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Saving Cost Through Modular Dry Dock



Dry Dock
  • Saving Cost Through Modular Dry Dock

Before now, the dry docking of vessels operating in Nigeria was done outside the country with huge implications in terms of foreign exchange costs running into several millions of dollars yearly. This wastage is about to end with the acquisition by Nigerian Maritime Administration and Safety Agency (NIMASA), of a modular floating dockyard. With this facility in place, the agency will save the federal government in excess of $100 million annually and about $1 billion in 10 years.

This princely sum will be a direct saving from the dry docking of vessels operating in Nigeria. Dry Dock is a waterless area for ship repairs, an enclosed dock from which water can be removed so that construction or repairs can be carried out below the water line of a boat or ship.

The agency and, in particular, its Director General, Dr Dakuku Peterside, has been celebrating and rightly too. To ensure that it did not end up as yet another government facility bugged down by bureaucracy, he has expressed the willingness of NIMASA to enter into a working relationship, a partnership of sorts, with interested parties in the private sector who will run it strictly as a business venture and profitably. Already, work on the dry-dock project is in progress and is likely to be completed before the end of this year.

This assertion by the Peterside himself debunks speculations that the plan for such a facility had been scrapped. He made it clear that, “It is not true that government has scraped the establishment of the proposed floating shipyard or dock yard in the Delta area; it is absolutely not correct.

According to him, the plan was on before his appointment. “Recall that before I joined NIMASA team, they had already established a business case for a floating dry-dock where owners of ship can dry-dock their vessels from time to time,” the D-G said

The decision to embark on this project, he further explained was based on the realisation at that time that “85 per cent or 90 per cent of those who own vessels dry-dock their vessels outside the country and we felt it encourages capital flight and that it doesn’t support the industry. So, it was at that point that we got into a relationship with a firm in Netherland to build a floating dry dock in the Netherland and in Romania. That project is on; when we joined the NIMASA team, we resolved to continue and follow it to its logical completion.”

Peterside, an accomplished technocrat was of the firm belief that the project would be completed this year and once that was achieved, it will be brought into the country and with it the agency should be able to dry dock most if not 100 per cent at least 90 per cent of all vessels in-country.

The Director-General said that another issue around the floating dry dock was location, adding that the agency had resolved to make the decision on location business related.

As expected, the location of the facility is beginning to generate political interest. But Peterside stressed that, “When we complete the dry dock, the location will be a business decision and many factors will be considered before we decide where it will be located. Studies are going on right now on where best it will be located”. This was just as he emphasised that, “it is absolutely not true that we have cancelled that project; that project is on. It is progressing at a satisfactory pace and we believe that it will be completed this year.”

Stakeholders in the Marine Transport sector are optimistic that the floating dockyard being built by the Nigeria Maritime Administration and safety Agency (NIMASA) would open new windows of opportunity in the maritime industry in West Africa.

After evaluating the extent of work on the floating Dockyard being built in Galati, Romania, the Senate observed that the opportunities would not only be limited to job creation or conservation of foreign exchange but would also include capacity building and wealth creation in the industry. With an average of 5,000 ships calling at the Nigerian ports annually, 400 active coastal vessels and several fishing trawlers, the demand for ship repair and maintenance facilities can only be on the rise.

However, it is lamentable that up and until now, no such indigenous facility was available in the maritime industry. The absence of modern functional floating dry docking facilities in the country which has forced ships and vessels to go overseas to undertake mandatory routine dry docking is not acceptable “the few land based dockyards in Nigeria are not even functioning optimally. Sometimes Nigerian ship owners have to go to neighbouring Cameroon to dry dock vessels paying in scarce foreign exchange”.

In addition to the Dry Dock project, Peterside is introducing other innovative policies that are intended to enhance the viability of the agency he heads. One of these is the Cost Insurance and Freight (CIF) to enable Nigerians lift the country’s crude oil

According to him, “One major factor that edges Nigerians out in the ‘affreightment’ of Nigerian cargo, especially crude oil lifting, is the prevalent Free On Board (FOB) trade term especially in a situation where Nigeria as a nation and Nigerian businessmen have very minimal control in the distribution of its crude oil with respect to carriage, insurance and other ancillary services.

