BLUE ECONOMY: PATHWAY FOR NIGERIA’S ECONOMIC DIVERSIFICATION

Text of paper presentation by Iju Tony Nwabunike, Maritime Transport Expert and National President, Association of Nigeria Licensed Customs Agents (ANLCA) at the 2021 Edition 8th Nigeria Annual Transport Lecture organised by Transport Day Newspaper on Friday, May 21, 2021.

INTRODUCTION

I want to start this presentation by acknowledging the foresight and positive impacts of the editorial team of Transport Day Newspaper, organisers of this annual lecture, which touches on the heart of our national economic growth and sustenance.

Speaking on the blue economy at a time Nigeria is not getting enough funds as she desired makes the timing of this paper auspicious

My area of discourse is maritime, which is critical to the historical, economic, political and spiritual life of Nigerians, depending on where you come from and the perspective from which you view our natural marine endowment.

The 853km long Nigeria coastline runs through seven of the Southern States of the Federation, Lagos, Ondo, Delta, Bayelsa, Rivers, Akwa Ibom and Cross Rivers bordering the Atlantic Ocean.

These are aside from other states that are linked by inland waters for copious socio-cultural and commercial activities.

This navigable inland water comprises rivers, lakes, lagoons, creeks and those directly linking to the sea.

What is Blue Economy?

According to the World Bank, the blue economy is the “sustainable use of ocean resources for economic growth, improved livelihoods, and jobs while preserving the health of ocean ecosystem.”

European Commission defines it as “All economic activities related to oceans, seas and coasts.

The European Commission’s definition looks more tailor-made for the Nigerian situation as it touches on local and foreign trade that is marine-related.

LOOKING BEYOND OIL

In one of my public messages, I postulated recently that as the second-highest revenue earner, the Nigerian maritime industry is the nation’s economic low hanging fruit capable of cushioning the temporary effect of inadequate oil revenue.

We are rich in maritime resources, rich in oil which is transported by ships but some time ago, in the recent past, we were tagged as the poverty capital of the world. This is ironically our reality, which we can change for the better.

National Petroleum Corporation (NNPC) had declared that it would deduct N112 billion from oil and gas proceeds for April to ensure a continuous supply of petroleum products to the country and guarantee energy security.

Implications include not having oil revenue for the federal government to share with the states and local governments

This situation is premised on the hike in crude oil prices on the deregulated downstream sector and the need for uninterrupted supply of petroleum products to citizens

Even if oil prices rise astronomically now to $200 per barrel, Nigeria is a country in debt and still looking for loans to fund the 2021 budget as of May this year.

What this tells us is that oil money alone cannot satisfy our national thirst for funds. Federal, states and local governments struggle to pay salaries while pension and other welfare liabilities are almost unattended in many parts of the country.

Organised labour and some state governments are likely to experience face-offs due to states’ inability to meet their payment obligations. These are fallouts of oil revenue inadequacy and looking to improve in the immediate

THREAT OF INSECURITY ON BLUE ECONOMY

Our maritime domain suffers the setback of general insecurity either due to lack of priority attention, inadequate security platforms like patrol boats, aircraft and supporting technology gadgets and a lesser number of personnel to implement or enforce adherence to security on the water.

Maritime piracy, sea robbery, oil theft, kidnapping on water or through water have been copiously recorded in the domain that should be contributing to our economic well being.

I am almost tempted to say that our Exclusive Economic Zone is no longer exclusive to us because the people I choose to call maritime bandits are threatening our space.

I am aware that the Federal Government (through Nigerian Maritime Administration and Safety Agency) is rising to the occasion with the planned deployment of advanced security assets to energise our blue economy. I believe it will work if consciously sustained. This they tagged the “Deep Blue Project”

It is anticipated that this move will go a long way in fighting piracy and other maritime crimes in the Gulf of Guinea and our country’s entire territorial waters.

The safety of vessels, cargoes and crews on our waters have direct impacts on our overall economy since the maritime sector is critical for us in the areas of trade, investment, employment and recreation.

While the government is procuring platforms and training personnel for maritime security, I wish to advocate that a community-supported security approach will be more productive.

Government should as a matter of policy involve youths of coastal communities in a kind of Civilian Task Force to support the Navy and other security agencies in nipping our maritime insecurity in the bud.

Further development of our maritime potentials will be a bold step towards economic diversification for job creation, addressing insecurity and positioning our ports for hub status in the West and Central African regions.

Everyone agrees that a safer and more secure maritime sector will open a vista of economic improvements for us as a country

Most thriving businesses in our maritime domain are forced to spend a good part of their profits on the provision of security. Where such private arrangements are not made, oil, construction and other workers operating or transiting through waters face the risk of kidnap, robbery or murder

Of truth, our maritime security profile and reputation is not impressive and should be urgently and practically worked upon.

DYSFUNCTIONAL DISPOSITION OF GOVERNMENT AGENCIES TOWARDS OPPORTUNITIES IN BLUE ECONOMY

Over 97 per cent of ships lifting Nigerian crude oil to buyers in refining countries and vessels bringing refined petroleum products into the country are foreign-owned.

These ships trading on our waters and carrying our number one foreign exchange products are manned mainly by foreign professionals and deckhands. Nigerian shipowners are struggling to break into this area of investment

A notable number of Nigerians are involved as crew members onboard Liquified Natural Gas and Liquified Petroleum Gas ( LPG) vessels under the Nigeria LNG Limited and its subsidiary, Nigeria LNG Ship Management Limited (NSML).

I have to identify this because it’s worth replicating in other areas and made to spread across the industry where Nigerians will be first-line beneficiaries of benefits derivable from our natural maritime endowments.

The oil industry is truly not interfacing enough with the maritime sector to help in reversing this trend of inadequate participation of Nigerian investors and professionals in the lifting of crude oil and working as crew members on board ships trading on our waters

Over the years, I have followed the Nigeria Content Development and Monitoring Board (NCDMB) and posit that it is doing very well in expanding opportunities for Nigerians in the oil industry but has not synchronized with other agencies like NIMASA to promote our cabotage regime in maritime.

Maritime transport is the key to unlock most of the untapped opportunities in the oil industry and will go a long way in supporting the government’s effort at addressing insecurity in our coastal area.

OPPORTUNITIES

There is an array of untapped opportunities holding back not less than 30,000 immediate jobs if our maritime and inland waters are safe for legitimate business activities where it’s also properly interfaced with the oil sector
Areas such as:

  • Import
  • Export
  • Fishing
  • Tourism
  • Transport
  • Chandling
  • Dredging and
  • Others abound.

These have the potentials to give governments at all tiers more taxes and provide sustainable earnings that will go around than what we have in the oil sector presently

Nigerian economy cannot afford to keep quaking anytime there is a downward slide in prices of oil in the international market.

Staying on that economic route as our only lifeline for sustainability will only lead us into piling debts upon debts and going cap in hand for debt forgiveness where we are unable to pay.

It’s time to look in the direction of our waters

CONCLUSION

A perpetual borrowing nation becomes an economic slave to its creditors. As our population increases over the years, the monolithic oil economy has become very unsustainable.

Staying on that economic route as our only lifeline for sustainability will only lead us into piling debts upon debts and going cap in hand for debt forgiveness where we are unable to pay.

It’s time to look in the direction of our waters.

I leave you with a verse from the Holy Bible which acknowledges that there is wealth in the sea

Isaiah 60:5 Then you shall see and become radiant, And your heart shall swell with joy; Because the abundance of the sea shall be turned to you (New King James Version).

 

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