• Wed. Nov 25th, 2020

Engr. Olu Akinsoji on Re-Establishing the National Fleet

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  • Engr. Olu Akinsoji on Re-Establishing the National Fleet

Excerpts of an interview with Engr. Olu Akinsoji, former Rector of Maritime Academy of Nigeria Oron and former Nigeria Representative at the International Maritime Organization (IMO) London on the formation of the New National Fleet Project.

DDH: What is difference now with this new initiative to refloat a national fleet for Nigeria, is this another NNSL or is this a different concept?
Akinsoji: There is a committee, the chairman is Hassan Bello. The committee was set up by the minister, and he had privilege of allowing the Chairman of the committee to know his heartbeat, so that the delivery of the committee will not be far from the policy trust of establishing that committee. I know Bello very well. I have been interacting with him since the 2nd Judges Seminar. He wants to do things transparently and allow the public to contribute to whatever he’s doing. But he’s not the only person, the Minister [of Transportation, Chief Rotimi Amaechi] is also involved. The Minister has also good intentions. The Minister has accepted that it is wrong for the country to generate cargo and not have ships. When having ships itself is business, which some people thrive on, even nations thrive on having ships. How will you now have cargo and not have ships? It means you are not optimizing your resources, you are not optimizing your endowment to its economic benefits. And it’s logical. He wants us to also tap into these areas of the economy, giving shipping services that will even make Nigeria present in the oceans of the world. Because as it is now, we are not present in the oceans of the world, we don’t have our flags flying there. It’s as if we don’t exist and we are not a landlocked country.

DDMAG: So, that is the rationale? Akinsoji:
Even if you say God doesn’t exist, what about whoever created us and this coast and made us subject of importation of cargo in the world, movement of cargo in the world? Whatever is responsible for giving us that would be annoyed with us if we do not partake in the carriage of it and earn money from it. All what we do is to tax the people who has the ability to carry it, that’s what we are doing now; we are taking money from the people who have the ability to carry it. They will charge us for carrying it and we tax them to give us part of the money they charged us. If they are not making profit, would they give us what we want. It doesn’t make sense.

DDMAG: When we have the manpower and the nation has spent money to train a lot of people in this area?
Akinsoji: If we don’t have structure in place to train people, we will not be successful in training the people, we will not be successful in carrying the cargo, putting technology in place to even repair. So, the minister appreciating all these, said we should find a way of putting in place a fleet that will carry Nigeria cargo, so that we can hand fleet ourselves. That is the bottom line. That is my understanding of the work of that committee, to put in place an oceangoing fleet that will be carrying Nigeria cargo so that the generation of freight will be to indigenous benefit. Am interpreting these so that you will understand, because a lot of people have given so many different definitions to the intentions of the minister. And my understanding of it is what I have told you. It is not a national shipping company. It is not a national carrier status we are talking about. They are all related but the crux of it is that we should establish a fleet that will be able to carry Nigerian cargo and the freight earnings of that fleet should be indigenous freight, the money should be earned by Nigerians.

DDMAG: What we are talking about will take a lot of expertise to set up. It’s not going to be another case of NNSL of government putting money down and ships for people to run?
Akinsoji: No, no, it will be totally different. You see, the understanding here is that Nigeria has cargo and shipping demand-derived. If there is cargo, there should be ships, if there is no cargo, there should be no ships. If there are no ships, there should be something called ineptitude, inability, limitation, knowledge limit, lack of understanding, intellectual laziness, incompetence, skills developed but poorly applied. These are all deficiencies; these are gaps that are recognized, in my opinion, by the Minister, even without expressing it. You know I was the chairman of the committee charged with coming up with the parameters or procedures to establish it. It was at the submission of the report of this committee that the Minister said that the Implementation Committee should be headed by Bello and that is what we are working on. You see, I continue to insist on certain areas of my recommendation that I feel we still need to revisit eventually. But right now, you can see that NNPC seems to be more flexible now.

DDMAG: Do you think it is because of the present economic difficulties Nigeria is having?
Akinsoji: Not really. I have always said it, more than 10 to 15 years ago that what we are quarrelling over is not NNPC’s problem, it is the system. The system is becoming more aware, but there has always been an opportunity for Nigerians to participate in carriage of crude oil. The only thing is that Nigeria has not shown enough capacity and confidence in that direction, that they are able. Have we shown enough competence in that direction till date? The answer is no. The only thing is that they are blowing the wind, even without competence, without having the ships. We don’t have the ability to understand how to manage a ship, we don’t even have it. Is NNPC going to give the cargo to the air? But they have even been doing it. If you read recent publications of NNPC & speeches of their headships, they have been giving right of lifting crude oil to some Nigerians in the past 5-6 years. It’s just that most of the people they give don’t even buy ships, probably they sell the rights to foreigners who use it.

