Ex-NIMASA DG and Agency Clash Over Currency Conversion of Vessel Fund

A former Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Temisan Omatseye, and the agency’s current management are locked in a dispute over the alleged conversion of the dollar-denominated Cabotage Vessel Financing Fund (CVFF) into naira.

Omatseye has defended the naira conversion that occurred during his tenure, stating that NIMASA held N52 billion in fixed deposits when he left office in December 2010.

In a statement on Sunday, the former DG explained that the N52 billion comprised both the CVFF and the maritime fund. He stated that the conversion of the dollar-denominated funds was carried out strictly on the directive of the Accountant-General of the Federation.

“The decision to convert the funds was based on the interest rates offered by commercial banks on naira and dollar deposits at the time,” Omatseye said. “The agency was directed to convert all foreign-denominated internally generated revenue, including the three per cent surcharge and the CVFF, into naira and place the funds in naira fixed deposits.”

He explained that when he assumed office in July 2009, the agency’s funds were held across several appointed collection banks, which transferred money to designated naira and dollar accounts on the 23rd of every month.

According to him, a memo from the Accountant-General’s office directed the agency to convert all foreign internally generated revenue into naira. He noted that while dollar deposits attracted interest rates of between one and two per cent, naira deposits earned upwards of 15 per cent, making the directive financially sound.

Omatseye maintained that all dollar funds received as CVFF during his tenure were converted, but noted that the agency is better placed to explain how the funds have been managed since the introduction of the Treasury Single Account (TSA).

“What has been the practice since the advent of TSA is better explained by NIMASA. In light of that, I stand fully by my statement that during my tenure all dollar funds received as CVFF were converted into naira,” he said.

In a swift response, NIMASA’s current Director-General, Dr. Dayo Mobereola, dismissed Omatseye’s claim as incorrect, stating that it does not reflect the actual status of the fund.

“For the avoidance of doubt, this claim is incorrect and does not reflect the actual status of the CVFF,” Mobereola said in a statement signed on Sunday.

The agency explained that the revenue streams accruing to the CVFF are denominated in different currencies. Mobereola clarified that funds remitted in US dollars are retained in dollars with the Central Bank of Nigeria, while contributions remitted in naira are retained in the local currency.

“There has been no conversion of the dollar-denominated component of the CVFF to naira, contrary to the allegation,” he added.

The CVFF was established by the Federal Government to provide financial support to indigenous shipowners for the acquisition of vessels and the development of local shipping capacity. Omatseye served as NIMASA DG from July 2009 to December 2010.