Slow $100m Cabotage Fund Implementation Threatens Indigenous Shipping

Container Shipping
  • Slow $100m Cabotage Fund Implementation Threatens Indigenous Shipping

Concerned about drag in the implementation of the Cabotage Act, stakeholders have requested the Nigerian Maritime Administration and Safety Agency to facilitate the disbursement and utilisation of the Cabotage Vessel Financing Fund for the purpose of developing indigenous shipping capacity.

They expressed worry at a conference in Lagos that the slow in policy implementation was threatening the operation of indigenous shippers.

The Director-General of NIMASA, Dr. Dakuku Peterside, had said that over $100m Cabotage fund lay idle in the Central Bank of Nigeria’s coffers.

He spoke at a Ship and Maritime Infrastructure Financing cocktail party for stakeholders in Lagos, lamenting that the Treasury Single Account policy made it impossible for local operators to access the funds.

It was reported that scores of Nigerian vessels were currently lying idle on the sea due to lack of maintenance and cargoes. The operators blamed the lack of access to the cabotage fund for the problems.

The Secretary General, Shipowners Association of Nigeria, Mr. Tunde Balogun, noted in a recent interview that the maritime sector was not as lucrative as it should be due to the lack of effective implementation of the Cabotage Act and other existing maritime laws that ought to create an enabling environment for local operators to thrive.

The Cabotage Act, according to him, should promote indigenous participation in cargo carriage.

He said, “The tonnage is no longer there even the offshore rigs are cutting down on production and this also affects us. So, government needs to enforce the Cabotage Act now more than ever before because the volume of available business today is not even enough for us indigenous shipowners so we need an enabling environment to be able to compete favourably with the foreign participants in the sector.

“We need government to actually implement the Cabotage Law to give us the opportunity to move the available cargo and pay for the movement in naira. The waiver for temporary importation for foreign vessels should be removed. We think we should allow Nigerian shipowners to carry the available cargo today.

“Even with the Nigerian National Petroleum Corporation, I know there are contracts for chartering of vessels; this should be handled by indigenous ship owners only.”

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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