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.:Maritime News :.
.: 9-May-2016 :.
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Why West Africa And Nigeria Have The World's Most Dangerous Seas
For years, piracy in African waters was almost exclusively associated with the Western Indian Ocean off Somalia's eastern coast.
But while the problem is still of grave concern in the Horn of Africa, another part of the continent has overtaken it as the most dangerous region in the world for seafarers-the Gulf of Guinea in West Africa, and in particular the waters south of Nigeria's oil-producing Niger Delta region.
Throughout 2015, 54 pirate attacks were reported in the Gulf of Guinea, which was actually a slight decrease on the 67 recorded in 2014, according to an annual report by maritime security monitoring group Oceans Beyond Piracy (OBP) released on Tuesday. But the attacks had deadly results-23 people were killed by pirates in the region in 2015. In comparison, records of attacks in the Western Indian Ocean region-which covers activity by Somali pirates-show only 16 attacks and no deaths in 2015. As well as the human cost, piracy and armed robbery in the Gulf of Guinea cost governments and industries an estimated $720 million, largely in security fees.
The Gulf of Guinea is a vast region comprising multiple countries, but one finds itself at the center of the recent rise in violent piracy. Since the election of Nigerian President Muhammadu Buhari in March 2015, Africa's biggest economy has been hit by a rise in pirate attacks in the Gulf of Guinea, which lies just south of Port Harcourt, one of the biggest oil-producing states in the country.
Technically, incidences of piracy only occur on the high seas-meaning, in international waters and not within the jurisdiction of any one state. Of the 54 incidents recorded in the Gulf of Guinea in 2015 by OBP, however, almost half took place in either Nigeria's territorial waters or in its Exclusive Economic Zone, waters in which Nigerian ships have rights over natural resources but which fall under universal jurisdiction.
Nigeria is no stranger to trouble on the waters. In the mid-2000s, the creeks and rivers of the Niger Delta were patrolled by militants belonging to groups such as the Movement for the Emancipation of the Niger Delta (MEND), who attacked oil infrastructure and kidnapped oil workers in recompense for what they claimed was the unfair distribution of the country’s oil wealth. At its peak, the Niger Delta militancy cut Nigeria's oil capacity to less than a third of its maximum capacity.
A presidential amnesty program introduced in August 2009 established a fragile peace in the Niger Delta, with ex-militants being paid monthly subsidies and offered training opportunities. Lucrative security contracts-where militant leaders were effectively paid not to attack oil facilities-were also proffered to kingpins of the groups involved, including Government Ekpemupolo, more commonly known as Tompolo.
Buhari has initiated an anti-corruption drive since coming to power, however, which has ruffled the feathers of those threatening Nigeria's maritime security. The president sacked the Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Patrick Akpobolokemi, barely two months into his administration amid allegations of multibillion-dollar fraud. Akpobolokemi is currently awaiting trial on fraud charges, which he denies.
More significantly, Nigeria's anti-corruption agency issued an arrest warrant for Tompolo in January on charges of fraud and money laundering totaling almost 46 billion naira ($231 million). Tompolo has since gone on the run, refusing to turn himself in for arrest and insisting he has done nothing wrong.
According to Matthew Walje, the lead author of OCP's report, there is a link between those involved in the Niger Delta militancy and Nigeria's spike in offshore piracy. "The problems in the rivers [of the Niger Delta] are inextricable from the problems at sea," says Walje.
Walje says that the modus operandi of pirates in the Gulf of Guinea has changed in recent years. While pirates previously attempted to hijack vessels carrying valuable cargo such as oil, the majority of successful attacks in 2015 were kidnappings, where pirates approached vessels in a speedboat and took crew members hostage without trying to access the cargo. In one tragic incident, pirates boarded the Malta-flagged MT Kalamos just off Bonny in southern Nigeria, then engaged in a shootout with armed guards aboard the ship. In the gunfight, a Greek seafarer named Nikos Dagre was killed and a further three people were taken hostage, and later released.
While the recent flare-up constitutes a "specifically Nigerian problem" driven by domestic issues-such as Buhari's crackdown on corruption in the maritime sector-greater regional cooperation is needed to deal with the problem, says Dirk Steffen, director of maritime security at Denmark-based Risk Intelligence.
Steffen says that involved nations have taken several positive steps, noting how piracy has been tackled successfully in the Western Indian Ocean. In 2013, 25 west and central African countries signed up to the Yaounde Code of Conduct, which aims to improve information-sharing between countries in the region and crack down on piracy and transnational crime. The code was modeled on the Djibouti Code of Conduct signed in 2009 by Somalia and others in and around the Western Indian Ocean. Also, a command center for merchant ships traveling in the Gulf of Guinea, based in Ghana, operates as a hotline for security advice and reporting incidents of piracy.
But, says Steffen, the measures are not being enforced with prosecutions. "Most countries do not have legislation in place that deals with piracy or piracy-like criminal activities," says Steffen. And without prosecutions or accountability, the pirates will keep trying their luck.
Simatech's India move could be a game changer for coastal shipping
After listening to M.G. Maghami, chairman of Dubai-based feeder container ship operator Simatech Shipping LLC, one can only wonder why more global fleet owners aren’t registering their container fleet in India.
Maghami is a pioneer in the container shipping industry, and doesn’t hesitate to say it.
"We are the pioneers," he said during a visit to Mumbai last week. "Three years ago, we started going to Mogadishu port, which was the centre of piracy. We were the first company to open container shipping services to Mogadishu… We opened the route, we went to the port, cleaned up the port. We put up cargo handling systems… everything; now, you can see all the shipping lines going there.
