The Pirate Den
Inside the modern business of wreaking havoc on the high seas.
LESS THAN A DECADE AGO, the world was congratulating itself on a job well done. The most treacherous international shipping lanes through the Strait of Malacca and the Singapore Strait had finally been tamed after years of brazen pirate attacks. But a far more dangerous threat soon emerged, with more spectacular seizures of cargo and skyrocketing ransoms: Somalia’s pirates. With a long coastline, lawless shores, and a steady stream of vulnerable targets, the quintessential failed state is a buccaneer’s dream. Attacks there went from 16 percent of the global total in 2007 to more than half last year with no end in sight, despite intensive international efforts to protect the seas. Today’s pirates are maddeningly difficult to stop, and it has much to do with who they are: ransom-seeking cartels with sophisticated financial backers. These aren’t your great-grandfather’s brigands — they use advanced geographical positioning equipment to trace targets and carry a bountiful supply of small arms. They ply their trade in the world’s ungoverned spaces, relying on corrupt and compliant officials to look the other way.
What They Want
Pirates are after just one thing: booty. Be it monetary or material wealth, what pushes pirates to sea is the hunt for their next payday. And it’s not just the now-infamous ransoms collected almost weekly off Somalia’s deadly shores. Pirates also steal anything they can — crew equipment, electronics, clothes, or even the ship itself. Of the 980 successful attacks in the last five years, 527 involved theft of goods onboard. In fact, it’s the preferred model in Southeast Asia, South Asia, South America, and the Gulf of Guinea. Hijacking and kidnapping, by comparison, most popular off the coasts of Somalia, Nigeria, and Malaysia, occurred 159 times during the same period, with 867 individuals captured off Somalia in 2009 alone. Is piracy ever about more than just loot? The sole exception might be Nigeria, where it has taken on an overtly political character. There, local movements seeking a more equitable division of Nigeria’s oil wealth have targeted rigs and offshore installations, kidnapped foreign oil workers, and bunkered oil. Little evidence shows pirates targeting specific people or industries elsewhere; they simply select the most vulnerable and potentially lucrative targets.
Pirates seek high rewards with minimal risks, making Somalia — the world’s least-governed state — the perfect pirate haven. It has the longest coastline in continental Africa, and more than 20,000 ships pass annually through channels nearby. Even with a low success rate for attacks, the combination makes the potential for ransoms enormous. Meanwhile, the risks are small. Of the 650 Somali pirates caught since late 2008, 460 have already been released, according to Lloyd’s Market Association, the research arm of the famous insurance exchange. In Africa, only Kenya and the Seychelles have agreed to prosecute suspected pirates. Nor is there much chance that pirates will get shut down on shore; local authorities are often all too happy to take a cut of the profits.
The Somali pirate business began relatively benignly when disgruntled local fishermen took to forming a “coast guard” to expel foreign trawlers taking advantage of the country’s inability to patrol its shores. But today, piracy is a well-organized, modern-day business backed by deep-pocketed financiers. The average Somali makes far less than $1,000 a year; even low-level pirates can make upwards of $20,000.
Avoiding modern-day piracy is expensive. Ships’ insurance rates skyrocket, alternative courses add time and money to a trip, and ransom payments can run into the tens of millions. As of March, Lloyd’s had named 19 countries (either in whole or in part) as “war risk zones,” a designation made by the association’s aptly named Joint War Committee. Ships sailing through these zones have the options of either rerouting their course or paying higher fees, depending on the ship and its cargo. Unfortunately for shippers, avoiding the Gulf of Aden, easily the world’s most dangerous route, adds two to three weeks to the journey. As a result, most companies accept the rate hike and take their chances.
Although it makes fewer headlines, piracy is also a significant problem outside the Horn of Africa. In fact, pirate watchers worry most of all that Somalia will offer a powerful example to criminal forces in other weakly governed states: that if they take up the profession, they too can take minimal risks and win sky-high rewards.
False Flags Who suffers the most from piracy is anyone’s guess. German, American, Japanese, or Turkish ships, for example, often don’t fly their own flags; instead, they register with 32 “open registry” countries, such as Panama and Liberia, that sell “flags of convenience.” Shippers simply pick which country’s laws best suit them, and often, that means the one with lower labor standards, fewer taxes, and laxer safety standards.
Piracy has been stopped before, and not just by the British Empire. Indonesia, for example, made rapid strides against piracy in the past decade. Today, a flotilla of ships from 17 navies patrols Somalia’s coast. But with just a handful of vessels matched against a pirate playground larger than the Mediterranean, the plunder goes on.