Under a CIF arrangement, NIMASA on Peterside’s watch is planning to effect a far-reaching change in favour of indigenous operators. To this extent, therefore, NIMASA is joining forces with well-meaning Nigerians to move for the change of trade term from FOB to CIF to reasonably involve our indigenous operators in Nigerian cargo affreightment.

The advantages of this policy when implemented is that it will not only give distribution control of the country’s hydrocarbon resources to Nigerians, but also enable the agency to empower Nigerians through cargo lifting and meaningful participation in the entire value chain of export goods. CIF as a policy thrust will enable Nigerians participate in cargo lifting, cargo insurance, create job for our teeming cadets and other ancillary economic and security derivatives.

Peterside added, “The plans are on top gear to reach out to relevant agencies of government and very soon, we shall do an executive memorandum to the Federal Executive Council (FEC) for consideration and approval.”

Another policy the management of NIMASA is putting in place and which lead to a process of giving indigenous ship owners greater participation in the industry. Already the agency has designed and embarked on a programme that will empower indigenous ship owners

Elaborating on this policy, Peterside said, “Conscious of our mandate-to promote the development of indigenous commercial shipping in international and coastal shipping trade, we are poised, more than ever, to achieving this obligation. We understand it requires a great deal of capacity building, especially human, infrastructural and tonnage capacities of our indigenous shipping operators.

“We have reviewed the participation of Nigerians in the industry and are not satisfied with the outcome. The summary of our findings reveals a very low indigenous participation in international commercial shipping trade in Nigeria. As far-fetched as it sounds, there are no Nigerian Flagged Ocean-going vessels known to us.

“In the course of our review also, we observed the salience of cargo availability to the commercial fortunes of a ship owner/operator and to our national tonnage growth. We noted also that commercial shipping will less likely develop without conscious, proactive, well -structured and monitored government intervention as is done in other sectors,” he stated.

The NIMASA chief executive added that one area of such intervention is cargo availability.

Developed maritime nations, he said, have at one time or the other consciously supported, and are still supporting their indigenous operators in building their commercial shipping capacities.

“Recently, a bipartisan bill was brought before the United States Congress aimed at strengthening indigenous participation in shipping. The bill seeks to allow US flagged vessels carry up to 30 per cent of the U.S LNG as a matter of both economic importance and security concerns.

“On our part, plans are in top gear to use our existing enabling laws to make public cargo available for indigenous shipping operators in order to improve their commercial fortunes and competitive advantage over their well-capitalised and established foreign counterparts. We are out to enforce Sections 36 and 37 of the NIMASA Act 2007 towards building indigenous capacities in shipping.

“This is already at executive management level and we are determined to take it to the highest level of bureaucratic, legislative and executive engagements necessary. We shall also involve our esteemed stakeholders at the right time because we understand they have roles to play in the entire process,” Peterside said.

––Eshiogu wrote in from Abuja

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.


China Fines Alibaba Record $2.8 Billion After Monopoly Probe




China slapped a record $2.8 billion fine on Alibaba Group Holding Ltd. after an anti-monopoly probe found it abused its market dominance, as Beijing clamps down on its internet giants.

The 18.2 billion yuan penalty is triple the previous high of almost $1 billion that U.S. chipmaker Qualcomm Inc. had to pay in 2015, and was based on 4% of Alibaba’s 2019 domestic revenue, according to China’s antitrust watchdog. The company will also have to initiate “comprehensive rectifications,” from protecting merchants and customers to strengthening internal controls, the agency said in a statement on Saturday.

The fine — about 12% of Alibaba’s fiscal 2020 net income — helps remove some of the uncertainty that’s hung over China’s second-largest corporation. But Beijing remains intent on reining in its internet and fintech giants and is said to be scrutinizing other parts of billionaire founder Jack Ma’s empire, including Ant Group Co.’s consumer-lending businesses and Alibaba’s extensive media holdings.

