Why high-seas piracy is here to stay

March 4, 2011


Bernd Debusmann is a Reuters columnist. The opinions expressed are his own.

WASHINGTON — In 2005, the average ransom paid for the release of a ship hijacked by Somali pirates was around $150,000. By the end of last year, it stood at $5.4 million. That means revenues for the business of piracy more than doubled every year. The 2005 to 2010 percentage increase is a staggering 3,600 percent.

The ransom numbers come from the One Earth Foundation, a U.S. think tank, and help explain why the business of piracy, probably the world’s most profitable, has been expanding — despite an increased international naval presence in the waters hounded by Somali pirates, despite a string of plans to protect shipping, and despite increasingly exasperated statements from politicians and ship owners.

Talking about pirates off Somalia, who killed four Americans on February 22, U.S. Secretary of State Hillary Clinton said this week that “I’m fed up with it.” Piracy is moving up Washington’s list of priorities, according to her. A few weeks earlier, Ban Ki-Moon, the United Nations Secretary General, noted that “piracy seems to be outpacing the efforts of the international community to stem it.”

Ship owners agree. Early in March, five of the world’s largest maritime organizations, complaining that “2,000 Somali pirates are hijacking the world’s economy”, launched an advertising campaign and a website (www. SaveOurSeafarers.com) demanding tougher action. The group includes the International Chamber of Shipping, which represents about 80 percent of the world’s merchant ships, and INTERTANKO, whose members operate most of the world’s tankers.

In half page advertisements in leading newspapers, including the Wall Street Journal, the group noted that “even when caught red-handed, 80 percent of pirates are released to attack again.”

The practice, known as “catch and release”, figures in the risk-reward calculations of the piracy business, whose leaders are aware of the thicket of laws, regulations and jurisdictional ambiguities which has made arrest and prosecution of pirates difficult. There are no uniform rules of engagement for the warships on counter-piracy missions in the Gulf of Aden and the Indian ocean. By some definitions, an act of piracy does not begin until grappling hooks are thrown over the sides and the pirates start clambering up.

While the number of navy vessels on counter-piracy patrols has increased (there are about 30 warships on patrol now) so has the area threatened by pirates, who launch speedboats from mother ships up to a thousand miles from the Somali coast. So, the warships are looking for needles in a haystack.



Which is why trying to end piracy purely with sea-borne operations looks like an enterprise doomed to failure. The key to solving the problem is on land the fact that Somalia, a failed state, is a sanctuary for pirates. No country is prepared to take action against that sanctuary, where more than 800 seafarers are currently held hostage.

“The problem is being addressed right now only from the sea,” Nikolas Gvosdev, a professor at the U.S. Naval War College, said in a recent radio discussion on piracy. “We are trying to deter attacks. We are trying to protect ships. But the problem lies on land. It lies in villages and port cities, in ungoverned spaces where…this is a profitable business. It is essentially the main driver for revenue in Somalia.”

Donna Hopkins, the U.S. government’s coordinator of Counter Piracy and Maritime Security, has described piracy as “deeply ingrained in the Somali economic and social structure” and said the problem would continue as long as there is no effective government to control territorial waters and the Somali coastline.

When might that happen? Don’t hold your breath. Somalia has had no effective government since 1991 when the Communist dictatorship of Mohamed Siad Barre was toppled. In the two decades since then, the country has been torn by fighting between rival warlords and militias, an Ethiopian invasion to oust Islamists, and battles between militants linked to al Qaeda and what passes for a government.

In the process, Somalia earned the dubious distinction of being ranked the world’s most corrupt country. It came dead last on the 2010 corruption perception index of 178 countries compiled by Transparency International, a watchdog group based in Berlin.

The longer the problem festers, the more difficult it is to resolve. “As pirates become richer, they become harder to dislodge,” says Roger Middleton, the author of a report on piracy by Chatham House, a British think tank. “Pirates can be chased on the ocean, but piracy can only be eradicated on land.”

