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Nigeria must have local colouration to globalization in maritime, says Cpt. Labinjo

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The Nigerian indigenous ship owners are gradually going out of business. Their participation in the lucrative inland and coastal shipping business is coming to near zero, despite the Inland and coastal shipping laws of 2003 that gave them right of first choice in the award of contract relating to the lifting of cargoes from one point of the country to another. In the this interview with DELE ADERIBIGBE, Nigerian Ship-owners Association (NISA) General Secretary, Captain Niyi Labijo said the extinction of indigenous shipping operators could be attributed to the appointment of non maritime professionals, to head key positions within the maritime sector in the country .He also blamed the ugly phenomenon on the absence of maritime bank, for the recapitalization of key players in the shipping sector. Excerpts :-

Let’s look at the issue relating to the emergence and the growth of indigenous shipping, then the decaying and now their gradual extinction. What really went wrong?

This is a simple question. The success or otherwise of the maritime business is dependent on unemployment. Employment is the same thing as contract because if we are providing services in the maritime, we need a contract. If you have equipment, such as a ship, you require employment. I have distinguished between employment and contract. Anybody who provides shipping services in the maritime needs contract. Anybody who has equipment needs employments. For as long as you don’t have employment or contract, you will be very idle.

When I was talking before, I said something about a carpenter doing an open surgery, and this is a very specialized job, and if you ask a carpenter to do such specialized job, the patient will die.

Maritime has made carpenters do open heart surgery, so the patients are dead, and that is what is killing more patients. If I become the minister today or if we have someone who is experienced; or a consultant in hearth surgery and you ask him to do this, he will do it and the patient will live.

Nigeria produces 2.5million barrel of crude oil a day and all your indigenous shipping companies are dying. It is not only stupid; it is criminal! Nigeria imports general goods and what have you, as an import oriented country. Our import is 78 million tons and all the indigenous shipping companies are dying. Using these statistics figures, if every thing comes from Europe, it will cost us $30 per tons and $30 multiply by 80 million ton gives you 2.4 billion dollars.

If any of it comes from Asia, it will be 65 dollars per ton and multiplied by 80 million tons, gives 5 billion dollars. Are you saying that our country is generating $5 billion dol-lars and your citizens have no contribution to it?

Look at the 2.5 billion we generate from oil, multiply that also and add figures from gas also. So, by the time you put all these together, you may now see why Nigeria has been a case of a farmer’s son dying, due to starvation. We have no business dying; but, that is an aspect.
I make bold to say you should forget anybody that says ‘it is because they have bad equipment’. That is not a reason for their dying.

If you peep outside this window, before the next 5 minutes, you will see a truck passing and the tanker, though so old and rugged will, it still carries kerosene. Yet, it could carry wa-ter or AGO (diesel) or PMS (petrol). In six months time or after that, go and look at the truck owner, he would have bought a brand new truck or tanker. Why? It is because he is making money. But if somebody says: ‘his truck is very bad’ and refused to employ him at all, in six months time, what do you think will happen to the man? He will be dead too; and that’ is all!

We are not saying that there should be poor standard, but we all know, in the maritime world, the efficacy of charter agreements. If you get a contract today, you can embark

on charter arrangements to beat the requirements. The only problem on our hand today, is that it’s like they don’t want us to grow our own industry. So, you will be a foolish man to continue to listen to them and allow them to continue to fool you, under the guise of ‘international best practices’. It is a way of keeping you under developed. There s nothing more.

I have already given you a practical exam-ple. Buying a ship is not like buying a car or a trailer, because they are not the same thing. If you buy a trailer and you don’t have job, what will you do? Assuming you park it; you won’t be spending on it. But it is not the same with a ship; whether you park it or use it, you will spend on it.

There was a time in this country that I was one of those who struggled, to gather every money I could get to buy whatever good ship one could buy. In those days, if we can get N100, 000 dollar or 100,000 pound, we were happy.

There was a time I wanted to buy a ship which was at marina for which I wanted to

raise 110,000 pounds; in fact I raised 140,000 pounds. For me to raise that, it took me four months.

