Chinedu Jideofo Ogbuagu from Enugu State is one of the early holders of a Distinction (HND, 1981) in Shipping and Masters in Transport Management (1982); International Shipping (1983), and Shipping & Trade (1986), before going ahead to obtain a Doctorate degree in Maritime Policy (1988). He wrote for globally-rated specialised publications such as Lloyd’s List, Shipping World, and Shipbuilder in the UK, but hit career heights as Consultant to the United Nations Conference on Trade and Development (UNCTAD) where he advised ‘77 ten 3rd world countries and developed Cardifff Free Port, and the NMA that is now NIMASA. Ogbuagu is president of Marine Club of Nigeria (MCN) through which he pursues the establishment of a maritime hub in Nigeria to rule West Africa. He is consultant to Martime Academy, Oron. In this interview with IGNATIUS CHUKWU, Ogbuagu believes that the current administration at the federal level has all it takes to remove the obstacles for the Nigerian National Petroleum Corporation (NNPC) to own over 200 vessels without spending a dime. He unveils blueprint to return Port Harcourt to maritime hub in West Africa, drive away poverty; he says Maritime Free Trade Zone in the Garden City with shipbuilders can mop up thousands of youths and end insecurity; explains why NNPC prefers to sell crude on FoB (Free on Board), instead of CIF (Cost Insurance and Freight) terms, among many other issues. Excerpts:
If you may rate Nigeria’s economy, maritime-wise, in comparison with global maritime economy, where are we by percentage; how do we close the gaps?
I will not lie to Nigerians; we have had a very bad run. I will tell you that our current public sector leaders have the best chance to turn things around; the ministers, heads of agencies, etc. At least 60 percent of them are well focused now. Look at NEPZA (Nigeria Export Processing Zone Authority). I do not know what background the honourable, Emmanuel Jime, had before going there but everything has changed. The guy in NIWA (Nigerian Inland Waterways Authority) is doing very well, NPA (Nigerian Port Authority), NIMASA (Nigeria Maritime Administration and Safety Agency). So, in a way, it’s almost as if something has happened, by some luck, we now have people we can talk to in the various maritime agencies and ministries; in Petroleum, Ibe Kachikwu is doing well; Maikanti Baru is doing well in NNPC. There is about to be an explosion. I encourage them to be focused on the development of the maritime economy, at all levels.
So, what is the relationship between the Nigerian maritime economy and the overall economy of Nigeria?
Between 60 and 75 percent of the Nigerian economy is maritime-related, including oil & gas. All pipe networks are part and parcel of maritime economy. There is no ministry or agency of government that has no maritime content. For instance, Ministry of Interior has marine police there. Ministry of Defence has the Navy. Ministry of Trade and Industry has the free trade zones. There is no maritime without cargo, without export or import. That shows how big maritime economy is, and our mission in Marine Club of Nigeria is to capture them wherever they are and bring them under one roof. Many years ago, people thought maritime was all about shipping. They did not know that Customs is part of maritime, despite being under the Ministry of Finance.
The message is getting across and by the time we are through getting all our people under one roof, people would see how big the maritime economy is.
What global experience, if any, does Nigeria need to move this kind of venture and do you possess this kind of global experience”
I hinted that by 1984 to 1986, I was a consultant to the United Nations Committee on Trade and Development (UNCTAD). My brief then was to help third world countries like India, Brazil, Pakistan, Saudi Arabia, Libya, Kuwait, Malaysia, South Korea, before they broke away to become developed countries and left Nigeria behind. We were all struggling together to come into the maritime economy. For instance, South Korea was nowhere but they are the number one in shipbuilding in the world now. In that period too, Korea has established about 20 big maritime universities, each one bigger than the biggest university in Nigeria. So, I have had that experience. The maritime city in Dubai is my design; I did not do it for Dubai, I designed it as a concept for the world but Dubai bought it from UNCTAD and developed it. There is no lack of knowledge in that sector, and it is not only me. They are in our Marine Club of Nigeria. If we get the maritime economy right, this decline in Port Harcourt will disappear. Empty buildings will bounce back, life will return to the city and insecurity will reduce.
Are there other things outside trade zones Nigeria should begin to do now to recapture maritime economy?
