The Federal Government on Thursday inaugurated the Cabotage Vessels Financing Fund application portal to enable shipowners to access the fund.

This is even as the government added that beneficiaries will access the loan at an interest rate of 6.5 per cent with an eight-year repayment plan.

Speaking during the commissioning in Lagos, the Minister of Marine and Blue Economy, Adegboyega Oyetola, explained that the occasion represents a deliberate and strategic step in repositioning Nigeria’s maritime sector as a central pillar of national development.

The Cabotage Vessel Financing Fund, established under the Coastal and Inland Shipping (Cabotage) Act of 2003, was designed to address this challenge, and the commencement of the application portal was part of efforts to ensure easy and smooth disbursement of the fund.

Oyetola added that the occasion represents economic diversification, resilience, and sustainable growth.

According to him, the establishment of the Federal Ministry of Marine and Blue Economy by His Excellency, President Bola Tinubu, in August 2023 was a forward-looking policy decision aimed at broadening Nigeria’s economic base by unlocking the vast potential of the nation’s maritime domain, coastal resources, and inland waterways.

“Today’s event must therefore be viewed within this broader policy context, one anchored on indigenous capacity development, transparency, efficiency, and long-term sustainability,” Oyetola said.

He emphasised that the maritime sector remains the backbone of global commerce, with the bulk of international trade conducted by sea.

Oyetola highlighted that despite Nigeria’s strategic geographic location, extensive coastline, and vibrant entrepreneurial base, “our participation in the carriage of coastal and inland trade has remained limited.”

The former Osun State Governor maintained that a major constraint has been the absence of a functional, credible, and transparent financing framework to support indigenous ship ownership.

He added that institutional, regulatory, and structural considerations over the years necessitated a cautious and deliberate approach to ensure that, when operationalised, the fund would be transparent, disciplined, and sustainable.

“Upon assumption of office, our policy objective was clear: to strengthen Nigeria’s maritime capacity and operationalise the CVFF strictly in line with sound governance and financial principles,” he said.

Oyetola explained that the CVFF is structured as a strategic development instrument, adding that by facilitating access to competitive vessel financing for indigenous operators, the government hopes to reduce reliance on foreign-flagged vessels in coastal trade, improve retention of value within the domestic economy, create employment opportunities for Nigerian seafarers, and stimulate growth in allied sectors such as shipbuilding, ship repair, and maritime services.

He noted that, collectively, these outcomes will strengthen economic resilience and enhance Nigeria’s competitiveness within the global marine and blue economy.

He averred that beyond its economic impact, the CVFF also complements the country’s maritime safety and security framework.

Oyetola maintained that a stronger indigenous fleet enhances operational visibility within the country’s waters and supports national efforts to maintain a secure, regulated, and efficient maritime domain, in line with Nigeria’s improving maritime security profile and growing international standing.

“The CVFF is a revolving fund, designed to grow through prudent utilisation and timely repayment. Beneficiaries are therefore expected to meet their obligations fully, ensuring that this intervention remains available not only to current applicants but also to future generations of Nigerian maritime entrepreneurs,” Oyetola said.

He stressed that the launch of the CVFF application portal will serve as an institutional gateway that introduces transparency, accountability, and order into the administration of the fund.

“Through this platform, eligible Nigerian shipowners can submit applications that will be assessed against clearly defined criteria, supported by robust due diligence and professional financial oversight through the approved Primary Lending Institutions,” he added.

He reiterated that the success of the initiative will depend on disciplined implementation and responsible participation by all stakeholders.

“I therefore call on indigenous shipowners and maritime operators to take full advantage of this opportunity, while I urge the wider maritime community to continue supporting this administration, particularly at this critical stage of comprehensive sectoral reforms,” he stated.

Earlier, the Director-General of the Nigerian Maritime Administration and Safety Agency, Dr. Dayo Mobereola, stressed that both NIMASA and the Primary Lending Institutions (PLIs) have reached an agreement on a 6.5 per cent interest rate.

“You also understand that the PLI is expected to bring a minimum contribution of 15 per cent, and on that axis, the PLI actually determines its rates based on market conditions. However, we had agreements, and we are going to commit ourselves to those agreements that a weighted average rate that will go to the borrower at the end of the day should not exceed 6.5 per cent. I agreed that the interest rate should be 6.5 per cent together with our fund as well as the PLI’s fund. So I’m very glad that the financial consultant has actually corrected himself,” Mobereola reaffirmed.

He stressed that the loan tenor was set at eight years to enable shipowners to have enough time for their operations.

“The second issue I think I should speak to right now borders on the tenor of the loan. What we all know is that the shipping industry requires long-term funding as well as patient capital, and on that note, we have specifically stated that the tenor for the loan would be eight years. This will allow shipowners confidence, enough time to carry out operations, peace of mind, and the ability to pay back those loans,” he added.

Meanwhile, a former president of the Shipowners Association of Nigeria, McGeorge Oyung, while commending the minister and the NIMASA boss for the laudable initiative, urged them to extend the loan beyond the eight-year repayment period.

“I commend the minister and the DG for this, but I want to ask them to reconsider the eight years because it is too tight,” he said.