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Posted: January 7th, 2024
ASSESSMENT OF CABOTAGE ACT IMPLEMENTATION IN NIGERIA
ASSESSMENT OF CABOTAGE ACT IMPLEMENTATION IN NIGERIA
The Cabotage Act, officially known as the Coastal and Inland Shipping (Cabotage) Act of 2003, is a law that aims to restrict the use of foreign vessels in domestic coastal trade, promote the development of indigenous tonnage, and establish a Cabotage Vessel Financing Fund (CVFF) for related matters. The objective of the Cabotage Act is to enhance the participation of Nigerian citizens and companies in the maritime sector, create employment opportunities, boost local capacity, and foster national security.
The Cabotage Act covers the carriage of goods and passengers by vessel or any other mode of transport from one place in Nigeria or above Nigerian waters to any other place in Nigeria or above Nigerian waters, either directly or via a place outside Nigeria. It also covers the carriage of goods and passengers in relation to the exploration, exploitation, or transportation of the mineral or non-living natural resources of Nigeria, whether in or under Nigerian waters.
The Cabotage Act stipulates that only vessels that are wholly owned by Nigerian citizens, manned by Nigerian citizens, built in Nigeria, and registered in Nigeria can engage in cabotage trade. However, the Act also provides for waivers on these requirements in cases where there is no wholly Nigerian-owned vessel that is suitable and available to provide the services or meet the demand. The Minister of Transportation has the power to grant waivers on the ownership, manning, and building requirements, while the Nigerian Maritime Administration and Safety Agency (NIMASA) has the power to grant waivers on the registration requirement .
The Cabotage Act also establishes the CVFF, which is a fund that is meant to provide financial assistance to Nigerian operators in the cabotage trade. The fund is sourced from a 2% surcharge on all contracts awarded under the cabotage regime, as well as fines and fees imposed by NIMASA. The fund is administered by NIMASA in collaboration with the Bank of Industry (BOI), under guidelines issued by the Minister of Transportation. The beneficiaries of the fund are Nigerian citizens or companies that are engaged in cabotage trade and have met the eligibility criteria .
The implementation of the Cabotage Act has faced several challenges since its enactment in 2003. Some of these challenges include:
– The lack of adequate and reliable data on the number, type, and capacity of vessels operating in the cabotage trade.
– The scarcity of qualified and competent Nigerian seafarers to man the vessels.
– The high cost and difficulty of building vessels in Nigeria due to inadequate infrastructure, technology, and expertise.
– The delay and bureaucracy in processing waivers and licenses for cabotage operators.
– The poor enforcement and compliance with the provisions of the Cabotage Act by NIMASA and other relevant agencies.
– The low awareness and understanding of the benefits and opportunities of the Cabotage Act among stakeholders and potential investors .
Despite these challenges, the Cabotage Act has also recorded some achievements and impacts on the maritime sector. Some of these achievements include:
– The increase in the number of vessels registered under the cabotage regime from 13 in 2004 to 125 in 2019: 2024 – Online Assignment Homework Writing Help Service By Expert Research Writers.
– The increase in the number of wholly Nigerian-owned vessels operating in the cabotage trade from 36% in 2015 – Research Paper Writing Help Service to 68% in 2019: 2024 – Online Assignment Homework Writing Help Service By Expert Research Writers.
– The increase in the revenue generated from cabotage fees from N9.4 billion in 2015 – Research Paper Writing Help Service to N25.8 billion in 2019: 2024 – Online Assignment Homework Writing Help Service By Expert Research Writers.
– The creation of over 6,000 direct jobs and over 20,000 indirect jobs for Nigerians in the maritime sector.
– The improvement in the security and safety of Nigeria’s coastal and inland waters through enhanced surveillance and patrol by NIMASA and other security agencies .
In conclusion, the Cabotage Act is a laudable initiative that aims to promote Nigeria’s maritime development and economic growth. However, there is still room for improvement in its implementation and enforcement. Some of the recommendations that can enhance the effectiveness of the Cabotage Act are:
– Strengthening the capacity and coordination of NIMASA and other relevant agencies to monitor and enforce compliance with the Cabotage Act.
– Developing a comprehensive database and information system on cabotage vessels and operators.
– Enhancing the training and certification of Nigerian seafarers to meet international standards and demand.
– Providing incentives and support for local shipbuilding and ship repair industry.
– Reviewing and streamlining the process and criteria for granting waivers and licenses for cabotage operators.
– Increasing awareness and sensitization among stakeholders and potential investors on the benefits and opportunities of the Cabotage Act .
Help write my assignment – Bibliography
: Coastal and Inland Shipping (Cabotage) Act, 2003. Retrieved from https://nigerianlawguru.com/legislations/STATUTES/CABOTAGE%20ACT.pdf
: Guidelines on Implementation of Coastal and Inland Shipping (Cabotage) Act, 2003. Retrieved from https://nimasa.gov.ng/wp-content/uploads/2019: 2024 – Online Assignment Homework Writing Help Service By Expert Research Writers/08/Guidlines-on-Implementation-of-Coastal-and-Inland-Shipping.pdf
: NIMASA (2020). Cabotage Act. Retrieved from https://nimasa.gov.ng/cabotage-act/
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