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Commonwealth, SOAN: Opportunities In Nigerian Shipping Industry

Commonwealth, SOAN: Opportunities In Nigerian Shipping Industry

From L-R: Engr. Greg Ogbeifun(president (SOAN), Akinwumi Ambode(Governor of Lagos State) and Barr. (Mrs) Margaret Orakwuesi

The 2015 Commonwealth Business Forum (CBF) hosted by the European island nation of Malta was a big event in all respects and an outstanding one in the business calendar of the 2015 Commonwealth Heads of Government Meeting. Beyond elaborate opening ceremonies attended by the Maltese Prime Minister, Hon Dr Joseph Muscat, the event was organized with the sole aim of increasing economic activities within the Commonwealth.

The Maritime Commonwealth session, hosted by the Ship Owners Association of Nigeria (SOAN) was arguably one of the most insightful sessions at the CBF, The presentation made by the SOAN President, Engr. Greg Ogbeifun, demonstrated that Nigeria houses the best from Africa in all respects.

He invited foreign investors to tap into opportunities in Nigeria to expand the frontiers of their businesses. The maritime environment in Nigeria, according to Ogbeifun, will continue to be a veritable platform for transportation, global commerce, resource exploitation and recreation. In his words, “the Nigerian maritime sector will remain relevant for the economic prosperity and development of most nations because of its abundant mineral resources and huge maritime ecosystem. In this vein, Nigeria’s maritime environment which spans about 84, 000 square meters is of great strategic importance to the nation on account of the huge deposits of mineral resources and marine life it offers. It is a known fact that there are vast resources in Nigeria’s maritime environment ranging from hydrocarbons to living and non-living resources most of which have remained untapped.”

He also debunked, in serious terms, negative media stories in the local and international media portraying Nigeria as a ‘no-go area’ for foreign investors owing to a number of concocted and unsubstantiated reasons proffered by people with various interests that are known to be largely selfish. Nigeria, through SOAN, also made a strong argument that it has become inevitable that developed nations within the Commonwealth family must partner with the poorer and developing ones in whatever ways possible to drive investments and development in them for the overall advantage of the people.

According to him, “As the largest market in the African continent and the biggest economy in the sub-Saharan Africa, Nigeria accounts for over 65% of total sea-borne traffic in volume and value in the West and Central Africa. Besides a high volume of import and export trade from and to dominant economic regions of the world, industrial activities in manufacturing, oil and gas, telecommunications and power generation have continued to expand in scope and context following a liberalized economic environment. These expansionist trends at the macro level have consequently widened the investment frontiers in the shipping and logistics industry that have moved and supported the growth of the nation’s economy over time. This trend is manifested in the following areas.

“First is the development and growth of domestic water-borne transportation.  Calls for modern, safe, reliable and efficient domestic water-borne transportation be expanded for the benefit of the people, shippers, their businesses and the economy. The number of vessels trading on Nigerian waters and the volume of maritime activities in the country demands vibrant ship repair and dry dock facilities to provide essential services to the vessels where and when necessary. Presently, these services are inadequate both in number, capacity and capability. Therefore, this calls for the development of a robust ship-building and repair industry that would make ships and marine platforms acquisition, repair and maintenance affordable.

“Also of great importance is the area of maritime training. Nigeria boasts of thousands of offshore support vessels of various types and sizes operating in her waters. These technologies such as dynamic positioning, operating equipment such as remotely operated underwater vehicles, seismic surveys, heavy lift, mechatronics, digital control systems for machinery, hybrid propulsion systems and thrusters require training and retraining of seafarers to meet up with the trend. There are limited institutions of international standards to meet these demands.” He explained.

Ogbeigun went on further to say, “In the area of offshore upstream operations, the demand for offshore support vessels depends on oil and gas exploration and production activities on the waters. With about 335 offshore installations both in developmental and operational stage within West Africa, the need for various types of offshore support vessels is imminent as a new requirement or replacement of aged vessels. This demand calls for great partnership opportunities with foreign investors to grow indigenous capacity.

“In the aspect of logistics, opportunities for African indigenous logistics concerns to partner with foreign ship owners who control large volumes of freight is of paramount importance. Such partnerships will offer opportunities for transfer of technical and managerial know-how. There is a growing demand for integrated logistics services to support increasing industrial production and services, especially in the oil and gas industry, telecommunications, power and manufacturing.

“Talking about terminal operations, the deregulation and liberalization of the port sector has given additional impetus for private initiatives in terminal operations. Private participation in all levels of port operations is now possible through the ongoing port reform measures expected to climax into full privatization. The port sector is among key sectors of the economy on which the government placed priority attention in her general economic reform programme. The Nigerian government has adopted concession as a preferred strategy for private sector participation in the port sector.” He asserted.

