High Chief ,Dr. Martins Emeka Enebeli is a man with many feathers to his cap.Dr. Enebeli is the president of the Nigerian Licensed Ship Chandllers Association (NLCA), President of the Nigerian Institute of Shipping (NIS),and also the president of Shipping and Petroleum and Freight Logistics Association ( SPFLA).
In this explosive interview with MMS Plus,Dr.Enebeli bares his mind on the elusive Cabotage Vessel Financing Fund (CVFF),and offers advice on how the elusive fund which has outlived three Transport Ministers could possibly be disbursed by the present Transport Minister, Engr. Mu’ azu Jaji Sambo.
What these solutions or pieces of advice that Dr Enebeli has offered, what might likely impede the disbursement of this fund? What is the Red Sea that Sambo must cross to walk his talk? Why is about 5 million jobs tied to the disbursement of CVFF? Find all the answers in this interview. Dr. Enebeli spoke with Frank Odinukaeze and Chioma Akabuogu. Enjoy it.
The shipping business is said to be a very lucrative venture with its attendant benefits to the economy. What does it feel like being a ship owner in Nigeria and the constraints?
Very cumbersome, very difficult, Not encouraging at all. It is laden with bureaucracy, too much bottlenecks , turnaround time is almost zero,cargo generation almost impossible, trade line movement also not available.So, it’s almost uninteresting doing that, except for part contracts that are involved. So it’s not quite interesting being a ship owner in Nigeria.
So what are the major constraints that ship owners face in Nigeria?
If I start to break it down to you, it is so humongous, in the sense that purchasing a vessel, the banks are not financing the purchase of vessels, and that is one. NIMASA that is collecting 2% and 3% on behalf of stakeholders for the purpose of encouraging purchase of vessels, the question is: When last did they give out loan? In Cabotage Act, they have not given out anything under the CVFF. On the 3%, they did once. And since then till now, nothing. Secondly, when you talk about owning a vessel, there must be some level of guaranteed freight, that is ,Cargo. The question is, where are the cargo or is it liquid cargo or is it transit cargo which is dry cargo? No cargo! You manage to generate it after a cargo consolidation fund, because the direct freight system has been high-jacked by foreign ship owners. On the part of the liquid, Memorandum of Understandings ( MoUs) agreement have been signed by NNPC on behalf of the Nigerian government with foreign ship owners to their agencies and so on. Thirdly, cost of insurance and freight policy of Nigerian government is also not encouraging, viz-a-viz, the Free on Boards ( FOBs).Nigeria has wrong policy direction on that. Our population is growing astronomically, and yet somebody somewhere is more comfortable that we do our exports on FOB and do our imports on CIF. So who is the beneficiary? The same foreign investors! So we are just loafing around. So there is no clear cargo guarantee. Fourthly, bureaucracy. Too many agencies are coming out with policy direction on operation of the ship. Nigerian Maritime Administration and Safety Agency (NIMASA) on one part, Nigerian Ports Authority (NPA) on one part, National Inland Waterways Authority (NIWA) on one part, the Nigerian Navy and the immigration, all these are the recycled problems. The whole maritime world, those that are licensed, are taking a position of strength. What is the strength? They have decided that they would come out with a policy of one spot- shop. So that at the end of the day, you submit one manifest and things are done. So how can you compete? These are constraints. Let me tell you about small cottage operations within the petroleum sector down stream particularly or I will give you the word, mid stream. Look at the issues, we have close to 20,000 ship operations in at least 8 international seaports, 11 oil terminals and at least 124 private Jetties, an average of about 20,000 ship operators. You cannot bunker. You cannot supply diesel, to an LPFO for the purpose of propelling these Vessels for economic gain. Yet, we are an oil producing nation.
That these ships coming into Nigeria, branch to South Africa, Durban, in Cameroon, and all these smaller countries, to take full bunker operation, before coming into Nigeria, is it not very shameful? And at the end of the day, we bring too much bureaucracy. When you use policy formulations, and people talk of recurring oil theft, when you use wrong policy formulations, when you use regulation to forestall easy movement, don’t forgive that shipping and ship operations itself are all about turn -around-time.
Today, as I speak with you, Navy has arrested over 200 ships, belonging to Nigerians. You can go and investigate how many of them are in ballast? A lot of them are in ballast. With the arrest, is that how you want to encourage the economy? So we are not even in tune, and in line with the Federal Government policy on employment creation. This particular president went ahead to say, look, Nigerians have to be employed but the mechanism for employment is being destroyed, these agencies working against the president’s intentions in the name of pursuing people for illegality, when illegality is created due to the fact of demand and supply principles. When people demand, they must be supplied. When there are no supplies, people will look for other ways to get what they want, so that they can remain in business. Even to supply common fresh water in our ports, are heavily burdened with bureaucracy. The issue of turnaround time for 24 hours for vessels is almost impossible because to carry out these visual and bunkering activities to vessels are bugged by bureaucracy. Close to 3-5 million jobs would be created if things are properly done as far as shipping activities are involved.
