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He explained that while dollar deposits attracted interest rates of between one and two per cent, naira deposits offered returns of more than 15 per cent at the time.

According to him, the decision to convert the funds was informed by the need to secure better returns rather than allow the money to remain in low-interest foreign currency deposits.

However, NIMASA has rejected the claim, insisting that the dollar component of the CVFF was never converted into naira.

In a statement signed by its Director-General, Dr Dayo Mobereola, the agency said dollar contributions remained domiciled in dollars with the Central Bank of Nigeria (CBN), while naira contributions were retained in local currency.

The conflicting accounts have raised fresh questions about the management of the fund, particularly the currency in which contributions were held, the interest accrued over the years and the extent to which successive administrations accounted for the resources.

Reacting to the dispute, former President of the National Association of Master Mariners, Capt. Tajudeen Alao, called for a comprehensive audit of NIMASA’s accounts from 2004 to date to resolve the controversy.

Alao said only an independent examination of the agency’s financial records would establish the actual position of the fund and reconcile the conflicting claims by past and present management.

He also expressed concern over the prolonged failure to disburse the CVFF, saying the delay had undermined its original purpose and contributed to the difficulties confronting indigenous shipping operators.

According to him, many local operators have been unable to sustain their businesses because of the high cost of acquiring vessels and the difficulty of accessing long-term financing.

He argued that the continued absence of an accessible financing scheme had weakened indigenous participation in the shipping industry, despite the country’s maritime trade potential.

Alao, however, cautioned that access to the fund should be tied to the capacity of prospective beneficiaries to manage vessels and secure cargo.

He urged the government to consider cargo guarantees and ship-management capacity as key eligibility requirements to ensure that loans obtained from the fund were properly utilised and repaid.

Beyond the CVFF controversy, Omatseye also criticised the capacity of Nigerian commercial banks to finance large-scale shipping investments, arguing that their short-term lending models were unsuitable for the capital-intensive nature of the industry.

He said the acquisition of sophisticated vessels, particularly liquefied natural gas (LNG) tankers, required substantial capital and long repayment periods that local banks were largely unable to accommodate.

“There is money available for this, and I keep telling people that we can never be competitive in our shipping industry because of what? Sorry, bankers may not like this. The banks in Nigeria do not have the capacity to finance shipping. One LNG tanker alone is about $250m. Repayment cannot be less than 15 years. I’m sorry to say this again, our banks are just traders looking for short-term loans,” he stated.

Similarly, President of the Nigeria Shipowners Association (NISA), Alhaji Adewumi, insisted that the CVFF should remain denominated in dollars, arguing that the fund’s guidelines did not provide for conversion into naira.

He noted that shipowners continued to make payments in dollars and questioned why their contributions should be converted into the local currency.

Adewumi urged NIMASA and the Federal Ministry of Marine and Blue Economy to clarify Omatseye’s claims, noting that the former director-general had previously occupied the agency’s top position.

He maintained that if the authorities intended to retain the fund in naira, they should explain the rationale, particularly as shipowners continued to make their shipping-related payments and contributions in dollars.

He, however, acknowledged that he was not directly involved in the management of the fund and was relying on the provisions of the guidelines and information available to him.

The controversy follows earlier concerns over discrepancies in figures released by NIMASA regarding the fund’s accumulated contributions.

In March 2023, the agency disclosed that naira collections stood at about N37.57bn, while dollar contributions amounted to approximately $269.38m as of October 2022.

The converted value of the dollar collections brought the combined balance to about N148.05bn at the prevailing exchange rate. NIMASA, however, said the figures were subject to reconciliation.

Established under the Coastal and Inland Shipping (Cabotage) Act 2003, the CVFF was designed to provide financial assistance to indigenous shipowners for vessel acquisition and strengthen local participation in Nigeria’s coastal and inland shipping trade.

The fund was expected to address one of the major challenges facing local operators: access to affordable long-term financing for acquiring and maintaining vessels.

However, more than two decades after the enactment of the Cabotage Act, the prolonged delay in making the fund accessible has remained a major concern among industry operators.

Shipowners argue that the situation has left Nigerian companies struggling to compete with foreign shipping firms, which often have better access to international financing, larger fleets and more favourable borrowing conditions.

The Federal Government has, however, renewed efforts to commence disbursement to qualified beneficiaries.

At the 2026 Annual Summit of the Shipping Correspondents Association of Nigeria in Lagos, the Minister of Marine and Blue Economy, Adegboyega Oyetola, directed NIMASA to accelerate the process.

The government also launched a dedicated application portal in January 2026 and increased the number of participating Primary Lending Institutions from five to 12 to facilitate access to the fund.

The involvement of more lending institutions is expected to widen access for qualified indigenous operators and strengthen the assessment and administration of loan applications.

However, stakeholders insist that the government’s disbursement plans must be accompanied by a transparent account of the fund’s financial history.

They argue that an independent forensic audit should establish the total contributions received since inception, the currency composition of the funds, investments made, interest accrued and any withdrawals or transfers carried out over the years.