Director-General of Nigeria Maritime Administration and Safety Agency (NIMASA), Dr. Dakuku Peterside has traced the collapse of ship building sub-sector of the maritime industry in Nigeria to exorbitant duties charged by the Nigerian Customs Service (NCS).
Giving the chilling revelation at the 6th Annual Conference of the Nigerian Society of Engineers, Marine and Naval Architecture division in Lagos, Dr. Peterside, represented by the Executive Director of Operations at the agency, Rotimi Fashaki, decried that “Last year, we went to Onne, West Atlantic Shipyard. I was horrified by the enormity of decay that had taken place there.
“That shipyard had churned out over 500 metric tonne-size vessels before then but owing to some adverse economic downturns and the parlous state of the economy and the industry, that shipyard has now become a shadow of itself.
“One of the things they talked about was the prohibitive customs duty that makes it cheaper to bring in vessels from China and Korea than actually building vessels here. This is because the moment you build your vessel, yes the place is a free trade zone, and it lands onshore, it attracts huge prohibitive import duties, which wipe off whatever gains you may want to make on that vessel.”
He was quick to hint that NIMASA is already talking to the Comptroller General of Customs, Col. Hameed Ali(rtd.), on how to reduce duties on vessels built in the country as part of efforts to encourage investment in the ship building industry in Nigeria.
According to him, there is no way NIMASA’s partnership with industry professionals towards growing indigenous capacity in shipping development in Nigeria when there are stumbling blocks here and there in the sector.
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He hinted further that “One of the things that we are doing as an agency is trying to make the right representation in government. We have had a kind of interaction with the NCS before now and we are still going to continue the interaction in order to build the right indigenous capacity that will attract less import duties in Nigeria so that Nigerian shipyards can hope to thrive. That is the only way you can encourage and bring the right investment in that area,” he said.
Corroborating NIMASA’s fears, Chairman of Starz Investment Company and top stakeholder in Nigeria shipping industry, Engineer argued that “Except West Atlantic Shipyard which is struggling to survive now, ship building in Nigeria was relatively non-existent due to lack of infrastructure such as power and a viable steel production industry”.
According to him, one of the best ways to revive the ship building segment of the Nigerian maritime industry is to resuscitate the moribund steel industry, step up power stability and introduce encouraging polices.