By Kenneth Jukpor
Capt. Taiwo Akinpelumi is a member of the 3-man committee tasked with reviving the Nigerian Indigenous Ship-owners Association (NISA) and Chief Executive Officer, Oceanic Energy Limited. In this interview with MMS Plus, he reveals how maritime security issues in Nigeria could be addressed. He draws a link to inland waterways management and ship-ownership. Akinpelumi also discussed other pressing shipping issues. Enjoy it:
The end of NISA crisis has been long anticipated because of the notable programmes such NIMAREX and other relevant interventions NISA had engineered. Going forward, in the next five years, how much influence and relevance can NISA assert in the shipping industry?
The first and most important thing is that we have decided to come together. You would agree with me that over the years as a result of the division among ship-owners, there has been severe retrogression. I’m happy that you have spotted the great initiatives that we have done in the past when we were together. Continuous crisis brought a lot of differences, however, we have discovered that there is no victor and no vanquish. In the next five years, we should have a better and more vibrant NISA that would carry all members along. It’s not just going to be about individuals but the group.
Our members have to be empowered and our voice should be heard. If a group like Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) could make impact in the country in terms of petroleum industry issues, as ship-owners who make transactions in billions of dollars, we should be able to organize ourselves. In five years, I see a NISA that would make significant impact in the industry such that the government wouldn’t be able to take critical decisions without NISA. That is where we are going and we wouldn’t lose focus until we achieve that.
What is the membership strength of NISA today and what would be done to ensure more people come in not just for numbers, but quality people with integrity and capacity?
Our focus is to increase our membership strength however; it’s not just about numbers as you explained. Good leadership is what has eluded the association for a very long time and that is why the association has been sitting in the limbo. Good leaders should be passionate about the members, the association and the happenings in the industry. NISA would continue to embark on membership drive. Whether we like it or not, there are potential members that just bought ships, last year, this year and two years ago. We would keep on updating and the idea is quality membership.
We would no longer coax people to join the association just because of numbers. We have to sieve the chaff from the substance. We need people that are ship-owners, seasoned ship managers and people that are highly knowledgeable in the shipping industry.
Recently, the Nigerian Maritime Administration and Safety Agency (NIMASA) had a global conference on Gulf of Guinea security while Nigerian Shippers’ Council (NSC) earlier hosted Global Shippers Forum on the same issues. As an operator, what’s your appraisal of the security of Nigerian waters and how can we make it better?
The focus of maritime security should shift from just seminars or bringing people together to the real actions. If you bring global bodies and maritime nations together on roundtable discussion for these issues, after they finish, they go their respective places. It is still left for us to look inward to figure out how we can address the problem. Maritime security has an undertone of socio-economic problems. With real poverty alleviation drives, the government should be able to empower some people and make the environment suitable for legitimate enterprises to succeed. Intervention loans should be given and youths should be actively engaged. We are talking of how to build capacity and this is what the new NISA is about. If we are able to build capacity, it will translate to employment for a lot of people. If we have just 10 people that have ships operating, how far can 10 people go? Compare this to a NISA that is able to engage government to build capacity and to empower members whereby the strength of members owning ships, managing ships and into shipping operations are multiplied. This would have a ripple effect on the economy as well as maritime safety because most of those engaging in criminal activities aren’t engaged. An idle mind is the devil’s workshop. If we engage people, it will definitely have an impact on the nation’s maritime security.
Under utilization of the nation’s inland waterways is also part of the problem of maritime security. We have over 33,500 estuaries and we barely utilize 3% of it. Isn’t it a shame that Nigeria don’t have a ferry system that could link Lagos to Port Harcourt and Calabar. The new NISA would be looking into these issues and opportunities. We want to make the shipping industry better. We want to see how our members can go into the business of ferry services, dry cargo operations, among others. If we are able to achieve this and our businesses are doing well, we can engage people and employ those that would have been part of the restiveness in Niger-Delta. Consequently, the insecurity and piracy will be reduced.
