Nigeria yet to disburse CVFF despite rise in global ship financing

Developed countries are increasing ship financing, especially with the move to green shipping, while Nigeria is yet to disburse the Cabotage Vessel Financing Fund (CVFF) to enable indigenous ship ownership to grow the industry.

According to a recent Petrofin Index for Global Ship Finance report, financing for green shipping is on the rise.

The yearly report showed that Asian and Australian banks (APAC) had significant growth, especially their market share, which has jumped from 40 per cent to 44 per cent.

The report noted that in terms of actual exposure, their portfolio amounts to $127.3 billion compared to $115billion in 2021.

Also, Greek banks showed a year-on-year growth of 4.6 per cent from $12.5 billion in 2021 to $13 billion in 2022. Japanese banks now also figure more prominently in global ship finance.

According to Petrofin Research, the indicative figure for global ship finance, including all forms of lending such as leasing, export finance and alternative providers, is approximately $525 billion.

Recall that international shipping trade is projected to grow by 2.4 per cent from 2022 to 2026 by the United Nations Conference on Trade and Development (UNCTAD).

This is just as the Chairman of the Board of Trustees of the Nigeria Indigenous Shipowners Association (NISA), Isaac Jolapamo, has criticised the Nigerian Maritime Administration and Safety Agency (NIMASA) for allegedly failing to prioritise shipping development in the country.

Jolapamo alleged that the creation of NIMASA has worsened shipping development when compared with what previously existed.

He noted that many shipowners no longer possessed vessels due to the agency’s failure to prioritise shipping development.

Jolapamo emphasised that shipping development, which should be at the top of NIMASA’s agenda, is now ranked as the sixth priority for the agency.

He further stated that if shipping technocrats are allowed to provide valuable input, NIMASA would have become a better agency.

He expressed a belief that the significant amount of resources expended by NIMASA in acquiring the Floating Dock would have been sufficient to enhance indigenous ship acquisition and promote shipping development.

“Most ship owners from the past don’t even have anything to show for it. If they hadn’t gone to purchase the dockyard, the funds intended for repairing the old vessels that Nigerians possess, known as bonds, ship repair, and subsidy, could have been utilized.

“For maritime development to progress, the center, which is shipping, must be perfected first. That is where we will continue to draw from. Although people like us are now old and tired, new individuals are taking over from us,” he stated.

Recall that seafarers had noted that Nigeria could generate over $100 million from ship development in the country while calling for utilisation of the Cabotage funds to build and maintain ships in the country.

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