Amaechi: How $200m vessel finance fund will be disbursed to ship owners

Rotimi Amaechi, minister of transportation, says the $200 million cabotage vessel financing fund (CVFF) will be disbursed to ship owners for the first time since it was established.

Addressing journalists in Lagos on Thursday, Amaechi said the criteria for the disbursement will be drawn up by a special committee which would involve banks.

The vessel finance fund was created in 2004, and represents 2 percent contribution by indigenous ship owners on every contract done in the maritime sector.

The minister said the guidelines which are subject to approval by the national assembly, would contain the percentage interest to be used in disbursing the fund to ship owners.

“In the past, the money was applied to building Maritime university and faculties of maritime in other universities across the country. This would be the first time the money is applied to ship owners directly,” he said.

“We have also agreed today to set up a committee that will come forward with the proposed guideline which will be presented to the national assembly. 

“It is the committee that will determine if it will be a single digit or not, and the committee would be chaired by the DG of NIMASA.”

Amaechi said banks would bear any financial risk that may occur in the operation of the fund.

“The banks will be involved in developing the criteria for the disbursement of the fund, so the risk will be borne by the lending institutions,” he said.