Looking at the issues of bureaucracy, job creation and unemployment, looking at the Cabotage funds, for instance, don’t you think the fund would have been of great assistance or advantage for ship owners to acquire more fleet and thereby create employment for Nigerians particularly seafarers? What is your take on that?
My take in the whole thing is that there is a lot of inordinate saying, in the sense that the agency that is saddled with these issues of responsibility of giving out loan, NIMASA,is enmeshed in political pressure by the politicians who have appointed themselves bourgeoisie to take loans when they don’t even have the capacity to do this work.
NIMASA is also doing their best to see that the qualified characters take the loans. But the question is, at the end of the day, it goes to the table of the same politicians who probably never practiced anything in Maritime. They want to have the exclusive right to select who this loan would be given. In that light, obviously it will derail. But if the government has a clear policy thrust of where it is going, the president and Commander-In-Chief of the Armed Forces of Nigeria, would have taken a decisive step, on the issue of this loan, by setting up an independent standard committee (ISC), to work with NIMASA, and this particular committee will be laden with professionals in the industry; professionals who are tested, and who are still testing this Maritime environment. This people are in a better position to give germane and reasonable advice. But when you start to see policies from the direction of public servants and civil servants, it’s just like you are doing things from the military angle; they take orders. Even if they have good ideas, they can’t implement them. But if the President, says no, I think I want entrepreneurs to form 75% of this standing committee and 25% from the public and civil service group, you’ll find out that this particular CVFF fund would have been given long time ago, would have started bearing fruits. And also inconsideration, people do things in comparative strength. Under what comparative strength are we going to do it? You don’t have cargo, you have not been able to generate cargo, you cannot tie the loan to cargo generation. Have you done anything? Where is the cargo? Dry cargo, where is the cargo? Where are they? You gave loan to people to go and buy ship and tomorrow Navy arrests the Ship? So these bottlenecks are issues that we need to resolve before we go into the next part of giving loan. So the issue now falls on the hands of His Excellency and the Honorable Minister of Transportation to put a portent and resilient standing committee that will work with NIMASA on the issue of issuing out that loan. That is one. Secondly, the auxiliary and ancillary service providers’ comparative strength should also be included in the loan. What do I mean by ancillary and auxiliary? I’m also talking of ship Chandlers. I’m talking about ship agents, I’m talking about ship mining, I’m also talking about ship maintenance. All these basic areas that we have comparative strength, that we know the turnaround time is extremely fast, we create some level of loan because, the turnaround benefit of ship owning is not something that is easy to get, that you just go home and drink coffee. That is where Nigerians have comparative strength. Now, what we need to do is strengthening those areas and make Nigeria a hub. If we have a hub of ship agents, if we have a hub of bunkering activities, if we have a hub of ship chandelling, if we are hub of these, at the end of the day, Nigeria becomes an economic power, vis-a-vis, the sub-region controls at 65% of the ship movement. So while you are giving out loan to ship owners, also consider giving out loan to also service providers.
It is said in some quarters that the ship owners need to come together as a body to be able to access the CVFF fund because, government would not be willing to give the loan to individuals. They prefer going through groups and this is probably one of the reasons why the fund is yet to be disbursed. Do you agree with this school of thought?
I don’t agree. We are talking about government. Some elements in government have personage leadership. And when leadership is personage, you start to have issues because, you only see the policy of government from your own direction because, you are either the Minister, DG, or whatever. This thing is about the people, Nigerians. The Nigerian Constitution guarantees freedom of association. You can have a thousand associations. It doesn’t really matter. Every association will school themselves in the promising policy direction of the government. When government wants to do something, they will do it whether you form 50,000 associations , it’s at your own peril. When government says this is the direction we are going, and all the practitioners, in all the level of sectors, are captured as standing committee members, of course there will be genuine, beautiful well-driven policy trust that everybody will queue into so the issue of coming together is not a reason for not giving out that loan.
The Minister of Transportation Mu’azu Jaji Sambo, has promised to disburse the CVFF fund as soon as possible, probably before he leaves office. We know that previous Ministers had equally made similar promise in the past, but were unable to fulfill them. What is the guarantee that Sambo will walk the talk?
I don’t know Sambo’s position of how he arrived at that calculation of very soon to disburse the fund. How is he going to grapple with politicians that their time is almost up? And they are looking for so much money to contest for next election. How is he going to grapple with that? How is he also going to grapple with the Bourgeoisies in the industry? How is he going to grapple with them? So, I don’t know how he arrived at that. Maybe I will actually take my time to look at the direction. But my only advice to him is that he should, with the consideration of the Federal Government, constitute a standing committee, that is about 60-70% private sector- driven.
They should select people that can show feasibly that they are on ground; they have been practicing regularly from there, you can now do an evaluation of the levels of experience and level of qualifications for those who may be entitled to this loan. But if you do it by virtue of the perspective of elitism, or by virtue of the perspective of who controls semantics, or by virtue of political consideration, we go back to square one