|
|
|
| Sunday, 10 July 2005 |
 |
|
 |
Business |  |
| News Business Features Editorial
|
'War risk' removal a stepping stone by Hiran H. Senewiratne The removal of Sri Lanka from the "War risk" list by the London based Joint War Committee is a stepping stone for the total removal of "Held Cover", industry analysts said. The War risk surcharge came into effect after 2001 in the aftermath of the Bandaranaike airport bomb attack, which resulted in Sri Lanka being included in the "List of Exclusion" where ships calling at the Colombo Port had to pay a high war risk premium. This decision by the Committee elevates the status of Sri Lanka as a safe destination for foreign vessels and lowers the vessel operating costs incurred by ship owners, analysts said. Director of Merchant Shipping Shantha Weerakoon said that there is a high probability on cost of freight trade to come down but it all depends on market forces. The held cover status on cargo remains unchanged and this has a direct impact on freight cargo. He said that prior to the removal of the war risk surcharge insurance companies increased the premium from all vessels that called at the Colombo Port. It is said that insurance companies charged US $ .5 million from certain foreign vessels that called at the Colombo Port. Weerakoon said the removal of Hull cover status or war risk surcharge on vessels could attract reputed ship operators to call at the Colombo Port without any reservations. "We also have conditional negotiations with Lloyds War Risk Committee to remove the 'Held Cover' status on cargo. "We are trying to get it removed through our diplomatic channels," he said. Chairman, Sri Lanka Shippers' Council Noel Piyathilaka said the removal of the Hull and machinery cover will not make any impact on the export and import sector in the country because the Hull cover status applies to the vessel and its machinery while 'Held Cover' applies especially to cargo which is still subject to the premium. The most important thing is to remove the 'Held Cover' status leaving the premia to be negotiated at a higher cost to ship owners. Marine cargo insurers also charge higher premia for containers to and from the Colombo Port. He said the government should negotiate with the relevant authorities to remove the 'Held Cover' status on cargo to attract foreign investors to the country. |
|
| News | Business | Features
| Editorial | Security
| Produced by Lake House |
