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Nigeria Targets Share of $380bn Global Seaborne Trade

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NIMASA
  • Nigeria Targets Share of $380bn Global Seaborne Trade

The global seaborne trade is increasing tremendously and Nigeria is putting everything in motion to ensure that there is as much local participation in it as possible.

According to maritime sources, the global seaborne trade rose to 112 per cent in the third quarter of 2018.

Unfortunately, Nigeria is not even listed among nations that actively participate in the global seaborne trade and this has been the situation for decades, since the decline of the first Nigerian National Shipping Line.

Currently, Nigeria has no national vessel bearing its flag and all its cargoes are borne by foreign shipping lines.

While presenting a paper titled ‘Indigenous Fleet Development, what Options’, the Executive Secretary, Nigerian Shippers Council, Mr Hassan Bello, noted that Nigerians had tried and failed to enter into international shipping, not necessarily due to the huge capital investment required, but because of their inability to compete with foreign operators who had list of incentives from their home governments.

He said, “At the moment, Nigeria cannot claim to have a viable indigenous shipping fleet and this is a disappointment, considering that about 60 to 70 per cent of ship traffic to West and Central Africa are destined for Nigeria.”

Bello said the NNSL was established to boost the image of the country by promoting the Nigerian flag, improving the country’s balance of payment, among other objectives.

He noted, however, that the company operated at a loss due to the modernisation in ship type coupled with evolving technology in the late 80s and 90s.

He recommended private instead of government control of the shipping business, adding that government control would lead to monopoly, non-economic choice of ships and routes, government interference and lack of capacity to compete.

According to the International Maritime Organisation, over 90 per cent of world trade is borne by sea and the real time growth in world Gross Domestic Product in the last two decades is 73 per cent.

Also, world exports and imports in 2017 were $17.8bn and $16.1bn respectively.

Reports from these international agencies also tied global trade to shipping, noting that shipping was the lifeblood of the global economy.

The International Chamber of Shipping and the United Nations Conference on Trade and Development estimated that the operation of merchant ships contributed about $380bn in freight rates within the global economy, equivalent to about five per cent of world trade.

According to it, there were over 50,000 merchant ships trading internationally, transporting every kind of cargo, adding that some of the vessels could cost up to $200m to build.

The world fleet is registered in over 150 nations and manned by over a million seafarers of virtually every nationality.

UNCTAD revealed that in terms of participation, the top 35 flags of registration by tonnage in 2018 were Panama, Marshall Islands, Liberia, Hong Kong (China), Singapore and others.

In its Review of the 2018 Maritime Transport, the body reported that with regard to shipping value chain, Germany was the largest container ship owning country.

Stakeholders are, however, determined to get more Nigerians into the global shipping business.

The Nigerian Maritime Administration and Safety Agency in 2017 set up the Cabotage Compliance Strategy to create room for more indigenous shipowners to trade in Nigeria’s territorial waters.

The agency said in line with the new strategy, it would no longer grant permission for foreigners to take on jobs that Nigerians were qualified to handle aboard vessels trading in Nigeria.

While unveiling the enormous potential of the maritime sector in the next two years, the Director-General, NIMASA, Dr Dakuku Peterside, said the government had finalised plans to empower local shipowners to acquire vessels and also build capacity to compete in international trade.

Peterside said in addition to the $300m Cabotage Vessel Financing Fund, the agency also sought alternative source of finance that could be accessed at single-digit by shipowners.

The Director-General, the Nigerian Content Development and Monitoring Board, Simbi Wabote, said the agency had equally partnered with NIMASA to increase local participation in the shipping sector.

Wabote, whose agency established $200m Nigerian Content Development Fund to aid the promotion of local content in the oil and gas sector, said efforts had been intensified to project local shipowners to the forefront of global seaborne trade.

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

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Uber to Halt Services in Parts of Belgium

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Uber

Uber will stop its ride-hailing service in most parts of Belgium tomorrow after a court ruling on Wednesday which extends an order given in 2015, banning its p2p (Peer to Peer) UberPop service to also cover professional drivers who provide its ride-hailing service.

Uber told TechCrunch that it is currently closely examining the details of the ruling, in order to arrive at a decision on whether or not to appeal the decision with the country’s Supreme Court.

This also follows a temporary decision to discontinue Uber’s service in Brussels, a decision which was referred to as “exceptional and unprecedented” by the tech giant. The company said that it was merely taking a step to complain about the lack of reform rules which forbid drivers from using smartphones.

After the ruling by the Brussels appeal court, private hire vehicle drivers have been obstructing a major tunnel in the capital of Belgium.

In a statement made concerning Friday’s impending shutdown, the chief of Uber in the country, Laurent Slitsagain criticized the government for not providing a reform which it has been soliciting for, stating that the decision was made depending on regulations which are now outdated as they were written before smartphones.

