Maritime Report

August 7, 2019

Cabotage: Ship owners demand audit of CVFF

Cabotage, CVFF

….NIMASA, AMANO seek collaboration

By Eguono Odjegba

THE Alumni of Maritime Academy of Nigeria Oron, AMANO, and other stakeholders in the Nigeria maritime industry have called for an appraisal of the implementation of the Coastal Inland Shipping Act, otherwise known as Cabotage Law, with a view to realizing objectives of the Act.


President of AMANO, Engr. Victor Umezurike, in his remarks at the meeting of the association last week in Lagos, expressed dismay that despite the Act has been around for sixteen years and with all manners of official affirmations, operational, legal and financial framework put in place to drive the law, Cabotage has failed to sail.

This is even as the chief driver of the Cabotage Act, Nigerian Maritime Administration and Safety Agency, NIMASA, declared that unless all critical stakeholders join hands in its implementation, Cabotage objectives cannot be realized.

But shipping magnate and immediate past president of Ship Owners Association of Nigeria, SOAN, Engr. Greg Ogbeifun has called for a forensic audit of the Cabotage Vessel Financing Fund, CVFF, saying the Federal Government has been economical with the truth on the report of the implementation especially with regards to financial disclosures of the fund, which he described as unhealthy and unhelpful to the cause of its implementation.

Meanwhile, the director general of NIMASA, Dr. Dakuku Peterside, had said that one factor that has impacted negatively on the implementation of Cabotage was the erroneous belief by maritime players that Cabotage is the sole responsibility of NIMASA, explaining that it is the responsibility of the organized private sector as much it is that of government. He said: “NIMASA alone cannot achieve the intent and aspirations of Cabotage Law.”

Earlier, Head, Cabotage Unit of NIMASA, Barr. Victor Egejuru, in a presentation, said until and unless all relevant stakeholders resolve to actively drive its implementation, the Cabotage Law may remain a mirage warning that “foreign players will continue to dominate the coastal trade” until there is a change of approach by local players.

Also read: NIMASA cancels Cabotage waivers, commences clamp down of defaulters

He enjoined players in the organized private sector, ship owners, shipbuilders, ship repairers, the Nigerian Ports Authority, the Nigerian Navy and operators of the oil and gas industry including associated departments of government such as the Nigerian National Petroleum Corporation, National Petroleum Management Services, NAPIMS, department of Petroleum Resources, DPR etc to close rank and reinvigorate the implementation process.

Explaining his position, Ogbeifun said the federal government’s failure to avail stakeholders information of how much has accrued to the CVFF as a component of the Cabotage implementation put in place over sixteen years ago is suspect.

He further said that contributions were drawn from ship owners and deductions from ships calling to the ports into the Fund.

He challenged NIMASA to make full financial disclosure of the CVFF as a way of promoting and maintaining accountability, transparency, corporate responsibility and governance.

“We must be sincere and committed to the cause of the Cabotage Law. One of the components of Cabotage implementation was the creation of the Cabotage Vessel Financing Fund.

“That Fund is central to the realization of its intents and aspirations. Deductions were made from every ship that called our ports, ship owners contributed certain percentages, NIMASA has continually avoided disclosing how much has accrued to the fund.”

Another speaker at the event, Engr. Wisdom Nwagwu, who doubles as an AMANO member traced the history of Cabotage Law and the various roadblocks that have so far impeded its implementation. Top on the list is what he described as “huge scale abuse of waiver by successive transport ministers”.

Nwagwu also fingered the relevant departments of government for non-cooperation and commitment and lamented that the Federal Government has failed to domesticate essential conventions of the International Maritime Organisation, IMO, capable of driving Cabotage and raising standards and compliance in ports administrations and shipping.