Nigeria’s maritime industry is estimated to have exceeded $153
billion as at 2016. In light of dwindling hydrocarbon revenues,
Nigeria’s maritime sector offers a host of opportunities. Nigeria,
Africa’s largest economy with a population of 193 million people, counts
for over 65% of total sea traffic in volume and value in West Africa
and Central African sub-region.
Nigeria has a coastline of about 854 KM (Maritime Advocacy
Foundation),
with rich continental shelf, inland waterways, and
exclusive economic zones. Nigeria has 34 free zones, set up to increase
FDIs, enhance economic growth and development. There is the need to
develop this sector for job creation and revenue, to drive the Nigerian
economy by harnessing maritime human and material resources.
Lloyd’s Register, QinetiQ and University of Strathclyde’s Global
Marine Trends 2030 report, state that the marine world in 2030 will be
almost unrecognisable owing to the rise of emerging countries, new
consumer classes and resource demand.
If Nigeria is to tap into the investment opportunity that will
arise, then it must have, well thought out policies and effective
implementation. Additionally, the benefits to the nation, is that it
could join the largest suppliers of seafarers such as China, Indonesia
and the Philippines. Improve productivity, using international
benchmarks, embrace technologies to enhance operational efficiencies.
Investment opportunities
There will be opportunities in provision of port infrastructure,
Shipbuilding, Insurance, Legal, (Arbitration), Research, Marine
Engineering, Logistics, Terminal facilities for container operation,
Dredging equipment services, Mooring services, ICT components/spare
parts, repair/maintenance and back-up systems, Empty container
operations (handling/transfer). Fire fighting vessel services etc.
Aside from terminal operation, fleet acquisition (vessels) is a major
segment of assets in the sector. Lagos Deep Offshore Logistics Base
(LADOL) in Nigeria, positioned strategically at the entry-point to Lagos
harbour, is a success story of domestic investors taking advantage of
investing in this sector. LADOL (now the region’s largest base for rig
and vessel repair, provides 24/7 operations with a wide range of
services and facilities) provides a one-stop-shop for multinational
industrial and oil and gas companies operating in West Africa.
Support from International Maritime Organisation (IMO)
In 2016, International Maritime Organisation Member States Audit
Scheme (IMOMSAS), carried out an audit on Nigeria’s maritime sector. It
identified (safety of life at sea, prevention of pollution from ships,
standards of training certification and watch keeping for sea farers
convention, load lines convention, tonnage measurement of ships
convention, and regulations for preventing collisions at sea) as areas
that Nigerian Maritime Administration and Safety Agency (NIMASA), should
develop and formalise as a long-term strategy for implementation of IMO
instruments in Nigeria.
Nigeria’s Alternate Permanent Representative (APR) at the
International Maritime Organization (IMO), Diko Balla, says Nigeria’s
chances of returning to the council of the IMO, has greatly improved and
that by November 2017, Nigeria’s election into the Category “C” at IMO
will be an overwhelming one.”
Overcoming challenges
The maritime industry has a myriad of challenges ranging from
combating piracy, crumbling infrastructure (poor access road and
transportation system). Other challenges are inadequate funding, foreign
domination and inadequate manpower, graft etc.
According to the Indigenous Ship Owners Association of Nigeria
(ISAN), no Nigerian flagged ship is currently plying international
routes despite the country’s large export of crude and import of over
100 million tons of general cargo. Nigeria exports about 900 million
barrels of crude oil annually, but foreign vessels earn the freight of
about $2.25 billion.
In 2003, the Coastal and Inland Shipping (Cabotage) Act was enacted,
with the aim of restricting the use of foreign vessels in Nigeria’s
domestic coastal trade and operations, promote development of domestic
tonnage. The Cabotage Vessel Financing Fund (CVFF) was also established,
to provide financial assistance to domestic operators in ship
acquisition.
Public Private Partnership
Adopting successful public private partnership for developing the
Maritime industry will depend on all stakeholders taking into
consideration, the challenges that constrain development. A case study
that will be useful is the Azura-Edo IPP, Nigeria.
It is the first fully privately funded power generation company in
Nigeria, which offers a best practice example of putting together a
complex group of investors, some of which had not previously invested in
power, and derisking the deal sufficiently to make those investors
comfortable. The process was so effective that the $876 million deal was
closed in 2015, with construction beginning in 2016 (AFC).
The Port reforms threw open investment opportunities which so far is
reflected in the concession programs. The Build Operate and Transfer
(BOT) initiative has resulted in the development and subsequent
commissioning of an ultra-modern RoRo berth at Tin Can Island Port in
Lagos, the terminal which was constructed at a cost of about
US$64,000,000.00 is fully automated and equipped.
Ease of doing business
With Nigeria’s seaport handling 68 percent of West Africa’s maritime
trade, there is scope for development, if the major port in Lagos is to
be the major hub for West Africa. Two major constraints that require
urgent attention, traffic gridlock going into Apapa port in Lagos and
streamlining activities at the ports.
The federal government should collaborate with Lagos State, for an
efficient and effective traffic management system; relocate tank farms
that hinder free flow of traffic. Fast track the 25 year port
development plan put in place by Nigeria Ports Authority (NPA) in 2010,
with specific reference to connecting the sea ports of Calabar, Port
Harcourt, Lagos, Warri, Sapele, Koko, Onne, by rail. Also ensure that
the marine transport sector operates safely and efficiently in line with
global best practices.
Nigeria Ports Authority should develop deep water ports, good port
management system and most importantly update its information technology
system.
By kede Aihie
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