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Tag: CVFF

  • $25m CVFF cap raises concerns over adequacy, others

    $25m CVFF cap raises concerns over adequacy, others

    The $25 million cap on disbursements from the accumulated $750 million Cabotage Vessel Financing Fund (CVFF) is now a subject of debate among stakeholders in the maritime sector. The debate stems from its adequacy and sustainability or otherwise in aiding local ship owners acquire viable tonnage within the coastal trade regime.

    While some stakeholders describe the cap as a necessary threshold to support smaller coastal and offshore service vessels, others argue that without accompanying cargo guarantees and complementary financial mechanisms, the fund risks repeating past failures.

     Addressing the realism of the cap in the face of global ship acquisition costs that can exceed $150 million per vessel, maritime expert and licensed customs consultant, Lucky Amiwero,  argued that the funding cap may be adequate if aligned with the core objectives of the cabotage regime.

    “The cabotage regime deals largely with service vessels operating in coastal and oil-related trades, not massive container ships or fleet expansion,” Amiwero told The Nation. “If this fund is truly for Cabotage operations, $25 million might be enough for acquiring smaller service vessels. But NIMASA must define that clearly.”

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    Amiwero, however, warned against treating CVFF as a stand-alone financial fix. “You don’t just give the vessel; you must provide the cargo. That’s why the U.S. has the Cargo Preference Act, which we also have in the NIMASA Act. Without cargo tied to the fund, you’re simply wasting money,” he said.

     He urged the government to emulate global best practices, such as construction reserve funds, construction differential subsidies, and enforceable cargo reservation policies. According to him, these elements help ensure the viability of vessel financing initiatives in countries like the United States.

    He stressed that CVFF disbursement must be tied to a sustainable, cargo-linked, and professionally supervised financing ecosystem. He explained shipping is not an individual business but a mafia business controlled by global giants noting that without a structured support regime, it will end up being a case of just feeding a few operators and setting them up for failure.

    While stakeholders have welcomed the idea of primary lending institutions participating in the CVFF disbursement, Amiwero maintained the institutions cannot operate in a vacuum. He argued that NIMASA, as the fund’s manager, must first design a holistic framework that ensures fund recovery, monitoring, and reinvestment.

  • Stakeholders seek timely CVFF disbursement

    Stakeholders seek timely CVFF disbursement

    Stakeholders in the maritime sector have called for timely disbursement of Cabotage Vessel Financing Fund (CVFF) which for which the Federal Government has given directive. This is coming after more than 20 years of delay.

    Maritime lawyers have described it as a potential game-changer for indigenous shipping.

    Established under the Coastal and Inland Shipping (Cabotage) Act of 2003, the CVFF was conceived to provide vital financial backing to Nigerian shipping companies, enabling them to acquire vessels and participate more competitively in coastal trade.

    Yet, despite its promising premise, the fund had remained dormant across successive administrations until now.

    On April 15, the Minister of Marine and Blue Economy, Alhaji Adegboyega Oyetola, directed the Nigerian Maritime Administration and Safety Agency (NIMASA) to begin the disbursement process, marking a turning point that maritime lawyers say could revive the sector and enhance Nigeria’s shipping sovereignty.

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    Under the new directive, eligible indigenous shipping companies can now apply for up to $25 million each at competitive interest rates through Primary Lending Institutions (PLIs) approved by the government.

    Reacting to the development, prominent maritime lawyer and Senior Advocate of Nigeria (SAN), Mike Igbokwe, commended the initiative while calling for swift and transparent implementation.

    “I am heartened by the Federal Government’s move to disburse the CVFF for the benefit of shipowners.

    “The fund is sourced from a mandatory two percent surcharge on contracts involving coastal trade vessels, in addition to other statutory revenues.

    It should not lie idle in banks,” he said.

    He warned that the fund’s purpose – empowering Nigerian citizens and growing local capacity would be defeated if bureaucratic bottlenecks stall implementation.

    He also suggested that even if acquiring large vessels proved difficult initially, the fund could be used for smaller assets like barges to support transshipment and short-sea trade.

    “This is not just a legal or policy issue; it’s a matter of economic empowerment. Let’s put this money to work.” Igbokwe urged.

    A former president of the Nigeria Maritime Law Association (NMLA), Chidi Ilogu, SAN, echoed similar sentiments, linking the success of the CVFF to Nigeria’s ambition of becoming a maritime hub in West Africa.