"We had several discussions with the United Nations anti-piracy force. I told them if there is business activity, people go. Luckily, Somalia is doing very well. After we started, volumes are growing, people have started getting hope, truck drivers are coming to the port, taking cargo and going to neighbouring destinations such as Kenya and Ethiopia. So, trade and business activities create society’s stability… it happened in Somalia".
"We were the first container shipping company to start services to Iraq almost 18 years ago. We are the first non-Indian shipping company to come to India and run container shipping services linking local routes with two Indian-registered ships. We are planning to register two more ships under the Indian flag."
Maghami, an Iranian national, is also excited over the decision of western nations to lift sanctions on Iran and the business opportunities it opens up. Simatech, he said, plans to start a direct shipping service between India and Iran.
What made him pick India as a destination for registering two of his ships under the Indian flag and run services connecting local ports when other global fleet owners have shied away"
"The most important thing that persuaded us to come to India is the government. The government believes in competitive industries, and this helps us a lot.
"What also made us look at India seriously is its open market policies, which allow everybody to come and operate. The second thing is the opportunities here," he added.
India allows 100% foreign direct investment (FDI) in shipping. So, global fleet owners can come and set up shop in India on their own without the requirement of a local partner to do business in the country.
There are some 18 Indian-registered container ships to cater to a market size of about 600,000 twenty-foot equivalent units (TEUs) that are transported for local use (not export-import) a year. This market is expected to grow as India takes steps to facilitate the shifting of containers now hauled by road and rail to sea.
Only Indian-registered ships are allowed to carry cargo on local routes, according to the so-called cabotage law. Simatech is trying to tap this opportunity.
From October last year, Indian-registered ships carrying export-import containers, empty containers and containers stuffed with cargo meant for local consumption plying on local routes have been exempted from paying customs and excise duty on bunker (ship fuel).
This is a big incentive for Indian ships because bunker accounts for about 40% of the operating cost of a ship.
Also, since 2004, Indian-registered ships have been subjected to tonnage tax-a levy based on the cargo-carrying capacity of a ship-in place of a corporate tax, cutting the tax outgo of a shipping company to 1-2% of its income. About 95% of the global shipping fleet operates under the tonnage tax regime.
More than the tax aspects, Maghami says that it was his "willingness" as a shipowner that prompted him to register the two ships under the Indian flag.
"Those ships we brought here, we bought them for cash and brought them here. Banks are not very clear towards the Indian flag. Indian flag must be known to the financiers," he said.
"The financiers prefer more flag of convenience, (a term used to describe ships registered in tax havens such as Panama, Malta and Cyprus). Because of the reputation in India especially, wherever the tax application is there, it’s a bit cloudy for financiers," he added.
Transporting cargo on local routes using ships will bring down the cost of domestic shipments and cut the overall logistics costs for local industries.
It also helps India to reduce carbon dioxide (CO2) emissions because ships emit lesser CO2 than trucks, he added.
Apart from the state-run Shipping Corp. of India Ltd (SCI) and Shreyas Shipping and Logistics Ltd, which runs Indian-registered container ships, India lacks container ship operators who can bring about a paradigm shift in the way cargo is shipped on local routes.
The arrival of Simatech with two Indian-registered ships could be a potential game changer from that perspective.
ABS Chairman, President and CEO Addresses SUNY Maritime College Graduates
Christopher J. Wiernicki, Chairman, President and CEO of ABS, addressed the college graduates, their families, faculty members and honored guests at the State University of New York (SUNY) Maritime College’s commencement ceremony on 6 May. The ceremony saw approximately 300 students graduate inside historic Fort Schuyler.
"I am honored to share real leadership lessons that these bright graduates may apply beyond the boardroom," said Wiernicki. "Success in life and leadership go hand-in-hand. While there is no substitute for experience and learning from mistakes, everyone can be a leader."
Wiernicki's remarks shared personal insight into his father's personal success and quiet leadership - from challenges as a prisoner in Auschwitz-Birkenau during World War II to humbling success following his escape from the concentration camp and ultimate emigration to the United States. Wiernicki focused on leadership lessons that may be applied no matter the situation one faces in life, highlighting the values of integrity, perseverance, hard work, relationships, focusing on the future, and placing respect and dignity as the cornerstone of any leadership philosophy.
"Over the years, ABS has been a valued friend to the college in its support of our students and faculty," said Rear Adm. Michael Alfultis, President of SUNY Maritime College. "It's an honor to have Chris Wiernicki at our spring commencement as a way of acknowledging all ABS has done, and continues to do, to help maritime education."
During the ceremony Wiernicki received an honorary doctoral degree from SUNY Maritime College in recognition of his contributions to the school and his professional achievements. In addition to serving as Chairman, President and CEO of ABS and Chairman of the ABS Group of Companies, Inc., Wiernicki also serves as Chairman of the International Association of Classification Societies. He previously held several senior roles at ABS, including President and Chief Operating Officer (COO), Chief Technology Officer, and President and COO of ABS Europe Ltd.
Wiernicki holds a Bachelor of Science in Civil Engineering from Vanderbilt, a Master of Science in Structural Engineering from George Washington University, where he was later elected to the George Washington University Engineering Hall of Fame, and a Master of Science in Ocean Engineering from Massachusetts Institute of Technology (MIT). He has authored numerous papers and lectured at the university level. Wiernicki is a Fellow with the Society of Naval Architects and Marine Engineers. In 2013, he was awarded the Vice Admiral Emory S. Land Medal for outstanding accomplishment in the marine field. Wiernicki also serves on the Board of Trustees for the Seamen's Church Institute, serves on the Engineering Advisory Council for the University of Michigan’s College of Engineering, is a member of the Board of Trustees for the Webb Institute, serves on the National Advisory Council of the George Washington University School of Engineering and Applied Science, and serves on the Advisory Committee for the Department of Ocean Engineering at MIT.