Mass death hits Nigerian-owned shipping companies

EXCLUSIVE!
Mass death hits Nigerian-owned shipping companies
• Over 80% shut down operations
• Ship owners sell assets to service bank loans

No fewer than 90 per cent of shipping companies owned by Nigerians have either completely shut down their operations or are barely struggling to survive, SHIPS & PORTS DAILY investigation has revealed.
Out of 12 indigenous shipping companies surveyed by SHIPS & PORTS DAILY, only two can be said to be operating viable businesses while the 10 others, representing 83 per cent of the companies surveyed, are either completely dead or are in comatose condition.
The companies sampled in the survey conducted last week by SHIPS & PORTS DAILY include Equitorial Energy, Oceanic Energy, Morlap Shipping, Peacegate, Pokat Nigeria Limited, Al-Dawood Shipping, Potram Nigeria Limited, Joseph Sammy, Genesis Worldwide Shipping and Multi-trade Group all in Lagos; Niger-Delta Shipping in Warri, Delta State; and Starzs Investment Group in Port-Harcourt, Rivers State.
Ironically, all the shipping companies surveyed in Lagos are either dead or struggling to survive while the ones in Warri and Port-Harcourt are thriving.
A visit to the business premises of the 10 shipping companies revealed that the once thriving ventures have completely lost their glamour, with most of them owing staff salaries of up to one year.

The companies, which the General Secretary of the Indigenous Shipowners Association of Nigeria (ISAN), Capt. Niyi Labinjo, described as “struggling heavily”, have mostly downsized and are operating with less than 20 per cent of the workers they had about two years ago.
All the companies are also heavily indebted to banks and are mostly unable to service the loans they took to buy ships.
Labinjo, who is also the President of Al Dawood Shipping, said that most of the ship owners have resorted to selling their landed properties to enable them service their bank loans, while others have lost prime properties to the banks.
The companies also owe their crew arrears of salaries ranging from six to 14 months, while some have sold off their vessels.
Genesis Worldwide Shipping, which was once seen as a thriving indigenous shipping company just four years ago, has completely gone under with not a single ship to operate.
The company, at its peak less than five years ago, had six ships.

The same fate has befallen Joseph Sammy Nigeria Limited with one of its staff describing it as “almost dead”. The only vessel left in the company’s fleet, MT Kemepade, was stolen recently. The ship was taken to a ship breaking yard in Ghana and the breakers were about to commence work on it before the owners found out. The case is in court in Ghana.
“The situation is pathetic. We are not only struggling, things are very bad for Nigerian ship owners. It has never been this bad. Most of us are selling our personal properties to meet our financial obligations,” Labinjo informed SHIPS & PORTS DAILY.
The dire straits in which the indigenous shipping companies found themselves have been traced to the non-availability of jobs for their ships to execute.
The situation, according to industry analysts, is compounded by the trio of poor implementation of the Cabotage Act, non-disbursement of the Cabotage Vessel Financing Fund (CVFF), and lack of implementation of the fleet maintenance and repair subsidy by the Nigerian Maritime Administration and Safety Agency (NIMASA).



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