(Ecofin Agency) – The establishment of the official portal of the Coasting Trade Vessel Financing Fund (CVFF) marks a turning point for Nigeria. Beyond simple support for local shipowners, Abuja is setting in motion a mechanism likely to redefine the balance of coastal shipping in West Africa.
In Nigeria, the programme for the promotion of local shipping companies called the Coasting Trade Vessel Financing Fund (CVFF) has taken a new step in its implementation with the launch last week of the official portal for shipowners’ financing applications.
Launched in 2003, but inoperative for about two decades, the CVFF plans to facilitate access to financing for the acquisition of ships by Nigerian companies, with a maximum subsidy of USD 25 million per shipowner. This comes after the announcement of the gradual end of the derogations granted to foreign vessels to operate in cabotage, a segment reserved by law for local operators.
From the internal market to the regional area
With its demographic weight (237.5 million inhabitants), the size of its economy and the importance of its oil and gas trade flows, Nigeria is the largest maritime market in West Africa. If the strengthening of local fleets materializes, the country’s shipowners could thus go beyond the simple framework of national cabotage to operate on regional coastal links.
In a sub-region where few countries have significant commercial fleets, Nigeria has the potential to evolve from a market dependent on foreign shipowners to that of a maritime service provider to neighbouring countries, particularly for the transport of petroleum products, bulk and goods related to the extractive industries.
However, this trajectory remains conditional on the governance of the fund, the real capacity of local operators to operate the financed vessels efficiently, as well as the availability of qualified technical skills.
source : agenceecofin
