THE ROLE OF THE NIGERIAN MARITIME ADMINISTRATION AND SAFETY AGENCY (NIMASA) IN IMPLEMENTING CABOTAGE LAW IN NIGERIA
A critical analysis of the role of Nigerian Maritime Administration and Safety Agency (NIMASA) in implementing cabotage law in Nigeria has been carried out using the NIMASA head office, Lagos as case study. The work adopted the ex-post facto research design. Three hypothesis were formulated and tested. Data for the study was obtained through structured, validated and reliable questionnaire which was administered on 345 respondents selected randomly. Simple percentage and Pearson moment correlation coefficient statistical tool were adopted to analysed the data. The Pearson moment correlation coefficient was used to analysed the data. For hypothesis 1 correlation between effective monitoring and compliance to the cabotage law in Nigeria. The correlation coefficient yielded positive value of 0.8. This states that there is no significant impact on cabotage law in maritime in Nigeria. As a result, null hypothesis were rejected and alternate hypothesis accepted. For hypothesis 2 correlation between knowledge on shipping and cabotage market in the Maritime business in Nigeria. The correlation coefficient positive value of 0.6 was obtained. This shows that the extent of enforcement of cabotage law has no impact on Maritime business in Nigeria. Base on this, null hypothesis were rejected and alternate hypothesis accepted. And for hypothesis 3 correlation between Foreigners in control of Nigerian coastal and inland water trade in Nigeria. The correlation coefficient yielded positive value of 0.8. This states that the effective implementation of cabotage law has not restricted the use of foreign vessels in Nigeria coastal and inland water trade. Because of this, null hypothesis were rejected and alternate hypothesis accepted. The result indicates that cabotage law was not effectively implemented in Nigeria. It was recommended that stringent conditions for granting waivers to foreign vessels should be made, and Nigerian Maritime Administration and Safety Agency (NIMASA) should partner with other relevant agencies in order to form the needed synergy required to effectively implement the cabotage law in Nigeria.
TABLE OF CONTENTS
Certification - - - - - - - - - -
Dedication - - - - - - - - - -
Acknowledge - - - - - - - - - -
Abstract - - - - - - - - - - -
Table of contents - - - - - - - - -
CHAPTER ONE: INTRODUCTION
⦁ Background to the Study - - - - - - -
1.2 Statement of the Problem - - - - - - -
1.3 Objective of the Study - - - - - - - -
1.4 Research Questions - - - - - - -
1.6 Significant of the Study - - - - - - -
1.7 Scope of the Study - - - - - - - -
CHAPTER TWO: LITERATURE REVIEW
2.1 The Cabotage Law - - - - - - - -
2.2 Cabotage Law Practice by Different Countries - - - -
2.3 The Four Pillars of Cabotage Law - - - - - -
2.4 Roles of NIMASA In Implementing Cabotage Law - - -
2.5 The Extent of Enforcement of the Cabotage Law - - -
2.6 Challenges of Implementing Cabotage Law in Nigeria - -
CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Research Design - - - - - - - -
3.2 The Study Area - - - - - - - -
3.3 Population of Study - - - - - - - -
3.4 Sample of the Study - - - - - - - -
3.5 Sampling Technique - - - - - - - -
3.6 Instrumentation - - - - - - - -
3.7 Validity of Instrument - - - - - - -
3.8Reliability of the Instrument -----
3.9 Data Collection Procedures - - - - -
3.10 Data Preparation and Scoring - - - - -
3.11 Procedure for Data Analysis - - - - -
3.12 Scoring of Responses - - - - -
3.13 Method of Interpretation of the Result- - - - -
CHAPTER FOUR: RESULTS AND DISCUSSION
4.1 Table 4.1 Present sex distribution of the respondents - -
4.2 Analysis - - - - - - - - - -
4.3 Discussion - - - - - - - -
SUMMARY, CONCLUSION AND RECOMMENDATIONS.
5.1 Summary - - - - - - -
⦁ Background to the Study
Nigeria is naturally endowed with numerous resources which includes: crude oil, natural gas, tin, columbite, iron ore, coal, zinc, Iime-stone, lead, a stretch of coastline of about 870 kilometres, and about 3,000 kilometres of inland waterways and 913,075 square kilometers in inland mass (USGS, 2001). The coastline as well as the inland waterways provide navigable route for transportation of bulk materials and passengers using ships and boats.
