Nigeria: Ship owners decry non-disbursement of N40b Cabotage Fund

Members of the Indigenous Ship Owners’ Association of Nigeria (ISAN) decried the non-disbursement of the Cabotage Vessel Financing Fund (CVFF) 10 years after it was instituted.
According to the group, proceeds from the CVFF, which were instituted by the Federal Government as part of measures to meet the provisions of the Coastal and Inland Shipping Act 2003, popularly called Cabotage Act, are in the vault of some banks, “generating interest for some people”.
The fund, which is currently more than N40 billion, is derived from the two per cent deduction from all contracts awarded under the Cabotage regime and is expected to help position indigenous ship owners to compete with foreign-owned vessels in Nigeria’s coastal water.
General Secretary of ISAN, Niyi Labinjo, explained yesterday that nine members of the association who applied for the fund over the years are yet to hear from either the banks identified as Primary Lending Institutions (PLI) or the Nigerian Maritime Administration and Safety Agency (NIMASA), the supervising agency.
Under the arrangement, according to Labinjo, any ship owner who applies to access the fund is expected to contribute 15 per cent of the sum required while NIMASA and the specific bank contribute 50 per cent and 35 per cent respectively.
Explaining further, Labinjo said: “What is delaying the disbursement of the fund? The law is clear on how the fund should be disbursed. The fund has been generated. The fund is available. The question is what is delaying the disbursement? Nine of our members applied to access the fund. Up till now (yesterday), nobody has contacted us”.
He alleged that some individuals are mapping out strategies on how to make the disbursement a ‘political affair’.
The association also used the opportunity to appeal to relevant agencies of government to ensure the fund is disbursed without delays and in line with constitutional provisions.
Meanwhile, the Chief Executive Officer, Ships & Ports, Bolaji Akinola, has alleged that some unnamed politicians and  ‘entrenched interests’ of attempting to foist “an unqualified firm on NIMASA as Consultant to the Cabotage Fund”.
Akinola explained that since four banks have been appointed as Primary Lending Institutions (PLIs) for the CVFF and since NIMASA has a whole department devoted to overseeing the implementation of Cabotage, “there is no need for appointing any consultant to the Fund, especially when the so-called potential consultant is being deliberately positioned to do the bidding of politicians and entrenched interests”.
He advised NIMASA to scrutinise applications for the CVFF carefully to avoid a recurrence of past experience, especially with regards to the Ships Acquisition and Ship Building Fund (SASBF).
“In the 80s and 90s, the National Maritime Authority, now known as NIMASA, administered the Ship Acquisition and Ship Building Fund (SASBF) through which it gave loans that were intended to encourage ownership of ships by Nigerians.
“While a few number of genuine Nigerian ship owners benefited from the SASBF and bought ships, though old and rusty, several politicians, ‘briefcase ship owners’ and cronies of the then military junta, also dipped their hands in the till and diverted the money to other uses.
“The fund was suspended in the late 90s but much of the money was never recovered and no one was prosecuted”, Akinola added.
Source: Guardian