How sector can bail out Nigeria from recession

As a nation that relies heavily on imported goods, the maritime sector is a key industry with huge potential, such that when harnessed, could ultimately bail out Nigeria from the prevailing economic crisis.

Being an oil-producing and exporting country, as well as a consumer nation, the country is a large market for foreign goods, owing to its population. In this regard, the maritime industry holds the key to nation’s growth and development.

As the economic recession bites harder, experts and economists have continued to develop various formula, monetary and fiscal policies that could help revive the economy, but the bedrock of these policies appears to have been left untouched.

With potential to generate about N8 trillion yearly, the industry holds key role to any sector particular a consuming nation like Nigeria where majority of our consumptions are imported. Indeed, statistics from the Bureau of Statistics showed that the nation’s import rose by 38.1 per cent, while exports also rose by 63.3 per cent in the second quarter 2016. Notwithstanding these figures, the shipping firms and terminal operators are groaning under low cargo handling.

These further established the need to urgently unlock the potential in the maritime sector, while policies and programmes, that have numerous ways and capacity to boost the nation’s economy must be implemented.

The National President, National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Lucky Amiwero, said the Federal Government should garner enough political-will to reform the maritime sector for better performance.

Just as the sector contributes about 1.6 per cent to the nation’s Gross Domestic Product (GDP), Amiwero believed that more could be achieved, if the damming policies are review and the era of imposition is stopped.

He also urged the government to improve on the infrastructure around the ports and reduce the multiple charges and overbearing regulations by various agencies at the ports.

Expressing optimism that the new management of the Nigerian Ports Authority (NPA) would champion the ‘change’ that is required in the industry, Amiwero said the nation stands a chance to earn more revenue when policies are implemented in the right manner.

He said: “When you look at infrastructure, we are having problem. Our cost of doing business is another big problem and our procedures are lengthy and cumbersome, because most of the things we do are imposition. The problem is that even the agency that is supposed to regulate the system is imposing. You impose value and decisions, among others. Things are not done properly in this country and the problem is that we cannot continue to run a country where you don’t do things based on law. Most of the revenue we have gotten is imposition.

“Look at Ghana for instance, they have cancelled terminal handling charges. This makes it easy for importers to go there because it is cheaper than coming here. So, whose economy is benefiting?

“For the past 15 years, I have been clamouring that terminal handling charged should be cancelled. In Nigeria, we have two charges- terminal handling charge and delivery charge. It is duplication of charges. And the terminal handling charges is in billions of naira.”

He advised the Federal Government to turn to reviving the maritime sector, as the oil revenue has failed the country.
President General of the Maritime Workers Union of Nigeria (MWUN), said the government should focus more on revenue blockage through under declaration of tonnage among other shoddy deals in the industry.

He added that: “Government should as a matter of urgency adopt policies towards resuscitating the export of agricultural products and mineral resources that were hitherto the mainstay of the Nigeria economy before the discovery of oil. This will no doubt create jobs in our seaports and increase revenue to the government,”

He however enjoined the Nigerian Maritime Administration and Safety Agency (NIMASA) to be alive to its obligation of monitoring and ensuring the sustenance of high standards in the seaports, while the Nigerian Ports Authority (NPA) is urged to halt involvement of third parties in the maintenance of its facilities to reduce maintenance cost under a depressed economy.

President Muhammadu Buhari at the ministerial retreat on the economy recently said his administration is focusing on reviving the economy through the critical sector, including transportation, where maritime lies.

He said: “Indeed, the challenges we face in the current recession require ‘out-of-the-box’ thinking, to deploy strategies that involve engaging meaningfully with the private sector, to raise the level of private sector investment in the economy as a whole.

“We are confident that the level of private investment will grow as we are determined to make it easier to do business in Nigeria by the reforms we are introducing under the auspices of the Presidential Committee on Ease of Doing Business.”
The Minister of Transport, Chibuike Amaechi, said: “The kind of change we are expecting is how transport sector can generate more revenue for government,’’

According to him, the maritime industry had the capacity to generate N500 billion revenue yearly for the nation, excluding customs revenue.

Amaechi said that the shipping sub-sector was a major aspect of the maritime industry, adding that the sector remained crucial to the economy as the second revenue earner for government.