The Nigerian Maritime Administration and Safety Agency(NIMASA) has said that no shipowner has applied for the Cabotage Vessel Finance Fund(CVFF) since the Federal Government announce its readiness to disburse the funds because there was no modalities in place .
However, NIMASA has confirmed that a tripartite meeting of the agency, shipowers and the banks, called the Primary Lending Institutions(PLIs) will soon take place after which modalities would be drawn up for applicants
The Director-General of NIMASA, Dr. Bashir Jamoh who stated this on Tuesday began talks with the five selected PLIs on agreed framework for the disbursement of the CVFF
Opening the discussions, Jamoh, told executives of the five banks; Jaiz Bank, Polaris Bank, United Bank for Africa, Union Bank, and Zenith Bank, that “The funds are ready. We want to start implementing the approval given by the president regarding the disbursement of the fund.
“We want to believe in your performance to deliver on your role in the disbursement of the fund,” Jamoh said.
President Muhammadu Buhari had granted approval for the disbursement of the fund meant to support shipping development by enabling indigenous operators purchase quality vessels for their operations in commercial coastal trade.
Provisions within the framework of the funds to be made available to indigenous shipowners demand that NIMASA makes 50 per cent available, the PLIs are expected to support the project with 35 per cent, while intending shipowners would be required to make their contribution of 15 per cent of whatever amount of money is needed for the acquisition of a vessel.
In this first meeting with the approved banks for the implementation of the CVFF, Jamoh requested that the banks harmonise their points, in order to have a homogenous representation of thought, ahead of the next stakeholder engagement, which would be with the shipowners.
He added that “As soon as we finish the stakeholder engagements, we will bring out the modalities for the disbursement of the CVFF. That is when the shipowners would start applying, because they are yet to start doing so.
“We would develop an action plan; it would come with deliverables, timelines, key performance indicators (KPIs). Once the action plan is ready, we will make it available to the press.”
The NIMASA DG explained that the agency, which is tasked with the responsibility of administering the fund, decided on meeting first with the banks in order for them to duly understand their role and whatever risks were involved and how best to manage such risks as professional financial institutions.
He said this stemmed from the earlier experience of the Ship Acquisition and Ship Building Fund, which was eventually stopped in 1996 after some beneficiaries of the fund defaulted in repaying the loans.
On their part, the executives representing the various banks, expressed readiness to play their part, but sought further guarantee with regards to the risks to be borne.
Representing Jaiz Bank, Serajo Salisu said: “We appreciate NIMASA for readiness to disburse the fund, and for having confidence in us. We will work professionally with the guidelines for the implementation of the fund as approved.
“We will try to see that this time around the risk would be minimised if not completely eliminated. The operators are aware this is not a grant, but money meant for a purpose. And we will ensure that purpose is achieved for the benefit of the country.” He then added, “Is there anything that can be done to further reduce the risks that the PLIs would undertake?”
According to the NIMASA DG, the banks are expected to have harmonised their thoughts in the next 72 hours and reach back to NIMASA with same, which would be important to the proposed stakeholder engagement.