Blue Economy
The Presence of Foreign Crew Aboard Our Coastal Vessels: What Must be Done to Enforce the Nigeria Cabotage Law – Part Two
The Presence of Foreign Crew Aboard Our Coastal Vessels: What Must be Done to Enforce the Nigeria Cabotage Law
A Comprehensive Special Report on Legislative Intent, Systemic Failures, Human Costs, and the Reform Agenda Nigeria Cannot Afford to Delay
By Waterwaysnews.ng | Maritime Desk | Thursday, March 19, 2026
Our four-parts report started yesterday with the release of part one: The vision – What the Cabotage Law was designed to achieve. Here is part two of the report
PART TWO: THE REALITY — WHY THE OBJECTIVES REMAIN LARGELY UNDERACHIEVED
Twenty-three years after its enactment, the verdict of industry observers, academic researchers, and regulatory insiders is consistent and troubling. Over twenty years since the enactment of the Nigerian Cabotage Act, the cabotage trade is still dominated by foreigners, raising questions about the reasons for the policy’s failure to deliver its intended objectives.
Despite the Cabotage Act, less than 20% of maritime trade is under indigenous control, indicating a failure to increase local participation since its enforcement. Foreign ownership of vessels still dominates the sector, undermining local shipping growth.
The causes of this failure are multiple, interconnected, and deeply rooted. Waterwaysnews.ng examines them in detail below.
2.1 INSTITUTIONAL WEAKNESS AND NIMASA’S ENFORCEMENT DEFICIT
The Nigerian Maritime Administration and Safety Agency (NIMASA) was designated as the principal implementation and enforcement agency under the Act. The scale of its institutional challenge has been consistently documented. NIMASA’s institutional incapacity to monitor compliance affects adversely the enforcement of the Cabotage Act 2003 in Nigerian coastal and inland shipping. The inability of NIMASA to bridge the capacity gap results in poor compliance with the Cabotage Act.
The institutions are weak and ineffective; the laws are not up to date to fill lacunae existing while implementing the policy. Defects thrown up by the agencies of government given the responsibility of regulating and promoting maritime cabotage have become evident.
The history of NIMASA’s leadership instability has compounded its institutional weakness. On July 8, 2009, the then Director-General of NIMASA was dismissed by the Nigerian Government, with his removal attributed to the fact that under his administration NIMASA lacked the requisite managerial capacity to implement and enforce the Cabotage Act and also failed in translating the intent of the Act to the benefit of potential Nigerian investors who have interest in the shipping sector.
2.2 THE WAIVER PROBLEM: A DOOR LEFT WIDE OPEN
Perhaps the single most damaging structural flaw in the legal framework is the waiver system established under Sections 9 to 11 of the Cabotage Act. While waivers serve a legitimate function in principle — allowing foreign vessels to operate temporarily where no Nigerian alternative exists — their administration has created a massive loophole that has effectively undermined the entire cabotage regime.
Section 9 of the Cabotage Act 2003 gives the Minister sole discretion to grant waivers upon an application by a foreign vessel that can prove there is unavailability of a wholly owned Nigerian vessel to perform the cabotage services required. This application must be scrutinised by NIMASA; however, NIMASA, which is the implementation agency, lacks the capacity and machinery to verify the claims made in these applications. This has resulted in the issuance of arbitrary exemptions without proper verification.
SEREC attributed the persistent failure of the Cabotage regime to institutional weaknesses, policy inconsistencies, discontinuity between successive administrations, as well as political interference and patronage networks influencing waiver issuance and contract allocation. The group further identified subtle pressures from dominant external operators, who benefit from Nigeria’s dependency on foreign tonnage, overly flexible waiver clauses (Sections 9–11), and the granting of excessive discretion to public officials.
Since the enactment of the Nigerian Cabotage Act, there has been a persistent dependence on cabotage waivers which exempt non-compliant vessels from adhering to the cabotage requirements in Nigeria. Countries like Nigeria and South Africa have encountered challenges in leveraging cabotage restrictions in order to build their supply-side capacity.
2.3 LACK OF INDIGENOUS TONNAGE AND THE VESSEL SHORTAGE CRISIS
The cabotage law can only be enforced if Nigerian-owned vessels are available to replace foreign ones. The fundamental reality is that they are not available in sufficient numbers. Another obstacle to the effectiveness of the Cabotage Act is the scarcity of cabotage vessels compared to the available tonnage. Insufficient funds for acquiring new ships and marine equipment have been identified as reasons for this shortage.
