ECONOMIC POTENTIAL OF ESTABLISHING A WORLD-CLASS SHIP REPAIR OR REFURBISHING YARD IN CALABAR, C’RIVER

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By Maurice O. Ekong, Ph.D.

INTRODUCTION

Cross River State, is known to be endowed with numerous potentials for economic growth and development due to her strategic location and abundant natural attributes. Unfortunately, in time past, the state has not been very lucky with breaking the vicious circle of underdevelopment occasioned by lack of adequate revenue, whether Internally Generated or Externally Sourced. In recent years however, it has become necessary for the state to appreciate the need to diversify her economy and tap into her abundant and other untapped potentials.

One promising avenue amongst others for economic growth lies in the establishment of an international class ship repair or refurbishing yard in Calabar. The establishment of a ship repairs or a refurbishing yard in the state holds tremendous growth opportunities for the local economy with the attendant effect on the macro-economy of the state. The choice of Calabar as a location would certainly be apt, because of the heavy influx and traffic of vessels conveying refined petroleum products into the numerous tank farms located within the state. Moreso, Calabar is proximate to a lot of offshore and shallow water oil and gas exploration and production activities. This would automatically make Calabar a preferred choice when operators of vessels servicing the oil industry have need for periodic maintenance, overhaul and or outright repairs.

This paper explores the economic advantages of such a venture and suggests a roadmap for its successful actualization through a public-private partnership (PPP) model, that would be beneficial to the Cross River State Government and serve as another stream of revenue generation to ameliorate the challenges of the state and position her as a frontline state in Nigeria.

CALABAR’S STRATEGIC LOCATION AND ECONOMIC ADVANTAGES

The prime location of Calabar along the Calabar River positions her as an ideal hub for ship repair and refurbishment. Serving as a gateway to the Niger Delta region, a bustling hub for offshore and shallow water oil and gas activities, Calabar experiences a continuous flow of vessels transporting petroleum products to tank farms and supporting marine transportation. Consequently, the demand for ship repair and maintenance services in the region is long overdue.

The establishment of a ship repair yard in Calabar, would offer vessels involved in offshore and shallow waters petroleum activities in the oil and gas sector a significant advantage. By eliminating the need to travel to distant repair yards, vessels can reduce downtime for repairs, minimize transit times, and lower transportation costs. The convenience and efficiency of a local ship repair facility would attract more vessels, stimulating increased economic activity within the state. The presence of a shipyard in the state, would create numerous employment opportunities for the local population. Skilled workers would be required for ship repairs, maintenance, fabrication, welding, painting, and other related activities. This would not only reduce unemployment but also enhance the skill set of the workforce, leading to a more competitive labor market in the state.

Since the state is not financially buoyant, to undertake such a project alone, it would be necessary to seek collaborative partnership with interested international investors (on a Public-Private Partnership basis), such a collaboration should eventually translate into, and or facilitate the transfer of advanced ship repair technologies and expertise to indigenes of the state. This knowledge exchange would empower local workers and businesses, fostering innovation and long-term economic growth. It would also position the state as a hub for maritime expertise in the nation.

A ship repair yard has significant revenue generating potential and a foreign exchange earner for the state. Thus, the state would earn revenue through docking fees, repair services, and ancillary activities. Foreign vessels in need of repair or refurbishment would bring foreign exchange into the state, contributing to its economic stability and growth. Moreover, the development of supporting infrastructure and services would further boost revenue streams.

The establishment of a ship repair yard would spur and stimulate the growth of ancillary industries such as logistics, transportation, hospitality, and tourism. Local suppliers would have opportunities to provide goods and services to the ship repair yard, leading to the development of a robust supply chain ecosystem. This multiplier effect would enhance economic activities within the state and create a conducive business environment.

ROADMAP FOR SUCCESS

• Location: The foundation for the establishment of a project of this nature may have already been laid by previous administration in the state, when an expanse of land was designated for “oil and gas” development related activities, based on an agreement between the Cross River State Government and the Ekorinim Community in Calabar Municipality. The land is strategically located along the Calabar River shoreline off The Marina, at Ekorinim Community. As a matter of fact, this is where The NNPC discharges its refined petroleum products through a pipeline to her Esuk Utan base.

• Feasibility Study: Conduct a comprehensive feasibility study to assess the market demand, potential investors, infrastructure requirements, environmental impact, and regulatory framework for the ship repair yard. This study would serve as the foundation for subsequent project planning and decision-making.

• Public-Private Partnership: Explore the possibility of attracting reputable international investors through a PPP model. Options such as build, operate, and transfer (BOT) or any other acceptable terms should be considered. This would leverage private sector expertise and resources while ensuring the state’s interests are protected.

• Infrastructure Development: Collaborate with relevant government agencies to develop necessary infrastructure, including construction of access roads for vehicular traffic through the Ekorinim Community, alternative industrial power supply system (since power is a major requirement), water, and waste management systems. A well-planned layout and design should optimize the use of available land, ensuring efficient operations within the ship repair yard.

• Regulatory Framework: Establish a favorable regulatory framework that promotes investment and supports the growth of the ship repair industry. This includes streamlined licensing processes, tax holiday incentives, and adherence to international standards and best practices. Close collaboration with maritime authorities and industry stakeholders is equally very essential.

To illustrate the economic potential of a project of this nature, we can draw comparisons from successful ship repair yards in Nigeria and other countries:

1. Lagos, Nigeria: The Lagos Shipyard and Dockyard Company has transformed the maritime industry in Lagos State, attracting investments, generating employment, and boosting the local economy. Cross River State can learn from their experience and replicate their success.

2. Singapore: Singapore’s ship repair and marine engineering sector has been a significant contributor to its economy. The Jurong Shipyard is a prime example of how a well-planned ship repair yard can attract international clientele and foster economic growth.

3. United Arab Emirates (UAE): The UAE’s strategic location and world-class ship repair facilities, such as the Dubai Drydocks World and Abu Dhabi Ship Building, have positioned the country as a leading maritime hub in the Middle East. Cross River State can aim to emulate their success by leveraging its geographical advantage and implementing best practices.

CONCLUSION

Establishing a ship repair or refurbishing yard in Calabar, Cross River State, presents remarkable economic advantages. Calabar’s strategic location within the Niger Delta region, combined with the continuous influx of vessels engaged in petroleum activities, forms a strong foundation for this venture’s success. The state can tap into the significant maritime traffic associated with delivery of products to tank farms in the state. The availability of vessels in need of repair and maintenance services would provide a steady stream of business opportunities for the ship repair yard.

By attracting reputable international investors through a PPP model, developing necessary infrastructure, providing regulatory support, and drawing insights from successful examples like Lagos, Singapore and the UAE, Cross River State can transform into a thriving maritime hub. The ship repair yard would generate employment, invigorate the local economy, and position the state as a key player in the ship repair industry, fostering long-term economic viability and sustainable development.

 

Dr. Maurice O. Ekong, is an Environmentalist, a Public Relations Consultant and an Oil and Gas Expert with over 20 years’ experience in the Upstream and Downstream sectors of the industry. He writes from Calabar, Cross River State, Nigeria.