NIMASA targets second quarter to disburse $350m Cabotage Fund

The Nigerian Maritime Administration and Safety Agency (NIMASA) said it expects to disburse the monies in the Cabotage Vessel Financing Fund (CVFF) by the second quarter of this year, according to the three years scorecard of Bashir Jamoh, the director-general.

The scorecard disclosed that the agency has obtained presidential approval to disburse the fund to qualified shipowners 17 years after it was instituted.

It further disclosed that the agency has also appointed primary lending institutions. The lenders are five commercial banks including Polaris Bank, UBA, Union Bank, Zenith Bank and Jaiz Bank.

According to Jamoh, disbursing the fund will help to advance shipping by ensuring a favourable environment for commercial shipping and encouraging indigenous participation in the global shipping business.

He said it will help fleet expansion by enabling shipbuilding and repairs, which is a critical aspect of shipping development.

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The CVFF was established alongside the Nigerian Coastal and Inland Shipping (Cabotage) Act of 2003, to empower indigenous ship owners to take control of the nation’s coastal and inland shipping business, otherwise known as the Cabotage trade.

According to NIMASA, the funds, which are available in naira and dollar components, are about ₦‎16 billion and about $350 million respectively.

The beneficiaries of the Cabotage Fund are expected to go into maritime businesses including ship acquisition for shipping, the establishment of jetties, ferry services, shipbuilding, ship repair and other maritime-related businesses.

Mu’azu Jaji Sambo, the Minister of Transportation, had in a recent meeting with primary lending institutions told the banks to fast-track the process of giving the fund to the qualified Nigerian shipowners.

Sambo said the maritime sector would be a major income earner for the country if properly managed.

He explained that the President also approved that the 2 percent charge that makes up the Cabotage fund should continue to accrue to the CBN Treasury Single Account (TSA) and each time the account hits $50 million, the Minister of Transportation should, on the recommendation of NIMASA, direct the CBN to release the amount to any of the five banks to disburse.