The director-general of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Dakuku Peterside disclosed that the Cabotage Vessels Finance Fund (CVFF) is held under the Treasury Single Account (TSA) of the Federal government, Naija247news has been told.
Speaking at the weekend’s cocktail parley for stakeholders in Ships/Maritime infrastructure Financing organised by Nigeria Ship Finance Conference and Exhibition (NISFCOE) in Lagos. The DG in a chat with journalists at the event said the Fund that has grew up to over a 100 million dollars would be disbursed to shipowners at the appropriate time.
When asked how much the Fund has risen to to DG said, “Over a hundred Million dollars.” He continued, “CVFF is there with CBN under TSA arrangement and we are working hard to disburse it. I can tell you that we are determined to disburse CVFF according to law and regulations that is what I can say with amount of seriousness that we are determined to disburse it and we are ready to go about the disbursement.”
Even though the DG identified funding as one of the problems of Indigenous Shipowners in Nigeria, he said the agency is engaging the CBN on how to make fund available for them. He disclosed that the Agency is worried about the high interest rate available to shipowners.
“We are worried that is why we are talking about ship financing because the industry is capital intensive the gestation period is long, the maturity period and the period Io begin to make return is usually fairly long. The current debt financing regime cannot support ship financing in Nigeria.
In many countries we get negative because coming to borrow money to finance shipping in some country is one percent and the maximum in ship building countries is 3 percent. So, a man who get the same facility at 25 per cent cannot compete.
“I agree there is a problem no dispute about that and we must do something to tell our financial institutions that ship building is a peculiar area unlike every other area and financing shipping is long term and again because of the capital outlay it is not something someone can pick off the shelves and finance we need partnership with the financial institutions but that partner must be at competitive rate.