Despite the legal preference for Nigerian-owned vessels, a structural shortfall in Nigerian-owned tonnage has persisted for many years. Foreign vessels and foreign-crewed ships continue to participate in domestic coastal logistics through various exemptions, loopholes, or weak enforcement, particularly in the oil and gas sector, where chartering conditions and urgency often trump local-only rules.
The shortage of vessels has a devastating ripple effect on seafarer training. The training of Nigerian crew as mandated by the Act to man Nigerian vessels engaged in coastal trade is highly dependent on vessel availability, as trainees cannot be certified until they have completed their sea time training onboard vessels. In other words, a vessel shortage has a ripple effect on the training of Nigerian crew. The primary challenge in seafarer training in Nigeria stems from the discontinuation of the Nigerian National Shipping Line (NNSL), which had a fleet of more than 40 ships that provided training opportunities for Nigerian cadets during its operation.
This creates a vicious cycle: few Nigerian ships means few sea-time training opportunities for cadets; fewer certified Nigerian seafarers means fewer qualified people to man Nigerian-flagged vessels; fewer qualified seafarers provides justification for more waivers for foreign crew. The cycle repeats.
2.4 THE LONG DORMANCY OF THE CABOTAGE VESSEL FINANCING FUND (CVFF)
The Cabotage Act established the Cabotage Vessel Financing Fund (CVFF) precisely to break the vessel shortage cycle — a dedicated credit facility to help Nigerian operators acquire and maintain tonnage. Its failure to operate effectively for most of its existence represents one of the Act’s most critical failures. The CVFF, designed to financially empower Nigerian shipping companies, reportedly trapped over N40 billion in local banks since its establishment, with no significant disbursements occurring as of 2016.
SEREC faulted the poor management and delayed disbursement of the CVFF, describing it as a major setback to indigenous ship ownership.
The provision of funds remains a major challenge for the successful implementation of the Cabotage Act, despite the availability of the CVFF. Shipping requires significant capital investments that indigenous shippers may struggle to afford, preventing their access to funds for vessel acquisition and perpetuating foreign dominance.
It is only in the last two years that meaningful movement has been recorded. NIMASA, via its marine notice releases in November 2024, invited duly licensed deposit money banks and local and foreign development financial institutions to apply for accreditation as Primary Lending Institutions under the CVFF for the inaugural round of disbursements slated to take place before the last quarter of 2025. In January 2026, NIMASA launched a digital application portal to commence the process, following directives to boost indigenous shipping capacity.
2.5 THE COVERT OPERATION: FOREIGN SEAFARERS SMUGGLED ONTO COASTAL VESSELS
Perhaps the most alarming dimension of foreign crew dominance on Nigerian coastal vessels is not merely regulatory non-compliance but active circumvention of the law. Investigations have uncovered a structured system through which foreign nationals are clandestinely placed aboard vessels operating in Nigerian waters. Despite the Coastal and Inland Shipping (Cabotage) Act 2003, which seeks to protect Nigerian seafarers and the shipping industry, foreign seafarers are still being smuggled from neighbouring Togo and Benin Republic to board vessels on the nation’s waters in contravention of the law.
The mechanism is calculated. Foreign seafarers are flown to Benin Republic and Togo from where they are picked up mid-sea on the territorial waters of these countries and ferried to board vessels in Nigeria. The illegal operation was possible because most of the vessels operating under the Cabotage area in the country are foreign-owned with Nigerians as fronts to enable them operate freely.
The scale of this infiltration, according to maritime stakeholders, is staggering. Some maritime observers have stated that sometimes out of a hundred ships that call to Nigeria, “you may not see five Nigerians working inside those ships. But they are bringing goods to Nigeria. So the Cabotage Act itself has not really worked.”
2.6 WEAK INTER-AGENCY SYNERGY AND FRAGMENTED ENFORCEMENT
The enforcement of cabotage is not the function of a single agency. It requires coordinated action among NIMASA, the Nigerian Ports Authority (NPA), the Nigerian National Petroleum Company Limited (NNPCL), and the National Inland Waterways Authority (NIWA). This coordination has historically been absent.
A lack of inter-agency synergy among NIMASA, the Nigerian Ports Authority (NPA), Nigerian National Petroleum Company Limited (NNPCL) and National Inland Waterways Authority (NIWA), resulting in fragmented enforcement, has been identified as a major contributing factor to the persistent failure of the Cabotage regime.
