Wednesday, 20 November 2013

America Wonder!

 

Wonders, they say, shall never end.
The story of the vessel known as C-Retriever is an amazing one. For the benefit of those who might not have followed the story, C-Retriever is a 221-foot oilfield supply ship owned by an American company known as Edison Chouest Offshore, based in Louisiana, USA. Before I delve into the story proper which might sound like a typical storyline out of Hollywood, it is important to point out that C-Retriever was operating illegally on Nigerian waters. It was in total breach of the nation’s Cabotage Law which requires vessels, including offshore supply ships, carrying out business on Nigerian waters to be owned by Nigerians, registered in Nigeria, maintained in Nigeria and crewed by Nigerians.
To the best of my knowledge - and I made enquiries at the appropriate quarters - C-Retriever did not comply with any provision of this law. First breach; it was flying American flag. Next, it is owned by an American company operating from America. The ship, according to my findings does not undergo serious maintenance checks of any sort in Nigeria and to make matters worse, its Captain and Chief Engineer are Americans. And it did not obtain waiver as required by law to trade on the nation’s territorial waters. So I think the first thing for NIMASA to do with regard to this ship is to apprehend it and prosecute the owners or their agents.

Now to the story: C-Retriever was said to have been hijacked near Brass, Bayelsa State on 23rd October, 2013. It was the Cable News Network (CNN) that broke the story. Every Nigerian newspaper that reported it subsequently only mouthed what CNN and other western media reported.
It was the western media that also claimed that two American sailors, the ship Captain and Chief Engineer, were kidnapped and taken hostage. No any other detail. No mention of the names of the Americans, no mention of other crew members; no nothing. And to make matters worse, the Nigerian Navy which maintains regular patrol on the nation’s waters said it was not aware of the hijack. Neither the American authorities nor the US Embassy nor the owners of the vessel nor family members of the kidnapped sailors deemed it fit to make any report to any Nigerian authority. All we got on the hijack and kidnap was the usual arrogantly terse statement from the US authorities. The US State Department said it was "closely monitoring" the reports and was "seeking additional information about the incident." And that was all. No mention of working with Nigerian authorities to rescue the ship.
The Nigerian Navy had no clue of what was going on. The Director of Naval Information, Commodore Kabiru Aliyu, said shortly after the alleged hijack and kidnap that despite the fact that the incident was not reported, Nigerian Naval officials were doing all they could to find the vessel and rescue the two sailors. He said the Central Naval Command, Yenagoa, had been instructed to take over the search for the vessel and the sailors.

The Central Naval Command in Bayelsa also said it had been combing the creeks around the area to track the vessel. The Commanding Officer, Forward Operating Base, Brass, Bayelsa State, Capt. Aniedi Ibok, said that it was curious that the company where the two sailors were working before their alleged abduction did not report the matter to naval authorities.
He said the only report they heard about the entire incident was on CNN. He said while the Navy was working round the clock to find the vessel that was conveying the Americans, information from other crew members on board the C-Retriever could be of vital importance. “We are still searching our waters to see if we can get the vessel since it was not reported to have been kidnapped. Apart from reported abducted two Americans, there were other people in the ship. They should be able to talk. They should be able to tell us where they are. They have not made any report. They have not called the Navy, neither have they called the Joint (military) Task Force. The only report anybody has heard regarding the abduction is from the CNN and nobody can work with that. The company they are working with should be able to give us information. They cannot be working in Nigeria from America. At least, somebody should be able to tell us what happened,” Ibok said.
He said it would be impossible to have taken the vessel to the creeks.

“They could not have taken the vessel to creeks. The vessel is too big to be taken to the creeks. They did not say they kidnapped the vessel. They only said they kidnapped the Captain and the Chief Engineer,” he said.
But despite the lamentation from Navy, the Americans won’t budge.
The next thing we heard about the vessel was that it had been sighted somewhere around the creeks of Onne. Recall that Ibok had stated above that the vessel was too large to enter into a creek! But the Americans said they found it in the creek. And it was reportedly found by, wait a minute; NBC News. Not by the Nigerian Navy. Not by NIMASA. Not by the Marine Police or any security agency in Nigeria but by a press crew made up of an Asian and an American which flew in from America (and headed straight to where the ship was lying, I suppose!). That happened on Monday last week and by Wednesday (two days after), CNN again reported that the two American sailors had been released.
The cable news network quoted the US State Department as having confirmed the release. “We welcome the release of the two U.S. citizens who were kidnapped from the M/V C-Retriever. For privacy reasons, we will not provide any additional information,” a State Department official reportedly said in a statement.
“It is the policy of the United States not to pay ransom or encourage the payment of ransom money,” the statement added although other reports claimed the men were released unharmed after a ransom was paid.
And no one in Nigeria saw the men. They were said to have been flown “home”.
Really I am beginning to doubt the integrity of all these. If truly this happened on Nigerian waters and the Nigerian authorities were not involved in it, then something is definitely wrong somewhere and the Nigerian government will do well to lodge formal complaints with the US authorities. I wonder if another country could have acted on US waters, the way the Americans did in Nigeria with regards to the C-Retriever case, and get away with it.
And if it truly happened and the two sailors have been flown out of Nigeria, the government should demand their repatriation to Nigeria to face prosecution for breaking the Cabotage Law.

Monday, 11 November 2013

Import duty waiver: The scam of the affluent

 

Import duty waivers, exemptions and concessions are used by governments in various parts of the world to protect local businesses and jobs but they have typically been serially abused here in Nigeria and have become a major drain on the national economy.
Minus the abuse which they have been subjected to in Nigeria, import duty waivers are useful devices carefully used by sovereign nations to meet specific economic goals, especially in protecting local industries, creating jobs and promoting exports.
An import duty waiver means excluding a firm from paying import duty on certain goods for a fixed period. Countries like Japan, China, Malaysia and India, at various times, had used import duty waivers, concessions and exemptions to protect and build up their local textile, vehicle, agricultural and manufacturing industries. Today, all four have become economic power houses with export-led economies.

When Nigerian policymakers latched on to import duty waivers, the advertised objectives were to boost certain local industries, make some much needed raw materials or goods available in the short term and boost employment. In three decades of reckless granting of import duty waivers, however, it is obvious that none of these lofty goals have been met. Import duty waivers, which were started in the 1980s by the Shagari administration, have been shamelessly abused by successive governments to the detriment of taxpayers.
Comptroller General of the Nigeria Customs Service, Dikko Abdullahi, told members of the Senate Joint Committees on Finance and Appropriation last Monday that Nigeria lost a whopping N603.2billion to waivers and concessions in the first eight months of this year.
“If not for government policies of waivers, import duty exemption etc on some imported goods and free trade zones that are largely being abused by traders involved, the Nigeria Customs Service would have collected more than N600 billion more of the N530 billion it remitted as at the end of September this year”, Dikko said.
The amount lost by the country in the first eight months of this year more than doubles the amount lost through the same means in eight years. It had been estimated that N276.9 billion was lost to import duty waivers and concessions from 2000 to 2008.

Federal lawmakers have observed in the past that the waivers were not only “illegal and indiscriminate”, but were granted to “totally undeserving firms and individuals”.
Some of the beneficiaries of the duty waivers are purely business enterprises that will not pass the benefit to Nigerians. They include The Redeemed Christian Church of God, Messrs Western Metal Products, International Hotels, Mandarin Hotels, Le Meridian, Grand Ikoyi Towers & Resort, Federal Palace Hotels, Dangote Industries, Vaswani, Coscharis Group and Stallion Group, among several others.
Dangote Group has been described as a major beneficiary of duty waiver due to the closeness of its President, Alhaji Aliko Dangote, to the seat of power.
There are unconfirmed reports that Dangote allegedly got a concession of five per cent for raw sugar and exemption from payment of the ten per cent sugar levy. The exemption is said to be ongoing and has no expiration date. Dangote is also alleged to have a two-year concession from payment of duties on the importation of tomato paste.
There have also been reports that the Presidency waived over N100 billion worth of import duties to the Vaswani Brothers sometimes last year. The Vaswani Brothers is a purely business concern engaged in importation of consumer goods and there is no record anywhere to indicate that it passed this huge savings to the Nigerian consumer.

Politicians, businessmen and religious leaders have continued to collude to undermine the nation’s economy through the issuance of fraudulent waivers.
Duty is a tax levied on imports by the customs authorities to generate revenue and to protect domestic industries from more efficient or predatory competitors from abroad. Such duty is charged generally on the value of goods or upon the weight, dimensions or some other criteria of the item. Waiving such duties to well-connected businessmen and political loyalists automatically leads to loss of billions of naira in revenue; money that could have accrued to the public coffers and used for the common good.
Indiscriminate granting of import duty waivers is not only a drain on the nation’s resources; it is undermining local manufacturing and concentrating the commonwealth in the hands of a privileged few.
We are now at the point where President Goodluck Jonathan will do well to heed the advice of the Speaker of the House of Representatives, Aminu Waziri Tambuwal, who recently called for scrapping of the duty waivers and review of the policy that allows indiscriminate import of goods into Nigeria. 

