Nigerian Banks Lack Financial Capacity To Sponsor Sea-Worthy Vessels – Shipbrokers

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Nigerian banks, according to the Institute of Chartered Shipbrokers’ Nigeria chapter, lack the financial wherewithal to support the acquisition of a seaworthy ship.

Dr Chris Esoba Ebare, the chairman of ICS, noted that there were numerous shipwrecks on the country’s waterways because Nigerian shipowners lacked the financial means to purchase conventional ships.

“There is no Nigerian bank today that can give you any loan to buy a good sea-worthy vessel because they don’t have the capacity. How many Nigerian ship owners can acquire a vessel worth $350m or $850m?

“Let me give you a classical example, how much does a new Prado cost in Nigeria today? It is around N50m. With that money, you will get a brand-new Prado that can go to the East or any part of the country you want to go to.

“If I now give you N1.5m, you will buy a car but not a standard one. That is just the explanation of what is happening.”

Nigerian shipowners should engage with their overseas counterparts in the acquisition of standard ships, according to Ebare.

“What they need is to collaborate with these big foreign shipping companies that have the financial muscles. Open the Cabotage Law, let it be free for all, so that our ship owners can collaborate with these people and partner those ones that can lend them money.”

Insecurity, he said, was to blame for a reduction in cargo exports in Nigeria.

“First and foremost, the major reason for the drop in cargo is insecurity in the country. Some of my friends that used to export cashew nuts from the North-Central and the North-East can no longer go there.

“For a whole month, local farmers could no longer go to these places and harvest these food products and export them. These are some of the challenges. Before now, exporters used to export charcoal from the South-East region, but these things are no more there.

“On the issue of lack of ship financing, I will blame it on the rigidity and backwardness of our Cabotage Law. Our Cabotage Law does not help our indigenous ship owners at all.

“The Cabotage law is too protectionist and it is killing the vessels, economy and the maritime industry. They should open it and let it be free for all,” he said.

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