Nigeria Loses Billions As 25,000 Foreign Vessels Operate Illegally — Agbakoba

Legal luminary, Dr Olisa Agbakoba, has alleged that more than 25,000 foreign vessels are operating illegally in Nigeria’s coastal waters, posing a major national security threat and causing extensive economic losses.

Dr Agbakoba, Senior Partner at Olisa Agbakoba Legal (OAL), made the revelation in a policy document titled, “Unlocking Nigeria’s Maritime Potential to Generate N70 trillion Annually,” which he submitted to the Minister of Marine and Blue Economy, Dr Adegboyega Oyetola.

The former president of the Nigerian Bar Association stated that the National Policy document submitted to the minister recommended, among other measures, restructuring access to the Cabotage Vessel Financing Fund (CVFF).

According to him, the federal government must ensure that Nigerian-crewed vessels account for at least 50 per cent of coastal trade to curb the massive revenue leakages currently benefiting foreign operators.

He stated, “Over 25,000 foreign vessels illegally trade in Nigeria’s coastal waters, representing both a national security challenge and massive economic loss. The National Policy specifically recommends reviewing the Coastal and Inland Shipping (Cabotage) Act 2003, strengthening institutions for effective enforcement, encouraging inter-agency synergy for implementation, and streamlining access to the Cabotage Vessel Financing Fund (CVFF).

“To capture this opportunity requires amending the Cabotage Act (2003) to establish strict enforcement mechanisms and compliance requirements, with penalties including vessel seizure for violations, thereby ensuring Nigerian-crewed vessels constitute 50 per cent or more of coastal trade and preventing the ongoing haemorrhaging of revenue to foreign operators.”

Dr Agbakoba further called for the establishment of a National Blue Economy Commission to harmonise and coordinate activities across relevant ministries and agencies, including Transportation, Environment, Fisheries, Petroleum, and Trade, to develop marine economic zones capable of drawing substantial investments.

He wrote, “Also strengthening inter-agency collaboration between NIMASA, NPA, NIWA, Nigerian Navy, Marine Police, and security agencies for better governance, coordinated enforcement and establishing a National Blue Economy Commission as a centralised body to coordinate activities across Ministries of Transport, Environment, Fisheries, Petroleum, and Trade and develop marine economic zones to attract investments.

“Revenue streams include registration fees from Nigerian-flagged vessels under NIMASA, fees from foreign vessels operating in Nigerian waters under the Cabotage Act, seafarers’ certification and training fees from maritime workers and companies, and increased domestic shipping revenues from Nigerian vessels.”

Dr Agbakoba also urged the federal government, through the Nigerian Maritime Administration and Safety Agency (NIMASA), to begin collecting taxes from oil rigs operating within Nigerian waters.

He explained, “Oil rigs have formed a cartel for tax avoidance. OAL is representing NIMASA in a tax avoidance case brought by oil rig companies. NIMASA has confirmed that tax is currently not collected from oil rigs.

“Capturing this revenue requires amending the NIMASA Act (2007) to expand its mandate beyond shipping, marine labour, and environmental protection to include responsibilities for marine conservation and blue economy oversight, establish a robust taxation framework for oil rigs operating in Nigerian waters, increase penalties for maritime pollution, illegal vessel operations, and labor violations, and strengthen NIMASA’s role in coastal tourism and renewable energy initiatives.

“Amending the Petroleum Industry Act (2021) to strengthen regulations on offshore oil and gas drilling to reduce environmental risks and introduce mandatory decommissioning funds for oil companies to clean up decommissioned offshore platforms.

“Revenue streams include royalties from offshore oil drilling and gas extraction, corporate taxes on oil companies operating in deep-sea oil fields, fees for pipeline installations and seabed resource extraction rights, tax revenue from private-sector investments in fish farms and marine aquaculture, revenue from private investment in offshore wind farms and tidal energy projects, and carbon credit sales under global climate agreements for using clean marine energy.”