The consequences of this fragmented approach are practical and immediate: vessels can be refused at one regulatory point and cleared at another; compliance documentation is not cross-checked across agencies; and foreign operators learn the administrative fault lines between institutions and exploit them.
2.7 POLITICAL INTERFERENCE AND ABSENCE OF POLITICAL WILL
Running through all the institutional and legal challenges is a thread of political failure that analysts return to repeatedly. The problems can be related to the inadequate understanding of the basic requirements of the Cabotage Act by the regulators and the government’s lack of will power in implementing the regime. This has led to the annual loss of over $6 billion to foreign maritime operators due to the lack of indigenous participation.
“Political will remains the most decisive factor in rescuing the Cabotage regime from perpetual stagnation. Government should declare emergency in cabotage implementation,” maritime stakeholders have urged.
Nigerian maritime experience has shown that African nations are not lacking in the development of well thought-out policy blueprints for maritime development; they rather have poor policy implementation strategies, as past records have shown — a failure pattern that mirrors the total abandonment of the UNCTAD 40-40-20 policy before it.
NIMASA Receives Over 60 CVFF Applications, Vows Open and Accountable Disbursement
By Okeoghene Onoriobe | Waterways News Correspondent | Lagos
The Nigerian Maritime Administration and Safety Agency (NIMASA) has disclosed that it has received more than 60 applications for the Cabotage Vessel Financing Fund (CVFF), a development that signals fresh momentum in the push to strengthen indigenous participation in Nigeria’s shipping sector.
The agency equally assured stakeholders that the disbursement of the fund would be handled transparently, with strict accountability measures guiding every step of the process.
The disclosure came on Thursday in Lagos, during the signing of the 2026 Performance Bond between NIMASA’s Director-General, Dr. Dayo Mobereola, and the Minister of Marine and Blue Economy, Dr. Adegboyega Oyetola.
At the event, Minister Oyetola left no room for ambiguity, issuing a pointed directive to heads of agencies under his ministry to focus on results and shun complacency.
“Let me emphasise that all Departments and Agencies under the Ministry must remain firmly focused on delivering tangible results,” the Minister stated.
He further stressed that the performance bonds carry real weight, describing them as binding commitments subject to close monitoring and rigorous evaluation — not documents to be signed and shelved.
“These are not ceremonial documents. They are binding commitments. Accountability will not be optional,” Oyetola declared.
Speaking after the signing, Director-General Mobereola said the reforms being pursued at NIMASA are deliberate and are being driven with strong backing from the Ministry, adding that the agency remains firmly aligned with the Federal Government’s Renewed Hope Agenda.
On maritime security, Mobereola highlighted a landmark achievement: Nigeria has recorded zero piracy incidents in its territorial waters over the past four years. He attributed this record to enhanced surveillance systems and improved collaboration among security agencies.
The NIMASA chief also announced that the agency is close to completing the automation of its ship registry processes — a reform expected to eliminate administrative delays, speed up turnaround times, and sharpen Nigeria’s competitiveness in the global maritime industry.
Additionally, Mobereola noted that Nigeria has deposited three maritime conventions with the International Maritime Organization (IMO), with three more pending Federal Executive Council approval. He also highlighted Nigeria’s re-election into Category C of the IMO Council in November 2025 as a milestone that restores the country’s standing in global maritime governance and reinforces its leadership role on the African continent.
Waterways News | www.waterwaysnews.ng
Oyetola Orders NSC Probe into Alleged Plot to Squeeze Out Local Barge Operators
Minister vows zero tolerance for anti-competitive behaviour as indigenous operators cry foul over foreign interference at Nigerian seaports
By Oghenewoke Onoriode|Waterways News Correspondent, LAGOS
The Minister of Marine and Blue Economy, Dr Adegboyega Oyetola, has ordered the Nigerian Shippers’ Council (NSC) to investigate allegations that a coordinated effort is underway to push indigenous barge operators out of Nigeria’s seaport logistics chain.
The directive came during the 2026 First Quarter Citizens/Stakeholders’ Engagement, Sectoral Performance Review, and Ministerial Management Retreat of the Federal Ministry of Marine and Blue Economy, held in Lagos on Thursday.
Operators Raise the Alarm
Representatives of local barge operators used the platform to allege that certain foreign interests are engaged in a deliberate campaign to undermine their operations. They told the Minister that policies, operational bottlenecks, and preferential treatment allegedly extended to foreign-linked entities by some terminal operators are tilting the competitive landscape against Nigerian businesses.
The operators warned that if left unaddressed, the situation could erode local capacity and destabilise Nigeria’s maritime logistics ecosystem.
