Piracy is a growing problem for shipping companies, but as it is a boom industry for otherwise poverty stricken Somalians, the problem isn’t going away soon, says Ruth Jackson.
Why has Somalia become a hotbed for piracy?
Somalia is one of the most lawless, dangerous places in the world. The African nation hasn’t had an effective central government since the civil war began in 1991. The current UN-backed transitional government controls barely a third of Mogadishu, Somalia’s capital, and practically none of the rest of the country. Instead, rival warlords battle for control of their local regions. As a result the country has suffered from famine and widespread poverty for almost two decades. Somalia is “ripe for misuse by those who would take that chaos and thrive on that chaos”, said Colin Powell, the former US secretary of state. At the start of the decade the Hawiye clan, who are based in central Somalia, began attacking vessels to deter illegal dumping and fishing. Then they realised that they could make more money by seizing the boats and holding them to ransom.
How much are the pirates making?
The average Somali gun-wielding pirate is thought to earn between $10,000 and $20,000 for each successfully captured and ransomed boat. That is far more than they could earn through honest work – the average annual income in Somalia is around $650, according to Sky News. The result is clear in the port of Eyl – a favoured pirate base. “Young men drive round in smart jeeps, big new villas are being built, it’s really very, very different from anywhere else in the country,” one resident told Sky News. And now some pirates are receiving millions of dollars in ransoms – last week they made $12.3m in one week from the release of a South Korean oil tanker and a Singaporean ship.
Where does all that cash go?
The business practice works a bit like a typical start-up company. The pirates who first went out and seized boats several years ago have moved up the ranks. They no longer leave shore, but receive a far higher cut of the ransom. The pirates also have to pay their suppliers – from the people who provide them with AK47s and rocket launchers to the caterers who provide food for hostages. Local clan leaders and warlords also receive a cut.
Does anyone else win from piracy?
Many reputable businesses are seeing an upswing in profits as more ships are captured. Shipping companies now spend thousands of pounds on insurance against seizures and kidnappings. Average premiums are around £50,000 per voyage, says The Independent, but can reach £300,000 for a super-tanker. But this isn’t all good news for insurers. Some are having to pay out so much money in ransoms they are now considering setting up a private navy, funded jointly between themselves and the shipping companies, to tackle the pirates. One other group of businesses is unquestionably profiting from the pirates – private security and negotiation firms. Numerous new companies offering these services have sprung up in recent years. Some will simply protect a boat. If your boat has been captured others will handle negotiations with the kidnappers and even arrange ransom drops. One such company, Task Force International Somalia, which is run by a former cabbie from London, claims to have helped arrange the release last week of Rachel and Paul Chandler, who had been held hostage by Somali pirates for over a year (see below).
What are governments doing to protect ships?
In 2008 Nato, the EU, and countries including China, Russia, India and Pakistan, sent warships to patrol the Gulf of Aden and areas of the Indian Ocean in an attempt to prevent piracy. But the area they are trying to patrol is vast – about two million square miles – and it is growing. As the pirates themselves get access to better attack craft, they are able to target boats that are further out at sea. This year, for example, Somali pirates captured a ship 1,300 nautical miles off Somalia’s coast. A joint naval operation has had some success – the Gulf of Aden is relatively safe now and just last month German and British forces successfully rescued the Beluga Fortune and its 16-strong crew. But there are other problems aside from the expanding range of the pirates.
The Royal Navy has admitted that if its budget were cut significantly it would struggle to protect sea lanes, and would possibly have to withdraw from the anti-piracy patrols. The other headache is the intrinsic instability of Somalia. Without a stable, powerful government the pirates are safe from the law when they are in Somalia, or in Somalian waters. They are highly unlikely to give up piracy unless there are other, more attractive ways to make a living. In short, “the solution is not at sea”, says Commander Simon Huntingdon of the Royal Navy in The Times.
Who paid the kidnappers?
This week saw the release of Rachel and Paul Chandler. The Britons were taken hostage by Somali pirates on 23 October last year, and were released following a $750,000 ransom payment. But who paid? The family has refused to discuss it, but a Somali official claims some of the money came from the British government, via the Somalian government. In March, Somalia received more than £5m in aid from Britain “to help promote peace and stability” – the official says that part of that sum was used to pay the ransom. Both governments deny the story, stating that Britain doesn’t negotiate with terrorists. If it ever started to, many fear it could lead to more kidnapping. However, tourists are not really the pirates’ main target. Compared to what they can make from commercial ships, $750,000 for a year’s work is negligible.