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NLC strike pushes Ship Forum-Govt Parley to back stage

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  • Governors approach World Bank for $3.25bn lifeline

The Vice President, Nigeria Indigenous Shipowners Association (NISA) Aminu Umar’s strong urge to parley with the Government and its functionaries, in burning desire to find alternative sources of foreign exchange may have become secondary, as Government directs full attention on the nation’s ports, which was effectively crippled on Wednesday, by strike.

Speaking during a Ship forum parley which ought to have started bearing fruits, before the Dockworkers Union of Nigeria (DUN), a strong member of MWUN, pulled the rugs off sea terminal operators feet, Aminu had indicated his group’s determination to open up discussion with the Government, following perceived Government’s renew interest in the Nigerian maritime industry, as a worthy alternative, for forex generation and job creation.

Rotimi Amaechi

Rotimi Amaechi

“For us as NISA, we intend to have meeting with not only the Minister (of Transportation), but also the Director General and all their teams, so that we can discuss as partners with Government towards actualizing Government agenda, which is to create jobs”, the NISA Chieftain had indicated in Lagos, adding that Government could find whatever it through crude oil slide, in the maritime industry.

“We are telling Government that maritime sector is worthy alternative to earning foreign exchange, and curbing what Nigerians are suffering today. For ship owners, we are more concern about the freight which is the earning we get when we transport products. If you look at the oil and gas sector; like we talk about crude oil, the crude today which is being taking out of Nigerian. I give you a statistics, there is approximately 70 to 77 crude oil vessel loading every month out of this country, and none of these vessels that are loading are owned by any Nigerian. And if you take a freight of crude tanker for a voyage, it is a minimum of about $4 million. So, $4 million multiply by 70 can tell you what is the total freight that these ship owners that come to load crude, who are not Nigerians, who don’t employ any Nigerians, and who do not pay tax in Nigeria daily, make. Actually that money doesn’t even come through our banks!

“So, insurance doesn’t collect anything. There is no VAT charge. It’s totally nothing! And what we are telling Government is that look, give us the support; we are not asking for opportunity to take over 100 percent; but, even if we take over 100 percent it is still our legitimate business, because we are Nigerians; but at least, let’s start with just 10 percent of this 70 vessels. If we take up, say only 10 percent or 20 percent of this trade, the money will come through the Nigerian banks; that means this $4 million multiplied by 7 or 14 vessels that would have come as dollars earn in this country; and would have generated more employment, and would have earned government tax, when we pay tax. The money would have earned Government VAT, PAYE tax through income taxes, and would have benefitted the various States, where the companies are situated.

“But this is not done; and this is a loss that Government is suffering. I should put it bluntly; this is a leakage, legal leakage; and this is the good reasons we believe we should partner with the Government to see how that can be stopped. That is our target; and that is on the crude oil side.

“On the product side, we have so many areas of focus; on all the products that we have been using: petrol, gas, jet, kerosene which are all imported. They are imported into this country and for all the freight earnings on these products that come here, there is zero participation from any Nigerians.

“The reason is that the (Government) policies sometimes do not support us; the policies of Government does not support the Nigerian ship owners, and that is why we are saying, for those of us under the Shipowners Forum, we are going to champion, and discuss it, with the relevant Government authorities, to say give us the support, create conducive environment, so that investors, including Nigerians can invest. The investors will create jobs, they will employ Nigerians, and they will pay taxes, because such freights will then be coming into the country”.

The parley has now petered off into back-stage, with the Nigeria Labour Congress (NLC) strike taking centre stage!

In the meantime, the 36 state governors have decided to turn to the World Bank as one of the ways of surviving the current economic downturn in the country, which has made it difficult for many of them to pay workers’ salaries.

They are putting machinery in place to access a $3.25bn portfolio currently lying idle in the bank.

The Chairman, Nigeria Governors’ Forum, Alhaji Abdulaziz Yari; and Kaduna State Governor, Nasir el-Rufai, briefed State House correspondents about the decision to approach the World Bank at the end of a meeting of the forum held inside the Presidential Villa, Abuja on Thursday.

The meeting, which started at about 8.45pm on Wednesday, ended in the early hours of Thursday.

Yari, who is the governor of Zamfara State, said he and his colleagues decided to invite the Country Director of the World Bank, Rachid Benmessaoud, who briefed them on the $3.25bn fund available in the bank, which largely belongs to the state governments but had not been accessed.

He said because of the cumbersome procedure for accessing the fund, most of the governors did not know that such existed in the bank.

Yari explained that it was el-Rufai’s initiative that officials of the bank should come and make the presentation so that the governors could be properly educated.

He added that the states had been defaulting in the payment of their own part of the World Bank fund because of the economic downturn afflicting the country.

He, however, said the bank officials had agreed to revisit the issue.

The governor said, “They came to educate the governors so that they would know that this money is there. This could help us in the kind of difficult situation we are in so that we can move forward in terms of infrastructure development and other matters in our respective states.

“We had a presentation from the World Bank officials and we agreed on the terms. The governors made their own contributions, especially the issue of counterpart funding, which the bank accepted they are going to look into.”

Yari added, “Also, they agreed that they would give us the details of how much each state could access. As of now, they are ready to facilitate a kind of workshop for the state governors, the commissioners of Finance and other officials for us to know how best to move and access these funds for the betterment of our respective states.

“We discussed the issue of counterpart funding. It is more difficult for us to fulfil our own part, because we are struggling to see how we can pay salaries. That is the most difficult aspect of it and they promised that they would look into it; and immediately that is done, the states will move fast to ensure we access it.”

El-Rufai admitted that all the state governments were broke, adding that this was the reason why they must work hard to access the money.

He expressed the belief that the idle money was capable of turning around the fortunes of the states.

El-Rufai explained, “The World Bank portfolio for the states for this year is $4.25bn and out of that, $3.25bn is lying there undisbursed, which means the states are not meeting their conditions or not moving fast enough to draw this $3.25bn.

“You know $3.25bn can do a lot to improve the lives and livelihood of our citizens in the states, and the World Bank has expressed its flexibility to look into the challenges we are facing as well as the procedure to ease accessing this money. The World Bank wants us to withdraw the money as quickly as possible so that our citizens will get the benefits from health to education, agriculture and the revival of livestock and water supply.

“These are the areas for which most of these funds are dedicated and we all need the money, because we are all broke. So, we are going to work very hard to try to get the money in trust.”

Additional report from Punch

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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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