The Risk Premium For Cargo Ships Travelling The Nigerian Route Is Now $946

Credits: Kerensa Pickett/Unsplash

Due to the Nigerian Navy’s improved maritime domain security following Nigeria’s removal from the International Maritime Bureau’s (IMB) list of countries with a high risk of piracy, the insurance premium paid by ships entering Nigeria for business has decreased from $5,000 to $946 dollars, according to Vice Admiral Awwal Zubairu Gambo, Chief of the Naval Staff, as reported by Vanguard.

War risk premium 

Admiral Gambo promised that “this accomplishment would be sustained by the Nigerian Navy. This has finally decreased the high insurance premium (also known as war risk premium), which is typically taken into account when calculating shipping costs due to the high incidence of piracy. To make up for their losses, shipping businesses then pass these exorbitant charges forward to customers.”

The CNS spoke at the Naval Headquarters in Abuja at the signing of an agreement between the Nigerian Navy and the National Agency for Science and Engineering Infrastructure (NASENI).

Gambo praised the Agency’s efforts to work with the Nigerian Navy, particularly in Research and Development, which made the trip to the Naval Dockyard Limited in Lagos necessary to improve the Nigerian Navy’s domestic shipbuilding operations.

According to him, “This indigenous shipbuilding effort has improved the presentation of the Nigerian Navy at sea, which ultimately resulted in a considerable reduction of pirate events and Nigeria’s removal from the list of countries with a high piracy risk.”

The good news is that the insurance price has been lowered from 5,000 US dollars to 946 US dollars as a result of Nigeria being removed from the IMB List of Countries Prone to Piracy in March of last year.

“I am therefore happy not only that we are present to see the Memorandum of Understanding being signed, but also because of what it means. The enormous efforts of NASENI, which are changing the dynamics of engineering and promoting R&D projects at every level of human endeavour in our great country and abroad, are extraordinary and laudable.”

“This Memorandum of Agreement is not just a piece of paper,” the CNS continued. It re-energizes the partnership between the two organisations in a number of ways, including, but not limited to, fostering operations and administrative engagements that would enhance the development of a sustainable Blue Economy for Nigeria’s prosperity as well as promoting mutual synergy towards enhancing Research and Development for enhanced security.

Nigerian Naval engineers’ capacity 

In addition, he said, “I, therefore, consider it most appropriate to thank President Muhammadu Buhari for his unwavering support, who coincidentally serves as the Executive Chairman Board of NASENI.” I appreciate the sustained efforts and support from the Federal Government, which have been instrumental to the successes recorded by the Nigerian Navy. The Nigerian Navy is truly appreciative.

“I also want to express my gratitude to the Technical Committee for helping to make this event possible and once more commend Prof. Muhammad Haruna, the Executive Vice Chairman of NASENI, and his management team for their bravery. I want to reassure you that the Nigerian Navy is prepared to uphold the conditions of this historic Memorandum of Understanding, and I’m looking forward to our collaboration. I thus beg both sides to be devoted to realising the goals of the Memorandum of Understanding for Nigeria’s benefit and that of Nigerians.

Prof. Haruna called the signing ceremony historic in his remarks, emphasising that the Navy and NASENI had already been working together; Wednesday’s ceremony was only a formalisation of that relationship.”

The attempt to save the government from having to spend a lot of money on purchasing technology and equipment, as well as building the Nigerian Navy’s capacity to enhance security structures in the country’s maritime domain, he said, is the most important aspect of the MoU.

His visit to the Nigerian Navy Shipyard in Lagos left him quite impressed with the capability of Nigerian Naval engineers in the area of shipbuilding and ship repairs. He congratulated the Navy for its accomplishments thus far in the area of research and development.

Employing workforce 

Beforehand, Rear Admiral Sulaiman El-Ladan, the Chief of Naval Engineering (CONE), stated that the MOU aims to align the Nigerian Navy’s capability, to employ the available workforce of both organisations to take ownership and utilise technology in shipbuilding and related sectors.

“Article 5 of the MoU states that parties shall establish a joint implementation committee with a goal of promoting development in the maritime sector; NASENI shall facilitate science and engineering research; and NASENI shall also provide funding, as necessary, to ensure the development of manpower capacity and infrastructure in the area of design and construction for fishing vessels as well as oil tankers,” he said. The Agreement, according to him, will initially be in effect for at least five years before being enlarged.

The CONE continued, “Up to 100 Nigerian Naval personnel, pursuant to the Agreement, are projected to get capacity training in electronics, engineering designs, and computer technology disciplines during the five-year duration term.”

Rear Admiral Saidu Garba, the Nigerian Navy’s Chief of Policy and Planning, and other Principal Staff Officers from Naval headquarters attended the occasion.

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Source: Vanguard


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