Emmanuel Omotayo Johnson*[1]
Abstract
As at the time of Nigeria’s independence in 1960, the maritime industry was largely undeveloped. Then, the country only had two major sea ports which were in Lagos and Port Harcourt. To a greater extent, these ports were inadequate to handle large volume of maritime activities.[2] Some of the problems faced with the sector were, the lack of indigenous manpower to effectively manage the industry, and the absence of indigenous shipping companies in control of significant share of commercial activities in the industry. However, the aforementioned had soon become a story of the past.
The Nigerian maritime industry over the past decades has transcended into one of the leading industries in the Nigeria economic terrain. The purpose of this paper is to examine the potentials of the maritime sector as a prospective frontier for the much needed upgrade of the Nigerian economy, particularly, through the “Blue Economy” agenda of the sector, and the role of the government in achieving this end.
Introduction
Nigeria is a middle-income, emerging market with expanding manufacturing, financial, service, communications, technology and entertainment industry.[3] It has a GDP growth of curve of -1.6%, 0.8%, 1.9% and 2.1% between years 2016-2019.[4] As at the year 2018, her unemployment rate stands at 23.1% (Q3 2018)[5] and inflation (CPI) drop rate of 11.4% as at 2018.[6] All of these facts and figures only point to one thing – need for (urgent) diversification of the economy.
Despite her abundant resources, Nigeria is poorer today than it was at independence in 1960. This deplorable condition can be summarized to two major factors; the corruption and mismanagement of its resources by the government, and the overdependence on the wealth derived from crude oil.
The dependence on oil resources as the major source of economy and foreign exchange earnings by the government has done little to reverse widespread poverty[7] and the collapse of basic infrastructure and social services in the country. Following the collapse of crude oil prices in 2018, which triggered unpleasant memories of the 2014 and 2015 crash in world oil prices, the Nigerian government found itself in unchartered waters. It continues to struggle to revive the economy amidst dwindling oil revenues compounded by unemployment, poverty and insurgency.[8]
It is high time that the government looked inward for other avenues to generate wealth necessary to boost and sustain the economy. One of which is the maritime sector.
The Potentials of the Maritime Sector as a Frontier to the Nigerian Economy
Nigeria, located on the coastline corridors of the Gulf of Guinea and the Bight of Benin, is blessed with a natural maritime endowment base comprising of coastline of over 850kms, an exclusive economic zone of over 200 nautical miles, a vast inland waterways resource estimated at nearly 4,000kms, capable of supporting a vibrant intra-regional trade. With Nigeria’s total annual freight cost, estimated at between 5 billion dollars and 6 billion dollars annually, there is no doubt that shipping is of great importance to the Nigerian economy;[9] a readymade industry, full of potentials begging the attention of the government.
With a prospect to generate over 8 billion dollars of revenue yearly,[10] the maritime sector no doubt has the potentials to propel the desired growth in the nation’s economy. Commenting on this fact, a media guru, and former General Manager, Lagos Traffic Radio, Mr. Layinka Adagun, observed:
“The oil industry has always been seen as the nation’s major revenue earner, but this sector lags behind the maritime industry that has earned its pre-eminence in Nigerian economy since the pre-colonial era… the strategic importance of the Nigerian maritime sector to the growth and stability of the nation’s economy is attested to by its value in the upstream sector of the oil industry. This is further stressed by the ministry of transport, which estimated a total of about 8 billion dollars freight cost yearly for the industry”[11].
Unfortunately, the government in her myopic nature has inadvertently failed to unlock the untapped wealth of maritime, which is attributable to their lack of focus on the sector. Reflecting on this fact, Kunle Folarin (Chairman, Ports Consultative Council), called for greater cooperation among government agencies to ensure a viable and competitive maritime sector.[12]
The prospect of the “Blue Economy” agenda under the auspices of the maritime industry is another viable potential of the maritime industry as the fulcrum to a sustainable economy. An agenda that has the capacity to generate wealth from exploitation of other maritime subsectors/components.
Discussing the “Blue Economy” concept, The Director General of NIMASA[13] Dr. Dankoko Peterside related:
“The call for economic diversification in Nigeria is a national consensus… the blue economy deals with the totality of all economic activity associated with the oceans, seas, harbors, aquaculture, biomedicine… in other words the application and exploitation of these elements in a sustainable manner for economic development and wealth creation defines the concept of blue economy”.
For instance, aquaculture as a component of the blue economy has the capacity to generate millions of employment, food security and GDP growth.[14]
Conclusion and Recommendation
Nigeria
economy is in a deplorable state, the overdependence on the oil sector is
persistently failing, and therefore diversification is necessary to fillip the
economy. The maritime sector undoubtedly is a perfect industry, with untapped
resources and potentials capable to buoy the economy. Surprisingly, the
government has not given much attention to this sector. To fully optimize the
industry capacity, the government has a key role to play. One of which is by
prioritizing the sector as a major source of revenue generation. The sector has
been plighted with the problems of inadequate financing, lack of synergy among
government agencies, and conflict in directives[15]
etc. We therefore recommend that the
Federal Government should ensure adequate funding of the sector and also put in
place well synchronized policies for the reformation, restructuring, and proper
regulation of the sector.
FOOT NOTES
[1] Is a student of the Faculty of Law of the distinguished Lagos State University, Nigeria.
[2] Orji Uchena Jerome, “How has the Nigerian Maritime Industry Performed in the Last 50 Years?” (Best Overall Essay in the Fourth hips and Ports National Essay Competition (2010)) – awarded the Dangote Prize
[3] Wikipedia, retrieved 24th Aug, 2019.
[4] https://www.openknowledge.worldbank.org retrieved 24th Aug, 2019.
[5] “Nigeria Unemployment Rate rises to 23.1% – NBS” Premium Times. 19 December 2018.
[6] https://www.vanguardngr.com/2019/02/breaking-nigerias-inflation-rate-drops-to-11-37-per-cent-nbs/%7Ctitle=Breaking
[7] Global poverty projections released by the Brookings Institution in 2018, based on data from the World Poverty Clock, shows that Nigeria has overtaken India as home to the largest population of people living in extreme poverty, with 87 million citizens living on less than 1.90 dollars per day compared to India’s 73 million.
[8] Obasesam Okoi, “The Paradox of Nigeria’s Oil Dependency”, 21 January 2019 pg.1
[9] Nigerian Maritime Administration and Safety Agency (NIMASA) 2018.
[10] Compared to the 26 billion dollars revenue generated by the oil sector between January-August 2018 (source: Punch, August 23, 2018). Judging by this figure, the maritime sector has the capacity to generate 30 billion dollars revenue more than the oil sector generates in seven months.
[11] The Guardian Newspaper, 14 December, 2018
[12] Supra
[13] Nigerian Maritime Administration and Safety Agency
[14] According to Dr. Dankoko Peterside, DG NIMASA
[15] According to Kunle Folarin (Chairman, Ports Consultative Council)
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