So what to do? One way would be stepped up military action on land, following the example of a daring helicopter-born French commando raid in 2008 to capture pirates who had held 30 hostages from a French yacht. Another way would be to redouble international efforts to finally help Somalia establish an effective government to tackle the linked problems of piracy, poverty, hunger and war.

Both options require what the ship owners backing the Save Our Seafarers campaign say governments around the world lack — political will.

(You can contact the author at Debusmann@Reuters.com).

Photos: Top;  Hostages and pirates stand with their hands up before the intervention of Dutch NATO soldiers off Somalia’s coast in this NATO handout photo made available April 18, 2009. REUTERS/NATO/Handout  Bottom; Pirates on speedboat approach one of their mother boats docked near Eyl, Somalia in this framegrab made from a November 24, 2008 TV footage. REUTERS/Reuters TV


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[…] fred7004 posted about this interesting story. Here is a small section of the postWASHINGTON — In 2005, the average ransom paid for the release of a ship hijacked by Somali pirates was around $150000. By the end of last year, it stood at $5.4 million. That means revenues for the business of piracy more than doubled every year. The 2005 to 2010 percentage … Early in March, five of the world’s largest maritime organizations, complaining that “2000 Somali pirates are hijacking the world’s economy”, launched an advertising campaign and a website (www. … […]

Posted by Why high-seas piracy is here to stay | Bernd Debusmann | Analysis … — Debt Free Forever! | Report as abusive

I think the article has its merits, but overlooks the fact that if the international community as a whole begins to ignore certain standing agreements and customs, and just starts to use force on any suspicious vessels in the high-profile areas, there would be less enthusiasm to leave the shore to threaten and steal.

There are precedents for such actions, but it would not play well in the western media or human rights sectors, but these mentioned people have no vested interest. At all. It makes it much easier to complain about disproportionate force, despite the fact that innocents are detained, injured and killed by these same “helpless” ragtag forces that garner such sympathy from these groups.

Posted by dzoo35 | Report as abusive

#dzoo35: Good point. Blowing them out of the water without further ado would probably act as a deterrent. So would replacing “catch and release” with “catch and hang.”

Posted by Komment | Report as abusive

While I’m not defending the Somali pirates who are clearly breaking the law, isn’t their infraction being made easy by the corporate shipping chains who operate these giant cargo enriched beomoths with a staff of a few untrained chimps?

If I was their insurance company I’d be asking the same sort of ‘have you taken sufficient precaution’ questions as they do when the assessor comes round to my house and looks at the lock on my back door.

Posted by Seonyx | Report as abusive

We have billions of billions of dollars of hunter-killer subs without targets…
If the SOB’s never knew WHEN a ship had one loafing along behind submerged with AUTHORITY to fire upon contact from the escorted ship there would certainly be 1. fewer “pirates”, [assholes], and 2. less incentive.

We HAVE the technology from 30 years ago…

Just need the stones to USE it, and bill the company attacked for costs.

Posted by Bookmanpc | Report as abusive

Please refer to South Park season 13 episode 7 “Fat Beard” to make light of the situation. hehe

Posted by kc10man | Report as abusive

Might I suggest that Somalia may be the best place for us to try using unmanned mobile weapons systems. We can learn how to fight the wars of the future today. As our robots patrol the beaches for Black Beard and his gold our soldiers can work safely from computer desks in the Nevada desert.

Of course capturing and selling a robot fighting machine would be the real prize with countries like France and China sending special ops teams in at night to try and capture the robots.

Soon the beach would really descend into chaos when other countries start developing their own autonomous titanium warriors and put them to the test against ares. The only victims will be the locals whom, most are poor fishermen stranded on a battle field trying to catch something to eat between robot battles. Live on the Robot War Channel/Fox.

Posted by kc10man | Report as abusive

Terminator 5 “Life’s a beach”.

Posted by kc10man | Report as abusive

I dont see why we cant have predator drones flying over the somali coast shooting hellfires at any boat that leaves with weapons on it

Posted by Sandy106 | Report as abusive

I have the perfect solution to prevent the pirates from reaching their destination in Somalia. Install a steering wheel lock or rudder lock that once activated cannot be disabled; The steering rudder will be locked in a turning pattern, hence the ship will only go in circles. Deactivation can be figured out later.

