A former Chairman of the Nigerian Ship-owners Association (NISA), Chief Isaac Jolapamo, has explained that over $5 billion debt owed banks by indigenous shipping companies should be ploughed back into the system. This is even as the former NISA helmsman explained that over 50 per cent indigenous ship owning businesses have packed up.
Speaking to Nigerian Tribune on the sidelines of the Federal Ministry of Transportation/Union of African Shippers Council validation colloquium on the United Nations convention on contracts held in Abuja on Wednesday, Chief Isaac Jolapamo explained that micro-finance banks cannot fund core maritime businesses.
According to him, “Over $5 billion bad debt owed by indigenous ship-owners is trapped in Nigerian banks.
“But instead of holding on to such money, the banks ought to have ploughed it back into the system. That is partly part of the reason why Nigerian banks don’t understand funding of shipping businesses.
“If such debts are ploughed back into the system, it will make the system work again. But it is a pity that the banks are not experienced in funding maritime assets, and that is why the indigenous ship-owners are in a precarious state presently.
“Even when ship-owners get a new ship, there is hardly anything to do with it profitably. That is why Nigeria will remain a shipping service nation where the agencies of government only collect monies from foreign vessels that come into our ports.”
When reminded that a Micro-Finance bank was recently established in Nigerian maritime sector, he explained that, “Micro-Finance banks cannot fund core maritime businesses. Such banks can only fund businesses on the periphery of the maritime sector, not the core shipping related businesses.”