Unfinished Business in Nigeria’s Maritime Sector

With about five months to stay in office, the Minister of Transportation, Mr. Mua’zu Jaji Sambo, who assumed office in July 2022, has a lot to accomplish based on the expectations of industry stakeholders before the May 29 curtain is drawn. In this report, Francis Ugwoke captures statutory industry obligations, including  dilapidated  ports infrastructure rehabilitation, ports concession agreement, cargo tracking note  deployment,  and National Transport Commission project, among others  requiring the Minister’s  execution  before May 29  end of President Muhammadu Buhari’s administration

Maritime industry stakeholders have always desired the appointment of an industry professional as Minister of Transportation. They showed this when Mr. Muazu Sambo, a former General Manager of the Nigerian Inland Waterways Authority (NIWA), was picked by President Buhari as Minister of Transportation in July last year. But they are anxious and indeed sceptical as to what he would achieve within such a short space of time. They wished he had come earlier. 

Sambo who was former Minister of State for Works had late last year spent time touring the maritime sector to study the system and identify areas that need urgent government attention. 

However, as the life span of this administration draws nearer, stakeholders have pointed out urgent areas of intervention of the incumbent administration before handing over to the next regime.  Some of the issues include those which the former minister, Hon. Rotimi Amaechi, could not tidy up before he resigned to contest the presidential election of the All Progressive Congress.  Among them include the quest for a national carrier which will further improve Nigeria’s shipping capacity, disbursement of the Cabotage Vessel Financing Fund (CVFF), and completion of the rail project with connectivity to the ports, including the new Lekki Deep Seaport. other issues include the rehabilitation of the ports infrastructure and renewal of ports concession agreements with terminal operators whose tenure may have expired.  

Ports Economic Regulation

Currently, the allegation of fraud is trailing port activities in Nigeria. Almost all the stakeholders are indicted in one fraud or the other. It involves all, ranging from importers, freight forwarders/customs agents as businessmen to providers of shipping services in the name of shipping companies and terminal operators. Those who are to police the system are not left out. There are some unscrupulous customs officers and other operatives drawn from agencies of government, such as the Standards Organisation of Nigeria (SON), and the National Agency for Food and Drug  Administration and Control (NAFDAC), among others. The operatives of these agencies allegedly feed fat on the illegalities of shippers. To address this issue is the Cargo Tracking Note (CTN) being championed by the Nigerian Shippers Council (NSC) as the ports economic regulator.  

CTN is seen by NSC and other critical stakeholders as having the capability of reducing fraudulent practices in the ports involving shipping companies that under-declare gross registered tonnage of vessels (GRT) to pay fewer charges. Similarly, shippers who under-declare,  conceal, and undervalue to evade payment of correct import duties are exposed to CTN which reveals every information on goods being shipped to the country even before arrival. 

 Observers are of the view that CTN could be the weapon with which the NSC as the umpire of the system needs to end all the issues of fraud in the ports system.  In this regard, all eyes are on Sambo on what becomes of the deployment of this instrument. 

 Eyes are also on Sambo and his ministry on the fate of the National Transport Commission (NTC) Bill which could not be signed into law by President   Buhari after the National Assembly forwarded it to him on two occasions.  

The former Minister of State for Transport, Senator Gbemisola Saraki, had indicated that this would be passed during the life of this administration. But not much progress has been heard of since she left. Industry stakeholders expect Sambo to pursue the bill to be passed before the next administration. 

 In the freight forwarding sector, so much is also expected as the Council for the Regulation of Freight Forwarding in Nigeria (CRFFN) is without a permanent office.  The agency had received N800 million approval under Amaechi to acquire a new office, but this was halted when the Board of the Council kicked against the office that was acquired.

  The allegation is that the property located in Lekki is not worth the value.  The minister had following this halted the move until he carries out his assessment of the situation. Sambo is expected to do this as soon as possible.  He can order renegotiation of the amount involved or order that the CRFFN look for another office space.  

