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Coastal Trade: Nigerian Operators Fall Behind Amid Challenges

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NEPC
  • Coastal Trade: Nigerian Operators Fall Behind Amid Challenges

The implementation of the Coastal and Inland Shipping (Cabotage) Act is being hampered by the myriad of challenges facing local operators in the shipping sector, ANNA OKON writes.

Cabotage, otherwise known as coastal trade, involves carriage of goods (and passengers) within the territorial and inland waters of any nation by ships and any other means of transportation from one place to the other in the same country.

As part of maritime reforms, Nigeria enacted the Cabotage Act 2003, which was designed to restrict foreign participation in Nigeria’s domestic coastal trade.

The Act makes provision for only ships that are built, flagged and manned by Nigerians to operate in Nigerian coastal waters.

The Nigerian Maritime Administration and Safety Agency had stated that even though the Act reserved the right of coastal trade to Nigerians, opportunities existed for foreign involvement.

But foreign participation in Nigerian coastal waters has overshadowed local participation owing to challenges peculiar to the Nigerian environment.

For instance, 90 per cent of the vessels trading on Nigerian waters are owned, manned and operated by foreign shipping lines, with Nigerian operators managing fishing boats and inland water transport boats that ferry goods and passengers to and from short distances.

The large cargo vessels and oil bunkers are all operated by foreign shipping lines.

The participation of local shipowners in the transportation of petroleum products ended when the Nigerian National Petroleum Corporation became the sole importer of products.

“Local shipping firms are hurting,” The President, Shipowners Association of Nigeria, Dr Mkgeorge Onyung, responded when asked about the fate of the industry in the light of the NNPC monopoly.

He said most of the shipowners had invested money and time in the business, adding, “Some of them borrowed money from banks to acquire those assets and the interest on the loans is increasing.

“When there is no business for them to do, the assets will decay and people will say local operators don’t have capacity. How can they develop capacity when they don’t have business?”

The President, Nigerian Shipowners Association, Aminu Umar, told our correspondent that the NNPC employed the services of foreign vessels to lift its products.

He said the practice was a departure from the past when oil marketers employed local shipowners to ferry petroleum products for them.

Responding to the yearnings of local operators, NIMASA had made several attempts, in collaboration with the Nigerian Content Development and Monitoring Board, to enforce the Cabotage law and increase participation of indigenous operators in the coastal trade.

In 2018, the agency cancelled waivers for foreign seafarers intending to work in vessels operating in Nigerian waters.

In February this year, the Director-General, NIMASA, Dr Dakuku Peterside, said the agency would no longer entertain any form of application for waivers under the Cabotage Act, particularly from oil firms.

Recently, the agency placed an embargo on the importation of cabotage vessels.

But all these efforts have been unable to bring about a significant increase in the participation of local operators in the shipping business.

Challenges facing local operators

Local operators are hampered majorly by finance.

Shipping business is capital-intensive and it would take the involvement of government for operators to build and operate a successful shipyard, according to the Managing Director, Genesis Worldwide Shipping, Capt. Emmanuel Iheanacho.

“The only thing that one would like to see is where the government recognises the critical nature of some of the things you are trying to do and provides a kind of guarantee that can get you the funding you need. When the government stands as a surety, then the financial institutions will have confidence to lend money to the investor.”

According to him, about $10m to $12m is needed to build a 15,000-tonne ship that can sail on a shallow sea with a draft of 6.5 metres.

Iheanacho disclosed that he obtained foreign grant to invest in his refinery and shipping business and the condition for that grant was that he must employ people from the country that gave him the grant.

Most Nigerian operators do not have access to finance, even for acquisition and maintenance of service boats.

This, in part, has resulted in their inability to build capacity and maintain their existing boats.

Our correspondent learnt that some local operators’ contracts were terminated by international oil companies because they did not have functional service boats and often defaulted in the contracts.

The Chief Executive Officer, Marine Platforms Limited, Taofeek Adegbite, highlighted the challenge of operating a shipping firm.

He said, “A vessel is a very expensive thing to maintain. You need to provision monthly. In fact, you must set your day rate per month aside for dry docking and it is simply not money you start running around looking for when you want to dry-dock your boat.

“If you want to dry-dock your boat, you are looking at a million naira a month; that is not money you can call your friends to lend you. You must understand what we are talking about here. It is not meant for the lily-livered.”

Operators had set their sights on the Cabotage Vessel Financing Fund but their hopes had proved futile as they had been unable to access the $124m fund set up to aid them in buying new vessels and maintaining existing ones.

Another challenge has been the shortage of skilled workers in the industry.

The maritime institutions in Nigeria cannot offer Certificate of Competence to seafarers and this necessitated additional training in foreign schools to enable them to obtain the CoC and be employed aboard ocean-going vessels.

As long as Nigerians do not have the necessary qualifications, they cannot be employed on ocean-going vessels, including the ones calling on Nigeria.

The National President, Nigerian Merchant Navy Officers and Water Transport Senior Staff Association, Mr Mathew Alalade, pointed out that if the foreigners were made to stop operating in Nigeria, there may be no indigenous seafarers to take up their jobs.

He said, “We don’t have people to replace these people because our training institutions have not been upgraded to higher level to issue CoC that accommodates all cadres of people on water.

