As maritime industry awaits Tinubu’s economic agenda implementation

President Bola Tinubu, in his inaugural speech, gave a snippet of his administration’s roadmap towards achieving a six percent yearly output target.

He said his administration would address complaints of multiple taxations and various anti-investment inhibitions to encourage local and foreign investors, prioritize road, rail/port infrastructure, reduce interest rates to increase investment, lessen import dependency, and ensure job creation.

The maritime industry has over the years been plagued with issues of multiple taxations, cumbersome cargo clearing processes, absence of indigenous ship ownership, foreign exchange scarcity, the poor state of access roads, dilapidated seaports infrastructure, non-functional rail system to transport cargoes, extortion, and corruption.

Others are job loss and unemployment of youths, regulatory inconsistencies and duplication of roles, and a high rate of infractions by ministries, departments, and agencies (MDAs).

According to a report by the Maritime Anti-Corruption Network (MACN), in collaboration with the Lagos Chamber of Commerce and Industry (LCCI), Nigeria loses over $7 billion yearly to inefficiency and corruption at the ports.

The report stated that illegal charges, rent-seeking and corrupt port officials as well as excessive delays in import and export processes were also some of the administrative bottlenecks responsible for such huge losses.

Also, shippers, truckers, and clearing agents lose about N900 million daily to arbitrary charges and extortion at various checkpoints at the port corridors mounted by state and non-state actors.

Stakeholders lament that this has resulted in the high cost of doing business in the port environment, thereby discouraging importers and other investors.

Also, the unavailability of rail to move cargoes from the ports to the hinterland, cost operators over N9 billion loss in 2022, according to the Managing Director/ Chief Executive Officer of Inland Container Nigeria Limited, Ismail Yusuf.

The challenges have crippled the industry as the country loses an estimated N130 billion yearly due to the diversion of over 60 percent of its transit cargoes to neighboring countries, such as Benin Republic, Togo, Cameroon, Ghana, and Cote D’Ivoire.

The country is also losing about $9.1 billion in freight yearly to foreign shipping lines due to its inability to lift its cargoes, according to the former executive secretary of the Nigerian Shippers Council (NSC), Hassan Bello, and other industry stakeholders.

Meanwhile, Singapore and Greece have leveraged the maritime sector to grow their economies, as it is one of the biggest revenue-generating industries globally.

According to the Nigerian Economic Summit Group (NESG), Nigeria’s maritime sector could generate N7 trillion in revenue yearly and create additional four million jobs if properly harnessed.

Stakeholders are, however, expecting the new administration to fulfill its economic growth agenda and not toe the line of the previous administrations that ignored the maritime industry and left it to languish.

Already, low port activities and a drop in cargo throughput were recorded at the start of 2023 as imports declined by over 30 percent at the ports, according to the Chairman of the Seaports Terminal Operators Association of Nigeria (STOAN), Vicky Haastrup.

The General Secretary, of the Association of Bonded Terminal Operators of Nigeria, Haruna Omolajomo, said it was important that the president’s economic agenda is implemented, noting that too many duplicated multi-purpose taxes imposed on importers are creating lots of challenges in the industry.

Omolajomo, who is also the Chairman of the Membership Committee of the Barge Operators Association of Nigeria (BOAN), said it is a known fact that multiple taxations in the maritime industry are killing the economy currently and positioning the country as the most expensive in doing business in West and Central Africa.

He said due to this, Nigeria is losing its position as a business hub in West Africa, despite all the advantages.

Omolajomo said if this present administration can show determination and seriousness in tackling this multiple taxations and reduce corruption to the barest minimum, it will help Nigeria to regain her lost ground and maintain her lead in the West African economy.

He said there should be an acceptable maritime regulator for all businesses to ensure that things are done right to avoid corruption and multiple taxations.

He said the country’s import dependency has been its bane for a long time while urging the new administration to promote domestic manufacturing and maintain local content for both export and import businesses.

Omolajomo also noted that a conscious policy that will favor local content should be implemented, especially in bonded terminals and barge operations.

He urged the government to ensure efficient standard operating procedure (SOP) for all maritime operators and agencies, adding that the different SOPs being used by the various agencies and parastatals have been a clog in the wheel of progress in the maritime industry for long

“Every agency and government just do as they like without any control. This is also noticeable in the dwell time of vessels, barge operations, and delays in the clearing processes of goods. This, most of the time, results in demurrage and high cost of clearing of goods,” he said.

The National Public Relations Officer, Association of Registered Freight Forwarders (AREFFN), Taiwo Fatomilola, said customs extreme and unstable duties are crippling trade as the effect has been felt in the decline in import and manufacturing.

“Multiple taxations on cargoes coming out of the ports from the chains of Customs units, such as taskforce, strike force, compliance, federal operations, alerts among others, are frustrating importers, agents and maritime trade.

“Importers and agents are dying due to the stress of these bottlenecks at the ports. Importation is also dropping and their contribution to the GDP of the country is going down gradually,” he said.

Fatomilola urged Tinubu to create a ministry solely responsible for ports and maritime affairs as well as appoint an industry professional as a minister, noting that the industry is a blue economy business that has the largest employment of people globally and should not be joined to the transport ministry.

He said Tinubu should also have a special adviser on maritime affairs, while also engaging with stakeholders in the maritime industry if he must get it right with the sector.

The Vice Chairman, of Business Action Against Corruption (BAAC) Integrity Alliance, Jonathan Nicol, said stakeholders want the economic policy to be restructured in favour of the trading public so that their confidence in government regulations will return.

He also called for a thorough overhaul of all the maritime agencies, especially the port regulators such as the Nigerian Ports Authority (NPA), Nigerian Shippers’ Council (NSC), Nigeria Customs Service (NCS), and Nigerian Maritime Administration and Safety Agency, (NIMASA), who he said come up with harsh regulations by militarizing the trading public.

Nicol urged the new administration to appoint professionals in the maritime industry to take the place of chief executives while faulting the past administration for fielding political appointees that were unable to put policies that will make ease of doing business workable.

Speaking on port infrastructure, Nicol said infrastructural architecture for the port is not there, as the country is still using what the white men left behind with just a few renovations while calling for complete modern ports.

The Chairman/Managing Director of Lamsam Intercontinental Company Nigeria Limited, Port Harcourt, Samuel Njoku, urged the government to implement friendly trade policies and streamline the multiple agencies, which are cluttered in the ports and hindering trade facilitation.

The Administration Secretary of the Association of Maritime Truck Owners of Nigeria (AMATO), Mohammed Sani, said the agenda of this government can only work to yield desired results when the purpose is sincere by those who are saddled with the implementation of the policy agenda.

Speaking on job creation, the Secretary-General, of the Merchant Seafarers Association of Nigeria, Captain Alfred Oniye, said Nigeria does not have plans for the future when it comes to maritime industry manpower, noting that over 80 percent of trained seafarers are jobless.

A captain of one of the largest vessels that sail in Nigeria, Williams Ogunsakin, said Nigerian seafarers are almost not relevant in the country, as many of them are without jobs.

Ogunsakin decried the large number of cadets that have remained unemployed due to lack of sea time training experience, especially as shipping companies require high skills and competencies to function on their vessels.

He also lamented the unavailability of ships and urged the government to float a national carrier that will enhance human capacity development among seafarers in the country.

By Adaku Onyenucheya

Leave a Reply

Your email address will not be published. Required fields are marked *