After two decades, Tinubu approves Cabotage fund for Nigerian shipowners

Minister of Marine and Blue Economy, Adegboyega Oyetola

After two decades, Tinubu approves Cabotage fund for Nigerian shipowners

President Bola Tinubu has approved the disbursement of the Cabotage Vessel Financing Fund (CVFF) to qualified Nigerian shipowners, more than 20 years after the fund was established to promote indigenous participation in the country’s maritime industry.

The approval, announced on Sunday, September 6, 2026, is expected to end years of uncertainty surrounding the CVFF and provide Nigerian shipowners with access to long-term financing for the acquisition of vessels and expansion of their operations.

The Minister of Marine and Blue Economy, Adegboyega Oyetola, disclosed the development in a statement issued by his Special Adviser, Bolaji Akinola.

Oyetola directed the Nigerian Maritime Administration and Safety Agency (NIMASA) and the 12 approved Primary Lending Institutions (PLIs) to fast-track the processing and disbursement of the fund to eligible applicants.

According to the minister, the move is designed to unlock investment in Nigeria’s maritime sector, increase indigenous ship ownership, strengthen the country’s participation in coastal and offshore shipping and create thousands of employment opportunities.

NIMASA has so far received 92 applications from prospective beneficiaries seeking financing under the CVFF programme. Twenty applications have already been forwarded to the approved lending institutions, while one has been reviewed and sent forward for final approval.

The development marks the latest stage in the Federal Government’s efforts to transform the CVFF from a long-standing pool of accumulated funds into an operational financing facility for Nigeria’s indigenous shipping industry.

The CVFF was created under the Coastal and Inland Shipping (Cabotage) Act to provide financial support to qualified Nigerian operators for the acquisition of vessels and development of domestic shipping capacity.

The facility is particularly important because Nigeria’s maritime sector has historically relied heavily on foreign-owned vessels for several coastal and offshore operations, limiting the amount of revenue retained by indigenous operators.

Through the CVFF, the government seeks to enable qualified Nigerian shipowners to acquire modern vessels, expand their fleets and compete more effectively for contracts within the domestic maritime market.

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The fund is structured to provide long-term financing at a relatively low interest rate, with the current framework designed to make vessel acquisition more accessible to indigenous operators.

NIMASA had previously disclosed that the financing arrangement would provide for a single-digit interest rate, a two-year moratorium and an eight-year repayment period.

Under the framework, NIMASA is expected to provide 50 per cent of the financing, while the participating lending institutions would contribute 35 per cent and beneficiaries would provide the remaining 15 per cent as equity.

The number of participating Primary Lending Institutions was increased from five to 12 to widen access to the facility, improve competition among lenders and reduce delays associated with loan processing.

The expansion is also expected to give applicants more options when seeking financing and strengthen the financial oversight of the programme.

Oyetola had earlier directed NIMASA in April 2025 to begin the process of operationalising the Cabotage Vessel Financing Fund, reviving efforts to disburse the facility after years of administrative stagnation.

The process received another boost in January 2026 with the launch of the CVFF Application Portal in Lagos.

The portal was designed to provide eligible shipowners with a more transparent and structured process for submitting applications and tracking their financing requests.

The latest presidential approval therefore builds on several reforms introduced by the Ministry of Marine and Blue Economy and NIMASA over the past two years.

The CVFF has a long history of delayed disbursement.

In December 2019, the Federal Government announced that then-President Muhammadu Buhari had approved the release of the fund to indigenous shipowners, with the accumulated amount at the time reportedly estimated at N44.64 billion.

Despite the announcement, the fund did not translate into sustained financing for Nigerian shipowners.

In 2023, the House of Representatives intervened over concerns surrounding the management and proposed disbursement of the fund.

The House investigated the amount accumulated under the scheme, the proposed financing arrangements and the process for selecting beneficiaries.

Following the investigation, lawmakers approved the disbursement of an estimated $360 million to qualified Nigerian shipowners.

However, the implementation of the disbursement continued to face delays.

By April 2025, NIMASA estimated the value of the fund at about $700 million and announced plans to commence disbursement under a revised financing structure.

The latest approval by President Tinubu is therefore another significant attempt to move the fund from years of accumulated resources and administrative delays to actual financing for indigenous operators.

The Federal Government expects the programme to have an impact beyond vessel ownership.

According to Oyetola, the initiative could generate more than 30,000 direct and indirect jobs across shipyards, marine engineering companies, maritime logistics firms and other businesses connected to the maritime value chain.

Greater indigenous ownership of vessels could also stimulate demand for shipbuilding, vessel repairs, marine engineering, maritime insurance, logistics and other specialised services.

The government believes this could help Nigeria retain a larger share of the economic value generated from activities within its territorial waters.

The CVFF disbursement is also coming as Nigeria seeks to improve its international maritime profile.

In August 2026, the United States Coast Guard lifted a 12-year Condition of Entry imposed on Nigerian vessels arriving at US ports.

The restriction, introduced in 2014 over concerns about maritime security standards, had subjected Nigerian vessels to additional requirements when entering US ports.

Its removal is expected to improve the operating environment for vessels trading between Nigeria and the United States, potentially reducing additional compliance costs and improving turnaround times.

The development has added momentum to Nigeria’s efforts to strengthen maritime safety, security and compliance with international standards.

For the Federal Government, strengthening indigenous shipping capacity remains a key component of its broader Blue Economy strategy.

The administration has identified the maritime sector as an area capable of attracting investment, creating jobs, expanding trade and increasing Nigeria’s revenue from its extensive coastal and offshore economic activities.

For Nigerian shipowners, however, the immediate focus will be on whether the latest approval translates into actual access to financing.

With 92 applications already received and 20 forwarded to lending institutions, the next stage will involve detailed assessment, approval and eventual release of funds to successful applicants.

The government’s challenge will be to ensure that the process remains transparent, commercially sustainable and accessible to genuinely qualified Nigerian operators.

After more than two decades of delays, investigations and repeated promises of disbursement, President Tinubu’s latest approval represents a major opportunity to finally make the Cabotage Vessel Financing Fund a functioning source of capital for Nigeria’s indigenous shipping industry.

After two decades, Tinubu approves Cabotage fund for Nigerian shipowners