Mr. Aminu Umar is the factional Acting President of Nigerian Shipowners Association (NISA). He is also a member of the Nigerian fleet expansion committee set up by Minister of Transport; Mr Rotimi Amaechi to workout modalities for enhancing Nigeria’s fleet in partnership with the Pacific International Lines, PIL.
In this interview with Shipping Position Daily correspondent; Dapo Olawuni, Aminu assured that the process would be transparent. He also alleged that the Nigerian Maritime Administration and Safety Agency is not discharging its mandate well despite the collection of sea protection levy from shipowners.
"On the proposed shipping line with PIL, Nigerian seafarers will work on, not only ships owned by this SPV, but on other ships owned by PIL and doing trade in other parts of the world"
“The real partners for NIMASA today are the Nigerian shipowners, we expect them to engage Nigerian shipowners”
How have you been coping in this hard time and considering the claim that shipowners are selling their properties to offset bank loans?
I have not heard of shipowners selling their properties to pay bank loans, Nigerian economy is in recession and this affects all business sectors and shipping is not excluded. If all the other sectors of the economy are having issues, definitely it would affect the shipping sector because the movement of goods and services would not be there. So, the recession is affecting us, but it is like every other sector in the economy.
Could you give us insight into how it has affected your business?
If you look at the level of activities, it has dropped by more than 50 per cent and since the level of goods movement has dropped by more than 50 per cent, it means that the number of ships coming into this country has gone down by 50 per cent. In the upstream sector where we have a lot of boats that provide services, because of the drop in oil price, most of the contracts and exploration businesses have been cancelled, so the sector has been hit with a drop in activity by more than 80 per cent, consequently, this has forced freight rates to cut down by more than 50 per cent, vessels that usually charge US$30,000 per day about one year ago are now charging USD$10,000 per day. So it is a total thing that has affected everyone because of the recession and the scarcity of foreign exchange. Shipping is a dollar based transaction, and since the dollar is very scarce, many of the activities that are supposed to be done have to be suspended pending when the dollar will be available, so presently, I think the overall shipping activity is down by more than 70 per cent.
Why have we not had NIMAREX 2016, is it cancelled?
So far, No. The reason it could not work in September as earlier planned is because we wanted to use it as a private initiative and privately-funded, but unfortunately, the NIMAREX funds that we are expecting from the private marketing companies have not yet been set up, because of the FOREX scarcity and the recession. However, we are still discussing to see if we can do it before the end of the year. We want to do something that is very successful, we do not want to do it the way it was done before by seeking donations from government agencies, we know this is not the right time, everybody now is facing financial difficulties, so we want it to be something that will add value to the Nigerian shipping community, not just a jamboree. So, in the midst of recession, FOREX issues, we feel that we would not get the real value if we push for the NIMAREX to take place, because many foreign companies that are supposed to come will not come, they would want to first see how our economy is doing and the stability of the currency. So until all these are stabilized, many international companies would not come and at the end of the day we would do a programme that would add no value to the shipping community.
How excited are you with the MoU signed by transport minister with PIL on re-floating of shipping line?
NISA is part of the project and we are in support, I was actually among those that accompanied the minister to Singapore to sign the MoU. PIL is one of the big liners in the world, they indicated their willingness to partner Nigerian shipowners and start up a company with Nigerian investors and shipowners together. Up till today, we don't have Nigerian shipowners that are into container vessels, multipurpose vessels or bulk carriers and even crude carriers, so if a big company in the world decides to partner Nigerian shipowners to transfer this technology, we all believe it is a welcome idea. It is an opportunity for Nigerians to participate particularly in the container line and bulk cargo carriers which nobody is doing today. There is a Nigerian fleet committee and very soon they would release the guidelines of how it would go. All members of NISA support the minister's initiative.
How does the MoU impact on our economy?
PIL is open to train Nigerians and do the transfer of technology and make sure that one day, Nigerians would also own and participate in the container liner business, even if it is within Africa. PIL has agreed to train Nigerians to be in the management position of this company, they have agreed to even employ Nigerian seafarers to work on not only ships owned by this SPV but on other ships owned by PIL and doing trade in other parts of the world, it is a great opportunity that has never happened.
We hope the process would be transparent and extended to every operator
I am a member of the committee and the committee members that we have are very straight forward and fair human beings, the guidelines that are being drafted would be open to everybody, many of the committee members would not even be shareholding members of the SPV, not because they don't believe in it, but because we want to be fair, it would be open to Nigerians and it would even be advertised in the dailies for months, the selection process would be done by an international consultancy company that would do it transparently.
Where does the CVFF come in all of these?
The target business of this venture is international business, this means that it does not fall under the Cabotage business, but the company after it has started running also has the right to buy assets that would trade in our Cabotage clime, if the company decides to invest in the Cabotage assets, they have the right to seek funds from the CVFF. The minister at our last meeting has said he was thinking of giving the CVFF to Bank of Industry who would husband it and distribute it according to the guidelines and laws of the Cabotage Act. We don't have anything against the minister giving it to the Bank of Industry to disburse it based on merit, any Nigerian who seeks it and merits it would get it, it should be open and transparent, the guideline would be published and anybody who seeks the intervention fund should be able to get it.
You were chosen to lead NISA about two years ago, what is the update about the elections this year?
We are going to call for another election, the mandate of our executives is supposed to finish in October, the excos are going to meet soon and people who want to vie for positions would be called in and anybody who wants to contest is free to do so, provided they meet the guidelines and conditions set up by the constitution of NISA. The excos will meet within this month and set all these in motion.
Should we expect to see you contesting to become the substantive president of NISA?
I am not a politician. I think the major thing for us is what we are facing in the industry and the economy in general, we have a new management in NPA and NIMASA, so what we should concern ourselves with is how to talk to these management to see that the promises and regulatory things that they do is something that is supportive to the industry, especially now that we are facing a lot of challenges in the economy and in the business environment. Whoever is running for the presidency of NISA, either myself or any other person, these are the key issues he should look at for us all so that we can come out of the recession period still intact and surviving, not that by the time the recession is over, no ship owner would be remaining.
What is your advice to the new management of NIMASA under Dakuku Peterside?
The new management team are welcome into the sector; our advice is that they should continue to engage with stakeholders especially the shipowners. The real partners for NIMASA today are the Nigerian shipowners, we expect them to engage Nigerian shipowners, to sit down and see how to improve the environment, they should have supportive policies and implementation of the regulations so that the more Nigerian shipowners, the more revenue and jobs NIMASA for NIMASA.
They are all new guys, we expect them to engage shipowners, though we have not had any meeting with them yet, but we intend to meet with them to tell them what we expect from them and what they expect from us so that we can all work together to improve the sector.
What is your take on the issue of piracy on our waters?
I think it has subsided for some few weeks now, but I just saw today that a ship owned by a friend had been attacked, though they did not succeed because the Navy repelled that attack, so it means the pirates are still there. The waters in the Delta outside the south of Escravos are totally still not safe, Nigeria is still considered a high risk area, I don't think the issue of piracy is gone yet. I think NIMASA particularly who is in charge of the safety of all ships within Nigerian waters and who all the shipowners pay sea protection level to, so that they could secure Nigerian waters, they are saddled with the responsibility to make sure these things don't happen, I think they should do more. The Nigerian Navy is doing the little that they could but the piracy is still there, so the issue is, NIMASA who is collecting the funds from us needs to sit with the Navy to see how they can assist them in providing materials and surveillance equipment to secure the hot zones.
Discussion about this post