CVFF Disbursement Conundrum: Shipowners Dont have 15% Equity—Capt Ladi Olubowale Opens Up

By DAPO OLAWUNI

The President of African Shipowners Association (ASA) Capt Ladi Olubowale has condemned the non-disbursement of the controversial Cabotage Vessel Financing Fund (CVFF) by the Ministry of Marine and Blue Economy and the Nigerian Maritime Administration and Safety Agency (NIMASA)

While delivering a lecture themed: Nigeria’s Shipping Carriage Gaps: CVFF and the Fading Manpower at the 30th Anniversary of PortNews in Apapa Lagos on Thursday, Capt Olubowale disclosed that Nigerian shipowners cannot afford to come up with the required 15% equity for the purchase of vessels as outlined in the CVFF Disbursement guidelines.

Recall that the Director General of NIMASA, Dr Dayo Mobereola had earlier given August 2025 as date for disbursements of the CVFF fund to commence.

In his lecture, Capt Olubowale said “We all waited for August 2025 for the CVFF fund to be disbursed, but right now, everything is on radio silence about the money and nobody is saying anything in the industry. The government owe us an explanation on the whereabouts of the money.

“The question remains that, how are we going to contribute the required 15% equity? NIMASA is expected to come up with 50%, the commercial banks are to pay 35%, while shipowners are to pay 15%

“For example, if a vessel costs 25millionUSD, the fifteen percent of is about 3.7millionUSD. Where do you expect a company in Nigeria to raise that amount of money?

Capt Olubowale also raised a valid concern, saying that should the CVFF be disbursed today and vessels are acquired, the vessels would be dominated foreigners because Nigeria has failed to develop its seafaring capacity.

“You cannot build a maritime sector when you dont have capacity. If today we have cargo vessels operating in our waters again, we have experienced hands (old master mariners) who might not be fit to work in that space anymore, this why the old master mariners need to impact their knowledge into the younger generation.
This is the gap that we are seeing in the industry right now
For every day we spend not releasing the CVFF fund, there is a loss, and our seafaring sector is dying”

According to him, there are several countries that would manufacture the required ships with ten percent advance of the overall cost, pending completion.

The ASA President warned that the growing shortage of maritime manpower threatens the sector’s future.

He revealed that more than 5,000 trained Nigerian cadets remain unemployed due to lack of sea-time experience, calling for immediate intervention to place them onboard vessels.

In his welcome address at the function, Publisher of PortNews, Mr Wale Oni said it is unwise for Nigeria as a nation to continue keeping the CVFF fund which is estimated at about USD800million for so long without finding it expedient to dispense it for the purpose it was generated.

“The Cabotage Vessels Finance Fund primarily provides funds for indigenous ship owners for medium size coastal vessels acquisition and maintenance. The fund was to be sourced through 2 percent surcharge and other levies.

“Between 2003, it is being mouthed that about 800 million dollars has been realized into the CVFF purse. Some rumour has it to be one billion dollars. Why can’t government tell us the exact amount? Why this level of opaqueness?
Why this humongous volume of public money remain idle for so long, especially now that virtually all tne indigenous companies in coastal carriage business have gone under ?

“At this juncture, i will salute NIMASA for keeping such large sums unscathed in its vault for over twenty years. It is a national record in fidelity.

“But, why would a nation deem it wise to Save about 800 million dollars for so long without finding it expedient to dispense it for the purpose it was generated? When thousands of its skilled seamen, master mariners, professionals trained at exorbitant costs in the best shipping schools around the world are loafing around, wasting away?