Ukraine close to grain shipping insurance scheme- report
Ukraine is finalising a scheme with global insurers to cover grain ships travelling to and from Black Sea ports following Russia’s withdrawal from the grain deal, the Financial Times reported on Monday.
The insurance scheme could cover as many as five to 30 commercial vessels in the Black Sea amid the threat of attacks from Russia.
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Ukraine’s deputy economy minister Oleksandr Hryban said that the agreement is currently under discussion between the relevant ministries, local banks, and international insurance companies such as Lloyd's of London.
The insurance scheme is planned to be introduced as early as September and could see as many as five to 30 ships covered to travel through what Mr Hryban described as the "danger spot" of Ukrainian waters.
Under the cover of Ukrainian coastal defence systems, a German/Chinese-owned cargo ship last week made the first commercial journey out of Odesa since July, when Russia warned it would consider any civilian vessel leaving Ukraine’s ports as military targets.
"Given the military risks, affordable insurance would be essential to reviving commercial shipping activity at any significant scale," the FT reports.
Kyiv is being advised by professional services group Marsh McLennan, which includes consultancy Oliver Wyman and Marsh, the world’s biggest insurance broker Marsh. While the details are still finalised, people involved in the discussions told the Financial Times the scheme would look to cover vessels going into and out of Ukraine’s ports against damage.
The risk is likely to be shared between insurers and a local state-owned bank. Mr Hryban, the deputy economy minister of Ukraine, suggested the scheme may also involve the country’s state road fund, created to repair Ukrainian roads and is funded by a tax on fuel sales.
On 17 July 2023, Russia announced its withdrawal from the Black Sea Grain Initiative. On the same day, Ukraine proposed to the UN and Turkey that the corridor continue to operate without Russia.
After that, Russia massively attacked Odesa from the air for two nights in a row, causing serious damage to the ports in Odesa and Chornomorsk that operated in the corridor and destryoing thousands of tonnes of grain.