From Anthony Nwachukwu, Lagos
Cost of imported goods may soon drastically reduce as the country has started rallying international maritime bodies and partners to end the continued exploitation of Nigerians through the bogus war risk insurance premium, which has sustained a huge freight cost on cargoes over the years.
Disclosing this during his interactive session with the maritime media in Lagos, the Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Dayo Mobereola, said the country was already seeking the support of the United Nations and international maritime organisation to compel a reduction of the charges to the actual risk.
Noting that a “powerful cartel” within the international insurance sector “behind the war risk insurance premium is making so much money from it and will rather keep it as it is than remove it,” he said that Nigeria cannot do it alone and needs support to meet the insurance companies.
According to him, though the enforcers are aware that piracy and sea robbery incidents in Nigerian waters have significantly reduced, they have nonetheless continued to add war risk premium to the cost of Nigeria-bound trade.
“One of the points I raised during my visit to Chatham House was how the war risk insurance placed on Nigeria-bound cargoes can be reduced,” he stated.
“Even if Nigeria maintains zero piracy on her waters for the next 10 years, if we don’t force the issues they will continue to charge us. They won’t remove the war risk insurance because they are making so much money from it.”
Also, Mebereola explained that the Cabotage Vessels Financing Fund (CVFF) is not a Federal Government revenue but a vessel development fund being contributed by ship owners.
Allaying the fears over the fund’s safety and availability, he said “the CVFF as at today is with the Federal Government and it is for the use of ship owners. It has not been touched, it is not a revenue, it is a contribution towards the development of the Nigerian shipping industry and ship owners.
“That is recognised and that is what it is going to be used for, as soon as we come back with the fine-tuned guidelines on how to use it, which we have been working on with my executive directors.”
However, he said the agency was “also exploring other avenues to ensure that this CVFF is not just CVFF but enlarged in such a way that we can even leverage it.”
Assuring that NIMASA was carefully working to avoid the mistakes with the defunct Ship Acquisition and Ship Building Fund (SASBF), Mobereola explained that the CVFF goes beyond vessel acquisition to the demand for steady supply of cargo for the vessels.
“In this case, we are looking for opportunities to ensure that when we start the disbursement of CVFF, it will be for the benefit of shipping promotion in Nigeria and not be a start and stop. It will be something that will help us to continually develop the sector.”