Can Lagos cope with two new deep seaports?

 

The development of new deep seaport in Lagos is certainly a most welcome initiative since it will be a huge boon not only to the economy of the state but that of the entire nation. It goes without saying that a viable deep seaport project will create close to half a million direct and indirect jobs for Nigeria’s teeming youths.
Container throughput at Lagos ports is expected to hit two million twenty-foot equivalent units (TEUs) by 2018 whereas the maximum capacity that the ports and the Inland Container Depots (ICDs) in the State can accommodate is 2.2 million TEUs.
Lagos ports alone handle 90 per cent of the cargo in and out of Nigeria. With this expected growth in container volumes, the combined capacity of Apapa Port fully-developed and Tin Can Island Port and all the Inland Container Depots (ICDs) in the Lagos area is expected to be inadequate within the next five years. The same situation also applies to general cargo terminals.
A new port will therefore be needed to keep up with the demand for capacity, as the existing ports are surrounded by the city and cannot be further expanded.

At present, two new seaports are at various stages of development in Lagos State. Leading global terminal operator, APM Terminals and its consortium of partners are developing the new Badagry mega-port project and Free Trade Zone while Indian firm, Tolaram Group, is spearheading the Lekki Port project being developed within the Lagos Free Trade Zone. The first phase of both port projects have been scheduled to open in 2017.
With the forecast in container volume, the pertinent question in the mind of stakeholders is the viability of building two new deep seaports, in addition to the existing port facilities.
Analysts have stated severally that since the existing ports in Lagos will run out of capacity in the next five years – a new port has become imperative but certainly two new deep seaports will be an over kill. So which of the two new ports will be sustainable? The natural location, the supporting infrastructure and the support of stakeholders are key success of a Greenfield port. In choosing the location of a Greenfield port, the factors that must be considered include natural deepwater and harbour and supporting navigational channels with commensurate draft.
Other factors include lower risk of encroachment of city development in the immediate future, connection to multimodal infrastructure for evacuation of cargo by road, rail and barge, government support to the investors with policies that will protect investments, presence of adequate supporting services and review of cargo clearance processes to support faster cargo evacuation and reduce dwell time.

Both Badagry and Lekki have natural features for a port. Natural harbours have long been of great strategic naval and economic importance. They reduce or eliminate the need for breakwaters which would ordinarily cost a fortune to construct. Some examples of natural harbours are New York City harbour in the United States; Kingston Harbour in Jamaica; Subic, Zambales in the Philippines; Sydney Harbour in Australia; Pearl Harbour in Hawaii; San Francisco Bay in California; Visakhapatnam Harbour in Andhra Pradesh, India; Killybegs in County Donegal Ireland; and Halifax Harbour in Nova Scotia, Canada. Unlike Lekki which is more of a residential area; Badagry has been used before now as a port especially in the days of slave trade.
The proposed Port at Lekki is surrounded by the lagoon and you can go in and out of the port area through only one way. Because the Lekki axis is largely a residential area, vehicular traffic in and out is very heavy without the added burden of trucks plying that route. What will happen when trucks join the fray on the road is better imagined. Due to this constraint and in the absence of a rail system, evacuation of containers from the Lekki Port to the Western part of the country will be very difficult if not impossible. You can’t move goods up north either except a new bridge the size of the Third Mainlaind Bridge is constructed around the lagoon.

Trucks evacuating goods from the port however can head for the Eastern part of the country but then, they will have to travel almost 100 kilometres to link up the Benin-Ore road. Movement of goods out of the port through barges is not an option either because Lekki is backed by a very broad and shallow lagoon making barging difficult.
Badagry is devoid of the logistics constraints confronting Lekki. The lagoon, which terminates just before Badagry, will form one of the boundaries of the Badagry mega-port. The lagoon is not a problem for the port as a bridge already exists over it.

Access road in and out of Badagry is much better than Lekki. The little congestion being experienced on the Badagry expressway is already being addressed by the Lagos State Government through the construction of six lanes on each side.
There is also a road link from Badagry through Agbara which can take trucks to the northern part of the country and which by-passes the heavily crowded Okokomaiko-Mile 2 axis. Badagry also has a higher potential for barging with its narrow but deep lagoon.
From a logistics perspective therefore, Badagry is superior to Lekki but one must quickly add that neither Badagry nor Lekki has rail links at present.
From a commercial perspective; it is necessary to consider how to move patronage from the existing facilities to the new port.
The inertia of freight forwarders, importers, exporters and other stakeholders to move their structures and operations from existing port facilities to a new satellite port is a significant challenge associated with new ports.
This major challenge can be seen with regards to the operation of the Batangas International Seaport in the Philippines which commenced operation eight years ago and despite several government incentives, is still struggling. The Port of Manilla was hugely congested and Batangas, located 70 kilometres away, was built to take pressure off it. For the first two years of operation, no ship called at Batanga and till date, the port handles less than ten percent of Manilla’s cargo.

Lekki Port’s business strategy, anchored on getting shipping lines to call at the port with the believe that this will compel patronage, has been proven time and again that shipping lines don’t actually control where cargoes go. It is overly simplistic to assume that once you offer shipping companies certain level of incentives, then the port will come alive.
Despite reduction in wharfage, berthing fees and vessel-related charges at the Batangas Port, activities are very low almost a decade after it commenced operation.
No doubt, government support and legislation are required to make new satellite ports work but it is important also to have the ability to move freight forwarders, truck operators and other stakeholders.
From this perspective - Badagry Port also has an advantage over Lekki because the promoters – APM Terminals and its consortium partners including Orlean Invest, the Macquarie Group, Oando PLC, the Chagoury Group and Terminal Investment Limited (owners of Mediterranean Shipping Company – MSC) have control over cargo volume in Apapa unlike the promoters of Lekki who have no control of any port operation in the country – or in any part of West Africa.
A “build it and they will come” mentality won’t work with a new port project. A new port must also have a significant basis of gateway cargo in order for a solid business case to be built for transshipment cargo. Building a port, like Lekki and Badagry, on the assumption that it will be sustained on transshipment cargo is a fallacy. Transshipment cargo can come and disappear overnight especially without strong domestic cargo.
The cost of building a new port cannot be underestimated with about USD1.5 billion (about N240 billion) required for investment in quay wall, quay apron, terminals, cargo handling equipment, information technology etc. Potential investors and financiers will certainly be interested in good return on investment.
Spending USD1.5 billion in Lekki and another USD1.5 billion in Badagry means someone is going to get their fingers burnt. There will be growth in volume over the years no doubt but not such as can take two new deep seaports in addition to the two existing ports.
Again, there isn’t likely to be people interested in investing in these two ports considering the huge capital requirement. The volume of cargo increase just can’t justify any such investment in the medium term and who is willing to invest and not get return in 8 to 10 years?
As stated earlier, two new deep seaports in Lagos in addition to Lagos Port Complex Apapa and Tin Can Island Port is an overkill. There is simply no market for it and there won’t be in another half a century.

 

Monday, 14 October 2013

Wanted: Tipping Point Leadership

 

 


Indigenous shipping is in shambles. I have often heard operators lament government neglect. In their opinion, government is the answer to all the problems they are facing. They want government patronage. They want bail out from government.
All attention has shifted to the Cabotage Vessel Financing Fund (CVFF). They make it look as if CVFF will solve all the problems they encounter in their daily operation, but I say nay.
The CVFF will provide fund for only a handful of ship owners to acquire vessels but if those vessels are not meaningfully engaged, it will be a matter of time before the owners run into turbulence again.
CVFF is not the solution to the problems of indigenous ship owners. The solution that will endure is a paradigm shift; a total change in the business model of Nigerian ship owners. I draw my argument from the following quotes:

“The world as we have created it is a process of our thinking. It cannot be changed without changing our thinking.” ? Albert Einstein

“Everyone thinks of changing the world, but no one thinks of changing himself.” ? Leo Tolstoy

“Change will not come if we wait for some other person, or if we wait for some other time. We are the ones we've been waiting for. We are the change that we seek.” ? Barack Obama
The change Nigerian ship owners are looking for is within them. It must start with them. It must start with the quest for a viable business model rather than an unbridled reliance on government support.
In April this year at a retreat for maritime journalists in Abuja, I talked about the Tipping Point. I stated that the maritime industry was at the threshold. It is still at the threshold. It is at the threshold of a dazzling boom. That boom will not materialise without a revolution of the mind.
Palliatives and verbal pontification have hardly created the relief and succour desired by Nigerian ship owners.

