AN INVESTIGATION OF MARITIME EXTORTION AND ITS EFFECT ON COMPETITIVENESS OF NIGERIAN PORT
ABSTRACT
Maritime fraud is an international trade transaction involves several parties – buyer, seller, ship owner, charterer, ship’s master or crew, insurer, banker broker or agent. The study was carried out to investigate the Maritime Extortion and Its Effect on Competitiveness of Nigerian Port. In achieving this aim, the following specific objectives were laid out to examine the level of maritime fraud, identify how the maritime fraud can be combated and identify how the maritime fraud can be combated. The research design used in this report is descriptive design, utilizing questionnaire method to obtain information from the respondents for this project. A total of 250 (two hundred and fifty) respondents were selected for this study to represent the entire population of the study. For null hypotheses were formulated and tested using the one-way ANOVA and the t-test statistical tools at zero point zero five (0.05) level of significance. Primary data were collected from the primary source which questionnaire was used as an instrument of data collection while secondary data were sources from textbooks, journals, newspapers and the internet were employed. The data were presented on a frequency distribution table and analyzed using simple percentage, while hypothesis was tested using chi-square test. The importance of Nigerian maritime security cannot be overemphasized with possible persistent challenges if a radical approach is not made. The findings of the study will enlighten the government of Nigeria and the general public on the spate of corruption going on in the maritime sector and how it affects the competiveness of the Nigeria port. It will also educate on approaches to combat the menace of corruption in the maritime sector.
CHAPTER ONE
1.1 Introduction
Maritime fraud is an international trade transaction involves several parties – buyer, seller, ship owner, charterer, ship’s master or crew, insurer, banker broker or agent. Maritime fraud occurs when one of these parties succeeds, unjustly or illegally, in obtaining money or goods from another party to whom, on the face of it, he has undertaken specific trade, transport and financial obligations. Maritime fraud is becoming more common due to criminals are increasingly turning to new methods such as computer hacking, ports are adopting new technologies that in the worst case can enable new types of fraud (such as automatic container operations) and as ship owners are under pressure to win new business, many have disregarded due diligence when dealing with new business partners (Safety4sea, 2021).
As a prelude to other parts of this study, this chapter will discuss the background upon which this study was initiated, the statement of problems that led to this study, the Aim and Objectives of the study. Others are Significance of the study, Scope of work, Research hypothesis and questions, Limitations of the Study and Definition of technical terms.
1.2 Background of Study
Despite the efforts of the government of Nigeria in fighting corruption in all sector, several unwholesome activities is still going on in the maritime sector most importantly by the shipping agencies and terminal operators, under the watchful eyes of government agencies, conniving to slam fictitious charges on importers and agents in what has been described in the maritime domain as a ceaseless economic rape.The product of this organized graft, which often runs into several billions of naira annually has continued to swell the volume of the capital flight the country suffers yearly. Following this scheme, used vehicles, clothing, food items and other goods are now cheaper to buy in Cotonou, Lome and Ghana markets, than when purchased in Nigeria (Thisday, 2015).
The sour side of is anomaly is that importers and clearing agents, in their battle to survive and grow in business, later pass the prohibitive charges to the consumers who now pay far more for the goods than necessary.
According to previous findings, the terminal operators, shipping lines and shipping agents have taken advantage of the largely unregulated maritime industry in Nigeria to hike charges like demurrage, and container deposit, among others, which are at variance with what obtains in neighboring West African ports. A full analysis of shipping charges conducted in three African countries - Nigeria, Ghana and Benin Republic by a maritime industry medium, “Shipping Position,” shows that port charges in Nigerian remain the highest in the ECOWAS region.
Experts have, however, attributed the high charges to the unwholesome practices among shipping companies operating at Nigerian ports. Again while it takes few days to get the container deposit refund in other ports once the empty container is returned, it may take up to three months in Nigeria because the terminal operators allegedly delay receiving it in order to build up demurrage that may eat up the deposit. Other charges not collected in other countries but obtainable in Nigeria include MOWCA levy and stamp duty (Tancott, 2015).
