IMPLEMENTATION OF SUSTAINABLE BLUE ECONOMY IN NIGERIA

"Never depend on single income, make investment to create a second source,”       this assertion by Warren Buffet speaks volumes of the Nigerian economy which has over the years been dependent on oil exports for survival. This alone exposes us maximally to the effects of the global economy.  This article explores the place of the maritime industry in the development of the Nigerian economy, both locally and globally.

It is saddening to note that despite the fact the maritime sector has great potentials and is said to be the next to crude oil in terms of revenue and job creation, the sector’s contribution to the Gross Domestic Product is very low. In fact, it is so low that the bureau of statistics does not capture it in their analysis of Gross Domestic Product (GDP) contributing elements.

Before we go into details of the effects of the global economy and other factors on our local economy, it is very pertinent to explain how the economy works, and how we can manage it so that it can grow over time. Economic growth is simply described as the increase in the market value of goods and services over time. In Economics, it is the outward shift in its production possibility curve (PPC). What this simply means is that there’s an increase in the production capacity of a given economy. This explanation is what gives rise to the increase in the GDP and Gross National Product (GNI). In layman’s terms, it means that there’s been an additional income or spending power for everyone.

One may want to know why economic growth is so important. Economic growth is one of the major determinants of a healthy economy. One of the biggest impacts of long term economic growth of a country is that it would have a positive impact on national income and level of employment, which generally would increase the standard of living and the wealth of a country and its people. This increase in the national income would also boost the government’s treasury by way of extra tax income for spending on national development.

No economy in the world today operates in isolation. Events in one country or region can have a significant effect on the growth potential of another country. Nigeria is not excluded from this. Our economy today is overly dependent on the price of oil which is controlled by the Organization of petroleum exporting countries (OPEC) who also controls the amount of crude exported by each member country each day. This is a major determinant whether Nigeria would have a budget surplus or deficit. This is Nigeria’s major source of revenue and this affects us greatly which calls for the need to diversify our sources of revenue.

Other factors that may affect the Nigerian economy in 2019 include the Nigerian election, the United States dollar and the rate of interest in the USA. Of note in particular is the election that would be taking place in 2019. This is laden with uncertainties and has caused a decrease in foreign direct investment (FDI) in the country. It has also led to capital flight and paucity of funds in the local economy pending the outcome of the election.

Other factors that may limit our capacity to grow our economy includes the scarcity of physical capital and infrastructure, technology, capital flight, human capital and government’s laws and policies.

Notwithstanding that the factors listed above limits our capacity to grow and develop the economy, the Nigerian Maritime and safety Agency (NIMASA)  forecasts an increase of 10% in maritime business and implores stakeholders to invest in the sector for huge returns.  Therefore, there's need to begin internalizing our externalities so as to expand our economic capacity. The Nigerian Maritime industry is under-utilized, but it has the capacity to increase the production possibility curve of the Nigerian economy. So many aspects of this industry is not utilized to full capacity or anything near it. One way to achieve this would be to make a huge investment in the maritime and shipping sector. This sector can bring in good revenue that could surpass the oil revenue if properly harnessed. Looking closely at the charts, Nigeria is no way near China that has greatly benefitted from the maritime industry.

NIMASA in its forecast for the year 2019-2020 has projected an increase of 10% in the Nigerian maritime and shipping business, notwithstanding the limitations or barriers to achieving that. Dr. Dakuku, the director general of the agency had stated that "the maritime sector remains a pivot to the stability and growth of the economy, hence the need to provide guidance for industry players as it will attract more foreign direct investment and ultimately improve the nation’s GDP.

On this backdrop, it’s imperative for stakeholders to seize this opportunity to grow their business. It's also an opportunity for new investors in the sector. The opportunities for greatness and fame are unlimited wherever one is inspired to invest in the maritime sector. Dr. Dakuku stated that the areas for growth which can be utilized by investors in the country include financing and acquisition of assets for coastal and international trade, manpower development, maritime safety, ship building and repairs, recycling, marine insurance and support services.

Speaking of opportunities, it is expected that the activities of the non-oil sectors will increase and the new Lekki deep seaport will create new opportunities for investors. It is also projected that there would be an increase in local sea business in 2019. Therefore, this provides an opportunity for Nigerians to invest.  These opportunities, though capital intensive, would see an increase in the economic production capacity, increase in the national income, rise in employment level and reduction in youth restiveness. It would also increase government’s revenue and the general standard of living for the average Nigerian.

There’s also the need to open up other seaports in the country which would help in decongesting the seaports in Lagos and increase economic activities in other cities like Calabar, Warri, Port Harcourt and it’s environs.

There are other opportunities in the inland water tributaries. These include transport, fishing and sport. These tributaries needs to be developed because there’s need to create opportunities for those living close to the waters so they can bring their produce to the urban areas. This would enhance their source of livelihood and would greatly reduce the rural-urban migration.

