- Nigeria continues efforts to exit war risk insurance
After 15 years of failed assurances, the Federal Government may finally begin the disbursement of the Cabotage Vessels Financing Funds (CVFF) to needing indigenous ship owners, in line with the promise of the Minister of Transportation, Mu’azu Jaji Sambo, to ensure its disbursement before his tenure ends.
The intervention fund – a deduction from cabotage contracts executed by indigenous ship owners – was created in 2003 to promote ship acquisition capacity for Nigerian operators in coastal shipping.
Disclosing the move Thursday at the 53rd session of the Presidential Media in Abuja, the Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr Bashir Jamoh, said the disbursement of the fund, reportedly $350 million presently, might commence next week.
According to him, it will begin with the inauguration of the special committee by the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, with 11 Primary Lending Banks (PLBs) already selected to facilitate it.
Jamoh, who regretted the nation’s lack of indigenous fleets, said the funds will enhance local shipping and help create jobs for the over 2041 NIMASA-trained seafarers, with about 800 others already engaged by shipping companies across the world.
“We are unable to retain them here due to the absence of fleets to provide jobs in Nigeria after their training overseas,” Jamoh stated. “One vessel can employ up to 40 of them.
“The shipping business is capital intensive thus government needs to give helping hands to potential ship owners. We need them to feed into our own system if the fleets are available.”
Meanwhile, he said the agency was working to end Nigeria’s war risk insurance surcharge by foreign lines for shipment of goods from Europe, as the improved safety in the Gulf of Guinea has made such continued payment justifiable.
According to him, “there are three basic insurance charges – war risk insurance, insurance on valuables in the ship, and personnel insurance for workers in the ship.
“These are the three key elements which we ought not to be paying for, as they are responsible for a 90 per cent increase in the prices of goods and services imported into Nigeria.
“They have commended NIMASA for the security recorded in the Gulf of Guinea and we are waiting for the report from the Lloyds of London. Very soon we hope to exit this insurance.”
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