“We must take it easy with the Cabotage law because our schools need be upgraded to issue first-class CoC.”

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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Npower News Today: Npower Salary Update, Npower Latest News on Permanency

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Latest Npower News Today: Npower Salary Update and Npower Latest News on Permanency

The Federal Government continues to engage private businesses and organisations on the absorption of exited batch A and batch B of the Npower program.

The Minister of Humanitarian Affairs, Disaster Management and Social Development, Sadiya Umar-Farouq, disclosed this in Abuja.

On continuity and sustenance, the Federal Government allocated N420 billion to Npower and other social investment programmes in the 2021 proposed budget before the National Assembly.

President Muhammadu Buhari also made mention of it in his last speech regarding the #EndSARS protest.

Buhari said, “In furtherance of our inclusiveness agenda, the sum of N420 billion has been provided to sustain the Social Investment Programmes, while N20 billion has also been set aside for the family homes and our Social Housing Programme.”

Speaking on unpaid exited Npower beneficiaries of batches A and B, the minister said “the ministry has directed that opportunity be given to the affected beneficiaries to verify and re-validate their eligibility so that qualified beneficiaries can be paid for their participation in the N-Power Programme.

“Beneficiaries are hereby directed to report to their State Focal Persons immediately with their bank account details including bank statements from March 2020 to date, NYSC Discharge Certificates, birth certificates and other related screening documents.

“The deadline for verification is October 13, 2020. Beneficiaries who fail to attend the verification exercise will forfeit their stipends.”

The fresh verification has now closed, however, the list of the successful candidates for Batch C would be announced soon according to the minister while the Federal Government continues to work on permanent placement for exited Npower beneficiaries.

On fake Npower news flying across social media, Rhoda Ishaku Iliya, the Deputy Director Information of the ministry, said the attention of the ministry has been drawn to series of fake news trending on social media.

She said “the attention of the Federal Ministry of Humanitarian Affairs, Disaster Management and Social Development has been drawn to the fake news trending on social media that President Muhammadu Buhari will broadcast to the nation the absorption of N-Power Volunteers Batch A, into the Federal Civil Service,” the statement reads.

“The Ministry is hereby calling on the public to disregard the message and consider it as fake news. Any information on N-Power or the National Social Investment Programme will be issued through the appropriate Federal Government channels.”

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Soldiers, Police Battle Hoodlums to Prevent Looting of Computer Village

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Soldiers and Police Battle Hoodlums Trying to Loot Computer Village

Hoodlums that hijacked the #EndSARS protest and turned it into a broad day robbery have continued to attack business districts, offices and properties of known establishments to loot and destroy years of labour despite the negative impacts of COVID-19 on these businesses.

Soldiers that were later joined by the Nigerian Police Force have been trying to repel hoodlums looking to break into computer village in Ikeja, Lagos State since the #EndSARS protest was hijacked.

According to residents and business owners contacted, the armed looters are still making an attempt to overpower security agents knowing there are valuables in the shops.

Right now they are still making an attempt (to overpower security agents) and considering the sensitivity of the business that we do, we sell very valuable commodities and they understand the liquidity of these products,” said Adeniyi Ojikutu, president, Computer and Allied Products Dealers Association of Nigeria (CAPDAN) said on the phone.

Ojikutu said the hoodlums, who were more than 500 in number, had shot in the air when they were discovered and remained close by for an opportunity to eventually break into the largest computer, mobile devices and ICT accessory market in Africa.

Also, because computer village is within close proximity to the Lagos State University Teaching Hospital (LASUTH), a new BRT station, Jara Mall, the Lagos State Police Command, Lagos State High Court and both the local and international Airports, it becomes imperative to protect it as a break-in by looters may spell disaster for other top establishments in the vicinity.

A resident said ‘Benin Boys’, a group of hoodlums, had earlier tried to invade computer village around 1 am but were prevented by security operatives. However, those that have been making attempts between the morning and afternoon of Friday were the Agege boys.

“The security were using megaphones to shout and warn all of us to stay inside,” said this resident.

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Dangote Sugar Refinery Postpones Board Meeting Amid Social Unrest

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Dangote Sugar Refinery Has Postponed Board Meeting Scheduled for Today Amid Social Unrest

The management of Dangote Sugar Refinery Plc on Friday said they have decided to postpone the company’s board meeting scheduled to hold today October 23, 2020 to a date they will communicate soon.

The management said the decision was due to the ongoing precarious situation in the country, especially the attacks on various establishments since governor Sanwo-Olu imposed a 24-hour curfew on all parts of the state.

In a statement signed by the company secretary, Mrs. Temitope Hassan, Dangote Sugar Refinery said “Further to our announcement made on October 8, 2020, the Company wishes to notify the Exchange and the investing public that the meeting of the Board of Directors of the Company earlier scheduled to be held on Friday October 23, 2020 to consider the draft unaudited financial statement of the Company for the Q3 ended September 30, 2020 has been postponed in view of the current precarious situation in the country.

“The new date for the meeting will be communicated as soon as normalcy returns. The Closed Period which has already commenced will continue till 24 hours after the filling of the Results.

“No insider of the Company, including its Directors, Employees, Advisers and Consultants and their connected persons may deal directly or indirectly in the Shares of the Company during the Closed Period.

All Dangote Sugar Refinery Plc Insiders have been duly informed.”

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