Even though it was predicted, not everyone thought seriously that it would be as bad as it turned out to be. Certainly, 2016 gave a lot of hurting punches to maritime industry stakeholders.
With the unprecedented sharp drop in the price of crude oil , no one was in doubt that, government would 2016 put pressure on revenue earning sectors and agencies, and this is where the maritime sector , especially the maritime sector.
We recall vividly that 2016 started with an all-time and sustained fall in the value of Naira against major currencies, like United States Dollar, Euro and Pound Sterling. From an exchange rate of about N280 to 1US$ in 2015, the Naira was plummeted to as low as 480 by end of 2016. The same ratio applies to Euro and Pound.
For an import-dependent economy that is faced with falling value of the Naira, in 2016, the Nigerian importer was also confronted with a terribly unfriendly import policy, especially the shut-out of 41 items from the official foreign exchange window.
In response to these policies, the ports started experiencing down turn in vessel and cargo traffic. Statistics reeled out by the Nigerian Ports Authourity also showed that 341 vessels entered Nigerian ports in September 2016, the lowest in nine months and a fall from 400 recorded in August 2016. Cargo throughput also dropped from 6.3 million metric tonnes in January to 5.6 million in September, which is also the lowest in the year.
According to the NPA, 3,347 ocean-going vessels estimated to be laden with about 100,152,274 metric tons called at Nigerian ports as at September 2016.
And as 2016 was running to an end, the Federal Government (through the Nigeria Customs Service) dropped another bombshell – it banned importation of vehicles into the country through land borders.
All these are indications and signs that 2017 may not be any better than the year(s) before it. And as if to confirm our fears, the Federal Government has started reeling out its fiscal policies for the year, and they are anything but, importer-friendly.
We like to recall that the journey to the present actually started towards the end of 2014, when the then- Minister of Finance; Dr. Ngozi Okonjo-Iweala gave inkling as to what 2015 would look like; she dropped the bombshell that Nigeria should be viewed henceforth as a non-oil producing nation and needs to explore new revenue sources as a result of the decline in the price of crude oil. True to her warning, the price of oil has been falling unprecedentedly. The 2015 budget was predicated on crude oil price of $US73 per barrel, 2016 was lower, while 2017 is far lower.
That is how far and bad it is, and we are happily now in 2017; a year that will further test the wits and survival of maritime industry stakeholders.
The decision of the Federal Government to reduce import duties of 115 items in different sectors of Nigeria’s economy is expected to enhance port activities.
Really, not much has changed in terms of the structures, superstructures and operators that we have. The issues of 2016 will still remain as issues in 2017. From the access roads to the terminals and jetties, to the channels on to the creeks of Niger Delta, we may not experience significant changes.
Sadly, in 2017, the Federal Government will still expect so much revenue from the sector, which has been touted as second and complimentary to the oil sector.
Finally, our wish list for 2017, which (sadly) may not be any different from that of previous years will include issues such as: the passage of the Port and Harbour Bill, complete rehabilitation or reconstruction of the two roads leading to Lagos port and other ports in the country, The Port and Harbour Bill, which incorporates the Independent Port Regulatory Commission (IPRC), enjoys an unenviable record of being one of the most delayed and the most controversial legislations since return to democratic rule in 1999.
Also, we are very hopeful that the CRFFN logjam will finally be resolved in 2017 to enable the body put its act together and get back to the good old days.
It is our hope that, as we move into 2017, Nigerian ports will take advantage of the new port-friendly policies and witness high vessel and cargo traffic.
Happy new year to you all!
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