Nigeria : Absence of national shipping carrier costs Nigeria $4m daily, says Ogbeifun
- 11 February 2021 / Analysis / 134 / Africa-BI
The memory of the defunct Nigeria National Shipping Line (NNSL), came to focus at a symposium organised in honour of the former Chairman of Ship Owners Association of Nigeria (SOAN), and CEO of Starzs Shipping Company, Greg Ogbeifun, turns 70 today.
At a virtual symposium, which focused on the possibility of building an indigenous global shipping fleet, experts explored the need to resuscitate the country’s national carrier to reduce capital flight following the death of the NNSL.
Ogbeifun recalled the heydays of the NNSL, saying Nigeria played an active role in the shipping business when the company was active. “Besides, the Nigerian shipping line, there were some private initiatives by individuals like Capt. Emmanuel Iheanacho, who flew the Genesis flag around the world and a few others,” he added.
He noted that as a result of the nonexistence of a national carrier, Nigeria loses over $41 million daily to other countries. According to him, the loss includes tax revenues and jobs that would have been created back home.
The national carrier coupled with private initiatives, he said, had put the country on the global shipping map but “unfortunately, due to a multiplicity of factors, this enviable national capacity we used to have does not exist today.
“Nigeria now depends on foreign-owned or foreign-registered vessels to carry our imports and exports, both wet and dry cargoes. And the economic loss to the country is tremendous.”
According to him, the Ministry of Transportation has made several attempts to kick start the process of reviving the national shipping line. He recalled that the Minister of Transportation, Rotimi Amaechi, had set up two committees for the purpose and reforming NIMASA.
One of the committees, he said, “was to work on the establishment of a national fleet while the second was to examine the structure of NIMASA.”
The first committee, which he was part of, the celebrant said, was to, among others terms of reference, find out what countries with the sustainable national fleet were doing differently.
“Kuwait, for instance, has over 100 supertankers. Nobody can touch their oil unless they use their ships,” he said, adding that the policy has a positive impact on employment and the socio-economic life of its citizens.
He said the committee also understudied what Greece has done to get the national shipping fleet right and build a globally-renowned business around the sector.
Ogbeifun said the committee also visited the United States and China on a fact-finding.
The major difference between Nigeria and countries that are doing well in the shipping business, according to Starzs CEO, “is the tax regime.
“The host country gives you a tax holiday of about five years because they recognise how capital-intensive the business is. Value-added tax (VAT) and tonnage taxes are reduced. What the country will lose in not collecting taxes from the new Ship, they gain in job creation.
“The Nigerian situation, however, is a different ball game. Government policies, in most cases, tend to limit the capacity of players to compete on a level playing field.”
He recalled that the last ship he built was constructed in China and that he “insisted that that ship must be flagged; Nigeria and crewed by Nigerians. I flew Nigerians to China to bring the ship”.
To bring the ship to Nigeria, Ogbeifun said he paid a total of 14 per cent of the cost price of the ship in duty among others. The $18 million ship was built to execute a project for one of the International Oil Companies (IOCs).
In her incisive lecture, the lead paper presenter, former Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Mfon Usoro, said Nigeria “needs a national carrier to ferry its cargoes around the world – America, Asia and Europe”.
The former NIMASA boss made a case for a national carrier, saying its benefits far outweigh its challenges that have held the country back from making progress in its effort to revive the line for decades.
Analyste: Greg OgbeifunChairman of Ship Owners Association of Nigeria (SOAN), and CEO of Starzs Shipping Company...
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