200m CVFF: Banks to hold beneficiary ship-owners accountable ― FG

The Federal Government has revealed that, as part of guidelines being put in place for the disbursement of the Cabotage Vessel Financing Fund (CVFF) which currently stands at about $200m, lending institutions will hold beneficiary ship-owners accountable for every Kobo collected.

Disclosing this, on Thursday, during a meeting convened in Lagos by the Federal Ministry of Transportation in collaboration with the Nigerian Maritime Administration and Safety Agency (NIMASA), the Honourable Minister of Transportation, Rt. Hon. Rotimi Amaechi, stated that every penny disbursed to ship-owners will be accounted for.

Speaking to maritime journalists after the meeting, Amaechi stated that: “We have agreed to form a committee that will draw up guidelines for the disbursement of the CVFF. It is the guideline that will be drawn up that will be taken to the National Assembly for ratification.

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“That committee, comprising of some stakeholders, will be headed by the Director-General of NIMASA and it is them that will decide if the interest rate that will be attached to the CVFF will be single digits or not.

“Essential elements in the expected guideline is that the responsibility of monitoring the funds will be transferred to the lending institutions, that is the commercial banks. Nobody will just walk away with the funds. Every ship-owners that gets a chunk of the CVFF will be held accountable by the lending institutions.

“The commercial banks will first and foremost give criteria to access the funds, so any shipowner that does not meet up with the banks’ guidelines will not be a beneficiary. So, in this case, the risk will be borne by the lending institutions.

“If we just allow people to take that money without a proper framework to service their loans, then we won’t achieve our aim of developing the maritime economy. People must borrow and return money borrowed so that others can benefit from the CVFF.”

In his own presentation, the Director-General of NIMASA, Dakuku Peterside revealed that the funds currently stands at about $200m.

In his words, “the committee set up will come up with a draft guideline which the Honourable Minister will study and then pass on to the National Assembly for ratification. It is after this that we will go to the next stage where we will use the commercial banks to disburse the funds.

“The CVFF is currently about $200m and the guidelines will determine the manner of disbursement.”

It will be recalled that the Federal Ministry of Transportation had, last year, revealed that President Muhammadu Buhari has approved the disbursement of the CVFF funds in the first quarter of 2020.