Will CVFF Ever Be Disbursed?

For the beleaguered indigenous ship owners, accessing the controversial Cabotage Vessels Financing Funds (CVFF) is like a proverbial camel passing through the eye of a needle.

In actual fact, none has ever gotten close to accessing it since 2004 when it was established.

The closest any of them could get within a sniffing distance of the funds was in 2014 when about 100 indigenous operators showed interest in the loans.

After rigorous screening, six of these companies were pencilled down as having met the conditions set by the four PLIs to benefit from the funds. They included Starzs Investment Company, Aquashield Oil and Marine Services Limited and UTM Dredging Limited all based in Port Harcourt.

Others were Zomay Marine and Logistics Limited and Seabulk Offshore Operating Nigeria Limited based in Lagos. The Calabar-based Nkrah Investment Ltd was also listed as a beneficiary.

So far, none of these prospective beneficiary-companies has obtained the loan.

Interestingly, the fund, an off-shoot of Cabotage regime, was specifically set up to empower indigenous ship owners, increase their tonnage, enhance their capacity to compete in coastal trade and generate employment.

More interesting is the fact that the fund is the two per cent contributions of ship owners deducted from the value of their contracts under the Cabotage regime.

Curiously, 17 years after, no single dollars has been disbursed from the fund.

It would be stating the obvious to say that nigeriamaritime360.com is saddened by the apparent delay in the disbursement of the funds.

No doubt, the indigenous ship owners for whom the fund is meant have grown weary of long wait, disappointed, pissed off and probably lost hope of accessing the funds due to the sickening politics its disbursement have been subjected to over the years.

The funds, over the years, have been subjected to mind-boggling serial abuses by previous administrations in the Nigerian Maritime Administration and Safety Agency(NIMASA), the agency which superintendents over the funds.

The funds, which actual accrual, has been subject of wild speculations and conjectures due to official secrecy and insincerity, have variously been diverted to purposes other than what it was meant for.

We are distressed by the fact that while this circus show was going on, most of the shipping companies which could have benefitted became distressed and went under, thus depressing Nigeria’s tonnage capacity and creating more unemployment.

Little wonder then that the ship owners, who had been scammed over the CVFF disbursement under previous administrations in NIMASA, looked at the present administration led by Dr Bashir Jamoh, to give them succour and hope for early disbursement.

We also share in their optimism given the fact that the APC, which was in opposition prior to 2015, criticised the administration of Goodluck Jonathan for its prolifigacy and insincerity over the vexed issue of CVFF.

During Dakuku management at NIMASA , he promised to expedite action on the disbursement of the funds.

But throughout the tenure of Dakuku as the DG of NIMASA, the funds were not disbursed despite his promises.

In October 2017, Dakuku had raised what has now become a forlorn hope of the distraught ship owners when he declared that he was vigorous pursuing the disbursement of the funds to grow tonnage and boost employment.

But in December of that year, Rotimi Amaechi, the supervising minister of Transportation vowed in a stakeholders gathering that he would not disburse the funds as long as he remains the minister, citing various abuses the funds had been subjected to in the past as well as lack of repayment plan.

He has even threatened to use part of the funds to fund the nebulous national carrier project while the house committee on maritime safety, education and Administration said N55bn would be taken out of the funds to start the infantile maritime bank.

But in December 12th,2019, the Minister again recanted his earlier hardline position and once again raised the hope of indigenous ship owners whensaid he has secured the blessing of President Buhari to disburse the funds in January, 2020.

One year after, the promise was kept in the breach.

Bashir Jamoh, at his take over as the Director General of NIMASA in May 2020, seemed to rekindle the forlorn hope of the intending beneficiaries when he regalled them with details of the new guidelines for the disbursement of the funds.

Ever since then, nothing was heard about the matter again.

We are not happy; to say the least, with the circus show being made of a serious and life-impacting project as CVFF.

No wonder most of the indigenous shipowners have turned to a more credible source of funding provided by the Nigerian Content Development Board.

It is more distressing to note that the board, through its intervention fund called the Nigerian Content Development Fund, established in 2010 and domiciled with the Bank of industry, has disbursed loans to at least six ship owners.

The NCDF derived from one percent contributions of ship owners, is perceived to be more transparent while its up to date accrual said to be over $700 was never a subject of controversy largely due to the sincerity of its managers.

We urge NIMASA to emulate the structure and guidelines of disbursement employed by its sister agency, Nigerian Content Development Board as well as the transparent manner the scheme is being handled.

We would not be surprised if many operators, especially the ship owners, scoffed at the recent promise of the Minister and NIMASA to commence the disbursement of the controversial funds as promised next year.

Their scepticism could be forgiven given the serial failed promises they have been subjected to over the years.

We however urged the distraught ship owners, who have obviously become weary of long and unending wait, to give the Minister and the new management of NIMASA the benefit of the doubt.

The pressure and agitations of well-meaning stakeholders may have finally gotten to them to enable them stick to their words this time.

This platform therefore wishes to implore NIMASA and Minister not to renege on their promise to disburse the long-awaited funds for the capacity building of the distressed indigenous shipping companies as promised.

We want to however implore the Minister to hasten the disbursement

By adopting existing guidelines that were fashioned out through rigorous process and which rest on a tripod of the beneficiaries, NIMASA and banks.

In the guidelines, which were generally agreed to by the three parties involved, four primary lending institutions were equally selected through rigorous process.

They are Fidelity bank, Diamond(now Access-Diamond), Skye Bank and Sterling Bank.

Also, intending beneficiaries must submit application need to their loan application tied to a maritime project cost for which 15 per cent of the project cost must be provided by the intending beneficiaries.

NIMASA, which has to pre-qualify them, must also provide guarantee to the primary lending banks.

We also recall that six companies out of 100 which showed interest in 2014 were shortlisted by previous administration and were at the point of getting the loan before the process was botched.

To us, the existing guidelines are fool proof and can stave off any abuse or infraction.

Subjecting the guidelines to another round of review, to our mind, is tantamount to elongating the disbursement process.

It will also send a wrong signal to stakeholders who are already weary of government broken promises and sceptical about the fresh promise.

We urge the authority to commence the disbursement of the funds without delay, using existing guidelines with minimum variations that will accommodate likely changes caused by the long delay.

It will do the industry a whole lot of good and our quest to increase tonnage and generate employment if the government ends this unending wild goose chase by prompt disbursement of the funds.

This, we believe, will end the misery of indigenous ship owners and terminate their wild chase of the evasive and elusive CVFF.