• Friday, June 14, 2024
businessday logo

BusinessDay

‘Maritime sector has suffered neglect despite its ability to stimulate the economy’

‘Maritime sector has suffered neglect despite its ability to stimulate the economy’

ADENIRAN ADEROGBA is the founder of CLG Securities, a transaction adviser to the Regional Maritime Development Bank (RMDB). In this interview, he speaks on the upcoming bank and the opportunities it has in store for the maritime sector. CHUKA UROKO reports.

To many, the Regional Maritime Development Bank is just another bank out there. But it could mean much more. What is the bank all about?

The Regional Maritime Development Bank (RMDB) is the brainchild of member-countries of the Maritime Organisations of West and Central Africa (MOWCA), comprising 25 countries. Having identified the need to promote indigenous participation and harness the potential of the maritime sector estimated at $100 billion per annum, Heads of States of the member-countries passed a resolution in 2009 to set up the bank. Nigeria was mandated to not only host the headquarters of the bank but also take all steps to midwife it.

I served on an inter-ministerial committee charged with the responsibility of bringing the bank to fruition but, regrettably, changes in government stalled the process. However, a few years ago, CLG Securities approached the current administration to revive the project and we have received cooperation from the Presidency, the Minister of Transport, and MOWCA itself.

Very substantial work has been executed so far and I am pleased to note that at a recent general meeting of MOWCA, member countries passed a resolution for the immediate operationalisation of the Bank.

What is the current status of the bank and what are to be expected in the short to medium term?

In terms of the current situation, the Bank Charter, which governs its operations, has been signed up by members, an interim board has been constituted, which has been meeting actively and taking important decisions. Capital calls have been made while key policies and strategic plans are in place. Projects are being analysed for funding and have reached an advanced stage.

Read also: NPA flags-off Ikorodu export processing Terminal to ease documentation

For example, there are shipyard expansion in Nigeria of about $150 million and a $100 million port rehabilitation facility in Cameroun. Also, there are various port projects in Cote D’Ivoire. There are also discussions on funding a National Shipping carrier for Nigeria.

With regards to expectations, the sky is the limit. The maritime sector has suffered serious neglect despite its immense promise and ability to generate foreign exchange, create jobs and stimulate the economy. What we have today is very minute indigenous participation with heavy foreign dominance to the detriment of the region.

One of the debilitating factors for local entities’ growth is lack of access to finance and it is this issue that the bank seeks to mitigate. The bank is strictly focused on core maritime activities and the value chain with flexible financing structures.

What role will the Nigerian government play in supporting the bank?

The government has played a major role to date and we must make special recognition of the passion and commitment of the Presidency and, in particular, the Minister of Transport who has pursued this matter with intense zeal. Further support expected, of course, will be to fulfill Nigeria’s hosting functions, provide policy support for transactions, meet capital obligations and continue to rally other member countries to engage in the bank.

You have just estimated the value of the maritime sector at $100 billion per annum which is quite huge. Now, what opportunities do you see in the sector?

Enormous, one is that funding will be made available for vessels acquisition, aquaculture, fishing, aqua tourism, ports and shipyards development and upgrades, inter-modal transportation ports-to-rails-to-inland depots, human capacity development, etc.

It is useful to note that a country like the Philippines dominates manpower in global maritime activity and generates billions of dollars annually from this. Nigeria has the human resources to match this and the bank is poised to support that. Also, there will be a promotion of the value chain such as accounting, legal, and insurance services.

From your explanation, RMDB will be public sector-led. Any hope for private investor- participation?

Yes. The bank is structured as 51 percent government and 49 percent private ownership. So, there is scope for credible private investors to come in. There are three classes of shares. Class A for member-countries only; Class B for West and Central African investors, and Class C for investors outside these two regions. The bank will welcome discussions.