Foreign vessels account for 80% of Nigeria’s CABOTAGE trade, SOAN laments

November 19, 2020
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THE Ship-owners Association of Nigeria (SOAN) has raised the alarm that foreign shipping lines are breaching Nigeria’s Coastal and Inland Shipping (CABOTAGE) Act in the carriage of petroleum products in the downstream sector of the economy.

In a letter dated 4th of September, 2020 and addressed to the Director General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Bashir Jamoh, the SOAN lamented that foreign vessels account for over 80 per cent of the Cabotage trade in Nigeria’s downstream sector.

According to the letter which was signed by the SOAN President, MKgeorge Onyung, and sighted by the Nigerian Tribune, “Foreign vessels currently enjoy Nigerian government incentives/waivers which are denied to indigenous operators.

“While indigenous ship-owners pay Nigerian Ports Authority (NPA) tariff in full and in US Dollars, foreign ships enjoy reduced NPA tariff and pay in Naira.

“Foreign vessels also receive payment for freight in full and always pre-paid, remitted to offshore bank accounts of these foreign vessel owners; while payment for freight for Nigerian flagged vessels is always post-paid and comes in after six months.

“Again, no Nigerian seafarer is employed by these foreign shipping lines benefiting from the nation’s downstream sector at the detriment of indigenous operators. Despite NIMASA spending huge public funds to provide sea time training for Nigerian cadets abroad, none of the 321 foreign vessels involved in DSDP imports or coastal shuttle fleets in Nigeria has accepted any of these Nigerians onboard for manning or seatime training.”

On way forward, the SOAN President advocated for the enforcement of the revised cabotage Act implementation guidelines. In the words of the SOAN President, “NIMASA should work closely with the Nigerian Content Development and Monitoring Board (NCDMB) for joint categorization of vessels operating under the Cabotage Act in-order to ensure full implementation of its provisions.

“Relations between the NNPC, her marine subsidiary, NIDAS MARINE, and their supply chains must include transfer of technology know how, issuance of bankable contracts to Nigerian ships, employment of Nigerians to man vessels under their charter, and sourcing of local service providers in line with Cabotage laws as stated in their tender processes.

“Also, waivers granted to foreign vessel owners operating within Nigeria’s territorial waters should be suspended since indigenous capacity exists.

“NIMASA should issue a Marine Notice with a threat of sanctions to foreign shipping companies who collude with foreign ship owners to reject Nigerian vessels from STS operation for petroleum products lighter-age offshore Lagos.

“Where local capacity does not exist, Bare Boat or Time Charter party should be encouraged with foreign vessel owners who should pay a more substantial fee to participate in Cabotage trade.”

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