NSC Given the Mandate
Responding to the allegations, Dr Oyetola reaffirmed the Federal Government’s commitment to protecting local investments and ensuring a level playing field in the maritime sector. He directed the NSC — in its capacity as port economic regulator — to conduct a thorough and impartial investigation into the claims.
The Minister was unequivocal: any anti-competitive behaviour or policy inconsistency that disadvantages Nigerian businesses would not be tolerated.
Engagement as Policy Tool
Dr Oyetola also used the occasion to underscore the importance of regular stakeholder engagement in driving effective sectoral governance. He noted that the government remains firmly focused on developing the marine and blue economy as a pillar of national growth, employment generation, and sustainable development.
Nigeria Watch
The allegations against terminal operators echo long-standing concerns in the Nigerian maritime industry about the marginalisation of indigenous players in port operations. Local barge operators form a critical link in Nigeria’s cargo evacuation chain — particularly at Apapa and Tin Can Island ports — and their displacement would deepen the country’s dependence on foreign logistics providers.
The NSC’s mandate as port economic regulator makes it the appropriate body to probe these claims. However, the effectiveness of the investigation will depend on the Council’s willingness to act on its findings — including, where necessary, imposing sanctions on terminal operators found to have violated fair competition principles.
For the Federal Ministry of Marine and Blue Economy, Thursday’s engagement signals a more assertive posture on indigenous content in maritime logistics — one that stakeholders will be watching closely.
Waterways News — Covering Nigeria’s Maritime, Shipping and Blue Economy Sector
Blue Economy
Tinubu Approves Cargo Tracking Scheme That Could Save Nigeria N900bn in Lost Import Revenue
Tinubu Approves Cargo Tracking Scheme That Could Save Nigeria N900bn in Lost Import Revenue
Presidential approval secured for ICTN as Nigerian Shippers’ Council begins procurement; scheme expected to go live before year-end
By Emetena Ikuku, Lagos
President Bola Ahmed Tinubu has approved the full implementation of the International Cargo Tracking Note (ICTN), a flagship initiative of the Nigerian Shippers’ Council (NSC) designed to plug revenue leakages in the country’s import trade and strengthen regulatory oversight of inbound cargo.
The approval, confirmed at a stakeholders’ engagement convened by the Federal Ministry of Marine and Blue Economy in Lagos, ends months of uncertainty over the scheme’s future and sets the stage for what industry analysts say could be one of the most consequential reforms in Nigeria’s maritime sector in recent years.
What the ICTN Does
The ICTN is a real-time, online cargo tracking system that monitors the movement of inbound shipments from origin to destination. Beyond logistics visibility, it is designed to function as an economic intelligence tool — capturing import data that can be used to close gaps in revenue declaration and combat under-invoicing.
Industry projections suggest the system could help Nigeria recover up to N900 billion annually in import revenue currently lost to leakages — a figure that underscores the commercial stakes of getting the rollout right.
Procurement Underway
Pius Akutah, Executive Secretary and CEO of the Nigerian Shippers’ Council, confirmed to stakeholders that presidential approval had been secured and that procurement processes were already in motion. He expressed confidence that the ICTN would become operational before the end of the year.
Akutah acknowledged that previous implementation attempts had been suspended due to unresolved operational challenges, but said the Council had drawn lessons from those setbacks.
He noted that the Minister of Marine and Blue Economy, Adegboyega Oyetola, is personally committed to ensuring a seamless rollout, with the ministry taking deliberate steps to resolve all outstanding issues before the scheme goes live.
Nigeria Watch
The ICTN revival is significant beyond its revenue implications. For years, Nigerian freight forwarders, cargo agents, and port operators have operated in an environment where cargo data is fragmented and often unreliable — creating fertile ground for manifest fraud, valuation disputes, and customs evasion.
A fully operational ICTN would give the NSC, the Nigeria Customs Service, and the Nigerian Ports Authority (NPA) access to a unified cargo data stream, potentially transforming how import risk is assessed at Apapa, Tin Can Island, and the emerging Lekki Deep Sea Port.
For the broader blue economy agenda being championed by Minister Oyetola, real-time cargo intelligence also supports Nigeria’s ambitions to position its ports as West Africa’s premier logistics hub — a goal that requires the kind of regulatory credibility the ICTN is designed to provide.
Stakeholders will be watching the procurement timeline closely. The scheme has been suspended before, and the maritime industry’s confidence in its delivery will depend on whether the ministry can demonstrate tangible progress before the year runs out.
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