Posted by mililani64 | Report as abusive

“But the problem lies on land. It lies in villages and port cities, in ungoverned spaces where…”
A few sorties of B-52s to carpet bomb the aforementioned land targets – problem solved. And also, as someone already suggested, switch from “catch and release” to “catch and hang”.

Posted by anonym0us | Report as abusive

Any unarmed ship that gets hijacked in that area DESERVES it. How stupid do you have to be not arm yourself for self defense? How hard could it be to blow them off the water? If they’re worried about the legality of what they’re doing, what country or what judicial system will actually rule against them?

Posted by Peanut345 | Report as abusive

Where there is a Will, there is a Way. I found that 100% true throughout life. There just isn’t any will, or we have those grownup kids from the 60’s and 70’s in government now who brains are fried.

Posted by DDavid | Report as abusive

Sadly these men have to resort to this. Nevertheless, the only way to stop them is to make it very nasty to be a pirate and caught. On the high seas, “don’t ask, don’t tell”. Otherwise expect even more piracy and it will spread from Somalia.

Posted by Boat52 | Report as abusive

I agree that the solution to the somali piracy is in the land it self. Somalia is a failed state populated with people who are not ready for democracy and self independent.
In this world of political correctnesss, somalia should be ruled under directly by any country willing to “colonialize” the countrt and break up the somalia into further three or four colonial administrative region.

In fact I believed, iron handedness are needed with clear calculated exploitation of the country , plus direct indoctrination and reeducation must be introduced to the level similar to the Orwellian standard.

In my opinion any so called ” western democracy” should be avoided and socialism with leadership democracy is in the order at later dates, where maybe a few century later where the entire somalian had been fully indoctrinated.

Posted by Geunchogowang | Report as abusive

The navies are patrolling for the commercial ships, the main traffic passing through those waters. The ship owners would rather the government take the cost on instead of themselves, as the risk is so low. Not only that, it is the governments economies feeling it in the pocket, much more then the ship owner. I’ll explain.

The solution is simple: All the shipping lines should carry armed contractors; some already do, and are allowed to.

However, let us look at the math for a large tanker company, with rough and ready numbers, operating VLCCs:

A VLCC costs $120m new.
Assume the VLCC costs $40,000 a day to charter.
Assume 50% of the charter is the cost: $20,000.
Assume net profit/day is therefore $20,000
Assume it is $5,000 for five contractors to defend it at $1,000 each a day.
Assume the boat spends 35 days per year in the safety of a port.
Assume this is a large tanker firm with 50 VLCC tankers.
Assume 5% of their fleet is pirated every year, 3 VLCCs.
Assume the average time to the release of a pirated ship is 150 days, and give the boat 30 days to be back in business: 180 days
Assume the boat is fully utilised minus the 180 days.
Assume no major maintenance was needed after release.
Assume the cost of the insurance/war time risk/crew/fuel is covered in the cost of the charter (within the 50%)

Cost of security:

5000 x (365-35) = £1.650m/ship/year

Protect the entire fleet in transit: 1.650m x 50 VLCCs = $82.5m/year for the fleet.

Cost of piracy:

($20,000 x 180 days x 3 VLCC) = 10.8m + (5m x 3) ransom = $25.8m


1. Difference is still over $55m in favour of paying the pirates compared to having security on every tanker, and that is with 3 of their ships being pirated every year.
2. A Closer, but still a high estimate, would be one ship pirated a year: $3.6m + $5m = $8.6m
3. Still over $70m in favour of the private shipping company. Note the word private.
4. The insurance covers the cost of the piracy, not sure if that includes the ransom.
5. The chance of being pirated is still relatively low. If a 1000 ships pass through those waters a month, and 10 are pirated that is 1% chance.
6. The above is very much based on assumptions, and just to give an idea of my train of thought, and what I think is the general picture.
7. It is because of figures like these that the pirates have got smarter and increased the ransom from $100,000 on 2005 to almost $10m in some cases, and still rising.

