The Nigerian Maritime Administration and Safety Agency (NIMASA) have rejected the 8.5 percent interest rate proposed by five commercial banks selected as primary lenders for the $350 million Cabotage Vessel Financing Fund (CVFF).
The approved lenders include Union Bank, Polaris Bank, United Bank for Africa (UBA), Zenith Bank and Jaiz Bank.
According to the agency, it is currently exploring better options for ship owners that would be selected as beneficiaries of the Cabotage Fund put together to empower Nigerian ship owners to take over the nation’s shipping business from foreigners.
This was disclosed in Lagos on Tuesday during the opening ceremony of the visit of some staff of the Ghana Maritime Authority (GMA) in charge of the implementation of Ghana’s Cabotage operations to understudy Nigeria’s Coast and Inland Shipping Act (Cabotage) regime.
Bashir Jamoh, the director-general of NIMASA, told journalists that the agency has opened discussions with a new set of developmental banks that will be ready to back the agency by offering an interest rate that would not impose burdens on Nigerian ship owners when repaying the loan.
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“The commercial banks are offering 8.5 percent but we want them to reduce the rate. We are still discussing with the primary lending institutions to ensure that ship owners get the best deal because we will never allow banks to impose unnecessary guidelines or interest rates on Nigerians. These are the core issues, the issue of interest rates will be dealt with and if we clear those grey areas; then we will disburse the fund before the end of the regime,” Jamoh said.
He promised that NIMASA will get the best bargain for the ship owners, adding that the CVFF guideline for the disbursement of the CVFF stipulates that ship owners will contribute 15 percent; the government will bring 50 percent and banks will provide only 35 percent.
“We are making contacts with development banks to see how much they can give to ship owners as interest rates, though we are currently working with commercial banks. This is why we are consulting other banks to do a peer review before going back to the stakeholders.
The NIMASA boss, however, assured that the amended Cabotage Act would be assented to before the end of President Muhammadu Buhari’s administration just as he allayed ship owners’ fear that the amendment would affect the disbursement of CVFF.
Earlier, Patience Diaba, the team leader of the Ghana Maritime Authority’s delegation to Nigeria, said the team from Ghana was in Nigeria to learn about the implementation of the Cabotage Act.
Diaba, who is the director of legal of GMA, said upon learning from Nigeria, Ghana will avoid the holes and go faster than Nigeria.