Grow shipbuilding industry with CVFF, zero duty on outbound vessels, shipbuilder urges FG

 

cabotage vessels

West Atlantic Shipyard (WAS) operating in the Onne Oil and Gas Free Zone has called on the Federal Government to consider investing a part of the Cabotage Vessels Financing Fund (CVFF) in helping ship builders in the country.

The shipbuilder also wants the Federal Government to eliminate duty on vessels built in the Onne Free Zone, but taken to work outside the zone. The gestures, according to the shipbuilder will encourage investment in the shipbuilding industry in Nigeria.

WAS Marketing Manager, Juliet Oji urged the Federal Government to stop duty payment by the company on outbound vessels built by the company.

She noted a stream of cost factors, including tax on built vessels which she blamed for the poor presence of shipbuilders in Nigeria.

She urged the government to avail shipyards the benefit of CVFF which she noted was meant to develop cabotage trade in its general form.

She said, “We do not pay duty on imported materials for ship building, but we pay duty when we send out the finished vessels. So, incoming it is duty-free, but outgoing, we pay duty, because the vessels do not operate in the free zone and the duty is to the Federal Government.

“The problem is that people don’t find it attractive to build vessels in Nigeria because of duties paid on built vessels which do not operate in the free zone. Shipbuilders prefer to invest overseas to cut a lot of cost we face here.”

As a rule of the free zone, vessels built and operated in the zone are duty-free, but duty is paid on those built in the zone but taken out to other places for operation.

But WAS is seeking waiver on such duty on vessels built by the company and taken out of the zone for operation. The company’s marketing manager also called on the Federal Government to raise tariff on imported vessels to discourage their patronage in Nigeria and pave room for increased demand of those built in Nigeria.

“Government can come in, especially through NIMASA as it has the responsibility for maritime development to help us to grow the shipbuilding industry. So this is a good opportunity because, they can cut down cost for us by granting waiver on duties on outbound vessels from the zone for locally built vessels to enable them to grow up.

“For imported vessel, the government can increase their tariffs to discourage importation of the vessels from overseas, then there will be local patronage. The government can come in by making the CVFF available to shipyards. We need all the help we can get from the government Even when the cabotage vessels are built, they can also be repaired here. Some of them go abroad, to places like Ghana for repairs. We have two floating docks that can support vessels of 4500 tonnes, so we can bring those vessels here for dry docking and repair, so that we will have more jobs for Nigerians,” she said.

 

Copyright 2016 Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to www.shipsandports.com.ng as the source.

..