Plenty! You know the government rolled out the programme of developing the railway system. You know it is 100 percent maritime economy. We want to encourage them, not just to roll out but to implement them to ensure we have rail lines linking all parts of Nigeria.
On the issue of NNPC owning ships, we have written proposals to them. The minister is a very hardworking person, very different. Before, if you wrote to the NNPC, you would not get any replyin four years. Now, write to Kachikwu, in less than one week you get a reply. It is very efficient now. Baru, the group managing director of NNPC is an industry player. He is a good hand. The time has come for that thing that should have been done a long time ago to be done so the NNPC would own its own vessels. The cargo, meaning the crude oil and the refined product, which are carried in vessels, must be sold CIF (Cost Insurance and Freight). By this, the person selling will now be able to nominate which vessel will carry either the crude or the refined product. As long as they are patriotic, why would they not nominate Nigerian vessels? But when you sell FoB (Free on Board), you lose 60 percent of the extra profit in the shipping or insurance that is involved. So, if NNPC can decide now, and it is as easy as ABC, tell all those people that have been collecting commission on FoB that it’s over. If they sell FoB, the foreign people will give them big money and carry the crude/refined product in their own vessels. This makes the individuals rich and makes Nigeria poor. That is how it has been going on for years and they don’t want it to change.
We have shown them how NNPC could in just four years own over 200 vessels. The cargo is the deciding factor and the NNPC has this. They don’t need to do any joint venture (JV) partnership. What has been going on is that these foreign companies would offer you JV deal and strangulate the chances of NNPC having its own vessels. Saudi Arabia, Kuwait, Venezuela, Libya (before), they have none. Why must Nigeria have JV with anybody? We don’t need it. We have the manpower and know-how for NNPC to have hundreds of vessels. If NNPC gives me cargo-guarantee now, that is all the cargoes they generate, by export and import, I will give NNPC hundreds of vessels in less than four yours. I have been saying this for years now. Why is it so difficult? All other countries have done this, so what is difficult here? You don’t commit one kobo in buying the vessels because you will get the funds from international finance companies at less than three percent to buy the vessels and offset it from the operations of cargo guarantee. The only way to give cargo guarantee is by selling CIF. Nigeria is the only oil country that has no vessel of her own. That was the formula that I used in the 1980s to make Saudi Arabia to become a major ship owner. Sell CIF and the finance world will fall over themselves to give you money. There are several vessels offshore Nigeria waiting to do bri-bri and do business in Nigeria. Why do people want to collect commission from foreign ship owners when Nigeria can get everything; can own hundreds of ships and employ thousands of people? If we sell CIF, you would see Nigerian flagged ships all over the world. The ships can help in wars. When Britain went to the Falklands to fight, was it not commercial ships that were converted to war ships? Yes, that is what countries do. Those commercial ships are technically the country that owns them. You will pay them but they are loyal to you. If you use foreign ships, they may sabotage you and you will be defeated. Your sovereignty increases with ships at sea. I don’t know why we just do elementary things; I have been talking since my 20s and I am still talking.
That takes me to my next question; why have they not involved you in running this sector since you have been talking?
I don’t even want them to give me job but they should at least do the right thing.
Why don’t they give you; do you have anything implicating in your records?
Maybe you ask them because there is nothing implicating in my records. Supposing I was in the driving seat of how we sell oil, nobody will sell Nigeria oil FoB. I must say that sometimes if I do not like a government I may not want to work with them. I have been offered things at the state level (Enugu) and I said no. The moment they know you know, they run away from you as far as possible. The reason I am friends with everybody is because they see I am not asking for position. Else, they would be distancing themselves from me.
What agenda do you have for Port Harcourt this time around; what has brought you to Port Harcourt this time around?
