WORLD
Somalia Piracy Leads to Economic Development
Baku, January 14 (AZERTAC). French luxury boat Le Ponant was hijacked by Somali Pirates in April 2008. About $200,000 in suspected ransom money was recovered after French Special Forces freed the ship. Because pirates tend to invest the spoils of their hijackings in local communities, a new report by Chatham House advises these needs to be taken into account in any anti-piracy strategy.
While certainly damaging to the international shipping industry, the fruits of Somali piracy are benefiting more than a handful of criminals—they`re being shared with the greater community, a new report based on satellite imagery has found.
“The international community should bear these results in mind when developing land-based strategies to resolve Somalia`s pirate problem,” stated Dr. Anja Shortland, the author of the report for British think tank Chatham House.
The context of the research was to shed light on the financial impacts of piracy in Somalia to help the international community develop a land-based approach to fighting the scourge of piracy on the Horn of Africa. It is estimated that in 2010, piracy cost the international community between $7 billion and $12 billion.
Somalia has been without a central government since 1989, making it difficult for analysts to obtain data on economic activity in the country.
To glean the situation on the ground, researchers took into account two types of data. One set, compiled from international non-government organizations, showed that large portions of the ransom money were being converted into the local currency that cattle prices had gone up along side the rise of piracy, and that piracy earnings helped offset the impact of food price spikes in 2007-2008.
Several years of international counter-piracy measures combining the efforts of over 30 nations have helped reduce the number of successful pirate hijackings.
A report from the International Maritime Bureau found that although in the first nine months of 2011, hijack attempts were up compared to the previous year—199 attempts versus to 126 during the same period of 2010—the success rate of piracy was down. Pirates only managed to capture the target ship 12 percent of the time in 2011, compared to 28 percent the year before.
Given the situation, international strategists are looking at the options for land-based solutions, such as substituting piracy income for another source.
A solution “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.