Nigeria’s maritime sector is vital to the country’s economy, but the Nigerian Shippers Council (NSC), which oversees it, confronts many obstacles. The 2% Port Development Levy, which serves as the NSC’s primary source of financing, is insufficient to cover its expenses. Legal and practical limitations have also prevented it from enforcing a mandated 1% freight fee. The NSC’s functions could also be severely hampered by government attempts to make agencies self-funded by doing away with the Port Development Levy. An additional crucial concern is the antiquated legal structure of the NSC. The presence of the Private Sector in ports after the 2006 Port Reform is one example of how the NSC Act of 1978 does not reflect contemporary reality.
As a result, the Council is less able to handle current issues like growing shipping costs, ineffective logistics, and freight charge conflicts. The Nigerian Shipping, Port Economic Regulatory Agency Bill 2023 plans to formally designate the NSC as the Port Economic Regulator and update its legislative structure. It is presently being reviewed by the Senate. The NSC would be able to control shipping procedures, uphold industry norms, and encourage fair competition as a result. The NSC’s capacity to handle conflicts, enforce rules, and guarantee compliance is weakened by a lack of funding and contemporary legislative instruments.
The maritime sector has enormous economic potential.
For instance, the NSC’s resource constraints prevented effective enforcement even though it recently settled a compensation issue between CMA CGM and ASPA POP Investment Limited. Moreover, the NSC is essential for lowering inefficiencies, keeping an eye on shipping costs, and guaranteeing transparency. The Council needs adequate Finance and legislative changes in order to carry out its mandate, draw in investments, and improve Nigeria’s marine competitiveness. Recent projections indicate that Nigeria’s maritime sector has enormous economic potential and may add more than $44 billion to the country’s GDP each year.
Despite this promise, the sector’s present contribution is still small, suggesting significant development potential. Founded in 1978, the Nigerian Shippers’ Council (NSC) is the nation’s port economic regulator, working to safeguard shippers’ rights and advance effective port administration. However, the NSC has issues that limit its efficacy, such as a lack of financing and an antiquated legal system. On the other hand, marine regulatory bodies in nations such as Singapore and the Netherlands enjoy the advantages of strong financial support and contemporary legal structures, which allow them to deploy cutting-edge technologies and sustain effective port operations.
Issues with security further impede operations and put off possible investors.
In order to improve competitiveness, Nigeria must update its maritime regulatory framework, as this discrepancy makes clear. Numerous negative economic effects, including higher transportation costs, inefficiency in operations, and a drop in foreign investment, might result from an underfunded NSC. Issues with security, such as cargo theft and port disorder, further impede operations and put off possible investors. In addition to raising operating expenses, these problems may harm Nigeria’s standing in regional Trade agreements such as the African Continental Free Trade Area (AfCFTA).
Industry stakeholders have voiced worries about the maritime industry’s current situation. The potential of the sector was highlighted by Dr. Daniel Tamunodukobipi, National Chairman of the Nigerian Institution of Marine Engineers and Naval Architects (NIMENA), who said, “Recent statistics reveal that the Nigerian maritime industry can contribute more than $44 billion annually to GDP, underscoring its importance to our nation’s Blue Economy ambitions.” In the same vein, Barr. Pius Akutah, the NSC’s Executive Secretary, emphasised the necessity of a robust legislative framework to empower the Council to regulate.
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A number of tactics can be taken into consideration to deal with these issues. The Nigerian Shipping and Port Economic Regulatory Agency Bill 2023 will give the NSC a contemporary legal framework, increasing its operational scope and regulatory power. Additional money could be made by putting into effect the mandatory 1% freight fee, which is stipulated in the NSC’s enabling Act. Enhancing financial resources may also involve investigating foreign financing opportunities and public-private collaborations. Putting these tactics into practice could improve the NSC’s ability to properly oversee the marine sector, allowing it to reach its full potential and make a substantial economic contribution to Nigeria.