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Maritime Piracy: The Phenomenon, its Implications and Responses

Published On: 11-17-2009
Related Issue Briefs:
| Trade | Culture | Environment | Migration | Development | International Law and Organizations | Human Rights |

Recent years have been marked by an unprecedented surge in maritime piracy, most infamously in the Indian Ocean off the coast of Somalia. This worrying increase has prompted the international community to take action in patrolling the waters of Somalia.

The multinational coalition, the Combined Task Force 150 (headquartered in Djibouti and comprising nations such as the United States, Canada and the United Kingdom) assumed responsibility for patrolling waters in the Gulf of Aden in August 2008. By October of 2008, the United Nations Security Council adopted Resolution 1838 calling on nations in the area with naval capacities to suppress the pirate attacks in the region.

This news analysis will provide a sampling of pirate attacks, highlight the causes of the phenomenon, examine its local and global impact, outline national and international responses and note similar instances of piracy in other regions of the world.

Notable Examples of Somali Piracy:

Somalia is one of the poorest countries in the world, and has been a failed state since the collapse of the Siad Barre  government in 1991. In a country with a severely dysfunctional and limited government, a strong clan-based society, and widespread poverty, it is no wonder that piracy has become a method of gaining income for some of the poorest residents of the African Continent.

One of the more high-profile incidents involved the kidnapping of a British couple in late October 2009. As the BBC summarizes:

Paul and Rachel Chandler, aged 59 and 55, from Tunbridge Wells in Kent, were taken hostage by gunmen in the Indian Ocean in the early hours of 23 October. They had been travelling to Tanzania from the Seychelles and their yacht was later found in international waters. Somali premier Omar Sharmarke said the government had been trying to contact the pirates through local elders.1 

A ransom demand is expected in the next few days, as pirates have learned that human lives are worth a lot of money.

Also, a group of pirates captured a Spanish trawler and held its 33-person crew hostage, demanding that the Spanish government free two Somali men who were captured and taken to Madrid to be tried for the hijacking of a Spanish-flagged vessel (the Alakrana) on October 2, 2009. As The Scotsman reports:

On Thursday night, Alakrana skipper Ricardo Blach told Spanish television [that] the heavily armed pirates had threatened to kill the three crew members taken ashore if there was no progress in freeing the two men. " He said about 30 pirates on the Alakrana took drugs, often quarrelled among themselves and were equipped with machine guns, bazookas, grenade launchers and handguns. "If you say anything to them, they put a pistol to your forehead," he said.2

So far, the Spanish government has refused to negotiate with the pirates and has vowed to continue arrests against suspected pirates, although it has not ruled out the possibility of transferring the arrested pirates to a third country, possibly in Africa.

On November 9, 2009, Reuters reported that Somali pirates, in their most daring attack yet, seized a United Arab Emirates-flagged cargo ship loaded with weapons bound for Somalia. This incident is highly significant because the ship was in contravention of the post-Barre international arms embargo on Somalia and because the attack has been the furthest yet from the Somali coast. Speculation on the contents of the ship has abounded:

Andrew Mwangura of the East African Seafarers' Assistance Programme told Reuters he believed the weapons ship was using a fake name. "She is one of the regular weapons carriers circumventing the U.N. arms embargo on Somalia," Mwangura said. Maritime sources say the craft is believed to be carrying light arms and ammunition, as well as rockets and rocket-propelled grenades.3

The pirates themselves have expressed their views on this issue:

"We understand the weapons belong to the Somali government," Farah, a pirate, told Reuters by satellite telephone. Another gang member, Hassan, said the weapons ship was well known to them: "It has been circling in our ocean for a long time, bringing illegal weapons to massacre Somalis," he said.3

These incidents represent a small sampling of numerous attacks successful and not successful, on ships and yachts in the region.

Causes of Somali Piracy

In addition to severe poverty and a lack of a functioning government, Somali piracy may be attributed to local resentment over the treatment of Somali waters by foreign powers.