Alibaba used its platform rules and technical methods like data and algorithms “to maintain and strengthen its own market power and obtain improper competitive advantage,” the State Administration for Market Regulation concluded in its investigation. The company will likely have to change a raft of practices, like merchant exclusivity, which critics say helped it become China’s largest e-commerce operation.

“The high fine puts the regulator in the media spotlight and sends a strong signal to the tech sector that such types of exclusionary conduct will no longer be tolerated,” said Angela Zhang, author of “Chinese Antitrust Exceptionalism” and director of Centre for Chinese Law at the University of Hong Kong. “It’s a stone that kills two birds.”

Alibaba’s practice of imposing a “pick one from two” choice on merchants “shuts out and restricts competition“ in the domestic online retail market, according to the statement.

The government action sends a clear warning to the tech sector as the government scrutinizes the influence that companies like Alibaba and social media giant Tencent Holdings Ltd. wield over spheres from consumer data to mergers and acquisitions.

The investigation into Alibaba was one of the opening salvos in a campaign seemingly designed to curb the power of China’s internet leaders and their billionaire founders. The company has come under mounting pressure from authorities since Ma spoke out against China’s regulatory approach to the finance sector in October. Those comments set in motion an unprecedented regulatory offensive, including scuttling Ant Group Co.’s $35 billion initial public offering.

Alibaba said it will hold a conference call Monday morning Hong Kong time to address lingering questions around the antitrust watchdog’s decree.

“China’s record fine on Alibaba may lift the regulatory overhang that has weighed on the company since the start of an anti-monopoly probe in late December,” Bloomberg Intelligence analysts Vey-Sern Ling and Tiffany Tam said, describing the fine as a small price to pay to do away with that uncertainty.”

Further Action

Still, it remains unclear whether the watchdog or other agencies might demand further action. Regulators are said for instance to be concerned about Alibaba’s ability to sway public discourse and want the company to sell some of its media assets, including the South China Morning Post, Hong Kong’s leading English-language newspaper.

The Hangzhou-based firm will be required to implement “comprehensive rectifications,” including strengthening internal controls, upholding fair competition, and protecting businesses on its platform and consumers’ rights, the regulator said. It will need to submit reports on self-regulation to the authority for three consecutive years.

“Alibaba accepts the penalty with sincerity and will ensure its compliance with determination. To serve its responsibility to society, Alibaba will operate in accordance with the law with utmost diligence, continue to strengthen its compliance systems and build on growth through innovation,” the company said in a statement on Saturday.

Faced Challenges

Chief Executive Officer Daniel Zhang said in a memo to employees on Saturday that Alibaba always reflected and adapted when it faced challenges. He called for unity among staff, saying the company should “make self-adjustments and start over again.”

The Communist Party-run People’s Daily newspaper said in a commentary on Saturday that the punishment involves specific anti-monopoly measures regulatory authorities take to “prevent the disorderly expansion of capital.”

“It doesn’t mean denying the significant role of platform economy in overall economic and social development, and doesn’t signal a shift of attitude in terms of the country’s support to the platform economy,” the newspaper said. “Regulations are for better development, and ‘reining in’ is also a kind of love.”

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MTN Partners Fintechs as Talks With Banks Lingers




MTN has activated a number of new channel partnerships with fintech companies as the company continues meeting with the commercial banks on a new pricing structure agreement.

MTN’s initial meeting for the reduction of the charges held on Tuesday with the banks ended in a deadlock and is expected to continue until a new long-term agreement can be reached on a sustainable pricing structure going forward.

The telco said this in a statement on Thursday titled ‘Update on banking channel partners’ dispute and expansion of channel network’.

MTN customers were reconnected to banking channels after the banks blocked them on April 2.

This was agreed on the basis that MTN would revert to its previous cost of sales structures with banking partners, until a new long-term agreement could be reached on a sustainable pricing structure going forward.