Other areas demanding private participation according to him are, Nigeria’s vast flourishing hinterland. Most of the regions are far from the coastline and cannot be serviced directly by the sea ports. This physical barrier makes the development of Inland Container Depots (ICDs) and dry ports imperative in order to bring port services closer to major commercial and trading centres of the country.

He affirmed, “Nigeria’s strides towards accelerated economic development have necessitated the adoption of the free trade and export-processing zones strategy to further facilitate private sector investments and encourage foreign direct investment in the economy. In this regard, comprehensive investment incentives are provided for would be investors in all segments of the economy, especially those activities that are export-oriented. This is made possible by the vast maritime environment nature largely endowed the country with.

There are a huge number of wrecked ships scattered over the waterways of Nigeria. Until the 1960s, ship-breaking was considered a highly mechanized operation concentrated in industrialized countries such as the United States, United Kingdom, Germany and Italy. Today, however, in Nigeria these vessels are left abandoned midstream and around waterfronts within the country. The cost of towing these vessels to other parts of the country makes it no longer profitable for ship-breaking and recycling of steel. There is need for serious foreign partnership in terms of utilization of the best available technology.

Another participant at the summit and former President of Women in International Shipping and Trade Association (WISTA), Nigeria, Barr. Jean Chaizor Anishere said, “The summit in Malta was about the Commonwealth heads of government meeting and also for Commonwealth business chieftains. It was a summit where every Commonwealth nation came together to interact and network, to do business to and to see how the Commonwealth nation can improve in their businesses in every aspect of it, be it maritime, agriculture or oil and gas, we even discussed about youth unemployment, safety and security of our territorial waters and also the issue of financing for small scale enterprises and quite a lot of other issues.

“ We had different participants from Nigeria, the Lagos State Chamber of Commerce (LSCC) was there with the governor of Lagos state and they talked about investments in Lagos State, they showcased the various areas of investments opportunities in the state, also there, was the National Industrial Export Commission(NIEC) among others.

“For Shipper Owners Association of Nigerian (SOAN), we went on the maritime platform, for the first time the common wealth summit provided a section for maritime and the turnout was huge. SOAN hosted that session. The ship owners wanted to know how the Commonwealth can fund the ship owners within the Commonwealth states because the issue of funding is very important to the ship owners because back home the interest for such facilities from our commercial banks is not as commendable as that of foreign banks.” She stated.

Jean lamented at the high interest rates charged by Nigerian banks, in her words, “ The banks here give interest rates as if the facility is for land mortgage, banks here have not started taking the bold step to take the risk of giving interests of single digits like their foreign counterparts do. SAON advocated for a Commonwealth maritime bank or pool or whatever name they want to call it but it will be a maritime bank within the Commonwealth, where ship owners in Commonwealth nations can take advantage of that pool which of course will be single digit interest rate.”

She averred, “The issue of training was discussed by our president Engr.Greg Obeifun, especially, training of seafarers. NIMASA has started it by sending our young ones to Malaysia and other countries abroad, SOAN advocated for training within the nations which invariably as one common nation, it will be comparatively cheaper that going outside the Commonwealth. Again I remember Barr Orakwusi talked about empowering the younger ones because we know that our master mariners are old and some are retired, running private business, so how can we ensure that there is continuity, in terms of marine engineers and master mariners, was also discussed and many more.

She noted, “In all the issues discussed, particularly at the maritime session which is also the Commonwealth enterprise network, the issues are put together as a communiqué and presented at the session of the head of governments which met after our session was closed by his royal highness the Prince of Wales. So we believe that the communiqué drawn up from the discussions by the network forum will be discussed by the heads of government to see areas where nations can develop economically and to see how those areas can benefit nations who are members of the Commonwealth. Subsequently, I believe that we will get the communiqué.”

Meanwhile, regarding the forthcoming investiture and dinner night of SOAN, Jean has this to say, “As the name connotes, it is to let the public know the trustees and the executives SOAN. The investiture is a public pronouncement and a type of induction ceremony of trustees and executives. We will be inducted and we will take our oath of office before the public and let them know who we are and let them know our mission statement.

“In addition to that, we are inviting the International Oil Companies (IOCs) and also the sector leaders, that is, the Minister of Transport Hon. Rotimi Amaechi, the presidency and the parastatals, to let them know we have ship owners who in fact and in truth own ships. So we want to use multimedia system to show what our members do and the types of vessel they have, to the government and let the IOCs see that there are some Nigerians who truly own ships that can be utilized to do business so that they will stop giving contracts to those who don’t even own ships but simply because they have the connection they are given contracts and they subsequently come to our members to hire their ships. We want to stop that. We want them to give the contract to ship owners directly because we do have them and they own good ships.” She emphasized.

Nigeria’s presentation at the 2015 CBF canvassed that the meeting should give the Commonwealth an opportunity to develop a master plan that will see an enhanced maritime and shipping activity within the region and beyond, while creating the enabling environment for international investments in the maritime domain, among member nations.

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