Maritime experts have praised the Nigeria Maritime Administration and Safety Agency for its commitment to fully implementing the Cabotage Vessel Financing Fund.

The commendation was given on Thursday during a panel session at a one-day maritime law seminar held in Lagos by the Nigeria Maritime Law Association.

With the theme ‘Lens into the Future of the Shipping Industry’, the seminar examined both national and international maritime perspectives.

The panel analysed CVFF-related challenges and the fund’s effective distribution under the topic: ‘Renewed Prospects for the Full Implementation of Cabotage Act’.

Maritime lawyer, Adedoyin Afun of Bloomfield LP, said NIMASA was seeking ways to leverage CVFF for better financial guarantees in ship financing. He noted that shipbuilding often involves emission guarantees, which can help ensure fulfillment of payment obligations for new vessels.

“NIMASA is exploring partnerships with multilateral agencies to facilitate ship finance credit, seller’s credit, and improved shipbuilding. Shipyards can build for Nigeria with NIMASA providing guarantees. The funds remain untouched unless there is a payment default,” he said.

Mr Afun said these arrangements fall within the cabotage framework, covering loans, debt, and guarantee-based funding models. He emphasised that the guarantee element offers opportunities for attracting third-party investors and funding.

Mr Afun stated that the fund would be used alongside guarantees for shipyards and their associated partners to expand maritime capacity.

Also speaking, Jibril Abba, NIMASA’s executive director for Cabotage and Maritime Labour, called the CVFF a transformative initiative for local shipowners.

Mr Abba said loan disbursement would be monitored for transparency and effective utilisation. He explained that CVFF, established by the 2003 Cabotage Act, supports vessel acquisition and builds capacity among Nigerian maritime operators.

According to him, after almost two decades, CVFF’s disbursement marks a new era with eligibility criteria and collaboration with 12 primary lending institutions. He reminded stakeholders that CVFF is a loan, not a grant, and urged them to apply through designated banks and follow the due processes.

Mr Abba commended NMLA for involving NIMASA in the discourse, adding that stakeholder collaboration helps refine the agency’s implementation strategies.

Ladi Olubowale, the president of the African Ship Owners Association, called for investment in Nigeria’s strategic and service vessel fleets. He said Nigeria must acquire vessels for coastal trade and reduce dependence on foreign-flagged ships for regional fuel distribution.

“Dangote now uses Angola’s fleet. When will Nigeria have its own vessels flagged and ready for trade? There are ships for sale that are suitable for our use. We can get ones aged under five years, with 10 years’ service potential,” he said.

He noted the absence of Nigerian vessels means reliance on waivers and third-party ships to discharge cargo within national waters.

Mr Olubowale added that currently, only five countries build ships and that Nigeria may need 25 years to establish full shipbuilding capacity.  

Former NSC executive secretary Hassan Bello said cabotage was effectively implemented in aviation and should be mirrored in maritime operations. He urged the Ministry of Marine and Blue Economy to replicate aviation’s success within Nigeria’s cabotage framework.

Mr Bello called on NIMASA to issue directives supporting domestic trade within Nigeria’s territorial waters.

He also advocated implementing a strategic fleet for international trade and increasing stakeholder involvement in NIMASA’s planning efforts.

(NAN)