I believe our operators have become too complacent. I believe something is missing and this is the right time to get serious about shipping business. The true practitioners have been too disparate in their approach. Too many policy initiatives have been left with the political elite and pseudo-technocrats while they stand aloof or at best occupy themselves with mundane rhetoric.
It is time our ship owners rise above the quest for bread and butter. As critical stakeholders in the Nigerian economy, our ship owners must make an impact, not just in the maritime industry but meaningful impact in the soul of our society. This is the tipping point I talked about earlier.
As we think, so we become. The time to change our thinking about society vis-à-vis our responsibility has come. Our ship owners must transcend the present realm of helplessness pervading their pursuits.

Again, permit me to draw Biblical anecdotes;
• We were told that God created Eve from the ribs of Adam; the Whiteman then reviewed his thinking and made a breakthrough in cloning through genetic engineering;
• We were told that a whale swallowed Jonah for three days and vomited him at Nineveh; then the Whiteman changed his thinking and made a breakthrough with submarines;
• We were informed that Elijah was drawn into heaven through a chariot of fire; the Whiteman’s vision affected his thinking and the rocket was made to take man into space.
• We were informed that Moses stood by the Red Sea and it parted, the Whiteman ensured through stretched thinking that glass doors and elevator doors could open on their own with the mere touch of a button.

These cases testify of the boundless stretch a people can make to lift themselves out of obscurity by the right paradigm or mindset.
Globalization, with all its attractions and trappings, especially in this internet age, will swallow our ship owners, except they change the way they think in pursuit of mundane attractions.
Our ship owners must take the lead and urgently design an agenda for visible impact in the maritime industry. They must revisit their strategies.
Whatever change we desire to see in the maritime industry and in our lives must start with us. 

Wednesday, 9 October 2013

My passion is telling maritime story to Nigerians

 



Bolaji Akinola is the CEO, Ships and Ports Communication Company. In this interview with BABATUNDE SULAIMAN, the well-travelled journalist cum entrepreneur talks about his humble beginning, his coming into journalism and the vast opportunities in the maritime sector.
 
Click to read the interview

 

Tuesday, 8 October 2013

Boarding, rummaging and sampling at Nigerian ports



Checks on ships at berth are statutory and are carried out all over the world but these vital components of port operation are being grossly abused on a daily basis and with impunity at our seaports. The checks carried out at our ports by security agencies are often abused and fraught with corruption.
Typically, after a long voyage and upon arrival at a port, Customs officers will board and rummage a ship. To rummage a ship means to search it and ensure that duty-free goods and goods that do not comply with the laws of the country of the host port do not find their way out of the vessel.
Usually, the Customs officer in charge of boarding and rummaging will seal the bar and other storage areas leaving only what is necessary for the crew to survive while at the port. Apart from Customs, Port Health Service officials and immigration officers also board. The Port Health officers’ are to ensure that communicable disease is not transmitted from the ship to the host community through goods or persons while immigration officers board to ensure compliance with the nation’s immigration laws.
In other climes, all of these checks are carried out simultaneously and will typically last for about an hour. I raised the alarm not long ago that our check officers keep the vessel waiting for an average of four hours translating to huge financial implication to the Nigerian economy.

In shipping, time is money and the longer the keep the ship in port, the more cost it incurs and the shipping line will naturally factor this into the freight charges.
My recommendation had been that while these statutory checks are going on, stevedoring operation should commence to save the ship time and money.
Now apart from the time factor, our officers also do not conduct themselves in the best professional manner when they board these vessels.
The Nigerian factor has crept in as they practically go cap in hand to the ship captain using everything within their official powers to rip off the captain and his crew of valuable commodities. They even go as far as asking for money from some ship captains. You will see some of these officers emerging from the vessel with cartons of goods and bottles of choice wine.
The other aspect of the activities of our security agencies which is worrisome is sampling of regulated goods. This process has also been heavily abused by our security operatives.

Typically, officials of the Nigeria Customs Service; the Standards Organisation of Nigeria (SON) and the National Agency for Drug Administration and Control (NAFDAC) take samples of regulated imported items for test to ensure compliance with safety standards. Several items including electrical/electronic items, household items, liquor, building materials and other commodities fall under goods that are so tested by the regulatory bodies.
One would have thought that one or two pieces of such goods that require testing will be sufficient to take to the laboratory and test. But what we see at the port today is massive looting by officials of these agencies in the name of sample collection. They collect the items in large quantity and they don’t return them even after the so-called tests are concluded.
It is another form of corruption which has eaten deep into the fabric of the Nigerian nation. And woe betides the importer or agent that refuses to cooperate with these unscrupulous government officials.
You see these officials gleefully stuffing their vehicles everyday with all manner of items which they take home and distribute to their family and friends. The so-called samples never get to the laboratory as they end up in personal homes.

It is corruption at its highest level. What I call “Authority Stealing”, apologies to the late Fela Anikulapo-Kuti.
Corruption has eaten deep into the fabric of our nation. Public officers use the privilege of their offices to plunder resources with impunity and thus plunder the country’s resources impoverishing the lives of the very people they were elected or appointed to serve.
Nigeria is considered one of the world’s most corrupt countries ranked 143 out of 182 countries in Transparency International’s 2011 Corruption Perception Index. Nigeria exports and sells over two and half million barrels of crude oil per day earning huge revenue. Despite this, however, over 75 million people representing more than half of the population live in absolute poverty largely due to corruption and mismanagement of state resources by political leaders. The dysfunctional state of public utilities and infrastructure in the country is also a direct consequence of high level corruption.
Who will save importers from this bare-faced extortion?

Monday, 30 September 2013

The way we are



There is a major problem at our seaports and that problem is basically that of an ambiguous clearing system. Unfortunately until the Minister of Transport, Senator Idris Umar, intervened penultimate week, the problem had almost degenerated to an unmanageable level with the principal actors digging in their heels.
Customs officers and their agents were shouting themselves hoarse and heaping all the blame on terminal operators. Senior government officials who visited the port were overwhelmed by the loud voices of the agents and in an attempt to please them, took rather simplistic paths and made public pronouncements that compounded the situation.
It was the Transport Minister’s intervention that brought calm to the whole situation. He adopted a completely different approach. He decided to set up a committee made up of all the stakeholders to critically examine the various issues and make recommendations to government. He also gave them a deadline of one week. That was leadership in action; contrary to the unproductive approach of other government officials including the Senior Special Assistant to the President on Maritime Services, Leke Oyewole.
I am aware that the Committee set up by the Minister has completed its assignment and submitted its report last Friday. I have seen the report but I must state that the recommendations made will only address the problem in the short term. We need a long term solution to port congestion so that we don’t keep going through this every now and then.

To evolve a long term solution, it is important to understand the real cause of the problem and to do this; I like to share an online post with you.
Responding to the issue of corruption at the port, a fellow maritime reporter posted the following on our website:
Is there any government agency that is as corrupt as the Nigeria Customs Service?
Just the other day we were with the Executive Secretary of the Nigerian Shippers' Council, Mr. Hassan Bello, who paid an unscheduled to the Tin Can Island Container Terminal (TICT) and we were opportuned to visit the office of the Officer in Charge of the Ashaye car park, a Deputy Comptroller of Customs whose name I know but cannot mention.
In the course of the visit, my colleagues placed their recording device on his table and because I could find a space in the front of the table I had to go behind the Deputy Comptroller's table to find a way for my own midget and lo and behold, what did I see under the officer's table? Bundles of bribe money in one thousand naira notes stacked under his table and that was just about 12 noon. So imagine how much that man will take home at the end of the day's job.


In my opinion, this colleague’s discovery is at the heart of the matter; corruption. Because of the stupendous money Customs officers and operatives of other government agencies at the ports are making every day, they have entrenched a cumbersome and inefficient process that benefits them and makes everyone else their slaves.
Does anyone sincerely believe that a Customs officer who makes the kind of money described above will allow an efficient clearing system take root at the port? No he won’t. He will do everything possible to sabotage efficiency and look for ways to heap the blame on others.
We conveniently forget that officials of government agencies are the greatest threat to prompt cargo clearance. They have erected all manners of human barriers that make it impossible for cargo to be cleared out of the ports in good time.
I buttress my argument here with the recent Corruption Risk Assessment (CRA) report released by the Independent Corrupt Practices and other Related Offences Commission (ICPC); the Technical Unit on Governance and Anti-Corruption (TUGAR) and the Bureau of Public Procurement (BPP) with the support of United Nations Development Programme (UNDP) on Nigerian ports. The report revealed that an importer or agent will require a minimum of 79 signatures of government officials to clear his/her goods at the nation’s gateways. And each signature costs money.

