Mr. Aminu Umar is the president of the Nigerian Indigenous Ship-owners Association (NISA). In this interview with Anozie Egole, he speaks extensively on the challenges in the sector and the way forward.
“There are requirements for the CVFF to be disbursed, but unfortunately the problem is that the existing guidelines do not support any business so there is need to change the guidelines”
“More than 90% of piracy issues are happening in that localized area of Brass”
What is your assessment of the maritime industry so far this year?
It depends on if you segment it, if you segment the shipping industry into different categories of vessels that is, we look at tankers. For tanker owners, this year 2019 has been very challenging, it has been difficult for tanker owners, the market has not been there, it is a very depressed market for tanker owners because the market is totally taken over by the government through the NNPC. So it has been a very challenging year for tanker owners, likewise for the offshore boat owners; already the market has been depressed for the past three years. It has been a very challenging market in the past three years for off shore segment of the ship owners. There are so many interventions by the government through the NNPC that is keeping the market totally down and depressed. I think there should not be intervention by NNPC in the sense that the government has no hand in business, the private sector should be allowed to be the ones to play in the industry. If NNPC wants to play in the industry, they should encourage Nigerian ship owners and not to bring in foreign ship owners to subsidize them and by that making it difficult for Nigerian ship owners to operate, it is not the way to do it. Likewise, in the offshore oil and gas industry I think there should be more room for Nigerians to participate and in those segments of the market, one of the major challenges we are having is funding. The cost of funding is highly expensive, all the investors in the shipping industry have taken funds from the banks which they are refunding at a very high rate and which is making it highly impossible for us to compete with foreign ship owners. So it is making it difficult for a Nigerian ship owner to operate in the market; one he is competing with the foreign ship owner who had a subsidized cost of funding and long-term funding which a Nigerian ship owner does not have. The cost of funding is not subsidized and then the long term funding is not available for him, he is only having short time funding. Secondly the government is interven
ing in the tanker market where they are encouraging taking international ship owners who already have cheap cost of funding and bringing them to remove Nigerian ship owners who are not getting anything from the government.
We, the ship owners in the country what we want to see is for NNPC to stop supporting the foreign ship owners and stop subsidizing their activities. Because the more they subsidize the more it creates a depressed market and killing the business for the private sector and more or less running the private sector out of business. Because they are not borrowing fund while the private sector is borrowing funds.
Recently there was an issue between dockworkers and IOCs over wages, how would you access the level of the compliance by the IOCs?
On the issue of dockworkers and the offshore terminals operators, I understand that they have reached a compromise with the NNPC and they have come to an agreement with the Nigerian Ports Authority (NPA) on that because I think the NPA are in charge. So I understand that they have got an agreement and they are already making the payments, they are complying. So I think they are working under the NNPC subsidiary and they have come to agreement with NPA on that, so it has been resolved.
There seems to be increase in the pirate attacks on our waterways, how would you respond to that?
I think you have to look at it in three different dimensions, one is for vessels that are transiting from Lagos to Calabar; these attacks have more or less localized at a certain place which is close to Brass area of Bayelsa. Most of the attacks now are happening around that area, more than 90% of the piracy issues are happening in that localized area of Brass, between Brass and Isagbami. Then you have piracy issues, when vessels are on the offshore anchorage. If you look at all the anchorages in Nigeria waters today, both Lagos offshore, Warri Port Harcourt, Calabar among others, you will only see attacks happening for people that drop anchor at Bonny offshore. But these days no vessel drops anchor at the Bonny; it only goes inside anchorage. For vessels that are in the ports, we don’t see any more attacks like it used to be, so I think there is an improvement.
Talking about piracy, there have been a lot of strategies put in place by NIMASA to ensure that piracy becomes a thing of the past, do you think those strategies will help fight pirate attacks?
To be honest, I don’t think in our association we have been briefed on these developments, however, whatever it is that anybody can do to reduce piracy is welcomed. But however we have not seen what the C4i is all about; I think Nigerian needs a system that will be checking the movement of vessels along the coastal area; that is the best thing to get. Whether it will improve the security of vessels, we do not know. Like I told you, some of the vessels are attacked not directly at the coast; maybe 30-50 nautical miles away.
What do you think can be done to revive ship ownership in Nigeria?
One is to get us funding; it is very important, number two is to see how you can reduce the cost of funding and the third is to create the market and by market, I mean the tankers where NNPC is intervening. There should be a place where NNPC will be restricted to only take vessels that are owned or belonging to Nigerians or flying the nation’s flag. So it is not possible for the government company to be the one to take vessels to foreign companies to compete with Nigeria citizens. This is what we think should not be allowed because something like this is not done anywhere in the world.
Are you comfortable with many ship owners’ associations spring up?
There is no difference in all the associations both the one headed by me and others we are all the same, the one different is SOAN, but so far we are all working together, there is unity, we have been working together.
How would you access the Nigeria ship registry committee which was set up by NIMASA and which is headed by Engineer Emmanuel Ilori?
The target is for the nation to be the best ship registry in the world. I understand that it is an implementation committee that have been inaugurated. So the committee has in the membership one of the biggest classification society in the world that is Lloyds. One of the major problems we ship owners have is registering the ships with Nigerian flags. It is very difficult to register, it is not friendly at all and it is not recognized internationally. So what we are saying is that this committee should try and ensure that the class is well recognized by all the classification societies and international bodies. They should also make sure that it is business-friendly and that it has respect and integrity all over. Then the processes should be streamlined because the processes today are very cumbersome, slow and difficult which is of no use and it is not like that anywhere in the world. So to encourage people to register ships in Nigeria you should make the system very easy going and not a very difficult and bureaucratic process which is also very expensive. The committee can change it and make things better. NNLG is also part of it, if you remember NNLG has up to 14 vessels and these are one of the most sophisticated vessels in the world. But NNLG which is Nigeria-owned or driven company which is 40-50 % owned by Nigerian government, went and register their ships outside; not in Nigeria. Because of what I told you it is not standard. Nigeria flag is not recognized, the processes are very difficult, the expertise is not there, but now the committee is going to change all that. NNLG is also part of the committee, so I am 100% sure they will make it better this time around.
What is NISA doing about the issue of the disbursement of the CVFF?
There is a committee being headed by the former DG of NIMASA; Temisan Omatseye, it is a committee on Cabotage and I think part of the mandate of the committee is to look at those areas of the disbursement of the CVFF, guidelines on the disbursement and way of preventing people from stealing the money, the processes that will help Nigerian ship owners.
The truth is there are requirements for the CVFF to be disbursed, but unfortunately the problem is that the existing guidelines do not support any business, so there is need to change the guidelines. So NIMASA has set up a committee which Mr Omatseye is heading, he has been meeting with all the stakeholders and I am sure he had met with almost everybody including NISA, SOAN, Master Mariners, Seafarers Association, Association of Engineers and all that. So let’s see what the committee will come up with, we believe that in the next few months to come the report will be there. You know Temisan is an ex DG of NIMASA, so he knows how it works.
Do you support the move the NSDP should be scrapped, that it has failed?
To be honest with you, I can’t agree less, personally I don’t see the relevance of that programme to the country. The young men that are being trained are being given the right training and at the end of the day, seafarer’s training is not about getting information from the classroom, it is what you have to undergo for a long period. It is like training a medical doctor is not all about going to the classroom. I think we should encourage MAN, Oron and any other institute in the country to do the training well. Then we should also encourage Nigerian ship owners to be able to take these guys and also give them on-board training. Because that is what is supposed to be done instead of encouraging international institutions who are just collecting money and bringing half-baked seafarers into the country.
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