The minister is also expected to play an important role in maritime developments bothering on expectations from the  International Maritime Organisation (IMO)  where Nigeria may be seeking an election this year. 

Development of capacity, key infrastructure, sustaining victory against piracy within Nigeria’s territorial waters and the Gulf of Guinea, bilateral relations and deepening of contact with other members are important for Nigeria to win the category  ‘C’ election.  The job has already started with the invitation and visit of the IMO Secretary General, Kitack Lim,  to Nigeria recently. 

But more needs to be done. Sambo needs to be on his mark to see that the Nigerian Maritime Administration and Safety Agency (NIMASA)  maps out strategies to win the election. The minister is also expected to cooperate with other agencies, including the  Nigerian Inland Waterways Authority (NIWA) and Maritime Academy of Nigeria  (MAN),  Oron,   for robust water transportation and human capacity building. NIWA and MAN are embarking on some development agendas that will need the approval of the Minister to see the light of day. 

Economy

As the apex maritime agency, NIMASA has a lot of statutory obligations.  With a core mandate in deepening indigenous shipping development, NIMASA  indeed has its hands full. To a large extent, the agency has performed creditably. But many stakeholders believe that there is still more to be done. And of course, the agency is currently carrying out a lot of development efforts as far as maritime is concerned. To the  Nigerian stakeholders and the international community, the agency has done well in the area of the Deep Blue Project or the war against piracy. The rate of piracy incidents in both the territorial and Gulf of Guinea has all gone down. What is however expected is that piracy should not be allowed to rise again for whatever reason. The agency is also championing the blue economy project. Last year, the agency visited littoral states as part of the efforts in pursuing the blue economy strategy expected to replace the current oil economy in about 10 years.  Industry stakeholders say this should be pursued.

Cabotage Vessel Fund

Perhaps, what remains a major task for the  Minister of Transportation is the expected disbursement of the  CVFF. Many industry operators are looking forward to this. The former Transport Minister, Rotimi Amaechi, had promised to do this but failed.  Many believe that it is possible that the fund may not be there and that the ministers are yet to say the truth.  However,  the incumbent minister, Sambo, on assuming office has affirmed his readiness to disburse the fund.  If he succeeds, his name would be written in gold. If he fails, it would go to prove that the government may not have told the industry stakeholders the whole truth about what happened to the fund. 

Sambo recently announced receiving approval from President Buhari to disburse the fund.  He has in turn tasked the Central Bank and the Ministry of Finance to do the needful. Indigenous shipping operators are earnestly waiting for fulfilment before May 29.

Rail Links with Ports

The hands of the Nigerian Ports Authority (NPA)  are full, so to say. The organization may be keeping an eye on other deep projects just as the Lekki Deep seaport project is completed.  The seaport is slated to flag operations any moment from now. How it does this remains a task ahead considering the absence of rail links, though the federal government is working towards addressing this issue. Already, the Transport Minister apprehensive that the operation of Lekki Deep Seaport without a rail link may trigger terrible traffic in that area has ordered that only barges will be deployed.  This in effect means more cost to shippers who have to use barges to move their goods to either Apapa or Tin Can ports before other modes of transport could be deployed.  This to industry stakeholders will be very expensive for shippers and final consumers of goods. To stakeholders, this needs to be addressed as soon as possible.

The  NPA  is currently on assignment of rehabilitating seaports with bad infrastructure. The rehabilitation will involve virtually all the seaports where facilities have been discovered to be decaying after decades of use.  Stakeholders are of the view that rehabilitation should be fast before the new administration comes to power for obvious reasons.

Ports Concession Agreement 

One other pertinent issue in the ports is the review of the concession agreement that has expired. It has been on the front burner for some years now. The review started during the time of Hadiza Bala Usman as Managing Director of NPA. The outcome remained unclear until Bello-Koko took over from her. The Minister of Transport had directed that the exercise be completed as soon as possible.  Bello-Koko was reported to have carried out this assignment which is now on the table of the Minister who is expected to give his approval to the next level.  The outcome remains unclear and industry stakeholders want the issue to finally be resolved before May 29.