As ever, Port Harcourt has always been the natural hub for the whole gamut of maritime economy and sub-sectors. It’s worrisome that this has not been realised. Now, the main focus or target we are coming with is the free trade zone project to be called the Maritime Free Trade Zone. We have already notified the governor, Nyesom Wike. If we get land, minimum of 2000 hectares of frontline waterfront, many wonderful things will happen, including a world class ship building yard, not boat-building but big ships that carry containers, Ro-Ro vessels; the kind they build in the US, Norway, South Korea, Finland and other ship-building nations including Britain. We need a ship-builder in Nigeria, and we want it here in Port Harcourt. Such a project could mop up all the boys that are restive in Rivers State because ship-building requires a lot of hands. It cannot be automated to eliminate labour. That alone will help to stop insecurity by mopping up a lot of idleness, hopelessness and poverty.
You mentioned the Chamber of Commerce; the leadership there has been saying that Port Harcourt is primarily a maritime city and was named after a port; do you agree with that; any hope for collaboration?
Absolutely, we are on same page. We spoke even today (August 28, 2017); what they say is what we say. If you want to address the economic downturn, poverty, and closure of businesses in the Garden City, you return to maritime. You deal with the cause of closure of maritime businesses. That would lead you to attracting investments into the maritime sector. We know the problem of Rivers State and this can be solved economically.
Why Port Harcourt, instead of other coastal states; is it just the love; if Port Harcourt rejects your offer, would you move elsewhere?
Port Harcourt will not reject our offer. The government of Rivers State is desirous of finding solutions to the economy of the state. We are here to provide that solution. Yes, it is true that in the course of inquiries, Delta State has said, come and take 2000 hectares of land. Lagos too is beckoning on us, but Port Harcourt must be number one because, you asked that question. By geography, by the expanse of hinterland; by the closeness of Aba and Onitsha, the seas and calm waters, Port Harcourt is it. Look at the oil/gas economy, agriculture, and fishery are here. Port Harcourt is the only place where everything about the maritime economy is in one place; the rail system, ports, international airport, etc. By nature, by now, Port Harcourt ought to be way ahead of any city in Nigeria, the New York, the Big Apple of Nigeria, by now. We have not arrived there yet; maybe they are sitting on attitudinal matters which need to be addressed. Port Harcourt was on the way to getting there before but something happened, and all of a sudden, Port Harcourt started to lag behind. Port Harcourt can come up again. If the Docklands of London came up again when Margaret Thatcher became prime minister of Britain, Port Harcourt can come up again. You just need the right mix of leadership and followership and Port Harcourt can start to grow again.
I can say this, Port Harcourt and Rivers State, there are enemies all over; people who do not want Port Harcourt to become what it ought to be. Those enemies include people that come from Port Harcourt, plus those from outside. Where there are such enemies, we find a way around them. We cannot throw in the towel because of detractors. There is no option than to make Port Harcourt what it ought to be.
Let me say this, it is not about Port Harcourt, there is Rivers State, there is the Niger Delta, there is the Gulf of Guinea, all looking up to Port Harcourt. There are many countries looking up to Port Harcourt, from Nigeria, Cameroon, Equatorial Guinea, etc as a hub. Port Harcourt ought to be a shining light and it can easily become so. Marine Club just wants to have a base to start doing things. The kind of services and the products that would be coming from the Maritime Free Trade Zone, from ships to fabrication, would be a surprise the neighbours. They too would sit up. We have always said, it must not be Onne or our free trade zone alone that should be the only free trade zones in Port Harcourt. All they need do is find people who can run free trade zones, and give them land to develop such hubs. All the newly developed economies of the world including Dubai did so on the free trade zone concept. The entire United Arab Emirate (UAE) is a free trade zone country; it means you don’t pay duty, either in importation or exportation. If you now want to bring any goods into the real country from the free trade zone, you now pay duty but you would have saved money from the one you would have paid to import directly. Free Trade Zone is attractive for even those who would produce and sell in-country because free trade zones are treated as foreign countries. It is far more attractive to those who produce and export to the outside world from the free trade zones. That is why foreigners love it so much because the regime there is very business friendly. So, if Port Harcourt wants to develop very fast, the concept of free trade zone is the answer. Make land available but not to anyhow person, to only those who have the capacity to attract investors and manage the free trade zones.