The day I sent the balance, the broker said ‘well Captain, ‘we are having problem wit the ownership of the tanker’. And at the beginning when he wanted to sell, he didn’t tell me that there was problem with ownership. I didn’t get the ship and that was how I lost my 140,000 pounds.

What I am trying to tell you, is of the difficulty we had in those days to raise money. Our bankers will tell you what will happen if the ship runs away or sinks? You don’t blame them; there is poor understanding, even till today. An American bank will not look at you twice before advancing funds to you, if you say you have an employment and bring your request for funding. They will only be too glad to help. So also, a British bank; because that asset goes into their own asset book and because they know that even though you have

only five years contract or three years contract, they know you are gong to have more business and that even after the three years, the vessel still has a reserve value. They are not afraid. They know that if the ship sinks insurance will pay. They know so many things.

But our banks have money for short term lending and you want them to give it out for long term lending, this is not possible. So, maritime needs a maritime bank that can look and give you facilities for longer period, they appreciate the fact that the gestation period must be long and so on.

In other clime, they call you after sometimes and tell you to ‘trade in your ship; we have observed that it is costing you a lot to maintain it. Trade it in, let them go and demolish it, get a brand new one’. That is why you hear them talk about scraping their ship!

The moment a ship is fifteen years old in Europe, Lloyds starts looking forward to get rid of it. The bank won’t say he has not finished payment. They get rid of the ship. They know it takes two years to build a ship. So when a ship is fifteen, they start encouraging you to sell it off. We have the various opportunities to engage all our indigenous people, but we are not engaging them because some people have been brainwashed, they forget this aspect of charterization which has been in existence since 1935 through the Americans. When Americans were saying no to the Russians and insisting it has to be American ships that will carry the gas from Alaska. These are the facts.

So, it takes somebody who understands, to do the right thing in the maritime sector. We have been all over the world to see our maritime colleagues. They come here, and we see them. They introduce themselves very well, with the man from their Maritime Authority at the background. But in Nigeria, the man from our maritime authority will be the one in front! So, sometimes, these people don’t want to do business with the man from maritime, all they want to know is that these shipowners have behind them a Maritime Authority. That is all.

To be continued.

 

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WAIVER CESSATION: Igbokwe urges NIMASA to evolve stronger collaboration with Ships owners

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…Stresses the need for timely disbursement of N44.6billion CVFF***

Highly revered Nigerian Maritime Lawyer, and Senior Advocate of Nigeria (SAN), Mike Igbokwe has urged the Nigeria Maritime Administration and safety Agency (NIMASA) to partner with ship owners and relevant association in the industry to evolving a more vibrant merchant shipping and cabotage trade regime.

Igbokwe gave the counsel during his paper presentation at the just concluded two-day stakeholders’ meeting on Cabotage waiver restrictions, organized by NIMASA.

“NIMASA and shipowners should develop merchant shipping including cabotage trade. A good start is to partner with the relevant associations in this field, such as the Nigeria Indigenous Shipowners Association (NISA), Shipowners Association of Nigeria (SOAN), Oil Trade Group & Maritime Trade Group of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA).

“A cursory look at their vision, mission and objectives, show that they are willing to improve the maritime sector, not just for their members but for stakeholders in the maritime economy and the country”.

Adding that it is of utmost importance for NIMASA to have a through briefing and regular consultation with ships owners, in other to have insight on the challenges facing the ship owners.

“It is of utmost importance for NIMASA to have a thorough briefing and regular consultations with shipowners, to receive insight on the challenges they face, and how the Agency can assist in solving them and encouraging them to invest and participate in the maritime sector, for its development. 

“NIMASA should see them as partners in progress because, if they do not invest in buying ships and registering them in Nigeria, there would be no Nigerian-owned ships in its Register and NIMASA would be unable to discharge its main objective.

The Maritime lawyer also urged NIMASA  to disburse the Cabotage Vessel Financing Fund (CVFF)that currently stands at about N44.6 billion.

“Lest it be forgotten, what is on the lips of almost every shipowner, is the need to disburse the Cabotage Vessel Financing Fund (the CVFF’), which was established by the Coastal and Inland Shipping Act, 2003. It was established to promote the development of indigenous ship acquisition capacity, by providing financial assistance to Nigerian citizens and shipping companies wholly owned by Nigerian operating in the domestic coastal shipping, to purchase and maintain vessels and build shipping capacity. 