    He said: “We have been discussing this disbursement for a long time; now, policy implementation is key. Without a robust fleet of Nigerian-owned vessels, foreign operators will continue to dominate our shipping space.”

    He underscored the fund’s potential to finance the acquisition of medium-sized vessels that can be deployed across West African ports, especially with new infrastructure like the Lekki Deep Sea Port providing transshipment opportunities.

    Ilogu also urged the Ministry of Marine and Blue Economy and the Ministry of Transportation to harmonise efforts and avoid overlapping responsibilities.

    “We must ensure that there’s no turf war. Collaboration is crucial if we are to make the most of this opportunity,” he said.

    The current president of the NMLA, Funke Agbor, SAN, hailed the move as long overdue, noting its significance for capacity building and job creation.

    “This disbursement will significantly boost the growth of the maritime sector, especially for indigenous players,” she noted.

    “Beyond vessel ownership, it will also provide much-needed sea-time training opportunities for Nigerian cadets, addressing one of the major gaps in our maritime manpower development.”

    She said empowering local shipping operators would yield ripple effects across shipbuilding, repair yards, and crewing services; sectors long stifled by limited indigenous participation.

    As the maritime sector watches with cautious optimism, legal stakeholders insist that the success of the CVFF will be measured not by announcements, but by the number of ships flying the Nigerian flag in the near future.

  • NIMASA targets N109bn revenue in 2018 – DG

    Dr Dakuku Peterside, Director-General of Nigerian Maritime Administration and Safety Agency (NIMASA) says the agency is targeting N109 billion as revenue in 2018.

    He said this while speaking on the 2018 budget before the Senate Committee on Marine Transport in Abuja on Thursday.

    According to him, the agency was optimistic it will generate N109 billion as revenue in 2018.

    Peterside said that the total estimate was achievable based on the number of initiatives the agency had put in place to block revenue leakages.

    “N109 billion is an estimate; we are workings toward accomplishing that, this revenue include revenue from Cabotage Vessel Financing Fund (CVFF), that I have no access too.

    “It also includes our mandatory contributions to Maritime Academy of Nigeria, which is not in our disposal but we optimistic that with the numbers of initiatives we have put in place.

    “We have blocked leakages, we have done everything humanly possible to reduce our expenses to make it achievable,” he said.

    He, however, told the committee that every adjustment and amendment had been made on the budget as directed.

    NIMASA boss said that a total of N18.7 billion was remitted in 2017, which was the 80 per cent of the total revenue for 2017.

    He said that N2 billion was also contributed to Nigeria Inland Waterways Authority (NIWA) for the dredging of the lower Niger River, which was approved by the presidency.

    Peterside said that in 2018, the agency hopes to complete the reforms it had started by making the waterways safer than it used to be by investing in the security of waterways.

    He said that the agency intended to build offices in the eastern zone, central zone and also concentrate on capacity building, by training seafarers and scaling up its operations in 2018.

  • Operators draw battle line with NIMASA over Cabotage fund

    Operators draw battle line with NIMASA over Cabotage fund

    SHIP OWNERS have drawn the battle line with the Nigerian Maritime Administration and Safety Agency (NIMASA) over the management of the Cabotage Vessel Financing Fund (CVFF).

    They are agitating that the management of the fund be transferred from NIMASA to a maritime bank.

    The firms are alleging that the CVFF has grown to billions of dollars without any of them benefiting from it.

    Their counsel Olisa Agbakoba (SAN) told The Nation that his clients were unhappy that NIMASA has not used the money to empower them to create jobs.

    He lamented that most contributors do not know the actual fund in NIMASA’s care, saying it was time the agency made the amount public since it is not the source of the fund, but just the collector.

    A maritime bank, Agbakoba said, would be more appropriate to handle the CVFF, adding that NIMASA should not be the repository of the fund.

    “The only way the government can support the sector is funding, but since the first National Maritime Authority (NMA) Act was created up till NIMASA, all the money that have been allocated for the CVFF, not a dime has been released, showing that there is a problem,” he said.

    Agbakoba wondered how many can say the NMA or NIMASA supported them to buy a ship.

    “ If we don’t have funding, we will have a weak sector; so our role is to continue to put it on the top of the agenda and that is the essence of this briefing,” he said, adding that NIMASA should tell Nigerians the actual size of the fund and why the money has not been disbursed all these years.

