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NIMASA’s crusade to end war risk insurance will save Nigeria over $400 billion premium paid annually 

By Osagie Edward.

War risk insurance (WRI) is an additional surcharge imposed by international shipping companies on cargo bound for Nigeria.
 It comprises two key components: war risk liability, which covers people and goods aboard the vessel and is calculated based on the indemnity amount, and war risk hull, which covers the vessel itself and is determined by its value.
This financial burden was initially introduced during the height of Niger Delta militancy and piracy.
Although the Nigerian Bureau of Statistics does not have precise data on the total WRI payments made to international insurers, available figures indicate that Nigeria has paid over $1.5 billion in the past three years alone to Lloyd’s of London, Protection and Indemnity (P&I) insurance, and other foreign insurance firms.
The impact on Nigeria’s economy is staggering: for a Very Large Crude Carrier (VLCC) valued at $130 million, the WRI surcharge per voyage is approximately $445,000.
 For new container vessels valued at $150 million, the cost rises to $525,000 per voyage.
Maersk, one of the world’s largest shipping companies, has also introduced a transit disruption surcharge of up to $450 per container, while other shipping lines impose a war risk surcharge of $40–$50 per 20-foot container.

Recognizing the severe economic implications of this financial burden, the Nigerian Maritime Administration and Safety Agency (NIMASA) under the leadership of Dr. Dayo Mobereola has launched an aggressive campaign to eliminate war risk insurance on Nigeria-bound cargo.

The NIMASA Act and the Merchant Shipping Act mandate the agency to promote shipping development, and removing the WRI premium has become a central focus of its maritime reforms.
 The security concerns that originally justified these premiums no longer exist.
 Nigeria has not recorded a single piracy incident in over three years, and in 2021, the International Maritime Bureau (IMB) officially removed Nigeria from its list of piracy-prone countries.
Over the past five years, NIMASA, in collaboration with the Nigerian Navy, has led an unprecedented crackdown on piracy in the Gulf of Guinea, earning global recognition from the International Maritime Organization (IMO).
Despite these achievements, international shipping companies have continued to impose war risk insurance premiums on Nigeria-bound cargoes.
In 2023, the International Bargaining Forum (IBF) further validated Nigeria’s progress by delisting the country from the list of high-risk maritime nations.
 With piracy no longer a concern, why has the international shipping community continued to impose these excessive premiums?

NIGERIA’S EFFORTS TO MITIGATE WRI PREMIUMS

To address this issue, Nigeria through the Ministry of Marine and Blue Economy and the Ministry of Defense made significant investments in maritime security through initiatives like the Deep Blue Project, which has successfully eliminated piracy in the country’s waters for over 30 consecutive months—a record unmatched anywhere in the world.
 In addition, Nigeria collaborates closely with the IMO and other international bodies to combat maritime threats, further reducing its risk classification.
 IMO Secretary-General, Arsenio Dominguez, has publicly commended Nigeria’s efforts in securing the Gulf of Guinea.
Despite these improvements, shipowners and insurers have refused to acknowledge Nigeria’s new security status, continuing to levy exorbitant premiums on vessels operating in the country.

MOBEREOLA’S INTERNATIONAL DIPLOMACY: BRINGING GLOBAL ATTENTION TO THE ISSUE

Determined to break this cycle of financial exploitation, Dr. Mobereola under the directives of the Minister of Marine and Blue Economy, Adegboyega Oyetola, took Nigeria’s case to international stakeholders, urging them to support the removal of war risk insurance premiums.
In a major diplomatic move, he engaged Chatham House, where he met with Dr. Alex Vines, Director of the Africa Programme, who agreed to escalate the matter to the United Nations.
 NIMASA has also engaged major global shipping organizations, including: • BIMCO (Baltic and International Maritime Council), the world’s largest shipping association. • The International Chamber of Shipping (ICS). • INTERCARGO (International Association of Dry Cargo Shipowners). • INTERTANKO (International Association of Independent Tanker Owners).
In discussions with these organizations, Dr. Mobereola emphasized that Nigeria has invested billions in maritime security, yet continues to be unfairly penalized.
He urged the global shipping community to recognize the country’s improved security status and remove the unjustified WRI premiums.

Stinne Taiger Ivø, Deputy Secretary General of BIMCO, acknowledged Nigeria’s progress and stated that shipowners should take the lead in pushing for lower premiums.