This mind-boggling revelation has not been acted upon by anyone. It has been conveniently kept aside.
The CRA also identified ineffective administrative practices, weak institutions and huge discretionary powers enjoyed and exercised by officials of government agencies as a major source of corrupt practices at the ports.
The CRA findings confirmed that government officials in the port not only enjoy huge discretionary powers but are also able to delay indefinitely the required signing of documents without consequence.
The CRA, conducted in six major Nigerian ports including the Lagos Port Complex (LPC) Apapa, Tincan Island Port, Port Harcourt Port, Onne Port, Warri Port and Calabar Port is a prevention tool which interrogates processes and procedures in a given system as well as identify areas which are vulnerable to corruption with a view to providing recommendations.
Since that report was released by the ICPC – an agency of the Federal Government set up to fight corruption – no one has taken any action. The Federal Ministry of Finance and the Federal Ministry of Transport which supervise the Nigeria Customs Service and the Nigerian Ports Authority (NPA) respectively have not deemed it fit to act on the report.
Now that import volume has peaked and containers have built up at the port, the consequences of government inaction have become glaring.
Apart from the issue of corruption at the port, we do not have a clearly articulated cargo clearing policy. Can anyone show me a document that details the processes involved in clearing cargo at the port?
Agreed, the Nigeria Customs Service relies on the Customs and Excise Management Act (CEMA) to perform its operation but I think we need to have a well documented and published cargo clearing policy. A step by step procedure that also indicates the time to be spent at each stage and who to hold responsible if the time is exceeded, will do our port system a lot of good. 

Our dead shipping companies


Ships & Ports Daily newspaper carried a stunning report last week that no fewer than 80 per cent of shipping companies owned by Nigerians have either completely shut down their operations or were barely struggling to survive.
According to a survey carried out by the leading national maritime publication, out of 12 indigenous shipping companies surveyed, only two can be said to be operating viable businesses while the 10 others, representing 83 per cent of the companies surveyed, are either completely dead or are in comatose condition.
The companies sampled in the survey conducted recently include Equitorial Energy, Oceanic Energy, Morlap Shipping, Peacegate, Pokat Nigeria Limited, Al-Dawood Shipping, Potram Nigeria Limited, Joseph Sammy, Genesis Worldwide Shipping and Multi-trade Group all in Lagos; Niger-Delta Shipping in Warri, Delta State; and Starzs Investment Group in Port-Harcourt, Rivers State.

Ironically, all the shipping companies surveyed in Lagos are either dead or struggling to survive while the ones in Warri and Port-Harcourt are thriving.
A visit to the business premises of the 10 shipping companies, according to the report, revealed that the once thriving ventures have completely lost their glamour, with most of them owing staff salaries of up to one year.
The companies, which the General Secretary of the Indigenous Shipowners Association of Nigeria (ISAN), Capt. Niyi Labinjo, described as “struggling heavily”, have mostly downsized and are operating with less than 20 per cent of the workers they had about two years ago. All the companies are also heavily indebted to banks and are mostly unable to service the loans they took to buy ships.
Labinjo, who is also the President of Al Dawood Shipping, said that most of the ship owners have resorted to selling their landed properties to enable them service their bank loans, while others have lost prime properties to the banks.
The companies also owe their crew arrears of salaries ranging from six to 14 months, while some have sold off their vessels.

Genesis Worldwide Shipping, which was once seen as a thriving indigenous shipping company just four years ago, has completely gone under with not a single ship to operate.
The company, at its peak less than five years ago, had six ships.
The same fate, according to the report, has befallen Joseph Sammy Nigeria Limited with one of its staff describing it as “almost dead”. The only vessel left in the company’s fleet, MT Kemepade, was stolen recently. The ship was taken to a ship breaking yard in Ghana and the breakers were about to commence work on it before the owners found out. The case is in court in Ghana.
Borrowing Labinjo's words, I must say that the situation is indeed pathetic. The report, published on Monday last week, should worry every right thinking Nigerian; especially those Nigerians saddled with the responsibility of developing and encouraging indigenous participation in the shipping sector.
Chairman of the Indigenous Shipowners Association of Nigeria (ISAN), Chief Isaac Jolapamo, was the first to raise the alarm over the hardship confronting Nigerian ship owners.

Chief Isaac Jolampamo, sometimes in February this year, had said that many Of the shipping companies owned by Nigerians were suffering untold hardship as a result of illegal activities on the nation's coastal waters and the domination of the Cabotage trade by foreigners despite the Cabotage law.
Jolapamo noted that these foreign companies, most of which are operating illegally have gradually succeeded in driving their local counterparts out of business. He said the local shipping fleet was being systematically depleted as a result of lack of jobs for the vessels. Jolapamo said that his own company, Morlap Shipping, which had six vessels 10 years ago had only one left by February 2013.
Since the story broke last week, I haven't heard of any response from the Nigerian Maritime Administration and Safety Agency (NIMASA), the agency saddled with the responsibility of developing indigenous tonnage and of implementing the Cabotage Act.

Some industry experts have claimed that the dire straits in which the indigenous shipping companies found themselves are traceable to the non-availability of jobs for their ships to execute.
The situation, according to industry analysts, is compounded by the trio of poor implementation of the Cabotage Act, non-disbursement of the Cabotage Vessel Financing Fund (CVFF), and lack of implementation of the fleet maintenance and repair subsidy by the Nigerian Maritime Administration and Safety Agency (NIMASA).
The question therefore is, what is NIMASA doing about this development?
Does anyone know or should we just wait until all the shipping companies collapse before we start asking questions? 

Minister Idris Umar’s habitual lateness to official functions



The 2011 World Maritime Day celebration was scheduled to hold at 10am that fateful day, Tuesday 27th September, 2011 in Port Harcourt, Rivers State, but it did not start until about 3pm.
Several dignitaries, including chief executives of various government agencies and their retinue of aides arrived the venue in good time. The State Deputy Governor, Engr. Tele Ikuru, had also come in but had to leave after waiting in vain for a while. Yours sincerely also waited (im)patiently.
Our Chief Host and Nigeria’s Honourable Minister of Transport, Senator Idris Umar, had kept us all – his loyal subjects - waiting. He kept us waiting for five hours and, wait a minute, …eventually failed to show up!
The story then was that he missed his 9am flight and the next available flight was 11am. And we waited and waited.
The organisers of the event quickly hired a comedian who turned the otherwise serious business gathering to a comedy show.

At about 3pm, a representative of the Minister sauntered into the hall apologising on his behalf. It was the Director of Maritime Service, Alhaji Nagogo.
In June 2012, Nigeria hosted the 35th Council Meeting/11th Round Table of the Ports Management Association of West and Central Africa (PMAWCA) in Lagos. It was an international event by all standards and Minister Umar was scheduled to perform the opening ceremony on 25th June, 2012 at 10am.
The magnificent hosting put up by the Nigerian Ports Authority (NPA) was almost marred by the Transport Minister’s habitual lateness as he failed to show up in good time at that Opening Ceremony. Our Minister kept the international maritime community waiting for over two hours just to come and declare the event open. Eventually, it was Alhaji Suleiman Nagogo, again, to the rescue.
Last Friday, the Minister was scheduled to perform the flag-off ceremony of the evacuation of containers from the Lagos Port Complex, Apapa by rail. The event was scheduled to kick-off at 10.30am. Again, Minister Umar kept everyone of us waiting. Three hours later, the Chairman of the Board of Nigerian Railway Corporation, Alhaji Kawu Baraje, arrived and was announced as representative of the Minister. So the ceremony commenced.

I am also aware of several instances where journalists were asked to meet the Honourable Minister in some place for either a briefing or facility tour and the journalists were kept waiting for hours.
I have a lot of respect for the Minister but this is unbecoming of his high office.
Will the Honourable Minister be happy if he arrives at the venue of an official function and the guests keep him waiting for hours before showing up? What would his reaction be if any of the chief executives under his Ministry arrived an event three hours after him and behind schedule?
The implication of keeping such senior government officials and businessmen and women waiting for hours on end is better imagined.
I know that Nigerians - especially those in government - are notorious for their lateness.
The concept of Nigerian time - a jargon that describes an average Nigerian’s lack of respect for time, has gradually become a monster, assuming a life of its own.

It is common knowledge that majority of Nigerians do not see anything wrong in turning up late at events. Many regard such repulsive attitude as “one of those things.”
It seems that corruption is not the only Nigerian, lateness is also a Nigerian and by extension, an African.
So disturbing is this trend that we, as Nigerians, must act quickly to rid ourselves of this cloak of tardiness that has blanketed us as a people from time immemorial. Nigerian Time has been the source of many embarrassing moments for this country. It has become the butt of many jokes.
One question for the Minister; does he go late to the Federal Executive Council meeting?

