A Review of the Nigerian Energy Industry

NIMASA, ISAN disagree over incentives for local shippers

Godfrey Bivbere

23 August 2012, Sweetcrude, LAGOS – A sharp disagreement has arisen between the management of the the Nigerian Maritime Administration and Safety Agency, NIMASA, and the Indigenous Shipowners Association of Nigeria, ISAN, over provision of incentives for greater participation by local shipping practitioners.

While the management of NIMASA is alleging that ISAN members are not taking advantage of the incentive for repairs of their vessels to enable them compete in the foreign dominated shipping industry, ISAN on the other hand is alleging that they have been neglected.

On the seeming neglect, Legal Adviser/ Board Secretary of NIMASA, Mathew Egbadon, said that NIMASA recognises the fact that local operators have some shortcomings and therefore told them they can make a list of all their vessels that need repairs for assistance.

Egbadon noted that the agency had budgetary provisions to assist local shipowners this year, saying that since the meeting where ISAN was told to make the list, the agency is yet to come forward with it.

According to him, “We recognise that the local operators have some shortcomings that is why we have some intervention policy. We held a meeting with ISAN, where we told them to go and identify some of their vessels that we can help them repair so that they can be competitive, and as we speak; we are still waiting for them.”

On the Cabotage Vessel Finance Fund, CVFF, he explained that local operators are not going to get it like that. The NIMASA boss explained that getting a loan from the fund is tied to their ability to pay back.

However,, General Secretary of ISAN, Capt. Olaniyi Labinjo, charged the Federal Government to put in place incentives to enable indigenous operators perform better in domestic shipping, otherwise known as Cabotage.

In his words, ‘There are no established rewarding incentives as well as patronage policies and guidelines for Nigerian operators engaged in domestic shipping. This is unlike what obtains in other maritime jurisdictions such as the UK, US, Canada, India,
Indonesia and Malaysia, where their governments have robust promotional and support initiatives”.

Labinjo recalled that the association had submitted a memorandum to the National Assembly in this regard during the Presidential Maritime Retreat held in Abuja in July.

The ISAN scribe said that there was need to develop several incentives, including cargo support, tax relief, duty waivers for ships and spares.

He also urged government to provide financial incentives and reduce port and harbour dues for cabotage vessels. Labinjo expressed concern on the absence of a conducive environment for the indigenous shipping fleet, adding that government should encourage local ship owners who, according to him, have invested so much in the business.

He also suggested exemptions from customs duty, company tax, exemption of seafarers from tax, as some forms of relief which could be granted the ship owners.

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