Nigeria: 17 Yrs After, NIMASA Gets Govt's Approval to Disburse $200m Vessels Intervention Fund

11 August 2020

Lagos — After 17 years of contributing into the Cabotage Vessels Finance Funds (CVFF), Nigeria Shipowners can now heave a sigh of relief as the Nigerian Maritime Administration and Safety Agency (NIMASA) said it has secured approval to disburse the vessel intervention fund.

The CVFF was established alongside the Nigerian Coastal and Inland Shipping (Cabotage) Act of 2003, to empower indigenous ship owners to take control of the nation's coastal and inland shipping business, otherwise known as Cabotage trade.

The director-general of NIMASA, Dr Bashir Jamoh disclosed this in Lagos during a meeting with the Shipowners Association of Nigeria (SOAN).

He said only the fine details of the scheme were being considered before commencement of pay-out.

The meeting held virtually, was hosted by the agency at its headquarters. Jamoh stated that the minister of transportation, Rt.

Hon. Chibuike Amaechi, had approved the disbursement of the fund, meant to assist operators in the acquisition of maritime assets.

"Only the details are being discussed with a view to avoiding mistakes of the past and ensuring effective and efficient utilisation of the fund," the director-general stated.

He added that, "We have also submitted proposals to the minister to seek fiscal and monetary incentives for our shipowners."

The NIMASA boss also disclosed that the country remains steadfast in its decision to stop the use of single-hull tankers by December 31 this year,

"We are committed to the complete phase-out of single-hull tankers by December 31. Operators still using this type of tanker should make adequate preparation to comply because there will be no going back on this decision," he added.

The director-general described shippers as the beacon and hub of any developing economy, saying "the journey to success for the current management of NIMASA depends on the shipowners.

"We shall continue to pursue our functions of promoting and regulating shipping in collaboration with shipowners and all relevant stakeholders," he noted.

Many of the country's major shipowners participated in the webinar, including the SOAN president, Dr Mkgeorge Onyung; first vice president, Mr Eno Williams; Iro Ogbeifun of Starzs Marine and Engineering Limited; Emeka Ndu of C&I Leasing Plc; Kameel Najjar; and Oviebo Ambrose.

NIMASA had in 2015 revised the timetable for the phase-out of single-hull tankers operating in Nigeria.

This followed the decision of the International Maritime Organisation (IMO) to extend its deadline for ban on single-hull tankers for certain categories of tankers not engaged in international trade.

NIMASA utilised the IMO extension window to shift the final phase-out date for single-hull oil tankers to December 31, 2020. IMO's Revised Regulation of Annex 1 to the International Convention for the Prevention of Pollution from Ships (MARPOL) required flag administrations to phase out Category 2 and 3 single-hull tankers by 2015.

But it extended the deadline for some tankers not engaged in international trade owing to the difficulty in achieving wholesale fleet replacement.

Cargo Glut Hits Lagos Port

Meanwhile, the glut of cargo at Lagos seaport has led to the diversion of shipping vessels to other neighbouring terminals and ports in the country.

The glut is said to be orchestrated by inability to evacuate cargoes out of the seaports due to bad access road and the closure of the border with Benin Republic which has made Lagos ports witness a spike in volume of cargoes.

Importers that have abandoned their containers inside the ports, have made it difficult for ships to berth with new imports.

This is even as the Seaports Terminal Operators Association of Nigeria (STOAN) had earlier raised the alarm that their facilities are 90 to 95 per cent full due to the congestion.

At the Lagos ports, various container terminal, Roll-On-Roll-Off (RORO) and bulk cargo terminals are filled to the brim that they are unable to receive fresh cargoes.

However, the inability to receive cargoes have also increased the days vessels spent at anchorage to 50 days with indigenous and foreign shipowners accruing demurrage running into several millions of naira daily to secure their vessels from pirate attacks.

Containers are now arranged so much that there are up to nine

containers high in block stacking.

This arrangement makes positioning of containers a herculean task which makes clearing and delivery process painfully slow.

For instance, a vessel meant for ENL Consortium was transferred to Green View Development Nigeria Limited (GDNL) for lack of space to receive the vessel. Also, in March, a RORO terminal at Tincan Island Port Complex, Five Star Logistics said it had to divert vessels coming to its terminal due to inability to receive fresh vessels.

According to the general manager, Wolfgang Schneider, Five Star Logistics, the terminal had to divert vessels to another terminal at the Tin Can Island port due to absence of space to discharge the vehicles onboard the vessel.

Speaking on the congestion recently, the manager, Tincan Island Port Complex, Bello Abubakar, adduced the congestion to more containers coming into the country than the numbers going out.

He declared that shipping companies have failed to take the directive of acquiring holding bays where empty containers would be kept.

According to him, "efforts by the Nigerian Ports Authority (NPA) to enforce the directive were always frustrated as most of the shipping companies give non-existent addresses as location of their container holding bays."

He said most times, the ones whose addresses are correct often do not have access roads; hence, the empty containers are held at the back of trucks.

He added that in a bid to drop the containers and get another job, the truckers will queue up on the roads to the port in a desperate bid to return the empties on time to avoid losing deposits paid by importers.

He said traffic managers along the corridor do not help matters as they sometimes allegedly turn trucks back.

Abubakar further noted that the road construction is another factor militating against the evacuation of cargoes from the port.

"Some truck owners too may have shunned the private holding bays because of the cost of parking a truck in the terminal and demurrage accruing for failure to move the trucks at the right time", he stated.

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