Why Nigeria should pull out of ETLS



It is my opinion that Nigeria is losing a lot more than it is benefiting from the ECOWAS Trade Liberalisation Scheme (ETLS). I am all for the removal of non-tariff barriers to trade, free trade and regional integration but these must be fair to all parties concerned. Because Nigeria is getting the short end of the stick, it is time, therefore, to urgently take a second look at its continued participation in the scheme.
ETLS was established in line with the objective of the Economic Community of West Africa State (ECOWAS) of promoting cooperation and integration and as one step towards the creation of a common market which, according to the ECOWAS Revised Treaty, should be established, among others, through “the liberalisation of trade by the abolition, among Member States, of customs duties levied on imports and exports, and the abolition of non-tariff barriers in order to establish a free trade area at the Community Level.”
ETLS was first implemented in 1979 with only agricultural products, handicrafts and crude products being allowed to benefit from the scheme. In 1990, however, it opened up to include industrial products. And it was at this point that abuse of the scheme by fellow West African countries set in.
The idea behind ETLS is for goods, originating within the sub-region, to move freely within the sub-region. It is therefore the main ECOWAS operational tool for promoting the West Africa region as a Free Trade Area.

From available literature, the objectives of the creation of the Free Trade Area is to encourage entrepreneurial development in the sub-region, increase intra-regional trade and boost economic activity; increase West African competitiveness on the global market and increase the GDP of member states, thereby creating better welfare for the citizens.
ETLS set out to establish a Customs Union among all member states aimed at the total elimination of Customs duties and taxes of equivalent effect, removal of non-tarrif barriers and the establishment of a Common Customs External Tariff to protect goods produced in the 15 ECOWAS countries.
The group of goods covered under the scheme includes unprocessed goods including livestock, fish, plant or mineral products that have not undergone any industrial transformation, traditional handicraft products and industrial products originating within ECOWAS member states. These groups of goods enjoy concessions including total exemption from import duties and taxes; zero restriction in quantity and non-payment of compensation for loss of revenue as a result of their importation.

Goods that qualify for the scheme must originate in member states and must be accompanied by a certificate of origin and an ECOWAS export declaration form.
This, however, is where the problems lie as Nigerian authorities have no means of ascertaining the origin of goods coming into its territory.
I think we should review our continued participation in the ETLS for the following reasons:
1. Nigeria is the biggest market in West Africa and is a target market by many foreign manufacturers especially from Asia who ship goods to those countries and bring same into Nigeria under the guise that they are produced in West African countries. They benefit from the ETLS and dump goods into Nigeria to take advantage of its huge market. Nigerian industries/manufacturers suffer as a result while Nigeria loses huge revenue and its youths wallow in acute unemployment.
2. There are 15 ECOWAS member states made up of Benin Republic, Burkina Faso, Cape Verde, Cote D'Ivoire, The Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone and Togo. Nigeria’s population is more than the combined population of the other 14 Member States. Indeed the country’s population is about 55% of the entire sub-region so it is a natural target market for exporting nations and under the present blanket ETLS arrangement, it will be impossible to derive commensurate benefit as other West African nations.
3. Some countries, especially those that are Nigeria’s neighbours, hide under ETLS to encourage and support unbridled smuggling of goods into the country.
4. Cheap Chinese textiles daily flood Nigeria under the guise of ETLS and have destroyed Nigeria’s textile industry.
5. Few Nigerian manufacturers take advantage of the ETLS to sell their products in other West African countries. Even if they want to, it would be difficult to compete with the goods of those countries due to high cost of production.

Just last week, the Tomato Processors Association of Nigeria (TPAN) decried the amount of money spent on importation of processed tomato paste, saying that the country has become a dumping ground for fake and low quality Asian tomato paste. The association in a statement said cheap imports were causing serious damage to the tomato industry. While noting that the international standard is 28 percent brix for canning and between 34-36 percent brix for drumming, the association regretted that majority of tomato paste imported, however, doesn't exceed 26 percent brix, resulting in watery paste.
It is an open secret that most of these processed tomato paste, like many other consumer goods produced in Asia, are imported under the guise of the ETLS.
A Gap Analysis on the Ecowas Free Trade Area conducted by the United States Agency for International Development (USAID) and validated in 2010 revealed that Nigeria there is a general lack of awareness among private sector traders indicating they had limited, detailed information on ETLS protocols. I think it is more of apathy though.
According to the USAID report: “The Nigeria Gap Analysis study revealed that incomplete or inconsistent implementation of ETLS protocols within the country has a host of negative effects, including increasing the costs and unpredictability of trade and discouraging business expansion and investment. There is a gap between the passing of legislation for ETLS protocols and its implementation; likewise between central government’s and border officials’ respective understanding of ETLS protocols. Many issues traders face are simply illegal - tolls, bribes, corruption - and a pervasive attitude of officials preying on traders persist.”

This was in 2010; over 30 years into the implementation of the ETLS. Three years after the report was published, the situation is not any better, so why stick to it?
The Nigeria Customs Service has also reported huge revenue loss as a result of the implementation of ETLS even at it has claimed several times in the past that some importers are hiding under the scheme to smuggle goods that did not originate from the sub-region into the country.
Former Customs Area Comptroller, Seme Border of the Nigeria Customs Service, Abubakar Sahabi, said the command lost N1.2 billion to the abuse of ETLS in the first half of 2012 while N998 million was lost to the scheme in the first half of this year.
Indeed, almost all the Customs Commands lose money, one way or the other to ETLS.
It is my view that due to the monumental loss Nigeria has suffered under the scheme, only agricultural products, handicrafts and crude products be allowed to be traded freely under the ETLS scheme in the sub-region. 

The folly of import prohibition


Countries ban importation of certain items mostly to protect their local industries but in Nigeria, the resultant effect is more often than not, the opposite of that intended by government.
I have taken time to study our country’s import prohibition list as published on the website of the Nigeria Customs Service. I think it will easily qualify as the world’s longest prohibition list. In all, there are 24 headings under the list. They include:
1. Live or dead Birds including frozen
2. Pork, beef
3. Birds eggs
4. Refined vegetable oils and fats (but excluding linseed, castor and olive oils. Crude vegetable oil are however not banned from importation)
5. Cocoa butter, powder and cakes
6. Spaghetti/Noodles
7. Fruit juice in retail packs
8. Waters, including mineral waters and aerated waters containing added sugar or sweetening matter or flavoured, ice snow (but excluding energy or health drinks, liquid dietary supplements e.g. Power Horse, Red Ginseng etc) and beer and stout (bottled, canned or otherwise packed)
9. Bagged cement
10. Medicaments falling as indicated below:
• Paracetamol tablets and syrups
• Cotrimoxazole tablets syrups
• Metronidazole tablets and syrups
• Chloroquine tablets and syrups
• Haematinic formulations
• Ferrous sulphate and ferrous gluconate tablets
• Folic acid tablets
• Vitamine B complex tablet (except modified released formulations)
• Multivitamin tablets, capsules and syrups (except special formulations)
• Aspirin tablets (except modified released formulation and soluble aspirin)
• Magnesium trisilicate tablets and suspensions
• Piperazine tablets and syrups
• Levamisole tablets and syrups
• Clotrimazole cream
• Ointments – Penecilin/Gentamycin
• Pyrantel pamoate tablets and syrups
• Intravenous fluids (dextrose, normal saline etc)
11. Waste pharmaceuticals
12. Soaps and detergents in retail packs
13. Mosquito repellant coils
14. Sanitary wares of plastics (but excluding baby feeding bottles) and flushing ceinstern and waterless toos toilets.
15. Rethreaded and used pneumatic tyres but excluding used trucks tyres for rethreading of sized 11.00 x 20 and above
16. Corrugated paper and paper boards and cartons, boxes and cases made from corrugated paper and paper boards, toilet paper, cleaning or facial tissue excluding baby diapers and incontinent pads for adult use and exercise books
17. Telephone recharge cards and vouchers
18. Textile fabrics of all types and articles thereof and yarn including African print (printed fabrics) e.g. Nigeria wax, Hollandaise, English wax, Ankara and similar fabrics
Carpets and Rugs of all types; but excluding lace fabrics, georges and other embroided fabrics; made-up garments and other textile articles.
19. All types of foot wears and bags including suitcases of leather and plastics (but excluding safety shoes used in oil industries, hospitals, fire fighting and factories, sports shoes, canvass shoes all Completely Knocked Down (CKD) blanks and parts)
20. Hollow glass bottles of a capacity exceeding 150mls (0.15 litres) of a kind used for packaging of beverages by breweries and other beverage and drink companies
21. Used compressors, Used air conditioners and used fridges/freezers
22. Used motor vehicles above fifteen (15) years from the year of manufacture
23. Furniture but excluding baby walkers, laboratory cabinets such as microscope table, fume cupboards, laboratory benches, stadium chairs, height adjustment device, base sledge, seat frames and control mechanism, arm guide and head guides, skeletal parts of furniture such as blanks, unholstered or unfinished part of metal, plastics, veneer, chair shell etc, motor vehicle seats and seats other than garden seats or camping equipment, convertible into beds
24. Ball point pens.


