The Director-General, Nigerian Maritime Administration and Safety Agency (NIMASA) Dr Dakuku Peterside, has called for the review of oil trade business in the country, saying the Free-on-Board (FoB) policy is causing huge financial losses to the country.
FoB is a trade policy that allows a buyer to pay for the shipment and landing costs of the goods from the port of origin.
Peterside said the country needs to adopt Cost, Insurance and Freight (CIF) for the lifting of crude oil to reap the benefits of the trade policy
CIF, he said, gives the seller the right to arrange for the ferrying of goods by sea to a port of destination, and provide the buyer with the documents necessary to collect them from the carrier.
Also, the President, Association of Nigerian Licensed Customs Agents (ANLCA), Alhaji Olayiwola Shittu, supported the review to end foreign domination of the huge shipping.
He said a major part of the problems faced by indigenous owners was due to the failure to enforce the Nigerian Maritime Administration and Safety (NIMASA) Act, 2007, more than 10 years after its enactment.
He said Nigeria is the only country that is still using the FoB policy, urging NIMASA to enforce its law.
A member of the group, Mr Segun Ogunsanu, said the indigenous shipping firms have over the years been grappling with lack of cargo support, adding that this had made many of them to close shop, a development which led to unemployment years after the enactment of the act and other legislations, such as the Cabotage Act, 2003 and Nigerian Content Act 2010.
“The policy is being used to the detriment of the economy,” he said.
Ogunsanu said the adoption of either the CIF by the Federal Government should be based on how the policy is of advantage to the parties involved in the shipping. The intention of the Cabotage Act, he added, was to give indigenous shipping firms the support to enable them to compete with their foreign counterparts, who have usurped the cargoes on the international shipping route and the coastal and inland region.