Similarly, Zhou Xianyong of INTERCARGO assured NIMASA of their support in Nigeria’s campaign to be delisted from war risk insurance premium zones.
 Reducing these premiums is critical for Nigeria’s competitiveness in global trade.
 Lower shipping costs will encourage more international trade, attract foreign investment, and strengthen Nigeria’s position as a leading blue economy player.

Recently, NIMASA met with a Danish delegation led by Kristin Skov-Spilling, Chief Technical Advisor from the Danish Ministry of Foreign Affairs, urging Denmark to advocate for a reduction in war risk insurance premiums.

Some critics argue that Denmark cannot intervene in private insurance matters, but this argument is flawed.
Denmark has a significant interest in Maersk Line, which contributes over 15% of the country’s GDP.
If Denmark exerts pressure on Maersk, other shipping companies will likely follow suit.
Dr. Dayo Mobereola and his Management team at NIMASA have successfully brought global attention to Nigeria’s unfair war risk insurance burden.
 Now, it is time for all stakeholders—government, industry, and international bodies—to support the removal of this unjustified premium.
Nigeria has fulfilled its obligations, securing its waters and eliminating piracy.
 Yet, foreign insurance firms continue to profit while Nigerian businesses and consumers bear the costs.
The message is clear: Nigeria cannot continue paying war risk insurance premiums indefinitely.
The time for change is now and lets sustain the momentum.
OSAGIE EDWARD, FNIPR is the Head of Public Relations at the Nigerian Maritime Administration and Safety Agency, (NIMASA)

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Customs

CTN as panacea for insecurity,  importation of contraband goods through ports.

Since the collapse of scanners at the nation’s  seaports and land borders,  the Nigeria Customs Service has been using manual method(100 percent examination)  to inspect cargoes but experts believe that  re-introduction of CTN at the ports would minimise the high incidence of insecurity through curbing of importation of arms and ammunitions through our ports into the country.

Eyewitness reporter writes

In 2015, the Nigerian Shippers Council was desirous to re-introduce the Cargo Tracking Note (CTN) into the nation’s maritime industry.

But this was met with stiff opposition especially from local Manufacturers who thought it will add to cost of doing business at the ports.

But, the  Council at that time was interested in the overall national security and safety of Nigerians because it is believed that the CTN will help check importation of arms, ammunition and hazardous materials into the country.

Two years after the council bowed to pressure and suspended the laudable projects, arms and ammunitions were being imported freely into the country but few are being intercepted in and outside the nation’s seaports, a situation the council want to avert through the CTN but was thwarted by stakeholders.

For instance,  in January 2017, the Federal Operations Unit (FOU), Zone A of the Nigeria Customs Service (NCS) intercepted 49 boxes containing 661 pieces of pump action rifles.

The ammunitions were intercepted by officers of the federal operations unit (FOU), Zone A, Ikeja, in a Mark truck with registration number BUG 265 XG, the 40 feet container with number; PONU/825914/3 along Mile 2 Apapa Road, in Lagos.

Thee boxes were concealed with steel and other merchandise goods.

Also in  May,  2017, another 440 pump action rifles were intercepted at the Tin Can Island Command, Lagos.

According to the then Zonal Co-ordinator of the Zone, Monday Abue, the cargo was shipped into the country from Turkey and concealed in POP.

On the 7th of September, 2017 another 1,100 rifles were further intercepted in a 20ft container  with No GESU2555208 during examination, while the Bill of Lading falsely indicated wash hand basins and water closets.

A week after, another container with about 475 pump action rifles with container number, CMAU189817/8 carrie about 475 pump action rifles.

However,  2018 was not spared as the Customs Service intercepted live ammunitions at the Tin-Can island port.

The Tin-Can Island Command of the service said the live ammunitions were concealed in a vehicle and container at the Lagos Port.

It was gathered that the interception were done in two different operations on the 9th and 10th of July respectively.

According to the Public Relations Officer of the command, Uche Ejiesieme , the first incident at the Terminal ‘C’, involved 1 x 40ft container No. TGHU 60143419, which on scheduled examination was found to contain 150 rounds of live ammunition and jack knives while  149 rounds of 38mm calibre live ammunition, 92 rounds of 9mm calibre live ammunition, 2 rounds Of 7.62MM calibre live ammunition,  11 cartridges of live ammunition,12 expenses empty shells of various calibre and one empty magazine were uncovered in another vehicle.”

