NIMASA to End Civil Liability for War Risk Insurance in Gulf of Guinea



By Chinweizu Amuta

Comprising 17 countries from Senegal to Angola, the Gulf of Guinea (GoG) is richly endowed with vast reserves of hydrocarbons, solid minerals (diamond, tin and cobalt) and fishing, making it a highly strategic area. Although not a major international sea route at present, the Gulf of Guinea accounts for 25% of African maritime traffic and has nearly 20 commercial seaports.

According to the Center for Strategic and International Studies, the Gulf of Guinea is home to 4.5% of the world’s proven oil reserves (with 60% of Africa’s oil production) and 2.7% of the world’s proven natural gas reserves. .

Two-thirds of these reserves are concentrated in Nigeria’s exclusive economic zone (EEZ), the region’s center of gravity, whose oil sector accounts for 75% of state revenues and 90% of total exports.

The recently launched Deep Blue project offers an opportunity to improve the ease of doing business in Nigeria and the greater Gulf of Guinea region. It is envisioned that this concerted effort to continuously tackle maritime insecurity would lead to a reversal of the issuance of war risk insurance charged on cargoes and ships bound for ports in the GoG region.

Pay insurance at war rate

War risk insurance covers losses resulting from events such as war, invasions, insurgencies, riots, strikes and terrorism. War risk insurance is offered as a separate policy, as it is excluded from standard insurance policies due to the high risks involved.

Due to the frequently reported cases of piracy in the Gulf of Guinea, insurers charge more to cover ships passing through the region as shipowners who are required to navigate the Gulf of Guinea will need to obtain approval from their insurer before they can. enter these waters.

The obvious consequence of this development has been higher costs of goods for end-users and reduced profit margins, which has a negative impact on economic development, not only in Nigeria, but in the GoG countries in general.

How are GoG hack numbers reported?

It is important to understand how piracy and other maritime crimes are reported, as this has a direct bearing on how decisions affecting the economies of GoG countries are made, including the billing of risk insurance. of war on the ships plying these waters.

Piracy data is often used as an indicator of general maritime security in the Gulf of Guinea, but if not interpreted with caution, its use could lead to incorrect answers.

Reports from the International Maritime Bureau (BMI), as well as other sources, such as the Yaoundé Interregional Coordination Center, greatly influence public and political discourse on the state of maritime security in West and South Africa. Center. Yet the extent of the threat is disputed and the numbers must be carefully considered to avoid distorting the true situation on the ground.

For example, the Nigerian Navy reported 339 incidents of piracy in 2020. But according to the definition of the crime under international law, 214 of them would not be considered “piracy” but acts of armed robbery. , because they took place in Nigerian territory. waters and not on the high seas.

Armed robberies at sea are the responsibility of the coastal state if they occur within 12 nautical miles of the coast. The location of attacks is therefore important, both for interpreting the data and developing responses.

Effective law enforcement far at sea is beyond the capabilities of most regional states. This means that any solution to the piracy problem is a collective solution requiring multinational support as envisioned in the Yaoundé Accord of 2013.

A deep blue answer?

In any event, the reality remains that the maritime security situation in the GoG could be significantly improved and to this end, the Federal Government, together with the Nigerian Maritime Administration and Security Agency (NIMASA) to head, launched the Deep Blue play project.

The Integrated National Security and Waterway Protection Infrastructure, as the project is otherwise known, was launched by President Muhammadu Buhari on June 10 with the mission of securing Nigerian territorial waters all the way to the Gulf of Guinea.

Land assets include the Command, Control, Communication, Computing and Intelligence Center (C4i) for intelligence gathering and data collection; 16 armored coastal patrol vehicles; and 600 specially trained interdiction soldiers, known as the Maritime Security Unit.

Maritime resources include two special mission ships and 17 rapid interception boats, air resources include two special mission aircraft for surveillance of the country’s exclusive economic zone (EEZ); three special mission helicopters for search and rescue operations; and four unmanned aerial vehicles.

It is important to note that the Deep Blue Project is the first integrated maritime security strategy in West and Central Africa with the aim of combating incidents of piracy, crew kidnappings for ransom and other crimes. maritime.

Present the reality on the ground

Amid the reduction in incidents of piracy in Nigerian waters and the Gulf of Guinea since February, when NIMASA deployed assets under Project Deep Blue, Agency Director General Dr Bashir Jamoh, called for an end to billing for war risk insurance in Nigeria. – tied vessels.

Speaking at the recent official launch of the DBP, Dr Jamoh said: “Since the deployment of Project Deep Blue assets in February, there has been a steady decline in piracy attacks in Nigerian waters on a monthly basis.

“We therefore invite the international maritime community to rethink the issue of insurance against war risks on goods destined for our ports. Nigeria has shown sufficient commitment to tackling maritime insecurity to avoid such a burden.

Although, according to Dr Jamoh and industry watchers, piracy in Nigerian waters is on the decline, industry stakeholders fear that offshore underwriters are still insisting that very high premiums be paid by companies bringing cargo to the GoG area.

As the Deep Blue project enters the implementation phase, NIMASA will not be complacent as it will continually evolve its strategies, including broad consultation with stakeholders and the application of cutting edge technologies, in the fight against maritime insecurity.

• Amuta is part of the Public Relations Unit of the Nigerian Maritime Administration and Security Agency (NIMASA).

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