• Saturday, June 22, 2024
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Navigating a world dominated by the ocean

FX stability, automation seen driving maritime growth

“The ocean is a realm that remains radically free…” – The Outlaw Sea, A World of Freedom, Chaos and Crime by William Langewiesche, 2004

Q: “Regrettably, maritime spaces have morphed into arenas for political contestations and operational voids, leaving natural resources at sea vulnerable to exploitation by state and non-state actors.”

Rising geopolitical tensions extending to the sea

In a recent article published by the Danish International Institute for International Studies titled “Maritime Security: How Geopolitics Hardens Threat Patterns at Sea and Challenges Known Solutions,” one can see that maritime security is threatened globally. It’s because of rising geopolitical instability caused by the power projection of global powers. The world is now facing a situation where state and non-state actors employ various tactics, short of outright warfare, as they display their capacities to deploy and sustain forces outside their territories.

Read also: Spanish Govt moves to support Nigeria in securing maritime domain

China, Russia, and Iran are state actors allegedly challenging international law and disrupting trading routes because of their activities in the South China Sea and Strait of Hormuz. While al-Shabaab and Houthi militias are reportedly exploiting the maritime domain to perpetuate their agendas, escalating violence and instability in the Red Sea,.

Maritime experts are of the view that this trend will endure as long as it’s driven by shifts in international relations where trade, energy, and geopolitical considerations are strategic imperatives. As we write, there are numerous maritime security challenges that undermine the existing maritime security cooperation framework that exists between maritime nations and their navies. Regrettably, maritime spaces have morphed into arenas for political contestations and operational voids, leaving natural resources at sea vulnerable to exploitation by state and non-state actors.

Why is the shifting dynamics of geopolitics a problem for Africa’s maritime domain? Regional maritime security efforts face additional threats. Maritime crimes will thrive despite partnerships with other developed countries. Russia, China, and Gulf countries are rapidly shaping the maritime security landscape in Africa. Disruptions in trade routes between Europe and Asia will impact most African economies.

Due to the Red Sea crisis, shipping faces challenges, and there are growing concerns about regional stability and potential geopolitical mixups. Most maritime countries in Africa that rely heavily on maritime trade must begin to strategize on how to mitigate fiscal losses. However, the crisis in the Red Sea may lead to inflationary pressures and hinder Africa’s economic recovery, affecting monetary policies and investment climates. In the final analysis, the Red Sea crisis may likely expose the fragility of African economies and the need for proactive measures to navigate through the stormy waters occasioned by geopolitical challenges.

NIMASA to engage insurance firms over war risk levy:

In Nigeria, it is widely reported that the Nigerian Maritime Administration and Safety Agency (NIMASA) plans to engage foreign insurance companies to tackle the issue of war risk insurance placed on Nigerian-bound cargo by shipping companies. This was disclosed by the DG NIMASA at the 2024 Stakeholders Engagement on enhanced activities in the blue economy sector organised by the Ministry of Marine and Blue Economy. The NIMASA boss wondered why Nigeria would be compared to Sudan and Somalia when there had not been a war in Nigeria since 1966.

“Of course, we want the maritime space to be clean, safe, and, most importantly, secure. I like the discussion that we are going to sit together and approach the insurance companies, the likes of Lloyds Insurance Company and many of them and ask them questions as to why we are being compared to Sudan and Somalia when there had not been a war in Nigeria since 1966,” he noted.

The NMASA boss promised that the Agency would ensure that something serious was done about the Cabotage Vessels Financing Funds before the end of the year… and that the Agency is working towards the creation of ship-to-ship zones to avoid cargo diversion to neighbouring countries.

265 Nigerian vessels registered in foreign countries, stakeholders lament:

Maritime stakeholders have said that 265 vessels owned by Nigerian beneficial interests have been lost to foreign ship registries due to the poor state of the country’s ship registry. A maritime lawyer, while citing a 2023 report by the United Nations Conference on Trade and Development, disclosed that the vessels were registered in Liberia, Marshall Island, Panama, Singapore, and others. Although Nigeria boasts the largest fleet in Africa with 291 vessels totaling 7.94 million deadweight tonnes and 30th place globally with a 0.56 percent share of the world fleet value, a staggering 265 of these ships, with a combined deadweight tonnage of over 6.485 million deadweight tonnes, are registered abroad. This is a classic example of capital flight and loss of control over maritime assets.

FG eyes $2.7 billion revenue from marine sector:

The FG said it has advanced a process of developing a national policy on marine and blue economy which is expected to contribute $2.7 billion to the national economy. The national policy on marine and blue economy, according to the FG, will play a great role in enhancing the performance of the shipping sub-sector and boosting trade as well as economic growth.

FG reaffirms commitment to dry ports development:

While commissioning the Funtua dry ports, President Tinubu affirmed that inland dry ports play vital roles in connecting seaports to the hinterlands. “I reaffirm our administration’s commitment to prioritising the completion and utilisation of more dry port projects. The critical infrastructure necessary for the seamless operations of inland dry ports is being targeted,” he said.

The Funtua dry port is the third to be completed and inaugurated among the six legacies of inland dry port projects spread across the six geopolitical zones. The dry port, according to Mr President, would grant importers and exporters located within inland cities as well as neighbouring hinterland countries such as Niger, Chad, Northern Cameroon, and Central Africa access to shipping and port services without physically visiting the seaports.

Extended continental shelf: Nigeria gains additional territory ….

Nigeria submitted an application recently to extend Nigeria’s maritime boundaries in accordance with the 1982 United Nations Convention on the Law of the Sea (UNCLOS). “These interactions have now culminated in the approval for Nigeria to extend its continental shelf beyond 200 M (200 miles).”

“As it stands now, the area approved for Nigeria is about 16,300 square kilometres, which is about five times the size of Lagos State.” But maritime experts would like to know by what distance in nautical miles Nigeria has been permitted by the UN to extend its continental shelf. Thank you.

MA Johnson, Rear Admiral (Rtd)