Chief Olisa Agbakoba (SAN) is a former chairman of the Nigerian Bar Association (NBA), Principal Partner of Olisa Agbakoba Law (OAL) and a key maritime stakeholder. In this interview with PAUL OGBUOKIRI, he says that the Buhari administration, like the ones before it, has not done anything to develop Nigeria’s maritime industry. Excerpts:
What do you think is the problem with the Nigerian maritime industry?
The government has failed since the time of the Nigerian Maritime Act in 1987. The government has not enacted any policy to review, examine and implement a plan. So, what you see now is a heavy decline in the way maritime policy is carried out, in the way new laws are even made to meet new challenges.
So, all together, the industry is very sick and don’t forget that the maritime industry is strongly connected to the hydrocarbon industry that is, oil and gas industry because oil and gas industry cannot take place in the absence of the maritime industry in particular, crude oil. Everything used to explore it is maritime, shipping. Right now we have a case in court where the question is whether oil rigs are defined as ships under the cabotage regime as it is. Imagine if we are to remove the oil rigs. So, for me having been in the industry for a long time, I have seen that the Federal Government of Nigeria has no understanding of maritime policies.
It was assumed that the last administration was not up and doing in developing the maritime industry, we have a new administration in place which is almost two years old, what impact do you think they have made in the industry?
There is no change, it is clear there is no progress, and rather there are more declines. Just take Apapa as one of the key maritime areas; you can see the decline yourself. No roads, the port is in tatters. I told the Managing Director of NPA that the port is technically deficient. You cannot say it is an ocean going port anymore.
The original plan of Apapa was a port city not residential, but today, residential houses are everywhere. Apapa was filled with warehouses but because of lack of planning, it has become residential rather than a port city. A city can’t serve as a port city and a residential area at the same time. It will limit the scope of port efficiency. Coming to Apapa in the 80s, vessels would load their cargoes onto train and the cargoes would be moved to Iddo. As I said, because nobody has given careful thought to the ways ports are run, the port here is only about eight metres draft, serious ocean going vessels will be afraid to come here because they may run aground.
So even though we control over 80 per cent of the traffic in the West and Central West African, the ship owners will continue to be afraid to come here, rather they will prefer to go to the ports of the neighbouring countries from where the goods are now brought by roads to Nigeria. The Ports and Harbour Bill has been lying in parliament going to almost 10 years so which investor is going to come and say I have located this parcel of land here and will like to build a port. The problem is Abuja which excludes everybody in the planning process.
From the pictures you have painted, what should an ideal port look like?
If you look at Jabilali in Dubai, it is an ideal port, if you look at Shanghai or Singapore, these are ideal ports. It is so clear, they have open space which is number one, it must be able to transfer goods very fast, you must have mechanized and technical way of bringing in ships and clearing them.
There is need to define the relationship between government and business, you should not combine both. You should allow business people to invest, just like Dangote is doing but Dangote is doing his own taking a risk, there is no legal context in what he is doing, there is no law backing it up and I am sure he knows that.
It is an investment risk to embark upon building a massive refinery with a port without a law. Babalakin got his fingers burnt in aviation. What profit will anyone have if government is always doing policy summersault? You give someone a concession at the airport, it comes to exercising his concession, you give it to Arik, people are watching.
Look at Dangote and Erisco Foods, they set up multi billion naira industries to process tomatoes while the government allowed China to flood the country with finished tomato pastes, but I am happy to see today (Wednesday) that they have announced a new tariff that will keep away foreign imports because the only way you can grow the economy is by growing production capacity locally and the port is critical because it is from there you export what you want to export. Either way, whether importing or exporting, our ports are not able to perform those functions.
Expatiate more on protection of local industries viz-a-vis the ban on importation of vehicles into the Nigeria through the land borders?
The problem is that the policy of national treatment as it is called meaning that you create an environment to encourage local production; it is not just one finger. So banning cars from coming into the country through the land borders is only one side of the coin because you cannot ban cars from coming when your ports are in tatters, when your roads are useless. If you ban cars from coming through land borders, where do they come from – these ports?