These opportunities are subject to the provision of an enabling environment for businesses to thrive. This is the role of government to provide such environment to attract investors.  Truth be told, if government does not work optimally by providing an enabling environment in its laws and policies, businesses can never thrive. This generally affects everybody’s ability to succeed. It is a biome that cascades down to everything and everybody. Therefore, one can say that the government has a very strong role to play in ensuring that maritime businesses succeed by providing an enabling environment and ease of business conditions in the maritime sector.

Playing the role of the government, Dr. Dakuku, as head of NIMASA is working so hard to ensure that Nigerians take an important role in this maritime sector. It can be recalled that in 2018, NIMASA, signed a Memorandum of Understanding, (MoU) with the World Maritime University, Malmo Sweden to develop human capacity for the Nigerian maritime sector. It is his wish that Nigerians play an active role in this sector, because he knows the benefits that can come from investing in this sector.

Still working hard to ensure that Nigerians take an active role in the maritime industry, Dr. Dakuku, disclosed in 2018, that Nigeria has been able to ratify 40 conventions passed by the International Maritime Organisation (IMO) and International Labour Organisation (ILO) covering Maritime Safety, Labour and Marine Environment. One very important convention that was ratified, led NIMASA to inaugurate Marine Litter Marshals to assist the agency in ridding the oceans of unwanted waste materials that could cause environmental degradation and also impede safety of navigation on the nation’s territorial waters.

For the sake of Nigerians, Dr. Dakuku in 2018 went for the full implementation of the cabotage act all in his bid to empower Nigerians. I still recalled what he said,

“Our laws forbid foreign vessels operating in our territorial waters save for compliance with the Cabotage Act. There shall be no sacred cow when we commence clampdown on erring vessels. We want to increase the number of Nigerians who participate in the marine aspect of your business and we are working closely with the Nigerian Content Development and Monitoring Board (NCDMB) to have a joint categorization of vessels operating under the Cabotage Act in order to ensure the full implementation of the Act”.

That being said, let’s fast-forward to 2019. In the 2019-2020 forecast document, Dr. Dakuku reiterated government's effort in the area of sustaining an enabling environment especially in the areas of safety of vessels in the gulf of Guinea and the reduction of militancy in the Niger Delta. According to the director general, he is expecting that the national assembly will pass into law the bill to criminalize and punish maritime offenders. This in itself will give assurance to the international community and investors in particular, the local stakeholders of government's willingness to support their businesses.

Apart from creating good laws and policies, there’s the need for government to provide funding to the sector. Funding is like the fuel that powers any business. A business without funding sources will definitely flounder under the weight of it’s own debts. Dr. Dakuku, noted that funding for the sector is not enough, he stated that the government needs to increase the cabotage vessel financing fund (CVFF) while looking for other sources of finance. Worthy of note is the provision of funds for stakeholders and interested investors to plough money in the business of ship ownership and management. This will greatly impact the sector for growth.

Because of the potentials inherent in this sector, the Dakuku led administration of NIMASA is negotiating with government at the highest level to push for a special intervention fund, special interest rates and other incentives that will drive optimal growth and performance in the sector. It must also be noted that from the 2019-2020 forecast document, Nigeria is making huge investment in building human capacity to see that more Nigerians will get involved in shipping business and operation.

Putting all these in place without fixing the issue of technology is like building a house on a sandy foundation. Technology has important effects on business operations. Technology has both tangible and intangible benefits that would help one make money in business. Now that there are newer technologies, like the amazon’s deep learning platform and google’s field programmable gate arrays. The Nigerian Maritime industry could invest in these new technologies in the area of ship and fleet management. There are many of such technologies and there’s need for training and re-training of staffs to enhance productivity and efficiency. There’s no gainsaying the fact that there would be greater levels of automation and digitalization of processes that would create impacts in the maritime sector, and Nigeria needs to improve in their game if they have to compete globally.

In the words of Warren Bennis, "leadership is the capacity to translate vision into reality," and this is what Dr. Peterside Dakuku is doing at the helms of affairs at NIMASA. He saw the opportunities in the maritime industry and has continued to provide enabling environments for maritime businesses to thrive for Nigerians in this sector.

He has projected that the year 2019 will see an increase in maritime business which will add at least 10% to the GDP and a general increase in the purchasing power of the ordinary Nigerian.

It is believed that when all is effectively implemented, there would be an increase in economic activity, which will position Nigeria on the way to economic recovery after the 2015 recession and an economy that can sustain job creation and produce the kind of revenue that Nigeria needs to defend our country at home and abroad.

After studying the 2019 maritime forecast document, I say to all stakeholders in the maritime industry to have a fruitful 2019 and let new adventures begin.