Nigerian Maritime Administration and Safety Agency (NIMASA) says it has selected 12 Primary Lending Institutions (PLIs) that will disburse the long-awaited Cabotage Vessels Financing Fund (CVFF) at a single-digit interest rate.
The Director-General of NIMASA, Dr Dayo Mobereola, disclosed this during a virtual meeting in Lagos on Monday.
Mobereola said that the move was to transform the maritime sector, emphasising that President Bola Tinubu’s administration, with the support of the Minister of Marine and Blue Economy, Mr Adegboyega Oyetola, had secured approvals for the fund’s operationalisation.
The PLIs are the designated banking institutions for the disbursement.
Mobereola underscored the transformative potential of the initiative, stating that it would empower indigenous shipowners to compete more effectively and significantly boost local content within the maritime industry.
He noted that the CVFF is a loan facility with a single-digit interest rate, adding that the utilisation of which would be closely monitored.
According to him, its monitoring will ensure it achieves its intended objectives of fostering growth and capacity development among Nigerian operators.
“This demonstrates the establishment of clear frameworks for transparent, efficient, and impactful fund utilisation, directly empowering our indigenous shipowners,” Mobereola said.
He noted that the CVFF was established under the Coastal and Inland Shipping Act of 2003 to provide vital financial support for vessel acquisition and overall capacity building for Nigerian maritime businesses.
“Despite nearly two decades of regulatory hurdles and past challenges, we are now at the cusp of a new era,” he added.
According to the director-general, the CVFF disbursement is expected to generate significant employment opportunities for Nigerian seafarers and strengthen ancillary maritime services.
This, he maintained, would contribute to the overall growth of the nation’s blue economy.
He assured stakeholders that the CVFF implementation framework prioritises transparency and accountability, featuring a dedicated Secretariat Cabotage Unit, clearly defined eligibility criteria, and the strategic partnership with the 12 PLIs to streamline access to the funds.
Mobereola urged all prospective applicants to adhere to the established procedures through the designated financial institutions, reiterating that the CVFF is a strategic investment in maritime future and not a grant programme.
“The CVFF represents not just the end of a long wait but the beginning of a new era for Nigerian shipping,” he added.
Mr Jubril Abba, the Executive Director of Cabotage Services at NIMASA, explained that the fund is design to invigorate activities within the maritime space.
He commended the President and the minister for their decisive action in ensuring the disbursement to benefit indigenous maritime operators.
NIMASA’s Legal Consultant on CVFF, Mr Adedoyin Afun, elaborated on the Cabotage Act’s provisions, noting that it is specifically designed for Nigerian citizens.
Afun explained further thar the Act aims to promote the development of shipping within Nigeria’s territorial waters.
He clarified the key requirements: vessels must be owned, built, operated, and managed by Nigerians.
Afun also outlined NIMASA’s enforcement powers under the Act and highlighted that vessels must have been purchased within 12 months prior to loan application.
The financial consultant for the fund, Mr Yusuf Buhari, said that the CVFF aims to provide Nigerian shipowners with access to affordable financing, thereby reducing Nigeria’s reliance on foreign vessels for its coastal and inland shipping needs.
He explained the required applicant contributions, with NIMASA (CVFF) providing up to 50 per cent or a maximum of 25 million dollars, with no direct funding.
According to him, the loan tenure is set at eight years, and the currency will be translated to U.S. dollars to align with international best practices.
The 12 participating banks include First Bank, Fidelity, Zenith, United Bank for Africa (UBA), Jaiz Bank, and Lottos Bank, among others.
During his virtual contribution, Mr Aburime Ehimare, the Managing Director of Zenith Bank, stressed the importance of engaging stakeholders in a post-disbursement monitoring group to ensure the programme’s effectiveness.
He also raised the need for a security sharing formula to address potential challenges related to the vessels.
The President of the Nigeria Chamber of Shipping (NCS), Mr Aminu Umar, called on NIMASA to clearly state the terms and conditions of the disbursement to ensure stakeholders are well-informed.
A Safety Engineer, Mr Olu Aladelusi, suggested the inclusion of insurance considerations and loan refund terms.
The meeting ended with a technical demonstration of the application process for the stakeholders.