These ones cannot bring in many vehicles so really, it is back to what we are saying that you cannot discuss the maritime industry until a holistic economic policy and the so called economic growth plan is put in place, it is still aspirational. I read the 40 pages of the aspirational values which doesn’t say exactly what they are going to do for instance saying that we are allocating N10 billion to fix the roads, it just says in seven years we hope to be. So, I haven’t seen any commitment on the part of government to grow oil and gas industry and the maritime industry. Indigenous ship owners have not been able to access the Cabotage Vessel Finance Fund (CVFF), how do you think they can access the fund?
Do you expect NIMASA to disburse the funds? I don’t think so. There is a difference between policy making and regulation. On business operations so unfortunately, NIMASA is given some responsibilities that is best done by the private sector so when NIMASA raises those funds from the freight charges or whatever, it can nominate a bank and deposit the money there and it is the bank’s responsibility to draw the lending process because they have the skills but when NIMASA now takes up the role of disbursing the funds, it has no capacity.
How does it assess those people who have come to borrow? It doesn’t have the skill, it is not its job so naturally, and the CVFF is lying dormant even though they said part of the money has been technically diverted but I just know that NIMASA doesn’t have the skill. I once told Dosunmu to name one DG that has assisted in buying one ocean going vessel apart from all these scraps that they buy, name one because if the key function of NIMASA is to develop the shipping sector, how come they are not buying ships? Not even one so you see it is a big problem.
Policy on carriage of crude oil: which do you think is better between Free on Board (FOB) and Cost Insurance and Freight (CIF)?
The Cost, Insurance and Freight is better. In the maritime industry, there are 36 value chains. I am surprised that the government didn’t know this when we had the Ribadu Committee set up by Diezani to look at how the maritime sector can be strengthened to raise revenue and block leakages. I told them that we have 36 value chains, four are of interest to me; shipping, banking, insurance and law. Of these four, the contribution of Nigeria that is us locally is less than one per cent.
So it means that when Shell brings up the crude from the ground under the FOB principle, they call the shots but if Nigeria turns it around and calls it CIF or writes a contract because we have a contract that says you are here to bring up the oil, once you done so, our people will take over, there will be a big difference and that is partly why the shipping industry is not working. The same thing in arbitration because am sure you may not know there is a lot in arbitration.
I just did one in the UK about a month ago and I was shocked that these are arbitrations concerning Nigerian oil, Nigerian money and we were in London, and I was the only black man there. When I looked at the yield in the legal services in arbitration to the economy there, it is 4.5 per cent but in Nigeria, legal and dispute services are not a sector, it is called other sectors. So what type of government do you have that can’t see that there is money to be made by Nigerians at these levels.
Mobil spends about $1 billion on legal services but no Nigerian lawyer gets it. We allow these guys to drill our oil here and insure it abroad, what sort of rubbish.
Then the worst is that you won’t bring your salary and say I should keep it in my account, you won’t say so but we keep our money in foreign bank accounts. Actually, it is Shell and other IOCs that put the money in and then they notify the Central Bank, the Director of Foreign Exchange to be precise. We discovered during the Ribadu Committee that an IOC delaying in notifying the Federal Government of sail will mean that Nigerian government loses millions because there is interest to the money. The man who holds the money holds it for longer than necessary before notifying you and he takes the interest.
NIMASA has given up till 28th of this month for abandoned ship owners to evacuate them or they be declared wrecks, what is your take on that?
It is under the law. The proper procedure before NIMASA was that Government In- spectors as they were then called, they were the receivers of wrecks then, they will send a notification to the Minister of Transport and he will authorised them to remove otherwise the waters will become accident prone. In fact, nobody knows that Lagos at a point was most dangerous port in the world because the vessels can hit something. There was a time some years ago that an airplane that landed in Port Harcourt hit six cows on the runway.
Air safety or maritime safety is paramount. This issue is actually NIMASA’s job but part of the problem is that is not exciting for anybody to go for wrecks because we don’t have steel industries. These wrecks is crushed and used in steel industries. No sane country will have the kind of wrecks we have here, in fact, some whites come here to buy wrecks and go away. The vessels you see in Marina, who owns the abandoned vessels, nobody answers that. What do they do with them? The law allows NIMASA to do that.
