Gulf War: How Nigeria Can Imitate Iraq’s Sustainable Oil Trade – Okorefe

By Kenneth Jukpor

Mr. Charles Okorefe is the Managing Director of Kamany Marine Services Limited and the publisher of the book; “ABC of Shipping and Ports Operation in Nigeria”. He was a special guest at the 20^th Anniversary Lecture/ Awards and Patron’s Investiture Ceremony of the League of Maritime Editors and Publishers (LOMEP). He shares his written by was recently launched in Lagos. Charles sat with MMS Plus shortly after the event as he bares his mind on the challenges hindering the development of national fleet in the country and other pertinent shipping issues as well.

Enjoy it:

The theme of today’s event is centred on indigenous fleet development which faces several issues. Where is Nigeria at the moment in this global business and what’s the way forward?

There are several issues that make or mar fleet development in the country and it is a huge question to ask where Nigeria is at the moment. However, I will be honest because the nation is at the bottom end of the ladder or what we can call the rudimentary stage. We are at the bottom in terms of our participation in international maritime trade. We have done a lot in the past but in recent times we seem to be retrogressing. This isn’t good for the nation’s economy and the industry as well.

What’s your take on the paper presentation delivered on ‘Indigenous Fleet Development: What Options?’?

The presenter, the Executive Secretary of Nigerian Shippers’ Council (NSC) Mr. Hassan Bello aptly captured the salient issues in the sector and he also made some important recommendations.

He narrated the ordeal of the Nigerian National Shipping Line (NNSL) which had about 21 ships in the past. The question is what kind of ships were they? While the world was reacting to the contemporary development and moving away from general cargo to containerization, Nigeria was stuck with the outdated class of ships and NNSL had to go under.

However, the important thing is to discuss the way forward. In doing that, we have to ask what is obtainable at the moment? Do we remain static where we are? No we can’t! One of the major commodities Nigeria exports is crude oil and we don’t need liner vessels to export. With few tanker vessels we are good to go.

The Nigerian National Petroleum Corporation (NNPC) continues to stick to the trade term of Free on Board (FOB) in the carriage of Nigerian crude. This is very wrong and it was pointed out in the paper presentation today. It is a shame that Nigeria cannot make any benefit from the freight earnings in carrying its crude. As the presenter pointed out, Nigeria is the only country in the Organization of Petroleum Exporting Countries (OPEC) that operates the sale of its crude on FOB basis. This is a major deficit for the nation and the first thing I would advocate is for that trade term to be reversed from FOB to Cost Insurance and Freight (CIF).

Nigeria should do whatever it would take to make indigenous operators get the benefits from this trade. All that should be done by way of policy formulation; implementation and enforcement. Nigerians must benefit from these freight earnings.

I always use the example of Iraq. Despite the heat of their war with the Western powers during the gulf war, they were still able to export their oil and earn freight. Nigeria isn’t in a state of war but the clause that the nation’s crude oil should be shipped on FOB is still there and it has prevented the indigenous operators from enjoying the immense potentials accrual from the sector. Hence, that clause must be amended to give room for indigenous ship-owners to participate and enjoy the benefits.

Besides that, it is also high time for the Cabotage Vessel Finance Fund (CVFF) to be disbursed so that NIMASA can empower Nigerian shipowners. These shipowners need the support to enable them play a more significant role in the industry whether at Cabotage vessel level or at any other level. The CVFF money alleged to be in the Treasury Single Account (TSA) wouldn’t be sufficient to buy a meaningful seagoing vessel but we can start from somewhere. We could get passenger ferries, badges, tugboats, etc. They can begin from there but they should be empowered.

Tell us about your recent book “ABC of Shipping and Ports Operation in Nigeria” and how crucial is it to the maritime sector?

‘ABC of Shipping’ is meant for new entrants, students in higher institutions who have interest in shipping, the port sector and the maritime industry in general. It also speaks to the operators because there are some areas I took time and conducted research on that other writers didn’t pay attention to. I looked into the details of the Nigerian Coastal and Inland shipping in the Chapter 8 of that book to bring out what Cabotage is really about. It highlighted the areas that Nigerians could participate in and get better advantage from the Cabotage. I think it is a book that would be beneficial to the overall wellbeing of the Nigerian maritime industry.

The book presents a historical insight into the evolution of shipping and ports development in Nigeria with brief overview of various ports and jetties commencing with the development of modern Maritime trade in Nigeria with the formation of Southern Nigeria Marine [1906], the opening of the sand bar at the entrance of the Lagos Harbor in [1907] and the Northern Nigeria Marine with headquarters at Lokoja [1908]. These culminated into the Nigerian Marine following the 1914 amalgamation, and the establishment of what could be regarded as a seaport with the creation of the defunct Customs Wharf in 1921.

The book also described in a simplified manner, the Ship and its Management listing various types and uses of ships and tug boats supported with pictorial evidence for those who may not have seen any of these before. This style of presentation is unique considering that this book will serve past, present and future practitioners of shipping and ports operators in Nigeria and the sub-region.

Why does government driven businesses fail in Africa especially in Nigeria yet such shipping companies thrive in China, India and other climes?

There is no myth about this. The problem is the political will on the part of the government to walk the talk and implement what they have already put down as policies in the industry and to enforce it.

What is lacking is proper policy implementation and enforcement. Cabotage is a good law; but is it been enforced? Where there is enforcement, there are results! Government may be bad in business but if they could develop the political will to act and enforce the existing policies and laws then you would see a change.

The event today also marked the 20^thAnniversary of the League of Maritime Editors and Publishers (LOMEP). How would you rate the association and the place of journalism in Nigeria’s maritime industry?

I have immense respect and admiration for the League of Maritime Editors and Publishers (LOMEP) because existing for 20 years is no joke. I want to commend the present crop of leaders as well as the previous ones who steered the association to the level it has attained today.

You can see the level of excellence and the attendance was also wonderful as the crème de la crème of the industry were here! I am happy to see someone like Capt. Emmanuel Iheanacho making time to come and also chair the occasion. This tells you how significant the association is in the maritime sector.