Lloyd's of London, the world's largest insurance market, recently lowered back its insurance premiums on vessels passing through Jordan’s port of Aqaba. Global insurance companies shot up risk premiums in the aftermath of the September 11 terror attacks on the United States.
Ever since Lloyd’s declared Aqaba a conflict zone, Jordanian officials have been vigorously lobbying to exclude the Kingdom's sole maritime outlet from the war-zones list. Over the past month, insurance surcharges were brought down in Israel, Lebanon and Yemen, but Jordan received the most generous 50 percent premium cut, down to 0.05 percent, reported Jordan Times.
The 12.5 percent war risk premium levied on normal cargo since Mid-November by international insurance firms, drove local shipping companies to increase transport tariffs. Shipping costs reached seven dollars per ton on all goods carried on vessels operating in the Aqaba Port.
Earlier in 2001, the Jordanian government cancelled Lloyd’s Register’s post at the Aqaba port, as monitor of Iraqi-bound commodities under UN restrictions. Lloyd's is a brokered market, in which 108 underwriting syndicates both compete and co-operate. Lloyd's underwriters cover risk insurance, including marine, aviation, catastrophe cover and professional indemnity.
Aqaba port handled six million tons of imported commodities during the first half of the year 2001, according to Port Director Saud Srur, noting that the port’s capacity totals 20 million tons of goods annually. The Jordanian government aims to transform Aqaba into a regional trade hub, by declaring it a free trade zone and offering investors major tax and customs breaks. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
