the former Chairman, Oil and Gas Free Zone Authority (OGFZA) and Lucky Amiwero, the National President of Council of Managing Directors of Licensed Customs Agents, did not share the same enthusiasm about the possible boom in the maritime sector.
‘’Where is the boom in the economy?’’ Amewero asked rhetorically.
He disclosed that the economy has not shown any sign of recovery in a situation where there is massive unemployment, where businesses are closing down and people are committing suicide daily due to lack of food to eat.
‘’Those figures being bandied about did not reflect the truth situation in the economy. They are political figures’’, he declared.
Chris Asoluka expressed fears over the future of the Nigerian maritime industry.
Asoluka took a cursory look at the Nigerian maritime industry and expressed shock that the country had seemingly failed to lay strong foundation for future growth.
Hon. Chris Asoluka lamented that the current maritime industry was not as good as the sector we had yesteryears.
Asoluka recalled that there was a time when Nigeria had both the cargo and the power of control, via the availability of vessels, especially, the Nigerian National Shipping Line (NNSL), bemoaning that the country once enjoyed a cargo sharing status, but has sadly forfeited it.
He insisted that the nation’s maritime industry’s salvation does not lie in the availability of requisite laws, stressing that the country has all the right laws in place, but has failed to harness or exploit them.
He was particularly unhappy with the dearth of capable skilled hands, noting that the experienced and the highly skilled persons like Master Mariners and the Marine Engineers were fast growing old, without an equal or corresponding measures for their replacements.