As Paul Salopek of the Chicago Tribune notes, toxic waste dumping has been one of the factors for Somali resentment of foreign ships in local waters:4

In the early 1990s, for example, Somalia’s unpatrolled waters became a cost-free dumping ground for industrial waste from Europe. Fishing boats from Italy were reported to have ferried barrels of toxic materials to Somalia’s shores and then returned home laden with illicit catches of fish. Rusting containers of hazardous waste washed up on Somali beaches as recently as 2005, after a powerful tsunami roared through.5

In addition, illegal overfishing has also taken its toll on local fishermen, who are hypothesized to be joining with the pirates out of desperation. Peter Lehr, a Somalia piracy expert at the University of St. Andrews in Scotland and the editor of Violence at Sea: Piracy in the Age of Global Terrorism, argues:

It’s almost like a resource swap. […] Somalis collect up to $100 million a year from pirate ransoms off their coasts. And the Europeans and Asians poach around $300 million a year in fish from Somali waters.6

Although these justifications may be a ruse covering up more self-serving interests, they nonetheless are considered to have a grain of truth to them, even though Somali pirates have focused more on extorting money from foreign governments than making policy demands.

Local Impact

In a report on the fishing town of Eyl, off the coast of Puntland, one of the strongholds of Somali piracy, reporter Andrew Harding highlights how the money funneled through the city via piracy has affected the local community:

We are all against the pirates here," insisted a businesswoman named Abdi Hirsi. "They have brought bad culture here. They come here with their shiny cars, collect their money and leave. We worry that our children will be attracted to crime. […]We are very fearful of the pirates, and of the international community. We hear reports that the West will launch airstrikes against our town.7 

As a consequence of piracy, even as the pirates themselves spread their newfound wealth amid their communities, they encourage more disaffected youth to sign up and take part in their lifestyle.

Global Impact: Money Laundering

On a more global scale, the financing of pirate activities has raised questions regarding money laundering activities in the Gulf region and elsewhere. As Mary Harper of BBC News reports, 

it has also been reported that much of the estimated $80m (£50m) paid out in ransoms so far this year has been laundered by organised syndicates in Dubai and other Gulf states. But this has been strenuously denied by officials in the Gulf. What happens to the money is exceedingly opaque, partly because of the way Somalis communicate with each other, and also because of the impenetrable way their finance system works.8 

There is a very limited paper trail to the money paid by ransom because the sum is usually received in cash and, through the honor system of “hawala,” – relying on connections and elders - is dispersed among the Somali community.

A UN report on the phenomenon asserted that a mini-economy has sprung up around pirate activities, with a whole host of players profiting from the lucrative ransoms. The breakdown of compensation is as follows:

  • Maritime militia, pirates involved in actual hijacking – 30 percent
  • Ground militia (armed groups who control the territory where the pirates are based) – 10 percent
  • Local community (elders and local officials) – 10 percent
  • Financier – 20 percent
  • Sponsor – 30 percent.9

Countries such as the United Arab Emirates and Yemen have also been accused of serving as financial launderers and military suppliers for Somali pirates.10 

Global Impact: Shipping Industry

Significant costs are associated with the phenomenon of piracy, especially for the shipping industry and traders who utilize ships to transport merchandise. In August 2009, Lloyd’s of London Insurance Market asserted that businesses will have to account for a rising “piracy tax” to maintain global networks.11 

Richard Ward, Lloyd's chief executive, said: "The cost of keeping global trade routes open does get passed down to businesses shipping the goods and, in the end, consumers."12 

Furthermore, as Ruth Sunderland of The Guardian notes,

ransoms can be as high as $3m, and other costs include delays in releasing ships and increased insurance premiums. Mainstream "hull and cargo" policies do not normally cover piracy, so captains have to purchase separate "kidnap and ransom" cover.13

In addition, this spike in costs has compounded the woes caused by the international financial crisis, as reported by Agence France Presse in November 2008.14 

Governmental and International Responses

As piracy is considered a crime against all nations and may be prosecuted by any nation, several states have sent naval forces, including warships, to bolster the international naval presence in the region. These include the United States, France, India, Russia, China, Norway and Australia. 

Such intervention has been carried out at the behest of the Somali government itself, which has issued pleas for international cooperation on the issue. Addressing the recent kidnap of the British couple, Somali Prime Minister, Omar Shamarke averred:

We're not powerless but the capacity to handle this issue is not all there. And that's why we're seeking assistance and investors. We have to understand that the cost of doing nothing is far greater than the cost of doing something.15

Earlier in the year, US Secretary of State Hillary Clinton unveiled a plan to combat piracy involving sending an envoy to the Somali donors' conference, freezing pirates' assets, and plugging gaps in the shipping industry's own defenses, and improving the situation in Somalia itself. Secretary Clinton declared:

These pirates are criminals, they are armed gangs on the sea, and those plotting attacks must be stopped. It is time to eliminate the financial payoff of piracy. We must press authorities within Somalia to take action against pirates operating from bases within their territory. […] We will also reiterate to all concerned the US policy of making no concessions or ransom payments to hostage takers.16 

In addition, in May 2009, the United States put a young Somali man captured during the rescue of an American sea captain on trial. The accused is believed to be the first person to face piracy charges in the US in over a century and faces life in prison if convicted.17 

In addition, the Chinese government recently held an anti-piracy conference in early November 2009. “The conference would consider how escort missions could cover different areas in the gulf so as to coordinate effective international cooperation,” said ministry spokesman Ma Zhaoxu at a regular news briefing.18

The significant numbers of countries cooperating via naval forces and expending political dialogue on the issue illustrates the global nature of this phenomenon and the possibilities for international cooperation inherent in the process of finding its solution.

Not Merely a Somali Phenomenon

Piracy is hardly confined merely to the Somali region. In particular, reports of piracy have been noted by Southeast Asian nations (in the Malacca Straits) and even in the North Sea.

According to the ReCAAP (Regional Cooperation Agreement on Combating Piracy and Armed Robbery against Ships in Asia)  monitoring centre, as of September 2009, there were 10 reports of sea attacks in the South China sea, compared to the previous high of nine in 2005.19  In one incident, six pirates boarded a tanker off Indonesia and robbed the crew.

Experts also point to a “copycat” phenomenon in Southeast Asia, of pirates influenced by the Somali example of hijacking ships for their human cargo rather than for the purposes of robbery.20

In addition, in late July 2009, a Russian cargo ship went missing from Portuguese waters, having been hijacked as it crossed the Baltic Sea. This prompted fears of European piracy in the North Sea. As Michael Schwirtz of the New York Times summarizes:

The Defense Ministry said the hijackers had commandeered the ship off the coast of Sweden and traveled for several days through heavily monitored European waters to the open Atlantic without detection, in what would be an act of piracy practically unknown in modern Europe.21 

Both examples illustrate a worrying trans-regional increase in pirate activity and represent a significant challenge to international maritime security.

Conclusion

The upswing in Somali piracy has had significant effect on local and global levels. The problem posed by pirate activity also, however, represents a significant opportunity for cooperation and collaboration among members of the international community, who have a common interest in protecting trade routes and reducing transportation and human costs. It remains to be seen whether measures already in effect will have significant results without long-term changes in Somali governance and stability.

Recommended Viewing: Postcard from Somali Pirate Capital: http://news.bbc.co.uk/2/hi/africa/8103585.stm

Recommended Reading: Piracy in the Horn of Africa: http://www.nytimes.com/packages/pdf/topics/piracycrs.pdf


1 "Couples ransom demand ‘expected’,” BBC News, October 30, 2009.
2  Woolls, Daniel, “Spain refuses to bow to pirate threat to kill fishermen.” The Scotsman, November 7, 209
3  “Somali pirates seize weapons ship, attack tanker.” Reuters, November 9, 2009.
4  Hari, Johann, “You are being lied to about pirates.” The Independent, January 5, 2009.
5  Salopek, Paul, “Off the lawless coast of Somalia, questions of who is pirating whom.” Chicago Tribune, October 10, 2008.
6  Ibid.
7  Harding, Andrew, “Postcard from Somali Pirate Capital.” BBC News, June 16, 2009.
8  Harper, Mary, “Chasing the Somali piracy money trail.” BBC News, May 24, 2009.
9  Ibid.
10  Ibid.
11  Sunderland, Ruth, “Rising wave of piracy sends shipowners’ costs soaring.” The Guardian-The Observer, August 16, 2009
12  Ibid.
13  Ibid.
14  “Piracy compounds world trade slowdown.” Agence-France Presse. November 23, 2009.
15  “Somalia to ‘purge piracy’ by 2011” BBC News. October 28, 2009.
16  “US unveils plan to tackle piracy.” BBC News, April 15, 2009.
17  “US charges Somali man with piracy.” BBC News, May 20, 2009.
18  “China hosting anti-Somali pirate conference.” EagleSpeak, November 7, 2009
19  “Piracy ‘spike’ in South China Sea.” BBC News,  September 21, 2009.
20  “‘Somali effect’ on piracy in Southeast Asia.” BBC News, April 23, 2009.
21  Schwirtz, Michael, “Russia says ship was hijacked, but explanation is sketchy.” New York Times, August 18, 2009.
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