By Steve Agbota
Stakeholders in the maritime industry have lamented the myriad of infrastructural deficits hampering shipping development in Nigeria.
This is even as they called on the government and other stakeholders to drum support for the development of shipping in Nigeria.
Delivering the lead paper at the 5th edition of the Taiwo Afolabi Annual Maritime (TAAM) Conference at the University of Lagos (UNILAG) recently, the former Director General of Nigerian Maritime Administration and Safety Agency (NIMASA), Temisan Omatseye, described the administration of the war risk premiums in shipping industry as the biggest fraud in the world.
Omatseye who is also the pioneer President of African Shipowners Association, revealed that as at 2010, Nigeria was paying about $ 400 million annually for this insurance, but there were no recorded claims to validate the insurance premium.
He added that people just sit in the Lloyd’s of London and the Joint War Risk Committee to collect these monies, yet the rates levied on Nigeria was about four times the rates charged on vessels going to the war-torn Afghanistan in 2010 when he was still in office.
However, he advocated the setting up of ship repair and building infrastructure, stressing that such places should be declared as Free Trade Zones (FTZ), while at the same time create incentives of Original Equipment Manufacturers (OEM) to set up shops within these shipbuilding free trade zones.
According to him, the nation should work towards the completion of the Ajaokuta steel complex, while at the same time provide support for the rolling mills and machine tools industry to fabricate needed spare parts for the shipping industry.
“War Risk Premium is the biggest fraud in the world. It is not only fraudulent and criminal in nature. When I was the Director General of NIMASA, the leadership of NLNG approached me to complain about this war risk premium because it was too high. At that time, Nigeria was paying about $400million annually for this insurance but there were no recorded claims to validate this insurance premium.”
“People just sit in Lloyd’s of London and the Joint War Risk Committee to collect these monies. Yet, at that time the rates levied on Nigeria was about 4 times the rates charged on vessels going to the war-torn Afghanistan. War Risk Insurance is an invisible charge that is built into the cost of shipping as all imported goods have to pay for this premium.”
“Nigeria should be making policies for the training of manpower for the shipping industries such as officers, able seamen, etc by also making the remittances of seamen tax free. We should have policies in place for welders with international certification to be trained in Nigeria,” he added.
Also speaking, the Secretary General of African Shipowners Association, Ms Funmi Folorunso said that although Nigeria has ships, the available vessels in the nation are nit the required specification needed for the available trade.
She, however, expressed regret that ship owners in Nigeria have placed so much anticipation on the Cabotage Vessel Finance Fund (CVFF), stressing that there is more funding outside the country.
“We have ships, but the ships we have aren’t the ships we need in 2023. There is a report on the number of vessels required in Africa with emphasis on the kinds of vessels. We should be working with this vital information as we go about ship acquisition.
“The CVFF isn’t required for ship acquisition. There is more funding out there. We must set an agenda for the next government. We must set an agenda for the government to work at it. Nigeria doesn’t have a fleet development agenda; but we can begin to work on this agenda. We should have veterans from the past like the esteemed former NIMASA Director General, Omatseye, the present (current NIMASA leadership and present stakeholders) and the future (young operators and students),” Folorunsho posited.
On his part, the Principal Counsel, Akabogu and Associates and Convener of Nigerian International Maritime Summit (NIMS), Dr. Emeka Akabogu lamented that the nation’s maritime sector suffers from gross neglect of salient issues by regulators.
Akabogu argued that there is no valid reason for the prolonged non-disbursement of the CVFF by the government, even as he wondered why the Maritime Fund captured in the NIMASA Act for the development of the sector hasn’t been utilized with the agency focused on humanitarian activities as Corporate Social Responsibility (CSR) projects.
“The broad maritime industry is founded on hard and soft infrastructure. Hard infrastructure with regards to the ports, ships, access roads to ports and cargo. Soft infrastructure with regards to policy implementation and facilitation of cargo,” he said.