Reps back disbursement of $360m Cabotage Fund

The House of Representatives has thrown its weight behind the Nigerian Maritime Administration and Safety Agency (NIMASA) for the disbursement of the $360m Cabotage Vessel Finance Fund (CVFF) to qualified Nigerian ship-owners.

A committee of the House, in its report, gave the nod for disbursement, at the end of an investigation chaired by Barr Legor Idagbo.
The Committee, in its report, requested the Nigerian Maritime Administration and Safety Agency and the Ministry of transportation to provide detailed information on the total amount accrued to the fund and disbursements since inception.

After a thorough analysis of the various submissions, coupled with the explanations given by the Ministry and NIMASA, the Committee observed that due process was followed in the planned disbursement of the Cabotage Vessel Finance Fund.

The Committee noted that the Cabotage Vessel Finance Fund (CVFF) is a fund that was set up in 2003 by the Coastal and Inland Shipping Act to develop indigenous ship acquisition capacity and to provide financial assistance to indigenous shipping operators.

The Committee further noted that there is a lack of capacity amongst indigenous/ domestic coastal operators in Nigeria, thus the reason Nigerian National Petroleum Corporation Limited (NNPC) still awards contracts to foreign shipping companies in contravention of the Cabotage and Nigerian Oil and Gas Industry Content Development (NOGICD) Acts.

“It was also discovered that the total fund of $360m in the Cabotage Vessel Finance Fund (CVFF) account with the Central Bank of Nigeria (CBN) represents 50%, while the remaining counterpart funds of 50 per cent is from stakeholders and banks, which is 15 per cent and 35 per cent respectively.”

The Committee commended the Nigerian National Petroleum Corporation Limited (NNPCL) for its commitment to awarding shipping contracts to indigenous companies that have built capacity to the level where they can successfully execute these contracts.

Reacting, Director General of NIMASA, Bashir Jamoh, thanked the lawmakers for their interest in verifying the due process being followed by the agency.

Jamoh, who expressed optimism that the NNPCL’s resolve to award maritime contracts to indigenous companies will give strength to the Cabotage regime being championed by the Agency, reaffirmed NIMASA’s transparency resolve in all facets of the agency’s operation

The DG also called for more stakeholders’ support, as the CVFF will evolve into greater benefit for more Nigerians, grow the per capita income and Gross Domestic Product (GDP) of Nigeria, through the maritime industry.