“Research shows that this fund has grown to about N44.6billion; and that due to its non-disbursement, financial institutions have repossessed some vessels, resulting in a 43% reduction of the number of operational indigenous shipping companies in Nigeria, in the past few years. 

“Without beating around the bush, to promote indigenous maritime development, prompt action must be taken by NIMASA to commence the disbursement of this Fund to qualified shipowners pursuant to the extant Cabotage Vessel Financing Fund (“CVFF”) Regulations.

Mike Igbokwe (SAN)

“Indeed, as part of its statutory functions, NIMASA is to enforce and administer the provisions of the Cabotage Act 2003 and develop and implement policies and programmes which will facilitate the growth of local capacity in ownership, manning and construction of ships and other maritime infrastructure. Disbursing the CVFF is one of the ways NIMASA can fulfill this mandate.

“To assist in this task, there must be collaboration between NIMASA, financial institutions, the Minister of Transportation, as contained in the CVFF Regulations that are yet to be implemented”, the legal guru highlighted further. 

He urged the agency to create the right environment for its stakeholders to build on and engender the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders.

“Lastly, which is the main reason why we are all here, cessation of ministerial waivers on some cabotage requirements, which I believe is worth applause in favour of NIMASA. 

“This is because it appears that the readiness to obtain/grant waivers had made some of the vessels and their owners engaged in cabotage trade, to become complacent and indifferent in quickly ensuring that they updated their capacities, so as not to require the waivers. 

“The cessation of waivers is a way of forcing the relevant stakeholders of the maritime sector, to find workable solutions within, for maritime development and fill the gaps in the local capacities in 100% Nigerian crewing, ship ownership, and ship building, that had necessitated the existence of the waivers since about 15 years ago, when the Cabotage Act came into being. 

“However, NIMASA must ensure that the right environment is provided for its stakeholders to build and possess the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders. Or better still, that they are solved within the next 5 years of its intention to stop granting waivers”, he further explained. 

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Breaking News: The Funeral Rites of Matriarch C. Ogbeifun is Live

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The Burial Ceremony of Engr. Greg Ogbeifun’s mother is live. Watch on the website: www.maritimefirstnewspaper.com and on Youtube: Maritimefirst Newspaper.

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Wind Farm Vessel Collision Leaves 15 Injured

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…As Valles Steamship Orders 112,000 dwt Tanker from South Korea***

A wind farm supply vessel and a cargo ship collided in the Baltic Sea on Tuesday leaving 15 injured.

The Cyprus-flagged 80-meter general cargo ship Raba collided with Denmark-flagged 31-meter wind farm supply vessel World Bora near Rügen Island, about three nautical miles off the coast of Hamburg. 

Many of those injured were service engineers on the wind farm vessel, and 10 were seriously hurt. 

They were headed to Iberdrola’s 350MW Wikinger wind farm. Nine of the people on board the World Bora were employees of Siemens Gamesa, two were employees of Iberdrola and four were crew.

The cause of the incident is not yet known, and no pollution has been reported.

After the collision, the two ships were able to proceed to Rügen under their own power, and the injured were then taken to hospital. 

Lifeboat crews from the German Maritime Search and Rescue Service tended to them prior to their transport to hospital via ambulance and helicopter.

“Iberdrola wishes to thank the rescue services for their diligence and professionalism,” the company said in a statement.

In the meantime, the Hong Kong-based shipowner Valles Steamship has ordered a new 112,000 dwt crude oil tanker from South Korea’s Sumitomo Heavy Industries Marine & Engineering.

Sumitomo is to deliver the Aframax to Valles Steamship by the end of 2020, according to data provided by Asiasis.

The newbuild Aframax will join seven other Aframaxes in Valles Steamship’s fleet. Other ships operated by the company include Panamax bulkers and medium and long range product tankers.

The company’s most-recently delivered unit is the 114,426 dwt Aframax tanker Seagalaxy. The naming and delivery of the tanker took place in February 2019, at Namura Shipbuilding’s yard in Japan.

Maritime Executive with additional report from World Maritime News

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