NIMASA is hosting the African maritime stakeholders in Abuja on from 19th to 21st, will you be there?
I am not going
Because every time there is a conference, even when Emeka was Minister of Transport and held a conference, I refused to go but the Director General of Chamber of Shipping persuaded me and I told him I am here and you know who I am and he said yes. We have been attending conferences, to me they are diversionary. Holding a conference to fix the Nigerian maritime, we need to make first decision to say we do away with FOB from the law and put CIF, do we need a conference for that?
If we don’t, we now need to tell the IOCs that we have a law called the National Content Act and by sections 3 and 6 of that Act, you are supposed to play a part in developing indigenous capacity.
In some aspects, engineering in particular, Nigerians are now getting work especially the new government policy and they are laying pipelines. That is the new law in the maritime industry. The foreigners could have decided in the olden days to choose who to use. So there is advantage in the Nigerian Content Development Act but the Content Act is missing out the legal services. Can you imagine if the government should insist to these IOCs, the legal works that would have come out for Nigeria lawyers?
Maybe the lawyers have been silent because I am not even aware legal content….
It is not us as lawyers. You are speaking to me as a man wearing two hats. First as a maritime stakeholder and also as a lawyer so if you ask me that whether as a lawyer, I think it is more of the maritime stakeholders that should play a role in putting pressure on government to make sure the laws work so that Nigerians play a role. The one thing I like about the US President, Mr. Donald Trump on his stance in his country’s businesses that have gone to Mexico.
He said how can we send them all our businesses and they are sending back the products to us because we are the market? I was in Malta at a conference and a permanent secretary in Cameroun who used Nigeria market as his reason why they should invest in Cameroun. If you invest in Cameroun, the market is here.
This thing is terrible, if you build a thousand cars per day for example, Nigerians would buy them so we are the consumers and produce nothing. My point is not just the maritime sector, it has to do with political, economic plans it has linkages with African development and capacity. The maritime is a very wealthy sector, a lot of money there. If the ports are working properly, we are looking at trillions of naira, we are looking at employment, job creation and many interlocking fallouts.
What do you think the government should do to bring out the potentials of the maritime sector?
What the government should do is to develop a plan and in developing the plan, we need to reach out to the people who have been in the industry. With greatest respect to Amaechi, he is new here and there is no way he will understand the sector as much as those of us who have been in the industry. So, it is important to have the minister call on people. It is like calling top business men and they tell you that what you are saying will not work.
There should be a forum where successful business men who understand the nitty gritty, who own businesses and ask them what he can do. He will hear something different from what the permanent secretaries are telling him. That is what we need to do we need to have people who understand how to build ports even though I am not a technical man I know that we have 47 inland waterways that the whites built. Not a single one is functioning yet we have NIWA sitting down there, yet we have road traffic congestion.
If you have ever gone round the waters of Lagos, you will indeed know that Lagos is a coastal city. The second advice I will give to the president is, don’t cut away the private sector. These are the people who constitute the engine of economic development not you. Your own is to listen to them and quickly respond and that keeps things going.
Yobe plans verification for retirees
The Government of Yobe State is mapping out arrangement to verify workers, who retired from January 2018 till date to enable it pay the appropriate retirement benefits. Disclosing this in a statement, Director-General, Press Affairs to the Governor, Abdullahi Bego, also revealed that the Governor, Ibrahim Gaidam, approved the payment of N670.73 million gratuities to 364 retirees and civil servants that died in the course of service.
He said Gaidam approved N670.73 million as gratuity payments to a total of 364 civil servants who have retired from the services of the state government. According to him, the approval covers the civil servants who have retired (or died) between August and December 2017.It could be recalled that in early January 2018, the governor had approved N1, 097, 896, 058.43 as gratuities to 631 workers who have retired from the services of the state government between January and July 2017.
AIB re-analyses crashes with resuscitated $5.8m lab
Nigeria, through the Accident Investigation Bureau (AIB), has resumed the downloading and analysis of black boxes of aircraft involved in accident in the country. This is seen as a positive development as the agency would save foreign resources that would have been used to take the important equipment to the U.S. or UK for the exercise.
