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Shippers’ Council, NIMASA to  halt $2.74bn war risk surcharge on Nigerian cargoes 

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Abiola Seun

The Nigerian Shippers Council, (NSC), and the Nigerian Maritime Administration and Safety Agency, (NIMASA), have disclosed plans to halt the continued payment of war risk surcharge on cargoes coming into the country by the international shipping lines.

The position of both agencies was made known in Lagos when the management team of NSC led by the Executive Secretary/ Chief Executive Officer, CEO, Hassan Bello, paid a working visit on the Director-General of NIMASA, Dr Bashir Jamoh on Tuesday.

Recall that Nigerian importers paid a whopping $2.74billion in the last three years over categorization of Nigeria waters as a war risk nation, a development that led to spike in insurance premiums slammed on vessels and cargoes destined for Nigeria.

War risk surcharge is a supplementary carrier charge, that is only applied when insurance underwriters designate specific zones as war risks. This surcharge has been applied relatively recently due to piracy along the Gulf of Guinea.

The surcharge is levied to recover potential extra costs, such as re-routing or additional security. But according to the International Maritime Bureau (IMB), Nigeria has paid $2.74billion as insurance surcharge due to pirate attacks in three years.

But, speaking during the visit to the NIMASA DG, Bello said the surcharges are unilaterally and sometimes arbitrarily fixed without the knowledge, consent of the local shippers.

According to the Bello, “We want to eliminate most of these surcharges that litter out trade, surcharges are supposed to be temporary charges to deal with unusual situations but some have become permanent like the war risk clues which I am sure that the Director-General will know that as soon as we solve the security problem the war risk clues will go.

“But even more important DG, we need the two organizations to work side by side to ensure that we know what these surcharges are because these surcharges are unilaterally and sometimes arbitrarily fixed without the knowledge, the consent or information of the people who pay for these charges, especially the shippers in Nigeria and sometimes of West Africa.

“You might recall the battle we had last year to stop the peak season surcharge which would have been a lot of money but when we all came together, we were able to at least stop the general application for cargoes coming into the country.

“Otherwise with the Covid-19 and those charges then we would have had an inflationary trend that would have affected our economy and that is not good,” he noted.

Responding, the Director-General of NIMASA, Bashir Jamoh, said the number of attacks on visiting vessels have reduced drastically since the cancellation of the Secured Anchorage Area, (SAA) by the government.

Jamoh noted that attacks on vessels have gone down from one daily to one in two to three months.

In his words, “The ES made mention of the war risk insurance, in the last one or two months; we began to record about six attacks per week in the last two months, making it an average of one attack per day.

“Since the cancellation of SAA to date, we have recorded only two attacks. So meaning that we are getting to the level where we can say in two or three months we recorded only one attack.

“We are working to collect the attacks within six months to be able to generate the number of attacks then we will now challenge the international community as to why we should continue to pay war risk insurance in Nigeria.

“We are quietly observing what is going on and we will not query, we will not fight the international community but we will go with our on data. This is what you charge us when we were recording six attacks a week, now six months down the line we recorded two or three attacks, please tell us the justification of why we should continue to pay the war risk and in so doing, we will be able to have a level playing ground internationally,” he concluded.

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