Categories: Business

As Nigeria exits piracy hot list, stakeholders’ expectation mounts

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3 years ago

The International Maritime Bureau (IMB) recently delisted Nigeria from its piracy hot list following declining maritime crime and attacks in the nation’s waters and to some extension, the Gulf of Guinea. With this feat, TOLA ADENUBI takes a look at the expectations of maritime stakeholders from the international community.

For years, Nigerian waters was scene to different attacks on commercial cargo ships by dare devil pirates who reigned terror and fear to seafarers plying the nation waters and the Gulf of Guinea (GoG) at large. As this terror attacks grew in bounds, cost of bringing containers to Nigerian ports became more expensive due to the cost implication s that got attached to these piracy attacks. While many cargo ships that dared to come to our waters slammed additional charges on cargoes due to this alarming insecurity problem, others who didn’t have the gut to face the insecurity threat easily diverted cargoes meant for Nigerian ports to neighboring ports, thereby depriving the nation revenue that could have accrued to it through this seaborne trade.

The deployment of the Deep Blue project, also known as the Integrated National Security and Waterways Protection Infrastructure by the Nigerian Maritime Administration and Safety Agency (NIMASA) in 2021 and the continuous acquisition of modern assets by the Nigerian Navy, notably the Falcon Eye has been a watershed in the fight against maritime insecurity in Nigerian waters.

The successes of this efforts of the Federal Government in combating maritime crime has been spurred by the patrol of the GoG by foreign navies, which culminated in the exchange of gun fire between the Royal Danish Navy frigate HDMS Esbern Snare and a skiff that was heading towards several merchant ships, leading to the killing of four suspected pirates and the arrest of three.

With more foreign navies like the Italian Navy Ship RIZZO and the Spanish Navy Ship SERVIOLA announcing their presence in the GoG, and NIMASA working towards sustaining the deployment of the Deep Blue assets on the nation’s waters, Nigeria got delisted by the International Maritime Bureau (IMB) from its list of piracy prone countries just recently.

With this achievement, maritime stakeholders have expressed optimism that more gains should be expected from the international community if this tempo is sustained. Speaking with the Nigerian Tribune in Lagos, President of the Nigerian Association of Master Mariners (NAMM), Captain Tajudeen Alao explained that if Nigeria sustains this tempo, international insurance underwriters should stop imposing war risk surcharges on Nigerian bound cargoes.

According to Captain Alao, “I want to commend NIMASA and the Nigerian Navy for a job well done. That the European Union (EU) came here last week to commend our efforts means we are on the right track as regards tackling maritime insecurity in our waters.

“That foreign governments are partnering with NIMASA’s Deep Blue project is an indication that we are getting it right at the moment. Recently, the Japanese Government pledged $2.4 million Dollars to support the Deep Blue Project. Also, the Korean Government donated a warship to NIMASA to add to the fleet of the Deep Blue Project. This is an indication that our efforts to tackle maritime insecurity are being commended by foreign nations, and we need to sustain it.

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“We need to sustain this tempo because at the end of the day, Nigerians will be the beneficiaries of such efforts. If we can sustain this tempo, I see the issue of war risk surcharges by international underwriters coming to an end.

“For years, Nigerian cargoes have been subjected to huge insurance premium in the form of War Risk surcharges even when the country is not at war with any other country. Nigerians have been paying through their noses to clear their cargoes due to huge insurance premium slammed on cargoes that come to our ports. If we can sustain these maritime security efforts that have started yielding dividends, in the no distance future, international underwriters should stop this War Risk surcharges.

“They (international underwriters) are monitoring developments around our waters. They are seeing that foreign governments are already applauding our maritime security efforts. However, they will not want to rush into cancelling the War Risk thing because they will want assurances. Therefore, we need to sustain this tempo to reduce cost of cargo clearance on Nigerian bound cargoes.

“Again, I want to commend NIMASA and the Nigerian Navy for a job well done. Yes, we have foreign navies around our waters, but these foreign Navies are not patrolling our territorial waters. They are in the international waters of the GoG. If the Deep Blue and the Nigerian Navy have not been up and doing, the recent gains which have come in the form of declining piracy rates and the removal from the IMB Piracy list won’t have come.”

Also speaking on the development, a clearing agent, Isaac Inegbe stated that the removal from the IMB piracy list is worth celebrating because Nigeria has been in the eye of the storm as regards maritime insecurity issues in recent past.

“When I read in the news that Nigeria has been removed from the IMB piracy list, I was surprised. This has never happened before. Nigeria has always ranked among the top three or if not number one on that negative list. How we did it still remains a miracle.

“It means our maritime administration is on the right track. It means we are suddenly getting it right as regards maritime security efforts. This must be sustained because we are approaching an election year and some unpatriotic people will want to derail such efforts. NIMASA and the Navy have to redouble their efforts to ensure this is sustained. Who says if this is sustained, the so called War Risk surcharges that has made cost of clearing cargoes in our ports can’t be removed? Let’s keep pushing this until the insurance premium is removed,” Mr. Inegbe told the Nigerian Tribune.

War Risk surharge is a supplementary carrier charge that is only applied when insurance underwriters designate specific zones as war risks. It covers more than actual wars (invasion, insurrection) including international events that may be escalating toward war, and areas where hijacking (piracy) is prevalent. The surcharge is levied to recover potential extra costs, such as re-routing or additional security. It generally has two components: War Risk Liability, which covers people and items inside the craft and is calculated based on the indemnity amount; and War Risk Hull, which covers the craft itself and is calculated based on the value of the craft. The premium varies based on the expected stability of the countries to which the vessel will travel.

According to nonprofit Oceans Beyond Piracy’s 2020 report, “The total cost of additional war risk area premiums incurred by Nigerian bound ships transiting the Gulf of Guinea was $55.5 million in 2020 alone, and 35 per cent of ships transiting the area also carried additional kidnap and ransom insurance totaling $100.7 million.