The $5.8 million unserviceable Flight Safety Laboratory equipment at the Nnamdi Azikiwe International Airport (NAIA), Abuja, which was resuscitated last year, was put into use for the analysis of Dana MD 83 airplane that skidded off the runway while landing at the Port Harcourt International Airport, Omagwa, Rivers State, on February 21, 2018. The laboratories were equally used to decode and analyse the Gulfstream accident in Abuja and that of Delta that happened recently.
The laboratory was designed to download information from Flight Data Recorder (FDR) and Cockpit Voice Recorder (CVR) among others, which are necessary requirements for a thorough and accurate accident investigation.
The facility was used to download the flight recorders of Associated Airlines’ aircraft crash of October 2013 with the assistance of the manufacturers of the laboratory despite the fact that the agency had not effected full payment.
However, since the single usage in 2013, the facility had not been put to proper use due to lack of personnel to manage the laboratory. There were also challenges from the manufacturer’s end. The summary of the matter is that the laboratory was not working when the Commissioner, AIB, Akin Olateru, took over leadership of the agency, January last year. Speaking to New Telegraph at the weekend, Olateru, an aircraft engineer, said lack of funds almost hampered activities at the agency when he was appointed last year to head the agency.
He disclosed that AIB does not charge for anything it does unlike the Nigerian Civil Aviation Authority (NCAA), Federal Airports Authority of Nigeria (FAAN), Nigerian Airspace Management Agency (NAMA), Nigerian Meteorological Agency (NIMET) and the Nigerian College of Aviation Technology (NCAT)that charge for their services. Olateru further disclosed that under United Nations charter, AIB is not allowed to charge for its services, forcing the agency to be creative in funding its projects.
Worried by the situation of the agency, Minister of State for Aviation, Hadi Sirika, caused FAAN to cede five per cent of its revenue to AIB from its Passengers Service Charge (PSC). “In terms of funding, this is where I really thank the minister of state for aviation, the National Assembly for their extreme support to make sure AIB delivers on its core mandate and that, we have achieved with their support,” he added. Speaking on common factor of human error or human factor that usually lead to air fatality, the AIB chief said majority of crashes usually happened as a result of human errors. “Human beings all over the world are the most complex machine on earth. Anything that has got to do with human is bound to fail someday. This is why there is nowhere in the world that is not accident prone.
There is no airline today that you can say that does not have serious incident. There is no perfect system anywhere, but all we can do as a nation, responsible people and responsible agency is to ensure we step up the game in human factor.
“Human factor has been identified as the cause of accidents all over the world to and it is recommended that operators, service providers invest in that training to avoid or minimise human factor,” he said. Asked if the age of aircraft operating in the country’s airspace is responsible for the frequent incidents recorded in recent times, Olateru noted that age of aircraft had got nothing to do with airworthiness of the airplane.
FBN General Insurance grosses N3.51bn premium in 2017
FBN General Insurance recorded a gross premium of N3.51 billion in 2017. According to the firm, the account, which has been approved by the National Insurance Commission (NAICOM), revealed a 60 per cent growth in premium, moving from N2.2 billion in 2016 to N3.51 billion, while claims expenses also rose by 180 per cent from N270 million to N756 million. Profit Before Tax (PBT) closed at N322 million, also representing a year-on-year growth rate of 66 per cent.
The firm noted that the profitable growth was partly driven by improved asset and investment portfolio management, resulting in an investment income growth of 112 per cent. Managing Director/Chief Executive Officer of the firm, Bode Opadokun, said: “2017 was the year we consolidated on the strategic restructuring across key business functions.
This has inspired a profitable performance exemplified by our total assets recording an appreciable growth of 27% at year-end from NGN6.06bn achieved in 2016 to NGN7.72 billion in 2017. With our strategic marketing drive and the support of our dedicated staff, we are hopeful of sustaining our growth in 2018.” FBN General Insurance is a wholly owned subsidiary of FBNInsurance Limited, an FBNHoldings company associated with the Sanlam Group South Africa.
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