The ban placed on a good number of the items listed above have much more serious side effects on the economy than government may be willing to admit.
Except for a few, most of the listed items have insufficient local substitutes. The ban on importation of textiles for instance is ill-advised because all the textile mills in Nigeria have closed shop due to the high cost of production. It is impossible for our textile mills, with the erratic power supply and poor state of infrastructure in the country, to manufacture products that will compete with the cheap Chinese imports that flood our markets.
The consumption of textile materials is very high and since local production is insufficient, smuggling is bound to thrive. When there is a huge demand and when the supply line is cut off, people will naturally look for other avenues/options available to them. This is what has led to importing these goods through unofficial channels. We all know what impact these unofficial channels have on the official economy.
The point I try to make here is that if there is sufficient local substitute for an item, then it will make a lot of sense to prohibit its importation but where there is an obvious gap in local production, banning such item will only fuel smuggling. With the porous nature of our borders, it is important to ensure that local substitutes are also able to compete in terms of price and quality with imported ones before a ban is put in place otherwise, the cheaper imports will soon find their way in and send the local manufacturers packing.

We see all these banned items everywhere; at the supermarkets, at local shops, by the roadsides; name it. The items are smuggled in and government is unable to charge import duties on them because they are banned. It is double loss to the economy.
Government’s new stance on rice importation, for instance, is ill-advised with the imposition of 110 per cent Customs duty. There is a huge gap between consumption and local production. According to government statistics, yearly consumption of rice is about 5.5 million metric tonnes with local production accounting for about 1.8 million metric tonnes, thus necessitating the need for importation to bridge the gap. Unfortunately, because of the excessively high import duty imposed at the beginning of this year, more than half of these imports are smuggled into the country.
An analysis of the vessels coming into the country at the Lagos Port Complex, Apapa revealed that since the beginning of this year, only one rice vessel has discharged at the port whereas more than 10 vessels were discharged monthly prior to the 110 per cent import duty policy. And there has not been scarcity of imported rice in the market simply because Customs operatives are incapable of stopping the commodity from being smuggled into Nigeria. Shipping lines simply discharge the commodity at Cotonou port and allow smugglers ferry it, in small quantities, into Nigeria.
What government has done with this long prohibition list, and other import policies that were not properly thought out before they were slammed on the economy, therefore, is promote smuggling with its attendant consequences.
It is not too late take another look at the list and other smuggler-friendly policies. 

Using God to cover-up non-performance


It was Mrs. Margaret Onyema-Orakwusi, Chairman of the Nigeria Maritime Expo (NIMAREX) Planning Committee that invited me to the formal launch of the autobiography of erudite scholar, foremost constitutional lawyer and Senior Advocate of Nigeria (SAN), Professor Ben Nwabueze sometimes last month at the Nigerian Institute of International Affairs (NIIA) in Victoria Island, Lagos. The invitation did not hold much fascination for me but I have tremendous respect for Mrs. Onyema-Orakwusi whom I have worked closely with on various committees including NIMAREX for a while. Besides, I love reading biographies and autobiographies. I have read quite a number of stories of great men and women and this has helped me tremendously in my life journey. I thank my stars that I finally decided to honour the invitation.
Apart from listening to beautiful speeches delivered by notable figures such as former Secretary General of the Commonwealth, Chief Emeka Anyaoku; former Abia State Governor and Chairman of the All Nigeria People’s Party, Dr. Ogbonnaya Onu; the Obi of Onitsha, Nnaemeka Alfred Achebe and Prof. Nwabueze himself; the review by the Chairman of the National Human Rights Commission, Prof. Chidi Anselm Odinkalu, was the most intelligent and liveliest book review I ever listened to.
What impressed me immediately was that the book wasn’t launched. It was only unveiled and presented to the audience. Moneybags were not called to the podium to show off their wealth and make pledges of financial donations which they might not honour. What a sweet relief, I said to myself. There was no arm twisting of any kind by the organisers to raise money from the guests.
The book was on sale, the Master of Ceremony announced, and anyone interested in purchasing copies should meet the ushers outside. This was a radical departure from the typical Nigerian book launch.

I quickly bought both volumes of the former Education Minister’s autobiography at the cost of N16,000 and started reading right from the car.
I soon discovered that Prof., as Nwabueze is fondly called by his admirers, is not your regular run-of-the-mill person. He has got a mind of his own and is not under any form of pressure to conform to the norm.
I was particularly impressed about his independent-mindedness on issues and especially on religion. While he admits being a Christian, he does not attend church services simply because he believes many of our ‘men of God’ are not really Godly.
Of interest to me in this column this week is his criticism of President Goodluck Jonathan’s use of God as a decoy for non-performance.
He believes Europe has deliberately used religion to implant the mentality of subservience in Africans, including African leaders. He cited two incidences through which this mentality of subservience has manifested, one of which concerned him personally. The other incident, according to him, had a national dimension. Please permit me to quote directly from the book:

The other incident that occurred recently on 14 April, 2012 was a speech by President Goodluck Jonathan during a national prayer breakfast meeting attended by senior Christian clerics and at which the sermon was delivered by Pastor Ayo Oritsejafor, President of the Christian Association of Nigeria (CAN). In the speech, as carried in the Sunday Independent newspaper of 15 April, the President said that the election of himself, his Vice-President and the State Governors was the choice of God, and that, by their election, God wanted to use them to solve the needs of Nigerians for peace, security, health care and electric power. He further said that “there is nothing that God cannot do”; he then went on, not only to affirm his confidence that “with Him on our side, every stumbling block on our way shall become a stepping stone into national rebirth”, but also to assure that “God who begun a good work in our country will perfect it until the day of Jesus Christ.” The speech was punctuated at every turn by references to God and “supplications” to him to “transform” the country, using its elected functionaries. The speech certainly manifested a mentality of subservience implanted in the President by Christianity.
As The Patriots, of which I am Chairman, pointed out in its reaction to the President’s speech, it is a truth, sanctified by the collective wisdom and experience of humankind, that God helps only those who help themselves, not those who wait helplessly for God’s salvation, like manna from heaven. The implementation and accomplishment of the needs of Nigerians mentioned in the speech requires that the entire nation, men and women, the young and the old, should be mobilized and galvanized for the task. This first step, which is necessary before we can qualify for God’s help, has not been, and is not being, taken.
To qualify for God’s help in the “daunting” task of “national transformation”, the country needs, furthermore, a leadership whose sincerity of purpose is so transparent as to induce people to adopt the desired new patterns of behavior in place of the old ones and whose dedication to the cause is sufficiently total and selfless to inspire confidence, a leadership that is seen to be practicing what it preaches. People cannot be persuaded by the leadership to be honest, public-spirited, patriotic, faire-minded, law abiding, devoted, disciplined, and to abhor corruption, etc, if the leaders themselves do not practice those virtues. Far from inspiring popular change in the desired directions, a leadership that does not practice what it preaches, and is not seen to be doing so, creates disillusion and disenchantment among the people.

A leadership of the kind described above is what is required by “national transformation” talked about by the President in his speech; it means one and the same thing as a Social Revolution led by a person imbued with, and fired by, a revolutionary ardour; a leader highly motivated in the national interest and in the cause of national transformation, a leader prepared to commit suicide by sacrificing his vested economic interests and ambition to stay in power. Certainly, “national transformation” requires more than prayers at “a national prayer breakfast meeting”!!!
As long ago as 1937, in his book, Renascent Africa (1937), at page 191, Dr. Nnamdi Azikiwe, the Great Zik of Africa, the acclaimed Father of the African Revolution against European colonialism in the continent, reproached the Nigerian politician of those days for not having the stomach for revolutionary action.
He looks to God for everything. He wants God to help in raising cocoa prices. He wants God to cause the firms to reduce their prices to suit his purchasing power. He wants God to soften the heart of Government so that his will may not be ignored by an official majority.
Today 75 years after, we are waiting for and praying to God to transform for us, our nation threatened with collapse by an all-pervading rottenness brought upon it by our greed and selfishness, aggravated by a lack of fervor for revolutionary action on the part of our political leaders.
I have quickly added Nwabueze to my list of most admired personalities. I simply love the forthrightness, candour and independence of mind of the 82-year old professor.
And his take on President Jonathan reminds me of what we are suffering in the maritime industry, in the name of God. The leader of the apex maritime regulatory agency speaks in like manner with the President. What Nwabueze said about His Excellency, therefore, aptly applies to the NIMASA helmsman. We need to get our hands dirty and stop passing the buck to God. 

