Harboursandport.com: Lagos - Renowned maritime experts has beckoned on the Federal Government to quickly reverse the nation’s foreign trade terms from the current Free on Board, FOB to Cost Insurance and Freight, CIF to benefit from the $360 billion annual global freight rate.
While the FOB gives the buyers of Nigerians crude oil right to determine who and how the product is shipped out of the country, CIF gives the country the right to include the cost of the product, its insurance and freight when selling to an intended buyer.
While Nigeria only benefits from the crude through FOB, the nation benefits from the product, its insurance and freight.
Speaking at the 20th anniversary lecture and awards by the League of Maritime Editors (LME) held in Lagos yesterday, the experts decried that government has refused to revert the negative trade terms despite its disadvantage to the nation’s economy.
The Former Minister of Interior and Executive Chairman, Genesis World Wide Shipping Nigeria Limited, Emmanuel Iheanacho, buttressed the need for government to quickly revert the trade terms to help grow shipping business and the nation’s economy.
Iheanacho explained that government should create conducive environment for the shipping industry to provide more job opportunities for Nigerians. He also said government should leave shipping operation in the hands of private sectors to run.
Managing Director of Kamany Marine Services Limited, Charles Okorefe, said until the federal government makes the change, the nation would continue to lose huge revenue annually from the freight component of the sale of crude oil.
“The FOB, CIF issue is enough, we cannot be losing freight. We are not earning anything from the freight of about $350 million in 2017, how much of it did we earn? It is not enough to just talk but we must begin to take action now”, he said.
Okorefe called on committee set up by the federal government on establishment of national fleet to ensure that the Nigerian National Petroleum Corporation buy into the effort because the NNPC have been frustrating stakeholders efforts in the past 20 years.
He also stressed that need to development local shipping capacity which would be of help in times of emergence. He pointed out that Iraq was able to survive its war situation and protect its economy because of its shipping capability.
“Iraq in their state of war would have gone under if they did not develop their indigenous capacity to lift their crude oil, what are we talking about? We do not have bottoms, can we not charter vessels? Of cause we can. So going back to your committee through the NNPC must ensure the involvement of Nigerians in the lilting of our crude oil. The FOB, CIF issue is enough, we cannot be losing freight,” he noted.
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