Shipping Podcasts finalists for Maritime Media award

Almost speechless about the @ChathamHouse report on Piracy

By • Jan 13th, 2012 • Category: Piracy

I have to admit to being almost speechless about the Chatham House report on piracy (January 2012)

I understand that it is written from an economists point of view, however, the lack of discussion and consideration to our seafarers in the report is frankly disgusting.

I did a quick search to find how many times certain words were used:

Seafarer – 0
Mariner – 0
Crew – 4
: 3 refer to the crew on the pirate vessels and 1 refers to the victims. The reference is:

“As the piracy business is based on ransoming the crew, hostages are treated reasonably well”

You can read the report here and you might also like to see the BBC story on the report

In the summary points, the report states,

“The positive economic impacts of piracy are spread widely and a military strategy to eradicate it could seriously undermine local development.”

Wow! The implications of that statement are immense!

The first thing that most people tend to focus on with piracy is the financial cost. Some estimates put this burdon as high as $12bn a year. That’s a lot! But hang on, what about the human cost? These hostages are real people. And they’re moving goods for our consumption. Surely there is some possible way to encourage and nurture development of Somalia as a country and to improve the lives of its poor, deprived people that doesn’t revolve around ruining innocent seafarers lives…

In the summary of the analysis of their data the report writer states,

“The data analysis indicates pirate incomes have widespread and significant positive impacts on the Somali economy….. There are clear trickle-down effects for casual labourers and pastoralists because of higher cattle prices.

Although there are concerns about data quality, analysis of the exchange rate changes used to establish the impact of piracy money on the local economy correlates with traditional intelligence sources.”

Concerns about data quality? Is that the authors real concern? [Takes deep breath]

In the final conclusions the author notes:

“The conclusion that a large group of people can be expected to benefit from piracy should not discourage the international community from seeking a land-based solution. The total cost of piracy off the Horn of Africa (including the counter-piracy measures) was estimated to be in the region of US$7–12 billion for 2010, while ransoms were said to be in the region of US$250 million.

Even if Somali communities received all of the ransom money, replacing this source of income (for example with a combination of a foreign-funded security forces and development aid) would be considerably cheaper than continuing with the status quo.

A negotiated solution to the piracy problem should aim to exploit local disappointment among coastal communities regarding the economic benefits from piracy and offer them an alternative that brings them far greater benefits than hosting pirates does. A military crack-down on the other hand would deprive one of the world’s poorest nations of an important source of income and aggravate poverty. ”

Yes, I do understand that the argument could be made that by understanding the benefit that the piracy industry has on the Somali economy that a solution can be negotiated for finance for the country that replaces their need for piracy. But to my mind that argument is well hidden in this report.

What do you think of this report? Please leave your comments or tweet me @jtweed