Shipping Chamber, AFC seal deal on maritime asset financing
The Nigerian Chamber of Shipping (NCS), has sealed an agreement with the African Finance Corporation (AFC), for alternative financing facilities for ship and maritime asset management in Nigeria.
President of the chamber, Andy Isichei, during a visit to the AFC to drum up support for ship financing in Nigeria, described the finance as a major challenge faced by indigenous ship owners.
He emphasized the huge potential that the shipping industry holds for the economy, and that it was desirable and mutually beneficial for organisations such as the AFC, to support operators in the shipping industry in order to maximise the huge benefits and economic growth that the industry portends.
“Access to fund for ship/maritime asset financing has been near impossible for Nigerian ship owners, facility/equipment providers, and for a host of ancillary business operators in the maritime sector of the economy.
“Indigenous banks have not risen to the occasion owing to a plethora of challenges, majorly the need for adequate capacity building, sky-high interest rates topping global statistics and liquidity issues.
“The Cabotage Vessel Financing Fund (CVFF), which is cursorily and altruistically considered as the major funding solution has remained in the vaults, while every interest has concentrated on its disbursement. In essence, these and other multifarious challenges have contributed to the retarded growth and arrested development of the Nigerian maritime industry,” he said.
The AFC’s Senior Vice President/Head of Transport, Reuel Andrews, welcomed the idea of forming a viable and mutually beneficial relationship with the NCS, saying it is open to receive proposals for financing in any aspect of the shipping industry that would help to improve the business of indigenous ship owners and the Nigerian economy.
On its part, the AFC listed major challenges militating against investments in the shipping industry to include: nature and tenure of shipping contracts; loan repayment and inadequate legal framework for enforcement and recovery of loans.
Noting that the collaboration between the AFC and NCS is coming at appropriate time, he encouraged stakeholders to be part of a sensitisation forum that will soon be jointly organised by the two institutions.
This, according to him, would provide a platform for contribution of ideas, and to fashion out an acceptable framework to solve the problems.
The expected outcomes from the synergy will be finding quality strategies to funding issues. The optimal objective will be for operators to have access to funds, to buy and operate shipping and other marine related assets, provide employment opportunities, and ensure that Nigerians play the dominant role envisioned by both the Cabotage and Local Content Laws.
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