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NIMASA To Furnish IMO With Compliance Plan Within 90 Days

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  • As NIMASA DG Promises compliance
  • Conglomerates, multinationals lose N200bn in 6 months, over Forex crisis

The International Maritime Organisation Member States Audit Scheme (IMSAS) has tasked the Nigerian Maritime Administration and Safety Agency (NIMASA) to come up within 90 days, an official, long term strategy for the implementation of IMO instruments in the country.

The IMSAS representatives gave the charge on Monday in its submitted interim report, after its week long audit of the Nigerian maritime sector, drawing attention to the need to fast track enactment of regulations pursuant to IMO instruments for which Nigeria is party to.

Presenting the interim report, the leader of the IMSAS team, Captain Yalscin Cahit harped on the need for the Agency to develop its systems noting that while NIMASA has no problems with human resources,  it has a lot to do in the areas of systems update, stressing that issuance of regulations is critical to enforcement of IMO instruments.

Captain Cahit who noted that the interim report has 11 findings and one observation emphasized the need for the Agency to respond within 90 days, to the findings and highlight the strategies being developed to remedy the gaps identified;even as he also highlighted positive strides Nigerian maritime sector is making.

Meanwhile, the Director General of the Nigerian Maritime Administration and Safety Agency (NIMASA) Dr. Dakuku Peterside has promised the IMSAS team that the Agency together with other stakeholders are committed to the implementation of relevant IMO instruments for the overall development of the Nigerian maritime industry.

The DG who restated that the IMO Audit is in line with the vision of NIMASA, also said that the Agency will leverage on the findings and observation of the interim report to repositioning the Nigerian maritime industry for more efficiency and competitiveness.

While thanking the IMO Audit team to Nigeria for a thorough job done, Dr. Peterside assured the team that the Agency will take the report very seriously and in the next one year, most of the identified deficiencies will be drastically reduced if not completely eliminated.

“With the active support of the Honourable Minister of Transportation and the leadership of the Agency which is forward looking, focused and determined, Nigeria will certainly regain its lost glory in the comity of maritime nations. NIMASA will immediately settle down to work to address these findings”, the DG said.

The Audit is aimed at promoting consistent and effective implementation of applicable IMO conventions, resolutions and protocols amongst member nations as well as assist member states to improve their capabilities in the enforcement of these instruments for the overall benefit of global shipping.

In the meantime, losses incurred by investors in conglomerates, multinational corporations and other big capitalized companies quoted on the Nigerian Stock Exchange, NSE, as a result of the delay in the roll out of the new flexible foreign exchange policy has hit N320 billion as at yesterday.

The stock market had recorded a massive rally following the announcement by the Central Bank of Nigeria, CBN, of its plan to introduce a flexible foreign exchange regime.

But the bullish trend gave way to a massive bear run which brought down total market capitalization to N9.3 trillion, yesterday, from N9.7 trillion as at May 25, 2016, a day after the CBN announcement, with the blue chips accounting for about 80 per cent of the total losses.

Vanguard learnt that most companies in the real sector, especially the big brands have taken similar steps since 2015 to retain their market share and brand equity at huge cost.

For Unilever Nigeria Plc, the major drag to performance in its full year 2015 results released earlier this year was the massive jump in finance cost, up 66 per cent year-on-year despite 37.5 per cent drop in borrowings in the year.

According to financial analysts at Afrinvest West Africa, a Lagos based investment house, “Unilever remains highly levered as 62.9 per cent of its full year 2015 operational profit went into finance cost.   We still remain somehow bearish on the valuation of the company as the current macroeconomic challenges, most especially foreign exchange related operations are expected to take toll on overall performance”.

Berger Paints Nigeria Plc has attributed the drop in their financial performance for the first quarter ended March 31, 2016 to foreign exchange scarcity.

The Managing Director, Mr Peter Folikwe, stated at the Nigerian Stock Exchange that”margin drop largely as a result of increase in raw material prices and scarcity of foreign exchange as we have to largely resort to local sourcing of raw materials at exorbitant price”.

Guinness Nigeria Plc had complained that the currency restrictions imposed by the Central Bank of Nigeria, CBN, were hindering it from procuring the foreign exchange needed to bring in raw materials.

“Foreign currency capacity has been a major issue for us and that has put a strain on our business, in particular, liquidity has been a major challenge”, Managing Director, Peter Ndegwa, stated.

Analysts attribute the decline in bottom line in the brewery sector to a weak Naira that significantly impacted on cost of sales since most of raw materials are imported to meet production.

Brewers are spending more to produce each unit of products as cost of sales ratio increased to 51.13 percent in 2015 from 45 percent the previous year, leading to total cost industry-wide of over N250 billion with Nigerian Breweries accounting for about N151 billion in 2015 and N40.2 billion in the first quarter of 2016.

The 11.85 per cent rise in cost recorded by Nigerian Breweries in the first quarter of 2016, according to analysts at FSDH Merchant Bank,  could be attributed to the rise in input costs.

The cost of raw materials and consumables alone rose by 30.44 per cent to N24.56 billion from N18.83 billion in 2015.

Guinness Nigeria’s cost in 2015 was N62 billion. The survey conducted by PricewaterhouseCoopers, PwC, showed that over 60 per cent of companies in Nigeria recorded huge declining sales/revenue as a result of the foreign exchange rationing policy.

The report, commissioned by the Lagos Chamber of Commerce and Industry, and unveiled in Lagos  by the President, LCCI, Dr. Nike Akande, and the Regional Managing Partner, West Africa, PwC, Mr. Uyi Akpata, revealed that 42 per cent of the companies had been implementing aggressive cost-cutting measures, while 18 per cent were already sacking staff.

Additional report from Vanguard

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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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