Are you satisfied with the security of Nigeria’s waterways?
I am not satisfied and until the regulatory agencies like NIMASA appreciates that the bulk of the responsibility is on its table. In any maritime nation, the flag administration is responsible for maritime security as it affects commercial shipping. In a situation where we are calling maritime conferences and making Nigerian Navy the focal point, then we won’t get there. Nigerian Navy already has its mandate as enshrined in the Armed Forces Act. The government should empower the Nigerian Navy and inject more funds needed to enable them patrol nation’s waterways and deploy modern technology against external aggression and internal uprising.
However, when you talk about maritime security as it affects commercial shipping, it is the responsibility of NIMASA and NIMASA has to assume the role of the coastguard in Nigeria. If there is anything happening in our waterways, there should be that open line where they can engage Nigerian Navy to say we want reinforcement because we are having this issue and there should be dedicated men for NIMASA. That would go a long way in addressing the problem of maritime security.
On the aspect of ship finance, we have talked about having a national fleet and looking at the cost. I’m aware that an influential committee was put together sometime last year to look for ways to make the national fleet a reality. There have been challenges as it affects policy framework, Customs duties among others. What’s the latest development on this?
We need to define and clarify what national fleet is all about. If you say national fleet, if I have 10 ships, you have 3 ships, someone else has 2 ships; they all belong to this national fleet. Every vessel flagged by Nigeria can be referred to as national fleet. Don’t forget that ship owners are business men. If any government visits any nation and says it wants to see its investors, it is the likes of ship owners that they would interface with. So if we have people, doing billions of naira businesses and you as government regulatory body is coming to decree that they should have national fleet, I don’t think that is the way to go.
Government can decide to float a government shipping company but I still believe that Nigerian government has no business in business. We are all witnesses to how the previous national shipping line went, so we should not encourage government to tow that line again. If government provides an enabling environment and shipping is thriving with develop capacity, people would be willing to partner and get vessels. If a national carrier is needed to lift crude oil and I don’t have the capacity, I could join someone else to float a bigger vessel and do the business. We could multiply the number vessels in the country and as we are multiplying, we start having such big vessels to ourselves. That is how to grow.
In Nigeria, customs duties on ships are very high while the crude affreightment terms of Free on Board (FOB) have also been biggest challenges to ship owners. Have the Ministries of Petroleum and Finance been sufficiently engaged on these issues?
We have gone through that route in the past. We have engaged all that needs to be engaged but with no results. What we have resolved is that we should come together as a formidable association. Secondly, let’s start from the low handling freight. If the target is lighterage operations, look at how many litres of petroleum products that are consumed daily in the country. If we leave that in the hands of indigenous operators, that is enough to empower ship-owners. In fact, we are talking about Cabotage and not the international trade yet. Charity begins at home.
We have written proposals about changing the crude carriage term from FOB to CIF several times. It is just for us to revisit it and make sure that the right thing is done. However, if the government says Nigerian ship-owners can lift crude; the finance is not there. What do you do? It’s so useless. It’s just like you have a million ships without cargo. It’s meaningless.
How would you rate the waiver cessation plan on ships by NIMASA?
The waiver cessation plan is a step in the right direction. I cannot fault that development at all because it is time to chase all those foreign ship operators that are feasting on Nigeria’s Cabotage trade. To me, five years is too long but it’s better to start now. In the next few years, we would be able to take charge, so it’s fine. We will start by making sure that our seafearers are gainfully employed, most of our local jobs are undertaken by Nigerians. Three years down the line, you will see that our industry would be better for it.
Dangote Refinery would be relying on ship owners to convey 70% of its products via shuttle vessels from December 2020. Are Nigerian ship owners ready for this opportunity?
This further stresses why we are coming together. We have to consolidate to make sure that we are relevant and we are ready for such opportunities. We want to synergize efforts to make sure that we are partakers in that business.
