Buhari authorizes disbursement of Cabotage Fund – Sambo

The Minister of Transportation, Mr. Mu'azu Sambo, says President Mohammadu Buhari has approved the disbursement of the Cabotage Vessel Financing Fund (CVFF) with immediate effect.

Sambo said this during the flag-off ceremony of Batch B of the Third Phase of the Nigerian Seafarers Development Programme (NSDP), Terra 11, in Lagos on Saturday.

The NSDP is a platform provided by the Nigerian Maritime Administration and Safety Agency (NIMASA) to consolidate its position in the maritime industry through a solid seafaring manpower base.

"We will disburse these funds in the days to come to the beneficiaries deserving of them, as we have made the case that the funds belong to shipowners."

"Mr. President is a man who respects the law, and he is on the same page with us that we should proceed with immediate effect."

"We will be liaising with the Minister of Finance, Budget, and National Planning and the Governor of the Central Bank of Nigeria to work immediately on the disbursement," he said.

Sambo noted that the agency had pledged to the president that it would allow the funds to go into the Treasury Single Account.

He, however, said whenever the money hit the threshold of 50 million dollars, the CBN, upon recommendation from NIMASA and the federal ministry of transportation, would inspect the transfer of the funds to the primary lending institutions.

"In this regard, five primary lending institutions have been approved by the President to do the disbursement."

"This milestone development and this ceremony go hand in hand because there is a nexus between seafaring, ships, capacity building, and making sure ships are available."

"With this approval, I am sure our indigenous capacity will grow, and not even the sky will be the limit," he said.

Sambo noted that his predecessor had administrative challenges with the federal ministry of finance, which is why he could not disburse the funds.

He said the agency had identified those gaps and that they had been addressed.

"The five banks selected for the disbursement are Union Bank of Nigeria, Polaris Bank, Zenith Bank, United Bank for Africa, and Jaiz Bank.

"The banks were selected based on criteria set out in the guidelines, the enabling law, and the guidelines for the disbursement of the funds as approved by the National Assembly," he said.

The transportation ministry said to avoid the pitfalls of the past, the guidelines were very clear: the applicants for the funds would make equity contributions of 50 percent, NIMASA 35 percent, and banks 15 percent.

He pointed out that the agency would put in place an administrative structure so that loan applications were professionally scrutinized.

"The approval for the disbursement got to my office late Friday, and on Monday, the NIMASA DG will take immediate steps to see to the disbursement," he said.

Dr. Bashir Jamoh, Director General, NIMASA, noted that the money at hand was in two folds: N16 billion and 350 million dollars.

Jamoh said the agency would develop an action plan with a timeline that would be made available to everybody so they would know when the first check would be signed to the beneficiaries.