If my assumptions are correct, you can see what costs a country’s economy billions, costs the ship owner millions. Until the cost of charter hits $200,000/day the ship owner just doesn’t care, it is just another cost.

We already have enough on our foreign policy agenda to be sorting the Somalia problem out. You will hear/read/see a lot of talk from politicians, due to the incidents like the four Americans killed on their yacht, and now the Danish family, but no action. We just aren’t ready to commit the resources.

Especially now with the Arab World revolutions, it is not that high on the priority list, but we will come around to it at some point.
Libya, only very recently became a problem, and we are shifting huge resources to it. The piracy in Somalia has been ongoing since 2005.


Posted by sharpshot | Report as abusive

Americans killed and the current administration does nothing …par.

Posted by HaoBo | Report as abusive

Sharpshot: these are interesting figures and if you are right that the chance of a ship being hijacked is 1 percent, it’s clear that the other beneficiaries (apart from the pirates) of this are the maritime insurance companies. War risk premiums, in effect for the Gulf of Aden since 2008, have increased 300 fold from 2008 to 2010 and Kidnap and Ransom (K&R) premiums rose tenfold from 2008 to 2009.

Posted by Komment | Report as abusive

There is an easy solution to this: destroy all ports/harbors on the somali coast and prevent any reconstruction of them. We won’t interfere with their internal politics but we can prevent them from killing our people.

Posted by pcasinelli | Report as abusive

[…] were holding. Ruthless new breed of Somali pirates craves riches, not revenge – Washington Times Why high-seas piracy is here to stay | Bernd Debusmann | Analysis & Opinion | Reuters.com Look like people in charge are happy to say the only solution to piracy is on land rebuilding […]

Posted by USA impotent against pirates ? – US Message Board – Political Discussion Forum | Report as abusive

The problem is lack of political will to do something as simple as killing the pirates. The “catch and release” nonsense needs to change to kill on sight. For over 300 years killing pirates on sight has been the law of the sea. 200 years ago a much smaller but better lead USA sent its Navy and Marines across the ocean to successfully attack and kill pirates in Tripoli, Libya. Hence “to the shores of Tripoli” in the Marines’ Hymn.
Another solution: ships in the region should carry security guards with machine guns. Announce to the Somalis that on the open sea, any boat approaching within 100 yards will be fired on, sunk, and NO survivors picked up.

Posted by Frank738 | Report as abusive

The solution is not coming down to their level with random violence (those pirates are desperate with little to lose), but eliminating the power of those who are controlling the pirates – you know, the bankers, politicians, and financiers who handle the ransoms. And they probably are not in Somalian. To solve this and all political instability problems, follow the money.

Posted by quasarquark | Report as abusive

So what is he saying? Nuke the country? Well I guess I would.

Posted by tomtomtom | Report as abusive

Why do the shipowners need to hire contractors? Don’t their crew members know how to aim and fire ax gun? Ships and yachts sailing in those waters should be required to carry defensive weapons–AK47’s, RPG’s, etc. After a few pirates grt shot, piracy will stop!

Posted by Marson | Report as abusive

[…] Reuters (blog) […]

Posted by Rola Pao News » Krishna speaks to Egyptian Ambassador on Indian hostage issue – Economic Times | Report as abusive

Oil tankers are essentially floating bags of oil. They don’t have to be very durable. Oil is lighter than water. Seawater is more buoyant than fresh water. The photo of the captured dingy says it all. All any of those pirates has to do is fire an incendiary device and the show is over.

That’s why they are so vulnerable. Shooting wars won’t help. The pirates don’t even need a port. What can they do with several hundred thousand barrels of crude anyway?
And that is very likely why the companies pay the ransom. If it is a natural gas tanker – it would be a bomb.

There may be no solution in the absence of a working Somali government. Or the oil companies have to get used to loosing shipments and the coast of N. Africa gets very greasy with no one to clean it up.

Posted by paintcan | Report as abusive

excuse me – I know where Somalia is – East Africa. I just tend to think of it as in the northern half of the continent. I have a globe and forget to look at it.

Posted by paintcan | Report as abusive

Most of the comments on here are listing various ways to kill people. bleh.

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