The CVFF and government game of deception

The CVFF and government game of deception


In 2003, Nigerian ship owners and maritime stakeholders danced at the seat of government in Abuja with the then President, Olusegun Obasanjo, after he signed the Coastal and Inland Shipping (Cabotage) Act 2003 into law. The Cabotage law, apart from creating a captive market for Nigerian maritime operators in the nation’s inland and coastal trade, made provision for them to acquire vessels in order to take full control of the nation’s cabotage business. 

Eighteen solid years down the line, the stakeholders’ jubilation has proved to be nothing more than the proverbial jubilation of the housefly, as their dream of taking control of the cabotage trade has remained a pipe-dream. Due to poor, shoddy and half-hearted implementation of the law, even their active participation in the nation’s cabotage business has remained near impossible as foreigners still control the business. The disbursement of the Cabotage Vessels Financing Fund (CVFF) which is an integral component of the Cabotage law has also been turned into an object of subterfuge and deception.

On several occasions since the Fund accumulated, government and its operatives had announced preparations for its disbursement to eligible Nigerian ship owners. They had set up committees upon committees, and even shortlisted would-be beneficiaries. They had also employed the services of banks known as Primary Lending Institutions (PLIs) in line with the disbursement guidelines. But the documents generated in each of these efforts all ended up in remote corners of the offices where they continue to gather dust, or ended up in the trash can. 

Countless reasons had been given in the past for the non-disbursement of the Fund. The present administration that inherited these excuses for the disbursement delay from the previous administrations has only added more to the bag of excuses. At a point, the Minister of Transportation, Rotimi Amaechi, who has been in charge of the ministry since the Buhari administration said President Buhari was responsible for the non-disbursement of the fund as he had withheld his approval for the disbursement. 

But early in 2019, the Minister announced that the President had given his approval for the immediate disbursement of the Fund estimated to have swelled to over $250 million –the NIMASA DG has said that there is presently N32billion and $209 million in the Naira and Dollar accounts respectively. Despite the approval by the President, the disbursement of the Fund has remained a mere conjecture. 

At the moment, the disbursement of the CVFF has gone from the sublime to the ridiculous. Government officials are now engaged in contradicting one another in what observers see as a grand deception. Pronouncements are being made which are alien to the Act establishing the Fund or its disbursement guidelines. The Ministry of Finance which has nothing to do with the Fund is now in the picture, and is being fingered as the only impediment to its disbursement.

Disclosing this during a recent two-day retreat with maritime stakeholders in Lagos, the Minister of Transportation, Rotimi Amaechi, said despite the approval of President Muhammadu Buhari authorizing disbursement of the Cabotage Vessel Financing Fund (CVFF) to eligible ship owners, the money will not be disbursed because of a stumbling block erected by the Federal Ministry of Finance.

Said Amaechi, “Concerning the disbursement of the Cabotage fund, the President made an approval saying we should go ahead and disburse. So also the Attorney General, but the law says it is private money. However, the Ministry of Finance has protested that it is a public fund, so what would I do? I’m handicapped.” 

To buttress his helplessness, the minister advised ship owners, whom he called “owners of the fund” to write a letter of protest to President Buhari over the non-disbursement of the Fund. 

“The owners of the fund have the right to write the President and copy me. Then I’ll go back to the President. The law says the fund is not public. The Ministry of Finance does not have the right to upturn the law and say the money is public which is against the law. 

“Now that the ship owners are aware that the fund has been approved for disbursement, and they are aware of the protest from the Ministry of Finance, they have the right to write to the Presidency, and if the President gives me a go-ahead, nothing would stop us from disbursing. But for now, the technicality of the law is hindering the process,” he said.

The Minister’s stance and advice is, however, contrary to the view expressed by the Director-General of NIMASA, Dr. Bashir Jamoh in a recent statement made available to journalists. According to Jamoh, the CVFF is a public fund and does not belong to indigenous ship owners. He explained that the proceeds of the fund belonged to the federal government, contrary to speculations that the money belonged to ship owners.

Jamoh further said that “The CVFF account is not under NIMASA’s control, in the sense that it cannot use the money,” adding that “it must go through a process and that is why we have not been able to disburse the fund.” He also said the Treasury Single Account (TSA) that now operates in all government agencies constitutes a hindrance to the disbursement of the CVFF. 

“With the way the Cabotage Act of 2003 is designed, disbursement from primary lending institutions as stated in the Act, cannot happen now, because the operations of TSA in all government agencies accounts now comes from TSA.”

While the Minister of Transportation, Rotimi Amaechi, is blaming the Federal Ministry of Finance for the delay in disbursement of the Fund, the NIMASA DG who agrees that the fund belongs to government, is blaming the TSA for the delay.

But what do the indigenous ship owners who had believed that the CVFF belonged to them say? To most of them, government is only playing games with them. To members of the Ship Owners Association of Nigeria (SOAN), the Federal Ministry of Transportation and the Nigerian Maritime Administration and Safety Agency (NIMASA) are merely “tossing Nigerian ship owners around like babies.” They queried the basis for the protest letter the Minister asked them to write after the Director-General of NIMASA, Dr. Jamoh had publicly declared that the CVFF is a public fund and does not belong to the ship owners. 

“When NIMASA had already said publicly that the money is a government fund, on what basis are we going to write to protest that the Minister of Finance does not want the money disbursed? A month ago, NIMASA said the CVFF fund is a government fund. A month later, the Minister of Transportation said we should write as owners of the fund. Are we babies?”

The ship owners also said that both NIMASA and the Ministry of Transportation had not responded to all their correspondence on the CVFF in the past two years. They wondered why the minister would prefer to talk to the media or offer them this kind of advice after refusing to respond to letters from them on the issue. “Who is fooling who,” they snorted. 

Speaking to a journalist on the issue, the President of SOAN, Dr. McGeorge Onyung, however, said his group was reviewing the minister’s statement and the call for a protest letter from the ship owners, and would soon make their position known on the matter.

Last Word:

It is unfortunate that Nigerian government agencies, ministries and departments are always working at cross-purposes. The Cabotage law and its CVFF component debacle present a classic example. If the President has given approval for the disbursement of the fund and the Attorney-General of the Federation has declared that the CVFF is a private sector fund, one wonders why Rotimi Amaechi, the Transportation Minister, should be listening to Zainab Ahmed and the Ministry of Finance. 

The law setting up the CVFF does not give any voice or role to the Ministry of Finance. If a minister who is ignorant of the law comes up to declare that the fund is a public fund contrary to what the law says, he/she should be ignored. But Amaechi is using this as excuse for the continued delay in the disbursement of the Fund. Is he taking orders from the President or the Minister of Finance?

On the part of the ship owners, they should not waste their time in studying a clear dribbling statement. They should rather prove they are not “babies” by taking the issue to court. They should allow the court to interpret the provisions of the Cabotage Act and the CVFF, as well as seek court’s declaration of the orchestrated delay in the disbursement of the Fund illegal.