Before the advent of cabotage law, maritime industry was controlled and dominated by foreigners; Nigerians own less than 20% of the market share in the industry (Ballack S., 2006). Even most of the shipping services which constitute about 30% of the crude oil transaction were performed by foreigners and huge amount of profits were being repatriated to their home countries (Ballack S., 2006). This makes the Nigeria economy dependent on the foreign economy and jobs that could be created for Nigerians were performed by foreigners. The operation of the foreigners was with impunity and without regards to safety of our maritime environment and bio-security. These have been the problems which cabotage law is trying to solve.
However, the government at various times had to develop indigenous merchant fleet or shipping industry initiated policies and projects to boost indigenous vessel acquisition, increase participation of Nigerians in the maritime industry, limit the domination of foreigners in the maritime industry and develop indigenous shipping business. Notable in this respect in the acquisition of 24 vessels by the now defunct Nigerian National Shipping lines (NNSL) in the 1970s and the establishment of the ship acquisition and ship building fund (SASF) under National Shipping Policy Act 1987 Cap. 44 LFN 1990. But all these initiatives failed to achieve their objectives. The commercial operations of carriage of goods, services and passages in the inland and coastal waters of Nigeria are still almost exclusively dominated by foreign owned and foreign and foreign crewed vessels.
For instance, Biu (2007) noted that in 2003, 11 out of 245 coastal vessels that operated in the Onne oil and gas free zone axis were owned by Nigerians. Also in every 266 tankers that were engaged in coastal trading in the Apapa port, 44 tankers that is about 16.5% were Nigerian owned while 222 about 83.5% were foreign owned. By implication, the total metric tonnage of petroleum products carried by the Nigerian owned tankers was 97,041 tons amounting 3.4%. While the foreign owned tankers carried 2,745,365 metric tons amounting to 96.6% of the entire volume of cargo. This alone confirms the reality of foreign domination in the coastal trade as at 2003.
In finding solution to this, stakeholders and professionals in the shipping industry made a clarion call for the restructuring of the maritime industry as it affects domestic trade for the benefit of the citizenry and the economy well being of Nigerians (Biu, 2007). Base on this coastal and inland shipping, Cabotage Act, 2003 was enacted and to be enforced by the National Maritime Authority (NMA) now Nigerian Maritime Administration and Safety Agency (NIMASA). Coastal and inland shipping (Cabotage) Act No. 5 of 2003 laws of the Federation of Nigeria is the “Act to restrict the use of foreign vessels in Domestic Coastal Trade to promote the development of indigenous Tonnage and to establish a cabotage vessel financing fund and for related matters.”
This Act was fashioned after the Jones Act of the United States of America (USA). The law include, restrictions, waivers to meet lack of capacity, enforcement, cabotage vessel financing fund (CVFF) amongst others. This law is a legislative apparatus for restricting access as well as reserving maritime trade within geographical space of a country to indigenous capacities (Usoro, 2010).
With the desire of seeing that cabotage law produce the required result expected to restricts the use of foreign vessels in our domestic coastal and inland waters trade; Hence, the establishment of Nigerian Maritime Administration and safety Agency (NIMASA) an agency of the Federal Ministry of Transport established from the merger of National Maritime Authority (NMA) and Joint Maritime Labour Industrial Council (JOMALIC) on August 1, 2006 to monitor, implement and enforce coastal and inland shipping Act, 2003. Interestingly, by 2007, the National Assembly passed a law formalizing the establishment of the Nigerian Maritime Administration and Safety Agency knon as NIMASA Act 2007 empowering it to implement and enforce the cabotage Act, 2003 (Usoro, 2010).
Furthermore, in the course of enforcing the cabotage Act 2003, the NIMASA under the supervision of the Federal Ministry of Transport synergized with the following federal agencies such as Nigerian inland Waterways Authority (NIWA), Nigeria Ports Authority (NPA), and the security agencies like Nigerian Navy, Customs, Police and Immigration. Also, in order for effective enforcement of the cabotage Act 2003, Nigerian Maritime Administration and Safety Agency (NIMASA) was divided into the following departments or units like the Register of ships, Cabotage enforcement unit, Collecting Agency for Cabotage Vessel Financing Fund and Seafarers Training and Certification Development (Wilson, 2005).
The NIMASA Act, 2007, conferred the following functions on the agency; restrict the use of foreign vessels in domestic coastal trade, promote development of indigenous tonnage, establish vessels financing fund (CVFF), reserved the bulk of coastal trade for vessels built, owned, registration in Nigeria and manned by qualified Nigerian Seafarers, improve environmental safety, protect the nations security interest, enhancing domestic waterborne transportation, increase the national fleet or tonnage, develop ship building and repair capability, create opportunities for employment, conserve foreign exchange and protect national economy and security (Agu, 2005).
