The Nigerian Maritime Administration and Safety Agency (NIMASA), which oversees the long-withheld Cabotage Vessel Financing Fund (CVFF) for shipbuilding in Nigeria, has assured shipowners of disbursement in August this year.
Dayo Mobereola, director general of NIMASA, disclosed this on Wednesday before the House of Representatives Committee on Maritime Safety, Education and Administration, stating that the project, now worth $700 million, has finally ticked all boxes.
“What we have done is to streamline the guidelines, to ensure that it takes nothing less than three to four months for ship-owners to access the funds,” Mobereola said.
NIMASA appointed 12 Primary Lending Institutions (PLIs) to administer the funds, seven more than the five former President Buhari approved in 2023, including Polaris, Zenith, Union and Jaiz banks, plus the UBA. “We re-advertised and the former ones also applied,” Mobereola.
Bashir Jamoh, the former DG, had in 2024 stated that NIMASA could not start disbursing the money in the Cabotage Fund without first engaging with banks and shipowners, according to BusinessDay.
Appointed banks were encouraged to have uniform modalities to avoid issuing different interest rates, which delayed disbursement. The previous administration insisted that NIMASA would only invite the shipowners to discuss further after the banks had concluded this.
Mobereola said the banks will lend 35 per cent while NIMASA will lend the other 50 per cent, while the beneficiary of the fund will provide the remaining 15 per cent equity shares.
NIMASA is pushing for cheaper interest rates and “patient capital” that includes a repayment allowance of up to 20 years for shipowners, to ease obligation pressure. “We are still insisting that we want single-digit interest rates because we want our shipping companies, our vessels, to be able to compete with international shipping companies,” Moboereola said.
The agency says only shipping companies with capacity to trade and pay back will be considered, “because it’s a revolving fund.” “The banks are going to carry out the initial risk assessment, to be sure that whoever wants to access this fund has the capacity in terms of his own financial capacity.”
“The other part of it is that we are also working to ensure that there is cargo for them to carry. We are working with the cargo generators, the NNPCs, the NLNGs, the exporters, to make sure they patronise Nigerian vessels that will be available at that time. So it’s a win-win and the ship owners are on board with us,” the agency boss said.
Uduak Odudoh, acting chairman of the House Committee on Maritime Safety, Education and Administration assured the agency of support.
“We saw that in the last three years that we’ve not had one single piracy and other maritime crimes. That means people that are doing business in the water now have the opportunity to do their business freely,” he said.
“When we get to the National Assembly, we will continue to work, collaborate with NIMASA, and collaborate with the Ministry of Marine and Blue Economy,” he assured.