FG Approves Disbursement Of $350m Cabotage Fund To Nigerian Ship Owners

FG Approves Disbursement Of $350m Cabotage Fund To Nigerian Ship Owners

The Federal Government has finally approved the Cabotage Vessel Financing Fund (CVFF) disbursement, 18 years after ship owners contributed to the contentious Cabotage fund.

Muazu Sambo, the Minister of Transportation, made the announcement yesterday at the flag-off ceremony for the third phase of the Nigerian Seafarers Development Program (NSDP) TERRA 2 at the Naval Dockyard in Lagos.

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His words: “The president of the Federal Republic of Nigeria, Muhammadu Buhari has approved my request for the disbursement of the Cabotage Vessel Financing Fund. It is my belief that finally, we are going to break the 17-year-old jinx that has hindered the expansion of the industry.

“When we disburse the funds in days to come to the deserving beneficiaries. We have made a case that the funds belong to you ship owners. Mr president is a man who respects the law and he is on the same page with us that we should proceed with immediate effect. We will be liaising with the minister of finance, the budget for implementation and the governor of the Central Bank of Nigeria (CBN) to work immediately for the approval.

“We have pledged to the president that they would continue to allow the funds to go into the treasury single account; however, whenever the money hits the threshold of $50 million the CBN upon recommendation from  Maritime Administration and Safety Agency (NIMASA) and the Federal Ministry of Transportation would inspect the transfer of the funds to the primary lending institutions.”

In this regard, he stated that Mr. President has approved the disbursement of funds to five primary lending institutions.

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Sambo added that the banks were recommended to the president and approved based on the guidelines, which clearly stated that the applicant of the fund would make a 15% equity contribution, NIMASA would make a 35% equity contribution, and the banks would provide 50%.

Meanwhile, Dr Bashir Jamoh, Director General of NIMASA, stated that the funds are divided into two parts: N16 billion and $350 million, with the N16 billion being an addition to the $350 million previously announced by former Transport Minister, Chibuike Amaechi.