The company stated that the government has promised a reform but has failed to deliver said reforms for the last seven years.

According to Bloomberg, the shutdown will not be applicable to a small number of drivers who are licensed in the Flemish region of Belgium, and are therefore still permitted to use the application. Uber confirmed that the Appeal Court ruling only applies to drivers with Brussels licenses.

In another statement, Slits stated that the tech giant is hugely concerned about the 2,000 possessors of LVC licenses (rental car with driver licenses) who according to the country chief will lose their ability to generate earnings.

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Honeywell Flour Mills Refutes Ecobank Winding Up Proceeding Claims, Assures Investors of Total Transparency

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Honeywell Flour Mill Factory - Investors King

Following media reports that Honeywell Flour Mills Plc (HFMP) is a subject of an ongoing winding up proceedings instituted by Ecobank Nigeria Limited in a suit no: FHC/L/CP/1571/2015, Honeywell Flour Mill Plc has now refuted the publication, insisting there is no winding-up petition against the embattled company.

The company disclosed in a statement signed by Yewande Giwa, Company Secretary and obtained by Investors King.

It said “It is pertinent to set the record straight that there is no Winding-up Petition currently pending or live against HFMP in any Court in Nigeria. There is also no pending Court Order restraining trading in the shares of HFMP or inhibiting HFMP or its owners from dealing in its assets. HFMP assures its investors, regulators and stakeholders that in all of its engagements with FMN, it received independent legal advice and asserts that the transaction is not in breach of any subsisting Order of Court. The issue as to whether HFMP is indebted to Ecobank is still before the Courts and the final decision remains the exclusive preserve of the Courts. It is also important to state that the Court of Appeal judgement being referred to in the reports did not declare HFMP to be indebted to Ecobank.”

This was in response to a publication titled “Ecobank Warns against Acquisition of Honeywell Flour Mills, Alleges Company Facing Winding Up Proceedings” that claimed Ecobank Nigeria Limited had issued a 7-day ultimatum to Flour Mills to desist from completing the acquisition of 71.69 percent stake in Honeywell Flour Mills Plc on the ground that the company was hugely indebted to Ecobank.

However, Honeywell claimed “The assertions lack merit, were written in bad faith and are a deliberate attempt to undermine a transaction that will result in substantial benefit to the Nigerian economy and entrench the collaboration of two publicly quoted companies. As a responsible corporate citizen, we have entered the transaction with FMN having taken all legal issues into consideration.

“All stakeholders are hereby assured that management of Honeywell Flour Mills Plc will continue to act in the best interests of all concerned and work diligently to preserve value for all its shareholders.

“We expect that from the proposed combination, stakeholders will benefit from the more than 85-year combined track record of FMN and HFMP and their shared goal of making affordable and nutritious food available to Nigeria’s population. The country and its food security agenda will benefit from both companies’ focus on developing Nigeria’s industrial capability, its agricultural value chain and specifically backward integration of the food industry.”

This whole drama started immediately Honeywell Flour Mills and Flour Mills of Nigeria, in a joint statement, announced FMN has agreed to acquire a 71.69 percent stake valued at N80 billion in Honeywell Flour Mills Plc. A deal that will automatically make Honeywell Flour Mills Plc Flour Mills of Nigeria’s asset.

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Merger and Acquisition

Flour Mills of Nigeria Acquires First Bank of Nigeria Limited’s 5.06 Percent Stake in Honeywell Flour Mills

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Honeywell Flour Mill Factory - Investors King

Flour Mills of Nigeria Plc, Nigeria’s leading flour mill company, has acquired First Bank of Nigeria Limited’s 5.06 percent stake in Honeywell Flour Mills Plc.

The company disclosed in a statement signed by Umolu, Joseph A.O., Company Secretary/Director, Legal Services.

The acquisition was in addition to the 71.6 percent stake of Honeywell Flour Mills Plc (HFMP) FMN acquired on the same day. Therefore, Flour Mills of Nigeria Plc will now hold 76.75 percent equity interest in HFMP.

According to the company, the move will help build a resilient flour mills company that will ensure job continuity, deepen productivity and support national growth.

Commenting on the transaction, Omoboyede Olusanya, Group Managing Director of FMN, said “The proposed transaction is part of our global growth strategy, which is aligned with our vision to not only be an industry leader, but also a national champion for Nigeria in the Food and Agro-allied industries.”

“Given FMN’s parallel negotiations for both stakes culminating in the agreements being signed on the same date, the basis for arriving at key commercial terms including final equity price per share, will be the same. The price payable to FirstBank will be the same with Honeywell Group Limited.”F

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