It is obvious that cabotage law aimed at restricting coastal and inland water trade in a country to vessels flying its national flag and operates within the country. It is basically a protective law that safeguards the interest of local shipping in the carriage of locally generated cargo. It suppose to develop indigenous capacity in our coastal and inland shipping trade. But this objectives seems to be a mirage because after 10 years of cabotage law, 2003 enactment restrict foreigners assumed to dominate Nigerian coastal and inland shipping trade (Agbakoba, 2010).
⦁ Statement of the Problem
In pursuance of the success of Nigerian maritime reforms, bold attempt to change the face of maritime business within its coasts or upturn the dominance of foreign owned and foreign crewed vessels was made. This was to enact the coastal and inland shipping (cabotage) Act, 2003, to be enforced by the National Maritime Authority (NMA) now Nigerian Maritime Administration and Safety Agency (NIMASA). The objective of the cabotage Act is primarily to reserve the commercial transportation of goods and services within coastal and inland waters to vessels flying Nigerian flag and owned by persons of Nigerian citizenship. The cabotage law is suppose to reserves the commercial transportation of goods and services within the Nigeria coastal and waters to vessels flying the countries flags, that is, vessels owned and crewed by Nigerians. Yet for about ten years, (since 2003), from when cabotage Act was enacted, foreign owned and foreign crewed vessel still dominating the commercial operations of carriage, goods services and passengers in the coastal and inland waters of Nigeria, it is important to explore the roles played by Nigerian Maritime Administration and Safety Agency (NIMASA) in the enforcement of the law, after ten years of it existence. Are the foreigners still in full control of our coastal trade? Have Nigerian taken their rightful position in the local coastal trade based on the cabotage law?
1.3 Objective of the Study
The work aims at investigating the level of implementation of cabotage law in Nigeria, this was achieved through the following objectives:
⦁ to identify the role of Nigerian Maritime Administration and Safety Agency (NIMASA) in implementing cabotage law in Nigeria.
⦁ to examine the extent of enforcement of the cabotage law.
⦁ to explore the impact of granting waivers to foreign vessels on cabotage law.
⦁ to identify the challenges of implementing cabotatge law in Nigeria.
1.4 Research Questions
Research questions raised in this work are as follows:
⦁ Does the cabotage law have any significant impact on the maritime industry in Nigeria?
⦁ Are the foreigner still in control of our coastal trade?
⦁ To what extent has the enforcement of the cabotage law affected the maritime industry?
⦁ Does granting of waivers to foreign vessels have any significance impact on the maritime industry in Nigeria?
1.5 Research Hypothesis
For the purpose of this study, two testable hypothesis have been developed with H0 representing null hypothesis and H1 representing the alternative hypothesis, which accepted while it is rejected. The null hypothesis was formulated to negate certain factual statement and attempts to have be made to prove them wrong.
The following hypothesis will be tested for acceptance or rejection in the study.
H0: There is no significance impact of Cabotage Law on Maritime Industry in Nigeria.
H1: There are significance impact of cabotage law on maritime industry in Nigeria.
H0: The extent of enforcement of cabotage law have no impact on maritime business in Nigeria.
H1: The extent of enforcement of caboateg law have impact on maritime business in Nigeria.
1.6 Significant of the Study
Cabotage Act, 2003 is a basket of opportunities for training and employment to Nigerians cadets and seafarers. The Act stipulates that any vessel whether foreign or local owned must have onboard Nigerians seafarers and two cadets (i.e one deck and one Engine).
Base on this, it is important to state categorically that this work will be of great benefits to Nigerian cadets, seafarers and NIMASA in the following ways:
To the Cadets: It will help them to have first class information on the protection of their right to seatime under the cabotage law.
To the Seafarers: It will benefit substantially because the activities in the marine operation will usher in carriage of cargo, passengers in the coastal and inland waters to the offshore exploration and production, which involves transportation of cargoes, passengers and crude oil in bulk by ships, which in turns create massive opportunities of employment to Nigerian seafarers.
To NIMASA: This work will be of great benefit to NIMASA as it helps to measures the level of compliance with the provision of the cabotage law and know whether vessels operating under cabotage law actually engaged Nigerian seafarers and cadets on board.
1.7 Scope of the Study
Based on cabotage law, this work is limited to vessel flaying Nigerian flag and primarily operates within Nigerian coastal and inland waterways. And the role of Nigerian maritime Administration and Safety Agency (NIMASA) in implementing cabotage law in Nigeria. Meanwhile, the scarcity of data due to the young age of the cabotage regime in Nigeria as well as financing and time constraints constituted major limitations of this study..