At Port News summit, stakeholders condemn foreign dominance of Nigeria’s shipping business, seek review of NIPC Act

Maritime industry stakeholders have expressed concern over the growing domination of Nigeria’s shipping business by foreign owned companies, saying it is undermining local content development and pushing indigenous operators to the fringes.

Speaking at a summit themed “Port Reforms & Local Content: Has Nigeria Fared Well?” organized by Port News in Lagos on Wednesday, the stakeholders noted that many indigenous companies are being pushed out of the market by foreign firms, which are taking advantage of the lack of effective regulations and policies to dominate the sector.

In his keynote address, Chief Executive Officer,
Centre for the Promotion of Private Enterprise (CPPE) Dr. Muda Yusuf called for a review of the Nigerian Investment Promotion Commission (NIPC) Act to protect indigenous investors in the maritime sector.

The NIPC Act, enacted in 2005, Yusuf said gives foreign investors unlimited access to all sectors of the economy, hence the need for it to be urgently revisited.

Yusuf clarified that while he is not advocating for the displacement of foreign investors in the sector, there is need for a deliberate policy action to support and elevate the level of indigenous participation in the maritime sector ecosystem.

“We cannot afford to be spectators in the sector.
We have local capacity in clearing and forwarding, cargo handling, terminal operations, haulage, warehousing and many more. The unfolding scenario is that most of these jobs are being taking away from indigenous players in the sector. Indigenous investors need policy support to curb their growing exclusion in the sector, ” he said.

Yusuf cited the example of the United States of America, which has implemented protectionist policies to safeguard indigenous jobs, and suggested that Nigeria should follow suit.

He also lamented that the Cabotage Act, enacted in 2003, to develop the local shipping industry, has not been effectively implemented.

The CPPE boss ccalled on the Nigerian Maritime Administration and Safety Agency (NIMASA) and the Nigeria National Petroleum Corporation (NNPC) to step up efforts to implement the law and disburse the Cabotage fund to indigenous shipping companies.

He also recommended replicating the Local Content law of the oil and gas sector in the maritime sector, which he said has had a significant impact on indigenous capacity in the oil and gas sector.

In his remarks, Chairman of the occasion and Managing Director, Integrated Oil and Gas, Captain Emmanuel Iheanacho noted that while Nigeria have made progress in its port reforms and local content development, challenges such as limited connectivity to inland transportation networks,
inefficient clearance processes,
limited capacity and expertise among local companies to compete with established foreign companies still persist.

To fully realize the potential of the maritime sector and support indigenous operators, Iheanacho urged the government to continue to implement policies and programs to support port reforms and local content development.

He said, “Continuous efficiency and performance audit of the port operating processes must be regularly carried out. Investing in infrastructure and technology to improve efficiency and reduce congestion at ports

“Providing training and capacity-building programs to support local companies and increase their participation in the maritime sector.

“Providing an opportunity for access to business finance at competitive rates by indigenous port terminal operators,”

General Secretary of the Association of Bonded Terminal Operators, Haruna Omolajomo in his submission faulted the 2006 port concession for excluding bonded terminal operators.

His words, “There is no indication or signs that our ports reforms have any positive relationship with the local content because no local content operation is accommodated in the reforms. Even if yes, it is on paper; not in practice. The reforms were hastily done not considering how local shipping would have future growth.

“Therefore, my submission is that the local content did not fare well for Nigeria or Nigerians. The port reforms never translate into the growth of local content as it is obtainable in Ghana, for example. Rather, it is a case of re-colonization.

“The Bonded Terminal Operators are still struggling to survive. As at 2012, out of 25 registered members of Bonded terminal operators, five had closed shop due to serious debts that threatened their lives and existence.”

In his welcome address, the Publisher of Port News, Mr Wale Oni, expressed concern over a situation where foreign companies have simply made Nigerian operators spectators in their own business environment.

Oni said, “Why have the terminal operators and foreigners seemingly ganged up against Nigerian bonded terminal operators by denying them container transfers/perhaps , there is a technical or operational deficiency, some very difficult, rocket science puzzle that sets us behind and which our expatriate counterparts need to teach us.

“Nigerian operators have lost the plot, they are mere onlookers. What can we do to correct these anomalies? How do we introduce and sustain a mutually beneficial working relationship between terminal operators and the concessionaires of our huge port terminals with cargoes.”