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The Renewed Bid for National Shipping Line



Container Shipping
  • The Renewed Bid for National Shipping Line

For decades, the nation’s shipping industry did not record significant progress. This has made stakeholders to cry out to no avail. The matter was made worse when the only national carrier, the Nigerian National Shipping Line (NNSL), was liquidated about 21 years ago. Since then, the shipping sector has been dominated by foreigners. Government had moved about 13 years ago to address this by establishing the Cabotage Policy, which limited carriage of local cargoes within the territorial waters to indigenous operators. But this again failed to work.

The cargo owners, mainly the Nigerian National Petroleum Company (NNPC), and the oil majors have not patronised the local operators adequately. The claim by the NNPC executives has always been that many indigenous ship-owners do not have the required capacity for the wet cargo job within the nation’s waters. For the foreign companies, this was a good development and they were issued waivers by the Transport Ministry for most of the jobs. Only few Nigerian companies have been lucky. But no one has been discussing the carriage of crude oil by Nigerian companies because of the trade terms that favour only foreign carriers. But recently, the NNPC welcomed the idea of a national carrier to be able to participate in crude oil transportation.

Multiplier Effect on Economy

At a gala dinner organised by the Ship Owners Association of Nigeria (SOAN) at Eko Hotel, Lagos, the NNPC Group Managing Director, Dr. Maikanti Kacalla Baru, made every stakeholder happy when he stated the readiness of his corporation to support the national carrier project.

Baru said establishment of a national fleet for crude oil affreightment would be of huge economic benefits to the country with multiplier effect on the nation’s economy. Apart from earning billions of dollars which will address the nation’s foreign exchange nightmare, a national fleet programme will also increase capacity building as it will provide a training ground for the nation’s cadets from which Nigeria can earn foreign exchange like other countries.

Baru said that since Nigeria exports her crude oil on FOB basis, a national fleet programme for the country will make the nation transact her crude oil business on CIF basis. Under Free on Board trade terms, the buyers determine who carries the products as against Cost, Insurance and Freight in which the seller will determine who carries the wet crude.

The transportation of the nation’s crude products has been in the hands of foreigners because those who buy the products nominate their own carriers for the products, most times their own liners.

Baru stated that the establishment of a national fleet for crude oil affreightment helps the country save some of the foreign exchange paid to foreign ship owners.

He said that, “The establishment of a National Fleet for crude oil affreightment helps the country save some of the foreign exchange paid to foreign ship owners. A total of 771,689,625bbl (197,179, 115mt) of crude oil was lifted from Nigeria in 2015. The current freight rate for 130,000tonnes vessel from West Africa-UKC/med is $7.99/tonne. Assuming that the total tonnage of the nation’s crude oil was freighted to UKC/Med using a 130,000 vessel (which could take 950,000bbl), it means that a total of about $6,165,800,104 was paid to foreign ship-owners. Some of these monies could have been saved if the nation had a national fleet for crude affreightment”.

Caution by NNPC

For the national carrier to succeed, Baru gave his advice. He cautioned that the establishment of a national fleet should not be considered solely as the responsibility of government, but should be private sector-driven like in other countries of the world. He also said there was the need to be very careful in the choice of the business model, adding this was very important for the success of the business.

He said, “The establishment of a national fleet should not be considered solely as the responsibility of government. Having a national fleet is about ensuring global presence of a nation’s flagged vessels. The shipping industry in Greece which is the largest in the world is mainly driven by private sector. The ship-owners association should thrive to grow the business of its members such that Nigerian flagged vessels are visible globally. The association therefore, should identify what government needs to put in place to make the shipping business of its members extremely successful.

Applauding SOAN for the efforts to have a national fleet, he advised everyone involved in the plans to learn from the mistakes of the liquidated NNSL. He warned about establishing a national fleet that will be operated by foreigners, adding that this will be against the provisions of the cabotage law.

He said, “Owning a ship is no mean feat, considering the amount of money involved in maintaining a ship, her crew, insurance, regulatory dues etc. The association should be applauded for its worthy objectives which are largely aimed at growing the shipping industry in Nigeria.

“I am sure that you all are aware that our country once had a National fleet under a company called Nigerian Shipping Line (NNSL). One cannot speak therefore on the benefit of establishing a National Shipping Fleet for Crude oil affreightment without referring to NNSL.

Views by Stakeholders

To open up indigenous shipping development in the country, SOAN wants the federal government to review some of its policies and programmes to drive the desired growth in the industry. The President of SOAN, Engr. Greg Ogbeifun, called for a review of duties paid on imported vessels, corporation income tax for companies acquiring new Nigerian flagged vessels and port cost concessions. Others include a review of fines and penalties for offences as contained in the Maritime Agencies Act.

Ogbeifun urged the federal government to amend the Act to support the Nigerian shipping fleet, adding that the Sea Protection levy for instance should be stopped. He also demanded that Nigerian ship owners should be allowed to carry at least 50 of government owned cargoes, adding that this was necessary for the development of the local industry. He called for the creation of priority berthing for Nigerian registered ships and a review of the “extant policy that traders should not earn foreign exchange to pay for product if that cargo is already on Nigerian waters”.

The association equally demanded for the amendment of the cabotage law to effectively enforce local content. The body also called for a review of the maritime law to permit the setting up of a Protection and Indemnity (P & I) Club in Nigeria.