In our own case, if we are given land, up to 2000 hectares, if we do not fully develop the land, the government should take it back. The governor should take back the land. That is the guarantee we are prepared to give. We do so because we have got people making inquiries for things like shipbuilding. Cabotage cannot build ships here. These foreigners want to come and build ships here but with land and other guarantees. These inquiries are from China, US, all over. You know I was a UN consultant in maritime development and a lot of these countries know me personally. If I call, they will come. I helped them but they have gone far. Their governments are not like ours. They supported them and they went very far. If I say, come and help me back, they will come. Port Harcourt is a must even if we move to Delta State.
Nigeria needs many shipyards and many ships. Our waterways are very idle. Elsewhere, waterways are as busy as roads. Here, only crocodiles, no marking, no traffic, nothing. It’s so sad, just like a dead country. We cannot depend on imported vessels to ply those waterways, no. We have to have ship-building and boat-building capacities. The only way to do that is for government to assist just by providing land. That is all, maybe access road.
To test your enthusiasm sir; there is this acrimony between Rivers’ sons in the state government and those serving the FG; how do you wish to survive this when there would be need for collaboration between the state and federal agencies? Don’t you have fears beyond land acquisition?
I don’t have any fears. For instance, the maritime economy is bigger than imagination, so it’s not one ministry that is in charge. For free trade zones, the regulatory authority is under the Ministry of Trade and Industry, the minister there is from Abia State. Even if the minister was from Rivers State, I would have no fears. The minister who is from Rivers State is even with us. Yes, he is one of us. His NIMASA agency is corporate member of the Marine Club and almost all his agencies are corporate members or about to become. As a matter of fact, the Marine Club of Nigeria abhors three basic things; partisan politics, tribe and religion. They are no go areas. The Minister of Transportation knows it too well. Those who tried it, including senators and big people were removed, after some warnings. It is highly for maritime economy, purely professional; it is for people with passion for maritime economy.
By the way, what is that big deal about federal or state? We are even capable of bringing them together, so long as they are involved in maritime investment. They all want the best for Rivers State, even those aides around them that may be fanning the embers of discord; they too want the best for their state. We know that some aides don’t help matters.
Even if there are approvals needed from FG agencies, it is not the state government that would go for it, it’s the Marine Club. Yes, we will need something from state, federal and local agencies plus individuals. We do not have any fears in terms of getting this dream actualised.
What is the structure of the Marine Club of Nigeria, and who are qualified to join and what roles do they play as members?
It is an incorporated umbrella association of maritime professionals, practitioners and stakeholders. When we started off by 2003, the club was defined for those mainly in shipping and in core maritime jobs. Over the years, we have broadened its scope to now cover what we present as Maritime Economy of Nigeria. It is true too that when we started, it was private sector, but in the last three years we saw there was a problem between the private sector and the public sector. Each sector saw the other as ‘them’. Now, we decided we must bring both sectors together under one roof. That was when the membership changed and corporate members are in. Now, there is no longer ‘them’ or ‘us’. It is all of us.
Again, when we started, it was seniority basis, people that had been there for long. It became necessary to bring down the lower bar to admit younger persons with good experience of up to 10 years, people with bright ideas, instead of 30 years and above. We welcome persons with passion for the maritime economy; lecturers, engineers, stevedores, chandlers, trained persons in the sector, etc.
Any other message, especially issues of maritime banking, insurance, etc?
One of the things we are doing is at the Corporate Affairs Commission (CAC) level. We are registering a company called Maritime Finance Company Limited. The delay is because the share capital should be a minimum of N200m if we must cover finance sector. When that is done, it will be the catalyst for acceleration of the maritime sector by providing maritime banking and insurance services. It will face infrastructural financing in the free trade zone. We are partnering with NEPZA.
Some of the companies would be scattered in the various maritime free trade zones across the country. Funds will come in from outside and could be disbursed at less than five percent interest; very special dispensation.
In a free trade zone, everything is within you. The interest rate is our business as long as it is in the free trade zones. We are on it. Things have been delayed because of distractions but we have not been idle. We will not be waiting for commercial banks at 30 per cent. The company we are packaging will operate as a brokerage firm because it is not a lender but facilitator. The lender will be the Maritime Bank which would be promoted by the Maritime Finance Company. The Maritime Bank would be on the stock market.
Conclusion
Our agenda is very clear on what we want to do to get us to where the Nigerian maritime economy ought to be.
