FG Approve N324.1bn to be Disbursed to Nigerians for job creation.
The House of Representatives has given approval for the disbursement of the Cabotage vessel fund, amounting to $700 million. The purpose of this fund is to enhance employment opportunities within the maritime industry and assist indigenous shipowners in acquiring new ships.
The Cabotage vessel fund was established under the Coastal and Inland Shipping (Cabotage) Act of 2003 with the aim of promoting the development and growth of Nigeria’s domestic shipping business by providing financial support to local operators. This recent approval by the House of Representatives signifies a significant step towards achieving these objectives.
In a bid to ensure transparency and accountability, the House Committee on Local Content has been tasked with auditing all contracts associated with the Cabotage regime. Last month, the House requested the Nigerian Maritime Administration and Safety Agency (NIMASA) to halt the planned disbursement until the auditing process is completed.
The Chairman of the Committee, Legor Idagbo, confirmed that due process was followed in the intended disbursement after conducting investigations and consultations with NIMASA and the Ministry of Transport. He emphasized the need to enhance the capacity of indigenous operators, as some contracts had been awarded to foreign shipping companies, which is contrary to the provisions of the Cabotage and Nigeria Oil and Gas Industry Content Development (NOGICD) Act.
To ensure compliance with existing laws, the Committee nominated Legor Idagbo as the Chairman, along with Henry Nwawuba as a member and Kehinde Bolade Olaiya as the Committee Clerk to oversee the disbursement process. This measure aims to prevent any violations of the laws established by the National Assembly.
The disbursement of the Cabotage Vessels Finance Fund (CVFF) is highly anticipated by indigenous shipowners in Nigeria, who have been waiting for this opportunity for 17 years. The initial disbursement, expected to commence in March 2023, will be facilitated by Primary Lending Institutions (PLIs). The available funds for disbursement amount to slightly over N16 billion and $350 million.
With the disbursement of the Cabotage vessel fund, it is expected that the maritime industry will experience significant growth and job creation, while also promoting the participation of indigenous shipowners in Nigeria’s domestic shipping business.