DDMAG: Is this why the minister now feels that something should be done officially?
Akinsoji: Yes, to create an environment that will make it possible for Nigerians to buy their own ships. So, it’s different from the nation buying ships. It’s creating an environment for righting the wrong, removing the barriers, bridging the gaps and creating general environment that is conducive for Nigerians to develop the capacity. When I talk about capacity, I talk about two types of capacity, infrastructural capacity & software capacity, the knowledge to source for finance. None of these can be said to be abundantly available. Do you want to tell me that Nigeria has the capacity to source for funds on our own? To procure ships? We don’t even have the banks that can fund it because banks themselves have not got the foundation of supporting ships. It’s not our core areas. So, if the banks that deal with financial knowledge don’t have [the capacity] how much more people that are outside the core areas that are dealing with services? So, you can see the deficit in the knowledge required. When it comes to insurance do we have the companies that have the capacity, the people that have the knowledge of insurance to be able to deal with insurance on that level? Do you have P & I [clubs]? Do you even have cargo handling procedures, people who can manage cargo, cargo managers? Do you have those at that level who are Nigerians? These are issues, your registration of ships. How many ships are under your registration flying the Nigerian flag? What is the problem with it, what is the gap? Do you have safety management of ships in terms of certification that is recognized by the port state controls of the world? That they will not arrest your ships because of lack of reputable knowledge of your activities? Just out of curiosity they can visit your ship and find deficiency and detain your ship. You need to have the kind of system that can give confidence to the whole world to take their eyes off your ships. Because as good as a ship is, it’s not likely that a surveyor will visit the ship and not find a fault. But the fault may be minor enough for them to let go if you have the reputation. But you have to demonstrate it. The fact that you have had ships before that you lost due to ineptitude and delays and lack of maintenance and corruption, bad certificates and all that, that feeling is still in the minds of people in the global system. So when you start to have ships, they will still go until you start to erase it by better performance. All these things are there. And I happen to have seen these conducts, that aspect of it, I will be able to talk about. I cannot talk too much about insurance and commercial issues. From my experience at IMO and interaction with the tanker owners’ association and insurance and commercial houses associations who are also members of the IMO, I will be able to speak a little bit about the level of risk that are involved in tanker operations. And how seriously the global system takes matters concerning them because when it comes to pollution matters it’s involving the whole nation, it’s so catastrophic, so they are very sensitive. And tanker operations are given special attention when it comes to insurance procedures and the level of carefulness in the safety operation and certification. Day in day out, conditions are imposed on this class of vessels and renewed on daily basis. Amendments are given. You see NLNG has 13 ships now and those 13 ships are not registered in Nigeria. But NLNG has been able to get regulations that give them incentives, [even] in other countries, and that is the corridor they have created for themselves. Now, if you want this environment that allows for entrepreneurs to come into shipping, it is likely that you will need a replica or similar laws that reviews the incentives and takes shipping away from general factory process that we have because the concept of shipping [in Nigeria] must be in tandem with the concept of other countries. Otherwise nobody will want to register their ships in this country. If it is possible to register the ships in Ghana and take your cargo in Nigeria, why should they come here if the condition is stringent and unfavourable? So, they will rather register them in Ghana and come to Nigeria to carry Nigerian cargo.

DDH: So, these are what the committee is going to look into?
Akinsoji: Yes, we are looking into it and trying to implement those things. Also, the financial aspect, how do you raise money from the industry? Our strength in Nigeria is cargo. How do we use our strength to mitigate our weaknesses? That is what shipping is all about because it’s a global system. If you have something that would attract ships, it should attract ships in such a way that those who have ships are able to release the ships for the cargo. So, there is something we have not put in place that should attract people who have ships to take advantage of the cargo we have. That gap that is created by our omission or limitation is what that committee wants to bridge. So, it doesn’t necessarily mean that we need to put money. We just need to have the knowledge, the capacity, the skill and the political will to bridge that gap. That is where the minister comes in. He is a politically strong person and he is willing to use that political will to leverage that issue of we having cargo and those who are financially capable to put the ship to carry the cargo so that even if it is the matter of sharing the benefit of that relationship, why not? If we start from sharing the benefit, as we go and acquire more knowledge you will start to shift it towards your own side, to ownership gradually and you now have full control without upsetting the international system. The international system will accept you because you have something to offer. We have been offering cargo for more than 50 years and they have been offering ships all that time, let us meet halfway somewhere. And it’s not only crude oil. We have been up and down in general cargo, sharing the freight with them and giving them the cargo. Suddenly they have removed us from sharing the freight and are still carrying our cargo, even though the cargo is increasing. So what have done wrong that they have moved us away? We want to find those things and put them back in place. So that as we generate more cargo, we want to develop the capacity and capability to even carry some of these cargo and not only money but also find employment, technology and managerial capacity for our people and develop skills all around.