Success Nwogu 
SUCCESS NWOGU writes on stakeholders’ views on how maritime can advance Nigeria.
Prominent stakeholders have called for the full maximization of the great potential of the maritime sector in Nigeria. They said that sector could raise trillions of dollars of revenue for the nation if well harnessed.
The Founder and First President of the Nigerian Shipping Chamber of Commerce, Dr. Olisa Agbakoba, (SAN) , in an interview with Sunday Telegraph said that Nigeria is a maritime country without realising it.
He said that smaller countries around Nigeria such as Ghana, Angola, Togo, and Benin Republic, are bigger maritime countries than Nigeria.
He explained that this is so because they have rules and regulations that work which Nigeria, according to him, do not have.
He advised that it is imperative for the country to have rules and regulations and everybody plays by it.
According to him, Nigeria can be one of the most industrialised countries in the world.
Agbakoba, who is Senior Partner, Olisa Agbakoba Legal (OAL) advised that there should be appropriate leadership to harness the resources of the nation, including in the maritime sector.
He said: “Shipping alone is very huge. And it needs regulators to shape the industry, so that Nigerians can come and dominate it. How can Belgium, small as it is, or the Netherlands, small as it is, be a bigger maritime nation than us? What are the solutions? The solution is to have the appropriate leadership, not only in the maritime sector, but across Nigeria.
“There is the need for the appropriate political leadership. To understand that, we can be one of the 10 most industrialized countries in the world. By the way, India is number four in the world. So, if India can be four, I don’t see why we can’t be two before India. Brazil is number six. So, these are countries that are on the southern side. We are not even talking about the usual western economies you know about. India, Brazil. Why are we not like them? The imbroglio in River State, does that help development? There’s too much destruction. There’s too much about 2027, rather than development. So back to the maritime, we should maximise the maritime potential of the country.
“The macro-developmental field of Nigeria is important to what happens in the maritime field. That’s my point. The maritime sector cannot succeed if the larger field is not working. We need a lot more. To tap the massive opportunities and contribute to Nigeria’s Gross Domestic Product (GDP).”
Managing Partner , Olisa Agbakoba Legal (OAL), Mrs. Yvonne Ezekiel, called for a non-litigation resort during disputes in shipping matters.
She stated that the matter could be amicably addressed in such a way that all the parties, including the ship-owners, and financial institutions do not lose revenue and rather have a win-win-situation.
According to her, there should be the adoption of ship management as a strategic commercial solution for distressed vessels, which she stated would ensure business continuity, asset sustainability, and profitability in the nation’s maritime sector.
She spoke at a recent OAL’s Breakfast Meeting on Ship Management and Marine Projects, with the theme: ‘Ship Management: A Commercial Strategy for Business Rescue.”
Ezekiel, who heads the Corporate and Business Advisory Practice, OAL, also called for better management and strict application of resources in the sector.
She said: “And therefore, at some point down the line, they run into trouble. And of course, the fact that with regulators, you have a multiplicity of regulators, a multiplicity of charges, right? And then even for ship owners, sometimes some of them may not decide the ship for maintenance as very key. They may not put a good focus, the right type of focus on maintenance.
“So, what happens is that the ship runs into trouble and then of course, they are not able to continue to work or put the ship to work. And if they’re not able to put the ship to work, it means they’re going to run into trouble when it comes to repayments or loans back on their lenders. So those are from the ship owners’ part, that’ is expected.
“Now, from the bank, so the bank says, ‘yes, we know that people are going through trouble,’ but there are certain factors that they look into when they have to finance the acquisition of a vessel. So first, some of the key factors are that they expect that the person should at least, have been in the business for some period of time, let’s say three to five years, to show a track record that, ‘you know, I’ve been in this business and I can do it.’ For the bank to have the comfort that, ‘okay, you know, we are comfortable lending to somebody who has shown that he’s got the experience and expertise to do that.’”
She added: “Also, the fact that he says you have to also look at who are the backers behind this venture. Are they reputable enough for us to keep our money in there? And then talk about the fact that, you know, also for maintenance, when the banks lend money to the vessel owners, part of what they’re taking into consideration is that there will be some downtime to be able to keep that vessel maintained. Now, obviously, if you don’t factor that money into it, it means that somewhere down the line, they’re going to have a payment issue.
“But they also look at the fact that if you’re looking for funding for one vessel, they expect that you should also have had other vessels that are on the combat, so that those vessels can help you manage your cash flow and help you with payment when your ships are being maintained, like some dry dock, being maintained and renovated. So, those are some of the areas that they have mentioned. But then, they also reference the fact that ship management is a way that they are looking at, because Stanbic Bank in particular, as we mentioned that they have an experience, they’ve experienced the ship management model as a form of business rescue.
“They see it as a viable way to help all parties have a win-win situation. So, at the end of the day, it’s all back to the key topic of today, which is: ‘Ship management as a model of business rescue,’ as a model for business community and business opportunity. Because what you don’t want is to pack your vessel, let your vessel somewhere and get damaged.
“That’s a legal aspect. But legal, you know, when you acquire a vessel, you have to see that you’ve got them, you need to see money paid as well. So, the home loader comes in where the bank is actually an issue, where you cannot pay your loan, and the bank has to call in, try to call the loan, okay? Also, even for the ship owner himself, he knows that ‘I don’t have the capacity to manage the vessel,’ that he wants to do this. So, the thing is, obviously, there has to be a contract, a chapter contract, especially when the company enforces the bank, there has to be a chapter contract between the ship owner, the bank and the ship owner himself.
“If it’s just a direct ship owner and ship manager, you know, a direct contract between them. So, it’s to understand that there has to be a tight contract. And like one of the speeches has advocated, you don’t feed the commercial parts of the business to the ship owner.”
President of the Ship Owners Association of Nigeria (SOAN), Mr. Sonny Eja, noted that there are harsh financial realities in the sector.
He said there had been cases where oil clients pressured shipowners to slash daily rates by as much as 40 per cent, which greatly reduced the shipowners’ profit.
Eja said there had been delays in the disbursement of the Cabotage Vessel Financing Fund (CVFF) and noted that this has not advanced the sector. He commended the Nigerian Content Development and Monitoring Board (NCDMB), which had successfully administered similar funds and urged other institutions and sectors to borrow a leaf from NCDMB.
President of the Nigerian Shipowners Association (NISA), Otunba Adewunmi, decried the underfunding and structural inefficiencies as well as regulatory overlaps in the sector.
He said: “You have Quarantine, Customs, and multiple other agencies all doing similar checks,” which inflate costs and deter serious investors.”
Managing Director, NBC Maritime Limited, Captain Nicolas Bernard, said there is a strong will to address some of the gaps in the maritime sector in Nigeria.
He, however, said the country was growing in the sector.
Bernard said: “Well, the shipping industry in Nigeria, if you look at the scale of the sub-region, is way more advanced than any other countries in the continent. What the CABOTAGE Act did to Nigeria in 2 years of existence is unprecedented anywhere in the world.
“It succeeded for Nigeria to develop a complete marine and shipping ecosystem, where there are ship owners, there are shippers, there are cargo interests, vessel interests, there are people trading, and this is, to me, is the best asset of Nigeria, and the asset that is to be cultivated, to give more food than the ones which were given already. And in this sense, is there a gap of quality remaining between the Nigerian shipping market and the rest of the world and the rules in operation? Yes, there are.
“But there is a strong will, and I can feel it in Nigeria, from some ship owners and some interests to bridge that gap. And I’ll be happy to assist them and to advise them because the success of Nigeria is the success of the community at the global scale.”
