As with his predecessor, the new Minister of Transportation; Engr Mu’azu Sambo has promised to disburse the Cabotage Vessel Financing Fund (CVFF). At his recent visit to Rivers state, the minister gave December this year as the final date for disbursement.
The Minister who bemoaned the non-disbursement of the fund, assured stakeholders present that he would do everything possible to ensure that the funds were disbursed before the end of 2022.
His words: “I want to say it here that it (CVFF) is indeed a low hanging fruits and I will do everything within my power to make sure that the fund is disbursed to Nigerians as quickly as possible, so that Nigerians ship owners can increase their capacity and as well generate wealth here instead of patronising foreign ships owners and money from such business is taken out of Nigeria, rendering us jobless”.
“We want to assure the maritime community that we have already put in place machineries to make sure that we take benefits of the CVFF before the end of this year, by the grace of God”, he said.
All things being equal, this Minister will vacate office by May 29, 2023, and we dare state here that Mu’azu Sambo will be assessed based on this promise.
We recall that, in June 2020, the Director General, Nigerian Maritime Administration and Safety Agency (NIMASA); Dr Bashir Jamoh equally raised hope of disbursement of the controversial CVFF in 2020. He specifically assured that, before the end of October, some beneficiaries of the fund will get it.
The NIMASA boss had given this assurance at a media parley to mark his first 100 days in office as the CEO of the agency. In June 2020, he had said: “We are working to disburse the CVFF, before October, we will disburse the first leg of the fund to beneficiaries”. He is yet to fulfill that promise!
The CVFF is an essential part of the Cabotage Act of 2003. An important annexure to the Act is the Cabotage Vessel Financing Fund; a Fund which is derivable from the two percent deductions from all contracts awarded under the Cabotage regime. It was designed to enable indigenous shipping companies acquire adequate tonnage to be able to participate in coastal and inland trade, still currently dominated by foreigners.
Sadly, the CVFF has been ‘untouchable’ for as many years as it has accrued. Even though the fund keeps swelling, it’s supposed beneficiaries have not been able to access it.
The fact is that, since the collection started, no one has officially benefitted from the CVFF; all that we have been hearing are promises.
We recall that, in 2018, the then- Director General of the Nigerian Maritime Administration and Safety Agency (NIMASA); Dr Dakuku Peterside said the agency had concluded necessary documentation needed for the disbursement of the CVFF. He gave the accruals from the fund at that time to be in excess of US$100 million as at that time.
And in 2019, the NIMASA DG also told journalists that the CVFF is already in the neighborhood of $124million, even as he raised fresh hopes of disbursement of the Fund to qualified Nigerian ship owners. But, it was never disbursed.
Currently, the CVFF may be in the neighbourhood of $350million.It is said to be in the custody of the Central Bank of Nigeria (CBN).
Under the CVFF guidelines that are already in public domain, each beneficiary must submit application and needs to tie the loan application to a maritime project, for which 15 per cent of the project cost must be provided, having been pre-qualified by NIMASA.
At a point, NIMASA which is statutorily mandated to disburse the CVFF appointed four banks: Skye, Diamond, Fidelity, and Sterling as Primary Lending Institutions (PLIs) for the CVFF.
There have been a lot of back and forth about the CVFF. At some point, there was an announcement that six companies had been prequalified to benefit from the fund; that was the last that was heard of it.
If it is true that NIMASA had for a long time conducted due diligence on the six companies and handed over their names Ministry of Transport, if it is also true that it is the Presidency that is delaying the disbursement, then our fears about the insincerity on the part of government may have been confirmed.
The fact is that, the CVFF remains an unfulfilled dream of the initiators and drafters of the Cabotage Act.
Perhaps, the starting point for the Minister is to ask NIMASA what happened to the companies that were shortlisted as qualified to access the CVFF a few years ago?
It appears that we have gone past the excuses of blaming the Federal Government and the Presidency. It also appears like the six companies (whose identities were not disclosed) are no longer in the picture.
Why is the CVFF still being warehoused at the Central Bank of Nigeria (CBN), and why are we still at the level of offering assurances.
While we are not subscribing to the insinuation that the Fund may have been misappropriated, the non-disbursement of the CVFF is raising questions.
Between NIMASA and the supervising Ministry of Transportation and the Presidency, there is a lot that is going on that is detrimental to the success of Cabotage Act in general and implies lack of transparency in the CVFF in particular.
Perhaps, Minister Sambo should be reminded that the immediate past Minister of state (who also acted briefly as Minister); Senator Gbemi Saraki actually promised the Nigerian maritime industry that the CVFF would ‘soon’ be disbursed. That was during the little time that she was in charge of the Ministry.
Saraki had told the media that the guidelines for the disbursement of the fund have been formulated and would soon be presented to the National Assembly for approval, which would immediately be followed by the actual disbursement of the funds to the already shortlisted beneficiaries.
If the incumbent minister is relying on the above process to lead to actual disbursement as enunciated by his predecessor, then he may not meet his December 2022 deadline.
It is a surprise that events are taking the same pattern. The usual practice is for every new DG of NIMASA and every new Minister of Transportation to dangle the carrot of imminent disbursement of the CVFF in front of stakeholders, especially ship owners. But, we have passed this route severally in the past!
Between NIMASA, and the Ministry of Transportation, there appears to be a conspiracy of not wanting to disburse the CVFF, or is there something unusual or untold about the fund that handicaps them?
Nigerian maritime industry stakeholders are tired of hearing this same song of; “we will soon disburse the CVFF”. Both NIMASA and the Ministry of Transportation are beginning to sound like a broken record.
If the then-Minister; Mr Rotimi Amaechi said in December 2019 that CVFF disbursement would commence in January 2020. This is September 2022, and we are still being told the same story. This is tantamount to dishonesty and it further reinforces the fears that we all nurse.
The fear is that, government has no intention of ever disbursing the CVFF, period! We pray that the new Minster will proof us wrong.
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