The Central Bank of Nigeria (CBN), plans to collaborate with the Nigerian Shippers’ Council (NSC), to compel all shipping agencies to open Disbursement Accounts (DAs) from where they will carry out operational costs for their multinational principals overseas.
The apex bank and the ports regulator said this was in line with Article 4 of the UNCTAD minimum standards for shipping agents worldwide.
The Executive Secretary, NSC, Hassan Bello, explained during a meeting between the CBN representatives and shipping industry stakeholders in Lagos, that the maintenance of a disbursement account as provided by ‘UNCTAD Minimum Standards for Shipping Agents’ stops the agent from going to the local market to source foreign exchange to settle charges incurred by the vessel locally.
Bello, who was represented at the occasion by the Director, Legal Services of the Council, Samuel Vongtao, identified such charges to be covered by the DAs as those collected by the Nigerian Ports Authority (NPA); Nigerian Maritime Safety and Administration Agency (NIMASA); ship chandelling costs, and other local shipping costs.
Bello said such charges were usually in foreign exchange since “it is assumed that the principal must have wired the funds to the disbursement of account of the agent in foreign exchange.”
According to him, it is left for the agents to make such payments in currency that was transferred to the disbursement account rather than going to the interbank market to source for foreign exchange.
He said it was wrong that in Nigeria, the practice was completely different, adding that “shipping agents apply to transfer all incomes to their principal, while at the same time applying to Central Bank of Nigeria (CBN) for Forex at interbank market to service local costs.”
Bello expressed delight that when it was notified of the development, the CBN had responded by setting up investigative teams that went to all banks, and positively ascertained that there was not a single type of such account being operated by any Shipping Agency in the country.
The CBN Deputy Director, Foreign Exchange Management, Trade & Exchange Department, A.S. Jibrin, said the meeting with stakeholders was to ensure that the DA enjoys the support of those in the shipping industry.
Jibrin explained that what the CBN set out to do was to listen to the stakeholders on the DA, adding that the apex bank is interested on policies that will grow the shipping industry and the national economy.
He said decision on the policy could not have been taken without hearing from those in the industry, and expressed joy over the consensus in favour of the introduction of the Disbursement Accounts.
A former Director, Shipping Services of NSC, Mrs Dabney Shall-Holma, said the Disbursement Account will go a long way in improving the contributions of the shipping sector to the country’s Gross Domestic Product (GDP).
Shall-Holma, while noting that the shipping sector was nearly absent or too low in terms of GDP contribution, saying it was sad that shipping operators were not contributing enough to the economy.
Participants said the CBN and the NSC should move as fast as possible to ensure that the DA policy takes effect in Nigeria.
Among those who spoke in its favour were the Founder, National Association of Government Approved Freight Forwarders (NAGAFF), Dr. Boniface Aniebonam; President, Association of Nigerian Licensed Customs Agent (ANLCA), Iju Tony Nwabunike; and a member of the Nigerian Economic Group, Dr. Ikenna Nwosu. Others are President, Nigerian Ship Chandlers Association, Dr, Martins Enebeli, former President, NAGAFF, Dr. Eugene Nweke, and a host of others.