Government’s Readiness

As part of the efforts to establish a national carrier, Nigeria and Singapore has already signed a Memorandum of Understanding on the planned re-establishment of a national fleet. A delegation of the committee was in Singapore with the Transport Minister, Rotimi Chibuike Amaechi, to sign the MoU. Since then, there has been a follow up with members of the Ministerial Committee on national carrier committee headed by Hassan Bello who is also the Chief Executive Officer of the Nigerian Shippers’ Council. Bello and other members of the committee were in China last week to continue discussion with the authorities connected with the project. The Chinese contact will handle areas of fish trawling in the national fleet and was referred to the committee by the Singaporean company.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade experience in the global financial markets.

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Company News

Farmforte, Others Signs MoU To Strengthen and Sustain Growth in Agricultural Sector



Farmforte - Investors King

Farmforte Limited has signed a strategic Memorandum of Understanding with the Agricultural Fresh Produce Growers and Exporters Association of Nigeria; HYBR, a pan-African innovation firm; and ALTS, a consulting and strategy development firm.

The firm said in a statement on Sunday that the partnership would strengthen common interest cooperation and stimulate inclusive and sustainable growth within the agricultural sector, by capitalising on the synergy and comparative advantage offered by each organisation.

Speaking during the signing ceremony, Farmforte Co-Chief Executive Officer, Osazuwa Osayi, said, “Our mid to long-term strategic goals are further reaffirmed, as this partnership will facilitate the sharing of knowledge, ideas, and expertise across the agricultural sector.

“We will collectively address initiatives and approaches concerning agricultural investments, food security, and the overall robustness of the value chain.”

He said the collaboration would also unlock the full potential of the sector and place it on a renewed path for success, especially within a post-pandemic economy.

The President of AFGEAN, Tajuddeen Dantata, said, “By creating dialogue and fostering investment in the horticulture sector, this partnership will endeavor to support Farmforte in its exporting efforts by improving operational efficacy and cost-savings, while ultimately driving socio-economic growth in the country.”

The Chief Executive Officer, HYBR, Charles Ojei, said to drive inclusion, sustainability, job creation, and Nigeria’s overall economic growth, the optimisation of the agriculture value chain was critical.

“This collaboration is a fusion of the complementary capabilities of all partners to move a bigger agenda forward.”

The Managing Partner, ALTS, Akintunde Sawyerr, said, “The goal of this partnership is to support Farmforte’s vision of becoming the largest agribusiness by 2035 via scalable and world-class innovation across its enterprise.”

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Company News

OctaFX Launches Dual Life Campaign



OctaFX- Investors King

International Forex broker, OctaFX has launched a socially conscious marketing campaign called Dual Life aimed at simplifying forex trading and helping Nigerians create wealth.

A statement by the organisation on Monday said that the marketing campaign would celebrate the superpowers of Nigerians who committed their time and efforts to two or more jobs and were successful at each one of them.

It stated that the #DualLifewithOctaFX campaign had influencers in the Nigerian lifestyle and entertainment space such as Toke Makinwa, Bovi, Denola Grey, Timini Egbuson, and others at the core of the engagements, establishing the other sides of the celebrities and influencers as entrepreneurs.

While speaking about the campaign, the Marketing Manager, EMEA, OctaFX, Ali Nwadike said, “We wanted to position forex trading as that activity young Nigerians and everyone else, can engage in, even while focusing on their careers.

“From findings, most young Nigerians today work two or more jobs to pay the bills and attain financial freedom. But, we don’t get to talk about this often or appreciate the efforts, hence the #DualLifewithOctaFX campaign.

“While some see their jobs as a burden, we want people to see it as an achievement; and promote the school of thought that says one, two, many jobs is not bad especially when you are trying to create wealth.”

Nwadike added that more Nigerians would be exposed to the beauty of keeping their regular jobs and careers while making more money from forex trading with the OctaFX Trading App.

The statement also affirmed that OctaFX had made necessary arrangements from assembling forex experts and compiling training guides in the simplest and relatable form.

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AfDB Appoints Dr. Beth Dunford as Vice President



African Development Bank - Investors King

The African Development Bank Group (AfDB) has announced the appointment of Dr. Beth Dunford as its Vice President, Agriculture, Human and Social Development. The appointment becomes effective from July 1, 2021.

A statement explained that Dunford, a national of the United States of America, brings extensive experience to this role. She has held senior-level leadership positions in the US government, where she managed large and complex programs, working with the private sector, civil society, and multilateral and bilateral institutions, as well as with African governments, to deliver agricultural, social and human development impact at scale.

Prior to her appointment, Dunford worked as the Assistant to the Administrator in the U.S. Agency for International Development’s (USAID’s) Bureau for Resilience and Food Security, as well as the Deputy Coordinator for Development for Feed the Future, the U.S. government’s global hunger and food security initiative.

“In this dual role, she coordinated Feed the Future across multiple U.S. government agencies, oversaw a $1 billion annual budget and leveraged millions of direct private sector investment annually. In this capacity, she also coordinated a $2.3 billion Feed the Future presidential initiative across 11 US government agencies and forged partnerships within the private sector and civil society targeted at reducing hunger and poverty.

“She also led USAID’s technical and regional expertise focused on improving agriculture-led growth, resilience, nutrition and water security, sanitation and hygiene,” the statement added.

President of the African Development Bank, Dr. Akinwumi Adesina said he was delighted to appoint Dunford as Vice President to lead the Bank’s work on Agriculture, Human and Social Development.

“Beth is a strategic and effective leader with deep knowledge and impressive track record in designing and delivering highly impactful large-scale programs that have helped in lifting 27 million people out of poverty in 36 countries,” he added.

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