Obasanjo, a maritime hero


“History will forgive us for taking wrong decisions but will never forgive us for not taking decisions at all.” - Author unknown

Notwithstanding the various criticisms that trailed his administration, I believe former President Olusegun Obasanjo did more for the growth and development of the maritime industry than any other Nigerian Head of State, including the incumbent.
I cannot readily identify any concrete evidence, in over six years, of a burning desire to develop the maritime industry. The Jonathan/Sambo years are as bad as the YarÁdua/Jonathan years.
Critics might contend that it is too early to judge President Jonathan’s two years old government but I say nay.
Right from his first year in office, Obasanjo showed a clear understanding and demonstrated the political will to tackle the various challenges confronting the maritime industry.
In 1999, Obasanjo left no one in doubt that his administration would reform the ports. He started with reforming dock labour – the one strong force that held the shipping sector captive for over a decade through the dreaded Maritime Workers Union of Nigeria (MWUN). It was clear that without a reformed dock labour industry and without breaking the stronghold of MWUN on the shipping sector, no meaningful progress would be achieved.

The Joint Docklabour Industrial Council (JODLIC) was set up in 2000 under the now repealed Nigerian Dock Labour Decree 37 of 1999 after the dissolution of the National Dock Labour Board in 1999 to achieve the reform objectives. JODLIC subsequently transformed into the Joint Maritime Labour Industrial Council (JOMALIC) following the enactment of the Nigerian Maritime Labour Act of 2003 which Obasanjo promptly signed into law. JOMALIC was a tripartite organization made up of workers’ representatives, employers and the government in line with the recommendation of the International Labour Organization (ILO).
JOMALIC became as a veritable platform for industrial labour relations and conflict management/resolution in the maritime industry.
By the time Chief Ojo Madueke took over from Dr. Kema Chikwe as Obasanjo’s second Transport Minister in 2000; the ground had been prepared for a definite move against the then tyrannical leadership of the MWUN. The action was swift and decisive – laying a solid foundation for the port reform of 2006. On this score alone, no Nigerian leader compares to Obasanjo in not only having a good understanding of the industry’s problems, but of possessing enough political temerity to tackle the problems.
President Obasanjo wasn’t done yet. In 2003, he signed the Coastal and Inland Shipping (Cabotage Bill) into law.
The Cabotage Law was spearheaded by then Chairman of the House Committee on Marine Transport, Hon. Okey Udeh, and was collectively driven by stakeholders in the maritime industry. It was a collective action backed by President Obasanjo.

The Cabotage Law – now bastardized at the stage of implementation – was a culmination of agitations by Nigerians to participate more in the country’s domestic shipping trade in line with their counterparts in over 50 maritime countries worldwide. The law intended to open up coastal and inland shipping business to Nigerians. About a decade down the line, Nigerian ship owners are not any better though not because the law was not well conceived but because those charged with its implementation decided to circumvent it.
The intention of government at the time was to use the instrumentality of the Cabotage Act to institute a liberal protectionist maritime industry policy for the resuscitation and protection of the local shipping industry from incapacitation due to the domination of carriages from point to point within Nigerian waters. It also was also meant to check unhealthy competition from the highly subsidised foreign vessels.
We all believed at the time that through the Cabotage Act, the local industry would be able to control and become very strong in domestic shipping before venturing into regional or international shipping where it would then be able to withstand competition from the highly subsidized foreign ships in international shipping.
After the Cabotage Law came the big one – the Port Reform of 2006. Nothing would stop Obasanjo from implementing his reform agenda for the ports. Not the workers, not the outcry of a few uninformed lot and certainly not the absence of a separate legislation for that purpose. In the President’s opinion, and rightly so, the Nigerian Ports Authority (NPA) Act provided sufficient cover for the exercise.

But for Obasanjo’s doggedness in performing that painful, but necessary, surgical operation on Nigerian ports seven years ago; we would have experienced a total meltdown in the system and the Nigerian economy would have paid dearly for it.
I align with the assertion of the Chairman, Shipping Association of Nigeria, Mr. Val Usifoh, when he described Obasanjo as the saviour of Nigerian ports.
Following closely on the heels of the port reform was merger of the National Maritime Authority (NMA) with JOMALIC. That merger became effective on August 1, 2006, giving birth to the National Maritime Administration and Safety Agency (NAMASA) which later became the Nigerian Maritime Administration and Safety Agency (NIMASA).
One month to the end of his administration, Obasanjo signed the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) Act.
The Council was charged with, amongst other responsibilities, regulating and controlling the practice of freight forwarding in Nigeria and promoting the highest standards of competence, practice and conduct among members of the profession.
It is clear, therefore, that not only did the former President hit the ground running with regards to the developing the maritime industry, he was able to sustain the tempo all through his tenure.
But what do we see today in terms of President Jonathan’s interest for the industry? Nothing, I must say. Apart from appointing a Senior Special Adviser on Maritime Affairs whose impact the industry is yet to feel, nothing meaningful has been achieved under this regime for the shipping sector.
President Jonathan made one attempt to address the challenges of the industry last year. Specifically on 23rd July 2012, he hosted the Presidential Maritime Security Retreat on Harnessing the Potential of Nigeria’s Maritime Sector for Sustainable Economic Development at the Presidential Villa in Abuja. At the end of the retreat, a committee made up of eminent persons in the maritime industry and chaired by Transport Minister, Senator Idris Umar, was set up to make far reaching recommendations to the President on how to develop the maritime industry. The Committee has since concluded its assignment and submitted its report but one year after, the report has neither been made public nor implemented. That is how serious this government has been with the ‘transformation’ of the maritime industry! 

Another look at the cost of doing business in Nigerian ports (Part 2)


Trapped in the morass of a thieving and an uncaring governing elite that has done everything but govern well, the Nigerian Ports that constitute one of, if not, the most veritable gateways of trade between the import-driven economy and the rest of the world, appear riddled with endemic corruption. Everywhere you go, from the Federal Ministry of Transport, the supervisory ministry that overseers the entire gamut of transport and logistics industry; the Nigerian Ports Authority – a major parastatal in the maritime sub-sector, and to the Nigerian Customs Service – the para-military agency that polices the land, air and sea borders of the country, all your nostrils can sniff is the putrid stench of corruption. And, to all intents and purposes, the three major priorities in all these agencies are: corruption, corruption and corruption.
Dan Amor, June 2012
Last week I identified corruption by operatives of government agencies as one of the main factors responsible for the high cost of doing business at Nigerian ports. I intend to illustrate this assertion with practical examples.
Jamiu (not real name) is a Superintendent of Customs. He was posted to Tin Can Island Port in 2009 from Katsina State. Jamiu borrowed N10,000 from a colleague in Katsina to travel down to Lagos to resume at his new post. Today, he lives in his own house, worth over N60 million, at Palmgrove in Lagos State. Jamiu is already the envy of a good number of his colleagues, including senior officers. His children attend one of the most expensive schools in Lagos and he’s rich enough to sponsor them on summer vacation to Europe or America every year.
Jamiu works in the Customs valuation unit at Tin Can Island Port where he is the second-in-command. Making money is as simple as it can be in the unit. Agents stream to the unit everyday to negotiate with officers on the value of the consigments imported by their principals. The lower the value of the goods, as determined by the valuation unit, the less the importer pays in import duty into government coffers. It is a matter of negotiation. And it is a cash and carry business. Any importer or agent that is not willing to settle will have to contend with the high value assigned to his consignment by the valuation unit. The unit rakes in over a million naira daily and as 2IC, Jamiu goes home with over N100,000 – the equivalent of his monthly legitimate salary – daily. Part of the unit’s collection is used to settle the ogas at the top outside the unit at the command, in the zone and in Abuja.

Jamiu and his colleagues will do everything possible, including seeking spiritual interventions, to remain in their position. Promotion is not even desirable for them at this time, after all there are several very senior officers including Comptrollers and Assistant Comptrollers General of Customs that are struggling financially because they have to make do with their salaries only.
Khalil (not real name) is a manager level official of the National Agency for Drugs Administration and Control (NAFDAC). He was posted to the Lagos Port Complex, Apapa three years ago. He heads the NAFDAC inspection team.
Khalil’s posting to the port was sheer providence as he never lobbied for the posting but now that he has tasted the pudding, he is not ready to let go easily. He will also do everything possible to remain in his present position.
Statutorily, some consignments must be approved by NAFDAC before they are released by Customs to the owners. NAFDAC officials have to stamp and sign the release documents of consignments that fall into such categories. Khalil’s team charge anything from N50,000 to N200,000 to stamp a document. Non-cooperation by the importer or agent means days of delays which will translate to more cost to the importer.
Khalil and his assistant collect over N600,000 unreceipted money through this means. Of course, part of the illegal proceeds is used to settle the big bosses in the office.
Police officers and security personnel of the Nigerian Ports Authority (NPA) are not left out of the odious system. They make money mostly from truck operators. It is difficult or impossible for any truck to enter any of the two ports in Lagos – the Lagos Port Complex Apapa and the Tin Can Island Port Complex – without settling the security operatives. The average settlement sum is N5,000 per truck for a trip into the port.
The above are only some examples of the numerous profiteering schemes devised by officials of government agencies at the port.
The lack of regulation of the government officials coupled with the connivance of the superiors have led to a litany of ignoble corrupt practices in the port system.
The flagrant and pecunious graft that exists in the port translates to more cost to the importer and this is eventually passed on to the final consumer. 