Importers are also perplexed that contrary to what is obtainable in other West African countries' ports, Nigeria only offers three days free of progressive storage charge while Benin, Ghana and Cote D'Ivoire offer seven days free of progressive storage charges. Maritime experts have argued that the development was threatening the nation's sea hub status as Cotonou, Lome and Accra ports are snatching cargoes from Nigeria.
It is feared that the partial cargo drought often experienced in the country, is attributable to this development as some shipping companies prefer to call at other West African ports where they enjoy huge incentives, especially reduced charges are largely the outcome of such practices (Tancott, 2015).The soaring frequency of smuggling is because some importers may not make profit after paying all charges at the ports.
Other stakeholders like the Nigeria Customs Service (NCS), Nigeria Immigration Service, Quarantine Service, Port Health and the Nigerian Maritime Administration and Safety Agency (NIMASA) who are also part of the import chain also contribute to the delay in carrying out clearing duties and corruption at the nation's ports. All these have made business very difficult and affected competiveness of the maritime sector in Nigeria.
Therefore, in Nigeria where the research was carried out, the activities that was conducted is to know An Investigation of Maritime Extortion and Its Effect on Competitiveness of Nigerian Port.
1.3 Statement of Problems
Ports play a key role in the Nigeria economy and development, as nearly 75% of the trade between the Nigeria and the rest of the world is handled in ports. Thus, the importance of ensuring efficiency in ports is related to the ability of the country to be competitive at international level. Unfortunately corruption and extortion by the shipping agencies, terminal operators and the government officials has continued to frustrate importers leading to price hike of commodities, encouraged smuggling and the competiveness of Nigerian port as many importing prefer to patronize other ports in the neighboring West African countries.
1.4 Aim and Objectives of Study
The aim of the study is to investigate the Maritime Extortion and Its Effect on Competitiveness of Nigerian Port. In achieving this aim, the following specific objectives were laid out as follows:
- To examine the level of maritime fraud in the Nigerian ports.
- To examine the effect of maritime fraud on the competiveness of Nigerian port.
- To identify how the maritime fraud can be combated
1.5 Research Questions
The study came up with research questions so as to be able to ascertain the above stated objectives. The specific research questions for the study are stated below as follows:
- What is the level of maritime fraud in the Nigerian ports?
- How can the maritime fraud be combated?
- What is the effect of maritime fraud on the competiveness of Nigerian port?
1.6 Research Hypothesis
In order to pursue the objective of this study, the following generalized statements have been designed to guide and aids in obtaining the result for the experiment to be conducted. For this work, the null hypothesis will be represented with H0 while the alternative hypothesis will be represented with hypothesis H1.
Hypothesis One
- H0: There is no significant relationship between maritime fraud and competiveness of Nigeria Port
- H1: There is a significant relationship between maritime fraud and competiveness of Nigeria Port
1.7 Significance of Study
The findings of the study will enlighten the government of Nigeria and the general public on the spate of corruption going on in the maritime sector and how it affects the competiveness of the Nigeria port. It will also educate on approaches to combat the menace of corruption in the maritime sector.
This research will be a contribution to the body of literature in the area of the effect of personality trait on student's academic performance, thereby constituting the empirical literature for future research in the subject area.
1.8 Scope of Study
The scope of the research is focused on An Investigation of Maritime Extortion and Its Effect on Competitiveness of Nigerian Port using Apapa Seaport in Lagos State as a case study.
1.9 Limitations of the Study
During the course of this study, many things militated against its completion, some of which are:
- Time Constraint: The time frame given to accomplish this project was very short due to school academic calendar and it was carried out under pressure which made the researcher not to implement some necessary features.
- Research material: availability of research material is a major setback to the scope of the study.
- Frequent power failure: This made the researcher append more money on fuel to ensure sustainable power.
- Financial Constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
1.10 Definition of Terms
Maritime Fraud: Maritime fraud is an international trade transaction involves several parties – buyer, seller, ship owner, charterer, ship’s master or crew, insurer, banker broker or agent.
CHAPTER TWO
2.0 Literature Review
2.1 Introduction
The review of relevant literature is the main topic of this chapter. A literature review covers theoretical and methodological contributions to a certain issue in addition to the state of knowledge at the time of writing. It provides information about the state of the art in relation to the subject you are writing about. It examines the body of work on the chosen subject. The literature evaluation in this study comprises the …
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