    Agbakoba also said there was the need for practitioners to call on the parties jostling for power to declare their plans for the sector before they are voted into power.

    “The first thing to do is for the sector to push for a very senior minister; if we do this, he will be close to the president and it will help to shape the relevant policies.

    “The other thing is to have a very effective maritime institution, NIMASA is too huge and doing many things; it is doing maritime safety and security, shipping development, Cabotage, seafarers and so on, and yet it is not doing it effectively. The only way it can be effective is to ask what they can do well, which is maritime safety and security, other jobs should be taken away from them,” Agbakoba said.

    Also, Lagos State Shippers Association President, Rev Jonathan Nicol, urged NIMASA to disburse the fund and take steps to streamline and profile Nigerian ship owners.

  • NIMASA to release cabotage fund, says DG

    NIMASA to release cabotage fund, says DG

    The Nigerian Maritime Administration and Safety Agency (NIMASA), will soon release the amount that has accrued to the Cabotage Vessel Finance Fund (CVFF). the Director-General, Ziakede Akpobolokemi, has said.

    He said the agency would commence the disbursement of the fund to qualified Nigerian ship owners once the processes involved are concluded.

    Akpobolokemi told reporters in Lagos that the release of the figures will put to rest speculations on the exact amount that has accrued to the fund.

    He denied insinuations in certain quarters that invested interest within and outside the corridors of power who want to corner the funds for other uses instead of vessel acquisition and repairs, was part of the reasons why CVFF has not been disbursed over the years.

    He said the agency which remains Nigeria’s apex maritime regulatory authority and recognised by the global maritime watchdog, the International Maritime Organisation (IMO), will not only make the exact amount public, but will also ensure it is disbursed to qualified beneficiaries as soon as possible.

    The NIMASA helmsman, said he is working at getting the actual figures before making it public.

    “Well, I will need to get the records to give you the exact figure. So I may need to go and get information from the department responsible for it. Getting the exact amount is important because the figures keep on changing by the day. If I give you any figure now, by the time I get back to Finance Department there may be some variation because from the report they have given from time to time, the figures keep changing.

    “As the boss of the agency when I make any declaration, or say anything that has to do with money, it should be categorical and specific to the last kobo. It should not be figures based on guess work or imaginations,” he added.

    He NIMASA will fulfil its mandate by focusing on its core functions for the benefit of Nigeria and Nigerians, adding that the agency will not relent in its drive to maximise the huge potentials in the maritime sector of the economy and make Nigeria a force to be reckoned in the comity of maritime nations.

    CVFF was established under the Coastal and Inland Shipping Act, 2003. It is derived from the two per cent deduction from all contracts awarded under the Cabotage regime. It was designed to empower Nigerian ship owners to acquire adequate tonnage.

    It is meant to empower maritime operators to participate in coastal and inland trade currently dominated by foreign ship owners.

  • CVFF beneficiaries to get $25m each

    Beneficiaries of the Cabotage Vessel Financing Fund (CVFF) will get $25 million each, the Nigerian Maritime Administration and Safety Agency (NIMASA) has said.

    The agency pegged the amount to save the fund from extinction. Its decision, it was learnt, was informed by how the Ship Acquisition and Ship Building Fund (SASBF) of the defunct National Maritime Authority (NMA) was killed.

    A senior official of NIMASA, who craved anonymity, told The Nation that the experience of its management in the disbursement of the SASB fund, showed that while some genuine shipping operators borrowed the money and paid back on time, others have yet to pay back the principal and accumulated interests.

    He said many of those who benefited from the SASB fund diverted the money.

    NIMASA, the official said, is taking precautions to safeguard the CVF fund.

    Findings revealed that the management of the agency has issued the criteria for participation in the CVFF, as it affects ship owners.

    According to the criteria, each applicant must own at least one classed vessel with P & I coverage; have a structured shipping company, which is verifiable and registered with NIMASA; must provide the company and staff profile; the vessel must be Nigerian-owned and must have five years experience.

    The requirements listed by NIMASA for ship agents wishing to participate in the CVFF are:

    •Proof of having husbanded at least 10 vessels (both local and international) within the last three years;

    • Must have a fully established and veritable office; and

    • Must provide the company and staff profile.

