Cabotage fund hits N72.4bn as FG sets up disbursement c’ttee 

Nigeria’s Cabotage Vessels Financing Fund (CVFF) has reached $200 million (about N72.4 billion), Rotimi Amaechi, minister of Transport has said.

This is as the minister set up a Comittee to come up with guidelines to disburse the fund to indigenous shipowners.

Headed by Dakuku Peterside, director-general of Nigerian Maritime Administration and Safety Agency (NIMASA), other members of the comittee are Temisan Omatseye, a former director-general, Margaret Orakwusi, chairperson, Nigerian Ship-owners Forum and Aminu Umar, managing director, Sea Transport Services Nigeria Limited, among others.

The CVFF is an intervention fund created alongside the Coastal and Inland Shipping Action, 2003, otherwise known as Cabotage Act. The fund is meant to provide leverage to indigenous ship owners for acquisition of vessels for the purpose of trading on Nigerian cabotage area. The fund has remained undisbursed to ship owners since 2003, but Amaechi said the fund had been earlier “applied to building a maritime university and faculties of maritime in other universities across the country.”

Speaking to journalists shortly after a meeting with indigenous shipowners and other maritime stakeholders in Lagos on Thursday, Amaechi  said, “What we have agreed is to set up a committee that will come forward with the proposed guidelines that I will send to the National Assembly. The committee for developing the guidelines would be chaired by Dakuku Peterside.

“In the past, the money was applied to building a maritime university and faculties of maritime in other universities across the country. This would be the first time the money is applied to ship owners directly.”

As part of efforts to mitigate the risk involved in the disbursement, the minister stated that financial institutions would be involved and the fiscal risk would be borne by the lending institutions.

“The banks will be involved in developing the criteria for the disbursement of the fund, so the risk would be borne by the lending institutions,” he hinted.

Among other things, the Dakuku committee will determine the interest rate for the fund, which is to be taken as loan by ship owners who would meet the disbursement guidelines.

Commenting, Dakuku said, “The meeting was conveyed on the instance of the minister to discuss the singular issue of CVFF disbursement which the minister has gotten approval from the president. After extensive discussions by the stakeholders here, it was decided that the committee should come up with the draft guidelines.

“The minister would study this draft and pass on to the National Assembly for approval in line with the Cabotage Act. Thereafter, we would move to the next phase of actual disbursement using the banks as platform to be disbursed.”