CABOTAGE ACT AND ITS IMPACT ON LOCAL CAPACITY DEVELOPMENT

Abstract: In the year 2003, the cabotage law was implemented, incorporating provisions that aimed to grant local investors the authority to dominate the domestic shipping industry. The intention behind this was to bolster the nation's capabilities and establish Nigeria as a prominent maritime nation in facilitating the transportation of import and export cargoes, including crude oil, to and from global markets. It is imperative to maintain a continuous vigilance over the implementation and enforcement of the provisions outlined in the Act, in order to ascertain that the aims and objectives of the legislation are ardently pursued and successfully achieved. Hence, the primary objective of this study is to substantiate the purported unrelenting hegemony of foreign-flagged operators in coastal services. Additionally, it aims to assess the influence of the Cabotage Act of 2003 on the advancement of local capacity in terms of tonnage, human resources, and cargo assistance. The research endeavoured to elucidate the perspectives of individuals that are pertinent to the study, thereby constituting the literature review. The primary tool employed for this study comprises a collection of questionnaires administered to a cohort of 55 individuals who hold significant roles within the industry. Of this group, a total of 27 participants provided their responses. The acquired data were subjected to statistical analysis utilising the chi-square model, and subsequently, a pie chart was employed to effectively present the findings as an explanatory model. The study's findings have brought to light various factors that impede the successful attainment of the Acts' objectives. These hindrances include insufficient financial resources, NIMASA's inability to efficiently process applications for the cabotage vessel finance fund loan to facilitate tonnage expansion, a lack of dedication from NAPPIMS and PPMC in ensuring cargo support for domestic operators, and NIMASA's lackadaisical approach towards enforcing the Act's provisions. The aforementioned study also observed that a significant majority of the cabotage vessels, which are predominantly operated by indigenous shipping companies, fail to meet the prescribed standards and are deemed unfit for navigation. Furthermore, it has been duly observed that a conspicuous dearth of seafarers, specifically those possessing the requisite qualifications and certifications as marine engineers and navigators, has been steadily on the rise. This scarcity poses a significant challenge in terms of efficiently operating the limited number of cabotage vessels currently in existence. The scholarly investigation proposed various methodologies to augment the involvement of indigenous communities while concurrently mitigating the prevailing influence of foreign entities.  It is imperative that NMASA, the National Maritime Administration and Safety Agency, takes immediate action to ensure that the cabotage vessel finance fund/loan facility is made readily available to local operators in order to facilitate fleet expansion. Additionally, it is crucial for NMASA to establish robust arrangements for cadet-ship sea-training, thereby enhancing proficiency and mitigating the need for importing skilled manpower. The implementation of PPMC (Port Productivity Monitoring and Control) and NAPPIMS (National Port Performance Information Management System) ought to ensure the provision of extended-term charters for the fleet, serving as a form of incentivization to mitigate instances of idleness. Conversely, it is imperative for local operators to endeavour to showcase vessels that adhere to established standards and possess the necessary seaworthiness for the purpose of facilitating optimal cabotage operations and ensuring the preservation of pristine marine environments.