This is part of the few interceptions that were made by the service while  many more may have eluded the eagle eye of the customs service.

But, stakeholders have argued that the CTN, if it had been  implemented in 2015 ,would have detected the contrabands before it was loaded on vessels to Nigeria.

Even,  the Central Bank of Nigeria agreed that the CTN would not only checkmate under declaration and share trade information but will also assist the Nigeria Customs Service to risk mitigation on imports, enhance and block revenue leakages at the ports.

Speaking, a frontline Importer, Ikechukwu Shedrack ,said the CTN would serve as a security measure to ensure safety and security of goods shipped from one part of the world to another.

“It is meant to be implemented worldwide. The regulation requires shippers to have a Cargo Tracking Note (CTN) accompanying all shipments.

“The CTN will help enhance security at a time Nigerian government is have difficulties in replacing obsolete scanners at the ports. It will give information of cargoes to be imported even before loading and it will help know what should be imported and what not to be imported into the country, especially if it were to be arms and ammunitions it will be intercepted at point of loading”

“Aside under declaration, the CTN will also bring trade information.

Research had also shown that the CTN, when reintroduced, is different from the old ways of monitoring cargoes as it has four distinct features from the previous tracking device.

It is noteworthy that, as can be seen from the agreement, four important features distinguish the current ICTN Scheme from the abolished version.

That is, the current scheme will be implemented at no cost to the shipper/consignee, at all and the current scheme is web based and therefore paperless,thus making the delay associated with obtaining Cargo Tracking Note and associated documentation by Shippers, under the abolished version of the scheme completely eliminated as the shipper needs not do anything apart from declaring in advance (i.e. at the loading port), information relating to the cargo.

Also,  the one hundred and fifty dollars ($150) per container CTN fee charged under the abolished version, paid by the shippers, which led to the stakeholders vehement protest against the scheme and its eventual abolishment, was radically modified and reduced to a token administrative fee of twenty five dollars ($25) per container, thereby making it the lowest in our West and Central African Sub-region.

This became necessary not only in view of Nigeria’s volume of trade but also to substantially downplay the insinuated revenue generation motive of the old version of the scheme in favour of the actual and more important Trader Information Generation motive which has tremendous potential to impact positively on the nation’s effort in Trade Facilitation, National Planning and National Security;

The NSC-TPMS Sharing Ration of the collectible Administrative fee was negotiated and reviewed from 60-40, under the abolished scheme, to 65-35 thereby raising the share accruable to the government.

Also,  all vessels loading and unloading or in transit (Export/Import and Transit) departing from Nigeria Ports or having Nigerian Ports as final destination or transiting through Nigerian ports shall, before any movement, obtain a Movement Reference Number (MRN).

The MRN will be allocated to the vessels by Nigerian Shippers’ Council irrespective of the origin of the vessel of cargoes.

 The Executive Secretary of the Nigerian Shippers Council, Barr. Hassan Bello had then disclosed that the CTN would be reintroduced to help curb importation of arms and ammunition into the country.

He said, “The Cargo Tracking Note would soon be reintroduced at a very negligible cost. CTN is a security thing because when we have it, there won’t be smuggling of firearms and all other contrabands.

” Smuggling of contraband won’t happen because everything coming in will be tracked, we will know the weight of the cargo, values and materials used.”

Bello stated further that the CTN would also help the Standards Organisation of Nigeria (SON) and National Agency for Food Drugs Administration and Control (NAFDAC) to fight substandard products and fake drugs respectively.

 “SON and NAFDAC will benefit by knowing whether products being imported are fake or not.

“I am calling on all the port stakeholders such as manufacturers, shippers and the rest to support this. That is why the Nigerian Shippers Council wants to develop the port community system because what the port needs is unity.

” There is need for everyone to come together on a platform to know what the other is doing. It is good for data collection for planning and for you to know your customers,” said Bello.
But the desire of the Shippers’Council to reintroduce the controvesial CTN was not to be at that period as it  was again aborted as stakeholders effectively shut down the move despite the efforts of the council to convince them.
But the country may once again have a shot at the CTN few years after  it was shot down by the sceptical stakeholders.
Following the resurgence of insecurity in the country which has assumed a verocious dimension, the Federal government has asked the Nigerian Shippers’Council to resuscitate the move to reintroduce the controvesial CTN to track all imports in order to identify and curtail importation of arms and ammunitions into the country through the ports.
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