Another look at the cost of doing business in Nigerian ports


Private terminal operators have inadvertently become the whipping child of Nigerian ports. Nigerian Ports Authority (NPA) used to be at the receiving end of the blame game before port concession but that has since changed with the coming of port concession in 2006.
Whenever people mouth ‘high cost of doing business at the port’, without much thoughts, they readily point accusing fingers in the direction of concessionaires.
I think this is rather simplistic and a reflection of lack of deep thoughts and understanding of port operation in the country.
The truth is that private terminal operators have not only done much to improve the fortunes of our ports, they have also reduced the cost of doing business within their own spheres of influence.

Minister of National Planning, Dr. Shamsudeen Usman, who visited the port penultimate Friday succinctly captured the contribution of the terminal operators when he said “Any ship that comes into Apapa docks immediately but the time of discharge will depend on the type of cargo to be discharged. Before the concession, many ships were waiting to berth such that you see a large number of ships lining up to the Atlantic waiting to berth but now it looks as if there is no business going on in the port. What we see now is due to the work that all these terminal operators have done in the port.”
The Minister, who led the Policy and Monitoring Committee of the National Council of Privatisation (NCP), to the Lagos Port Complex, Apapa also said that port operation in Nigeria has come a long way, stating that “obviously with all the improvement and investment taking place we are heading to a situation where there is a significant headway.”
“For instance, the additional surcharge imposed on every containers coming into Nigeria has been removed and this has been a significant benefit to the importers and those who are doing business at the port”, the Minister stated.

What the Minister said had been stated severally in the past by other leading personalities and keen watchers of port operation in the country.
The situation in our ports today, especially due to increased volume of import by about 200 per cent over the past seven years, would have been worse but for terminal operators.
But port operation and its associated costs are way beyond the direct influence of private terminal operators. There is more to it than that. As a matter of fact, the amount paid to terminal operators, according to the Managing Director of APM Terminals Apapa Limited, Mr. Dallas Hampton, is less than 2 per cent of the cost incurred by importers in the logistics chain. Where then lay the big chunk of this cost of doing business at the port?
In my opinion and from years of observation, high import duty, corruption and bureaucratic bottlenecks are the major reasons why Nigerian ports remain the most expensive among ports in the West African sub-region. Not terminal handling charges or progressive storage charges.

High import duty, corruption and bureaucratic bottlenecks are the factors responsible for the high cost of doing business at Nigerian ports by way of increasing the amount of money importers spend on taking delivery of their consignments out of the port.
As a matter of fact, the costs incurred by port users as a result of these factors becloud the worthy gains of port concession.
Apart from being compelled by the Bureau of Public Enterprises (BPE) in 2006 to charge 30 per cent less than what NPA used to collect as Terminal Handling Charges, port concessionaires have succeeded in reducing the dwell time of vessels, improved turnaround time of vessels and enthrone, to a reasonable extent, efficiency in port operation.

Despite the improved turnaround time, unnecessary delay of vessels by government officials upon arrival and before departure is still commonplace.
Time is money in shipping and that is why in other climes, conscious efforts are made to avoid delaying a ship because the cost implication may be as much as $10,000 an hour. Elsewhere when a vessel arrives the port, it sails straight to berth and begins to discharge almost immediately while regulatory authorities simultaneously carry out their regulatory duties. But not so in Nigeria! When a vessel arrives at our port, it is first kept waiting for about six hours by the authorities under the guise of searching, rummaging and performing other regulatory functions. The vessel is also kept for an average of another six hours after discharging before it is allowed to sail. So unlike at other ports, a vessel calling at Nigerian ports wastes an average of twelve hours to bureaucratic bottlenecks. The average cost of this on a medium size ship will be about $120,000 (N19 million).

Will the shipping company absorb this cost? Of course not, it will pass it on to the shippers and consignees.
Delays in the clearance of cargo also contribute to the high cost of doing business. Many importers and agents do not commence the process of clearing their cargoes until the vessels arrive. If the clearance process could commence pre-arrival of vessels, most consignments would be cleared within the first three days of arrival which are rent free days and thus substantially reduce charges associated with storage payable to terminal operators and demurrage payable to shipping companies.
A publication titled Why Does Cargo Spend Weeks in Sub-Saharan African Ports? written by Gaël Raballand, Salim Refas, Monica Beuran, and Gözde Isik and published by the World Bank last year ranked Nigerian ports as having the highest cargo dwell time in Sub-Saharan Africa.
The book was the outcome of research conducted on ports operations in six countries in the region.
The authors of the book claimed that most ports in Sub-Saharan Africa have average cargo dwell times of about 20 days, compared to three to four days in most large international ports. They blamed the trend on the low level of professionalism of importers and clearing and forwarding agents and the strategies of shippers.
Apart from bureaucratic bottlenecks at the ports, corruption is also a major culprit. I will dwell more on this some other time. 
 

The burden of Nigerian seafarers

 

 On Tuesday 25th June, 2013, we all gathered again on the occasion of the 3rd Day of the Seafarer event to pay tribute to the hard work and bravery of sailors worldwide.
The work of a seafarer is one of the most difficult, dangerous and challenging jobs in the world today. Away from family and friends for many months at a time, in multinational crews with others who may not speak the same language, seafaring can be a tough, lonely and hazardous career.
The International Maritime Organisation (IMO) had chosen this year's theme for the Day of the Seafarer celebration as Faces of the Sea. It was a natural evolution, according to IMO, from last year’s successful theme of It came by sea and I can’t live without it. Fundamentally it moves the theme to bringing the campaign back to the unsung heroes of shipping – the seafarers themselves and literally spotlights the human face of shipping and the sacrifices that seafarers make.
In 2010, the Diplomatic Conference which met in Manila to adopt milestone revisions to the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers (the STCW Convention) and its associated Code, also agreed that the unique contribution made by seafarers from all over the world to international seaborne trade, the world economy and civil society as a whole, should be marked annually with a Day of the Seafarer. The date chosen was 25 June, the day on which the amendments were formally adopted.

The campaign objectives are to increase awareness among the general public of the indispensable services seafarers render to international seaborne trade, the world economy and society at large; and to redouble efforts at the regulatory level to create a better, safer and more secure world in which seafarers operate.
In addition to the natural hazard of the job, Nigerian seafarers face several other challenges including incomplete training, joblessness, poor remuneration and stagnation.
As I sat in the hall gazing at the face of one seaman after the other; I realized that hope is still far off for majority of them.
Many are not even seafarers yet in the true sense as they have been stuck mid-way in their studies because they are unable to acquire relevant seagoing experience to qualify for Certificate of Competency.
To work as a crew member on a commercial vessel, possession of a Certificate of Competency is compulsory.

A good number of Nigerian cadets especially those of the Maritime Academy of Nigeria, Oron spend a long time in the labour market. This problem is compounded by the fact that they are unable to acquire seagoing experience on board ships.
Different Ministers of Transport have promised to address this issue. Such promises were made once a year usually during the annual passing out parade of the Maritime Academy of Nigeria. And that is where such promises end. They are more often than not mere political talks.
In fourteen years of reporting the maritime industry, I have not seen any major step taken to address this shortcoming.
The few fortunate Nigerian seafarers that have jobs are poorly remunerated while the unemployed are in the majority.
While their counterparts elsewhere are handsomely paid to make up for the high risks they face in the course of doing their jobs, Nigerian seafarers are languishing in abject poverty, unemployment and penury.
I have been a significant part of observing the annual Day of the Seafarer in Nigeria and I am aware that it is the same tale of woes year in year out. Who then is listening? Who will lend a helping hand to these hapless seafarers?

I have heard it said severally that life would have been a lot better for the seafarers if the Joint Maritime Labour Industrial Council (JOMALIC) had not been merged with the defunct National Maritime Authority (NMA) to give birth to the Nigerian Maritime Administration and Safety Agency (NIMASA). The argument was that JOMALIC, as an agency of government dedicated to the seafarers and dockworkers’ well being, had a narrow focus whereas NIMASA has a lot of issues contending for its attention. Perhaps so. Perhaps not.
While Nigeria’s ratification of the Maritime Labour Convention (MLC) 2006 has been greeted with so much euphoria, it may not hold much promise for seafarers who have not completed their trainings or who have no jobs. It protects only those in employment. It does not guarantee anyone job or sea-time experience.
It is my opinion that NIMASA needs to step in to help the Cadets broker arrangements to acquire relevant sea-time experience. That way, they can complete their trainings and become competitive in the open market.
It is also my opinion that Nigerian shipping companies should be empowered and supported to survive so that they in turn will provide employment to Nigerian seafarers even if it is for coastal water operation.