Evaluation of the Nigerian Cabotage Law’s Effect on Indigenous Coastal Shipping Capacity Development

The Coastal and Inland Shipping (Cabotage) Act of 2003 was enacted to reserve Nigerian coastal trade for Nigerian-flagged and Nigerian-owned vessels, with the intent of developing indigenous maritime capacity. This study evaluates the effectiveness of the Cabotage Act in achieving its capacity development objectives over two decades of implementation, examining vessel ownership trends, flag registration, crewing, and financial outcomes. A professional policy review methodology was adopted, using secondary data from the Nigerian Maritime Administration and Safety Agency cabotage vessel registration database, structured interviews with fifteen shipping company executives, and review of Cabotage Vessel Financing Fund disbursement records. Findings indicate that the number of Nigerian-owned vessels engaged in coastal trade has increased but remains significantly below the target established in the initial policy framework. The Cabotage Vessel Financing Fund, established to provide concessional vessel acquisition financing, has disbursed funds to a small fraction of applicants due to stringent collateral requirements that exclude smaller shipping entrepreneurs. Waivers of cabotage requirements for foreign vessels continue to be granted at rates that undermine the policy's protectionist intent. Recommendations include revision of Cabotage Vessel Financing Fund collateral requirements, reduction in the number and scope of waivers granted, and establishment of a capacity development monitoring dashboard by NIMASA to track progress against policy targets. Keywords: Cabotage Act, indigenous shipping, coastal trade, CVFF, Nigerian maritime policy