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Sunday, September 27th, 2020

Growing the maritime sector: Government-stakeholder model

by August 28, 2016 General

Globally the maritime sector is passing through challenges but it also provides opportunities for growth especially in developing countries where nobody can talk of excess capacity. In good and bad times alike government play a significant role in the growth of maritime sector through visioning, regulation, infrastructural development, creating the right environment,amongst others .

This is why the recent developments in Nigeria’s maritime sector is gladdening . We have a Minister of transportation who understands the power of the private sector and a regulator who knows that regulation can make or mar an industry .

For once industry players have absolute confidence that the regulator is up and doing ,focused and ready to make necessary changes to put the industry on a sound footing to run .  The global maritime picture is worrisome. There is excess ship building capacity in almost all the ship building centres of the world including China and South Korea that recently have been acknowledged as the topmost two ship building nations in the world ahead of Europe.

The fall in the price of crude oil has also affected the demand for new vessels and platforms . Funding of new ship facilities is a big challenge as return on investment has been slow . Competition for new projects is intense between China, Korea and Singapore on one hand and Europeans on the other hand . There is also a serious gap in skilled professionals which ordinarily the developing world should take advantage of. This is despite the fact that in China alone thirty four million persons are employed in the maritime sector yet China do not have enough trained personnel to man the industry.

The picture of maritime in Africa is not better. Despite new oil finds which should fuel growth in the sector ,the multiplier effect is not being felt. There are no new shipyards established in the past one year, vessels demand is not commensurate with expected trend mostly due to low price of crude oil and low investment in the oil and gas sector . Exports which is expected to boom has not grown geometrically. Africa thus has not maximized the benefit of excess capacity and low demand of vessels in Europe and Asia which could have seen a shift to Africa to handle the effect of competition.

Nigeria appears worse off in this interplay of forces . A new unpredictable forex exchange regime appears to stifle investment in the maritime sector by making it unattractive. Dip in price of crude oil which is the main driver of maritime growth in Nigeria has not helped matters . Insecurity and piracy has contributed to affect low vessel traffic to the Gulf of Guinea. Excess charges and multiple charges are also having negative impact in both import and export . Poor infrastructure at the ports and access road to the ports has further complicated the matter.

The country do not have a national fleet thereby tilting the balance of trade and cargo against her. It’s only natural area of strength skilled manpower is grossly underdeveloped . Nigeria thus have not taken advantage of its geographical location to assert itself as a maritime hub. Two developments seems to give observers of the industry hope of a bright future . One is the realization by Hon Minister of transportation Rt Hon Rotimi Amaechi that the private sector working with Government can change this gloomy picture . The second is the current leadership in Nigeria maritime Administration and safety Agency NIMASA which has proven to be visionary ,dynamic and goal oriented. This is what is referred to in the industry as Government- Stakeholder model for the development of the industry in Nigeria .

The federal ministry of transportation is driving the national fleet project through the private sector. This is to address the gap in cargo sharing , training needs of young cadets , employment opportunities that abound and restore the dignity of Nigeria at the comity of maritime nations without wasting government scare foreign resources. The ministry also intends to upgrade facilities at the ports soon using the public private partnership model . There has been increased industry networking since Amaechi assumed office as minister .

To complement the trend NIMASA ,the industry regulator seems to have suddenly recovered itself . Dr Dakuku Peterside the Director General has proven to be a competent, knowledgeable and determined driver . NIMASA does all within its power to ensure total enforcement of international standards as enshrined in various IMO instruments . NIMASA is also championing the creation of a critical mass of trained maritime professionals to take advantage of the global acute skill gap that will see to the creation of not less that forty million jobs around the world in the next five years in the industry. A number of new stakeholder supported maritime education and training were laid out recently to see that Nigerians play a leading role as seafarers . The NIMASA helmsman has adopted a number of local and international networking to solve complex problems, this has proven more than useful. His determination to fully implement the cabotage regime will see to the creation of at least ten thousand jobs in the next two years . The promise to reengineer the Nigeria ship registry and make it more technologically driven will see to the explosion of Nigerian flagged vessels and respectability globally . Connected to enhancing the reputation of Nigerian ship register is increased port state ( foreign vessels) and flag state ( Nigeria flagged vessels) control duties Dr Peterside seems to have deep passion to reposition the industry for accelerated growth and needs to be supported.

The effort by Federal Ministry of transportation and the industry regulator NIMASA will not pay off unless stakeholders both from the public and private sector play critical role in the change we are trying to implement. Government should set the tone and the framework and allow stakeholders to implement and drive a new order . Nigeria is a maritime goldmine waiting to be harvested .

  • Dr Ken Kirkbun is an IMO activist and researcher