    NIMASA demanded that applications should show the type of vessel to be purchased/chartered or the guarantee required, and the amount being applied for not exceeding $25 million.

    Applicants were given a two-week ultimatum, which will expire on June 5.

     

  • Firm seeks roadmap for local content

    The Managing Director, Lagos Deep Offshore Logistics (LADOL), operators of the Lagos Free Zone behind Tin Can Port, Dr Amy Jadesimi, has challenged the government to chart a definite roadmap for Local Content Law administration in the maritime industry.

    She said this became imperative following the delay in the disbursement of the Cabotage Vessel Finance Fund (CVFF) by the Nigerian Maritime Administration and Safety Agency (NIMASA).

    The LADOL boss, who spoke with The Nation at the Logistics West Africa Conference and exhibition in Lagos, said the call became necessary in view of some challenges faced by local operators.

    She bemoaned the foreign domination of the shipping business in the country and urged the Federal Government to make the fund available to Nigerians.

    The LADOL boss also called on some private sector operators, who still operate as appendages to foreign interests, to have a change of focus. Mrs Jadesimi noted: “We need to see more private sector indigenous operators in the industry being on their own. We need to stop being mere agents. This agency model of classifying ourselves with one or two percentages of large contracts is not sustainable and will not help us.”

    Mrs Jadesimi said with the passage of the local content law, many indigenous operators were coming into the business with a measure of confidence, noting that it is the right way to go.

    She said the impact of free zones to the maritime and oil and gas industry, and how they are facilitating logistical efficiencies, specifically called for a sustained synergy between the Ministry, relevant government agencies and notable private sector operators in taking another look at some of the areas of the law, which constitute significant challenges that still impede the success of the law.

    According to her, one of such areas is the issue of tender process, which, she says, actually works against Nigerian players, in favour of foreign interests.

    “So, they now have to work together with qualified private sector and look at how we can encourage such investors who are seen to be doing something realistic so that they can continue to invest with a measure of confidence,” she added.

    Harping on challenges facing operators in the industry, Jadesimi said from LADOL’s experience, financing was still a huge problem because of bank’s lending rate compared to what obtains elsewhere.

    She, however, berated some of the top players who she accused of festering what ‘zero sum game: I win you lose, and I lose, you lose’ syndrome, which she described as “very damaging and anti-development.”

  • Firm seeks roadmap for local content

    The Managing Director, Lagos Deep Offshore Logistics (LADOL), operators of the Lagos Free Zone behind Tin Can Port, Dr Amy Jadesimi, has challenged the government to chart a definite roadmap for Local Content Law administration in the maritime industry.

    She said this became imperative following the delay in the disbursement of the Cabotage Vessel Finance Fund (CVFF) by the Nigerian Maritime Administration and Safety Agency (NIMASA).

    The LADOL boss, who spoke with The Nation at the Logistics West Africa Conference and exhibition in Lagos, said the call became necessary in view of some challenges faced by local operators.

    She bemoaned the foreign domination of the shipping business in the country and urged the Federal Government to make the fund available to Nigerians.

    The LADOL boss also called on some private sector operators, who still operate as appendages to foreign interests, to have a change of focus. Mrs Jadesimi noted: “We need to see more private sector indigenous operators in the industry being on their own. We need to stop being mere agents. This agency model of classifying ourselves with one or two percentages of large contracts is not sustainable and will not help us.”

    Mrs Jadesimi said with the passage of the local content law, many indigenous operators were coming into the business with a measure of confidence, noting that it is the right way to go.

    She said the impact of free zones to the maritime and oil and gas industry, and how they are facilitating logistical efficiencies, specifically called for a sustained synergy between the Ministry, relevant government agencies and notable private sector operators in taking another look at some of the areas of the law, which constitute significant challenges that still impede the success of the law.

    According to her, one of such areas is the issue of tender process, which, she says, actually works against Nigerian players, in favour of foreign interests.

    “So, they now have to work together with qualified private sector and look at how we can encourage such investors who are seen to be doing something realistic so that they can continue to invest with a measure of confidence,” she added.

    Harping on challenges facing operators in the industry, Jadesimi said from LADOL’s experience, financing was still a huge problem because of bank’s lending rate compared to what obtains elsewhere.

    She, however, berated some of the top players who she accused of festering what ‘zero sum game: I win you lose, and I lose, you lose’ syndrome, which she described as “very damaging and anti-development.”