The telecom company noted that it had been participating in a series of meetings with the banks since Tuesday, after the intervention of the Minister of Communications and Digital Economy, the Nigerian Communication Commission and the Central Bank of Nigeria.

According to the telco, the reduction in the banks’ commission on USSD airtime is ‘international standard and best practice as scale is built along distribution channels’.

“We will provide a further market update once these discussions have been concluded.

We are confident that partners in the banking sector will work with us to ensure this process concludes as quickly as possible to the benefit of the entire industry,” MTN said.

It said it had partnered with new fintechs to expand the range of channels available to customers, adding that the partnerships would remain in place.

“The new channel partners include Sparkle, Konga Pay, Barter By Flutter Wave, Jumia Pay, OPay, Kuda, Carbon, BillsnPay, MTN On Demand, MTN Xtratime airtime loans (*606#), myMTN Web and Momo agent *223#,” the statement said.

The telco expressed optimism for a mutually acceptable solution that empowered all ecosystem participants.

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Trove, Bamboo Assure Nigerian Investors Assets Are Safe Following SEC Warning



Bamboo -

Trove and Bamboo, the two of the numerous fintech companies, facilitating investments in foreign assets for Nigerians in Nigeria have released statements to assured Nigerians that have invested through their platforms that their investments are safe.

The assurance came few hours after the Nigerian Securities and Exchange Commission (SEC) released a circular to warn the public against unregistered online investment and trading platforms facilitating access to foreign markets.

The SEC, in a circular titled, ‘Proliferation of Unregistered Online Investment and Trading Platforms Facilitating Access to Trading in Securities Listed in Foreign Markets’ stated that its attention has been “drawn to the existence of several providers of online investment and trading platforms which purportedly facilitate direct access of the investing public in the Federal Republic of Nigeria to securities of foreign Companies listed on Securities Exchanges registered in other jurisdictions. These platforms also claim to be operating in partnership with Capital Market operators (CMOs) registered with the Commission.”

“The Commission categorically states that by the provisions of Sections 67-70 of the Investments and Securities Act (ISA), 2007 and Rules 414 & 415 of the SEC Rules and Regulations, only foreign securities listed on any Exchange registered in Nigeria may be issued, sold or offered for sale or subscription to the Nigerian public. Accordingly, CMOs who work in concert with the referenced online platforms are hereby notified of the Commission’s position and advised to desist henceforth.

“The Commission enjoins the investing public to seek clarification as may be required via its established channels of communication on investment products advertised through conventional or online mediums.”

However, Trove immediately released a statement, saying “Our attention has been drawn to the SEC circular that was recently issued.

“Please be aware that we are and will remain committed to being in compliance with all local laws and regulations. We have always maintained good standing with all existing compliance requirements and regulatory frameworks.

“Be rest assured that your funds and equities are safe and secure with Trove.

“Since the memorandum, we have been liaising with the SEC to get more clarity on the circular. We are also engaging with top level executives at our local partner brokers. Additionally, we have involved legal professionals to manage the on-going mediation.

“From all indications, we anticipate everything would be resolved.

“Kindly note that your US funds and equities are held in custody by Drivewealth LLC, a regulated broker dealer in the US and protected by the SIPC, for up to $500,000.

“You can continue your trading activities as normal as we are still fully capable of carrying out our responsibilities as usual.

“Be rest assured that we are on top of all the happenings and would actively communicate with you all as things progress. Thanks for all your support and confidence”

Bamboo also responded in a similar version to calm thousands of investors on its platform.

Richmond Bassey, CEO, Bamboo, in a statement sent to all registered investors said “We are aware of the recently released SEC circular about trading in foreign markets.

“First off, we want to assure you that your assets on Bamboo remain safe and easily accessible to you.

“We are already in discussions with the SEC and our broker partner and are fully committed to working with them to ensure your interests as our users are fully protected.

“We want to reassure you that there’s nothing to be concerned about. We are still able to carry out all our operations and will continue to do so. Should the situation change, we will inform and advise you on the best course of action.

“Thank you for your continued faith and trust in us. We will continue to put in all the hard work to serve you. Thank you.”

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