The Threat of Piracy

The golden age for Somali Piracy was 2009 to 2011- it’s fairly accepted that Somali pirates haven’t hijacked a major vessel since 2012, that however is not to say Somali pirates have all gone away. Mary Harper of the BBC said it best, “pirates are sleeping.”

At the present piracy in Somalia exists- albeit at a much reduced level. There are numerous incidents that have been classified as pirate approaches. The map to the right shows all reported approaches, sightings and attacks from 2014.

The pirate groups that are operating do so at a reduced level, their activities have been limited by changes onshore in Somalia as well as counter piracy activities at sea. But those that remain in business as pirates retain their capabilities.

In addition there are other pirate groups in existence that at present use the proceeds of piracy to fund other commercial ventures both legal and illegal, as opposed to conducting pirate operations. Business such as hotels, airlines and even Somali based maritime security firms have all sprung up as a result of piracy.

It is now accepted by most commentators that Somali piracy has diminished. The question is why and can it return? In the next section we will elaborate on the causes for reduction and finally examine if we could perhaps see Somali pirates resurgent in the future.

Changes on Land

Somalia has seen actual improvements in terms of political stability since mid-2012 and the vacuum created by the long civil war is being filled by regional administrations- Federal Member States. However despite the progress that has been seen so far, there remains a significant amount to be done before a comprehensive political and constitutional settlement that guarantees a permanent end to piracy is achieved.

While the established pirate networks still exist, there have been developments in both the security dynamics and political parameters onshore in Somalia, removing much of the local support. The Somali piracy model- as opposed to the Gulf of Guinea or South-East Asia- relied on ability to hold hijacked vessels close to a secured coastline where they would enjoy the protection of local militia and enjoy accessibility for ransom drops. In the absence of a safe port, Somali piracy as a model cannot operate.

Economics

Somali piracy was in its early days a benefit for coastal communities who saw employment and investment of pirate funds and this in turn boosted local economies in the most cash starved areas of Galgaduud and Puntland.

Piracy grew because local communities saw the pirates as saviours who worked to protect them from illegal fishing activities. Prior to the development of piracy in the mid-2000s, local communities were seriously affected by illicit maritime activity including foreign fishing vessels were shooting at coastal fishermen operating 2-3 miles from the shoreline, damaging vessels and fishing nets. Once piracy took hold, local communities saw them as a meal ticket. This escalated to the point that those host communities very soon became hostage to powerfully armed and wealthy young men.

Over time as the industry grew the positive economic impact of the early days disappeared. The influx of money into coastal communities led to massive inflation and destruction of the local lifestyle. In addition coastal communities suffered when their young men joined pirate groups and never returned either dying at sea or being arrested and imprisoned overseas.

In short piracy to start protected local communities, but over time became a curse. This was the death knell of the previous piracy business model.

Politics

At the same time as local communities were rejecting the presence of pirates in their midst, a new political solution to Somalia’s woes was forming. The 2012 “election” of the Federal Government saw regional administrations attempting to exert control over their territory as a means to achieve political legitimacy and be a part of the political solution to Somalia going forward.

The Provisional Constitution allows 2 or more regions to form a Federal Member State and becoming relatively self-governing under the umbrella of the Federal Governmental system. There was an exception built into the Constitution that states in existence- re Puntland- could continue to manage their own affairs until differences between the Puntland and Somalia constitutions are settled. But to demonstrate self-rule, Puntland had to be able to show it was in control, it therefore became politically expedient to repress piracy in Puntland.

Changes at Sea

Counter Piracy Activities

At the same time as we have seen changes on the ground in Somalia we also saw developments at sea which have affected the return on investment for pirate groups. Naval Forces, Vessel Hardening and Armed Guards have come together to create a situation where pirates that do launch expeditions are unlikely to meet success. With a diminished return on investment it is in the pirates interests to look at other commercial opportunities that provide a better return.

The corollary to the cost of launching a pirate group and not seeing a return is that all the counter-piracy efforts also cost the shipping industry and if there a vessel is not attacked it is understandable that ship owners see the investment in armed security as a loss. However if there are no armed guards and a vessel is hijacked what is the cost then? The unfortunate reality for ship owners is that they are in a vicious circle where they need to embark security even though the risk of piracy is low pirates only need to be lucky once.

The Future Threat

A Return to 2009-2011?

Pirate groups have plenty of roadblocks to success in their way as the previous section I hope has shown. But despite the cost of piracy and the vast sums utilised to repress it at sea there has been little investment to prevent piracy on land in Somalia. There still remains over a thousand kilometres of coastline without any formal security presence. As piracy has become more difficult, pirate groups have sought to use the proceeds from piracy to conduct both legitimate and illicit activities. For example- in the ultimate irony- operating as maritime security companies and protecting illegal fishing fleets inside Somali territorial waters. So while pirates remain, the threat they pose has diminished because they lack bases and because of the counter piracy effort- including armed guards and naval forces.

The bases used by pirates in Puntland cannot be revived without a major change in the state administration. Politically and financially it is not in the best interests of Puntland state to allow pirates back into coastal regions. Not least because it would undermine the funding for the PMPF they obtain from the UAE and the funding for various government and security structures they receive from the EU and UN.

Galgaduud could see a return of pirate bases though as it remains an unstable region, divided among competing clans with the Galgaduud Administration unable to guarantee security in their Administrative seat- Gaalkacyo- let alone the rest of the region. Al-Shabaab and criminal groups regularly exploit this weakness to use Galgaduud as a base. Indeed the former pirate hubs of Hobyo and Haradheere remain outside of Federal Government control- with Harardheere under the control of Al-Shabaab who have access to the maritime domain through the port.

On land we could see the return of Somali piracy, if the current political progress ends and AMISOM (which has created space for political dialogue) is withdrawn. While regional and international security interests would suggest this is unlikely, given the fractious nature of Somalia it is possible. If anything, the political progress from 2012 has come at the cost of perpetuating clan feuds and Somalia is slowly dividing into Federal Member States dominated by single clans at the expense of less powerful clans. This creates the potential for regional administrations to fall apart, indeed we have seen this most recently in Galgaduud where the Federal Government’s forces clashed with a powerful Sufi militia over the future of the region.

While bases are important counter piracy activities have also had an impact on piracy, though less than many people think. But as long as armed guards and naval forces are present, the launching of a pirate expedition is a hit and miss affair. If it goes well and the pirates have a place to store a vessel then it would result in a ransom, if however they encounter a vessel with armed guards it represents a loss of investment.

If the shipping industry moves away from the armed security model currently in place to either a reliance on naval forces or a reduction in alertness because the attitude that there is no more threat, conditions could be right for Somali pirates to again move to sea.

Over the last year the maritime security industry has already seen a reduction in the number of vessels carrying armed security and at the same time a reduction in the quality of many maritime security personnel. Many shipowners are looking at the economics of security, balancing the cost of a maritime security team against the perceived risk. While many shipowners remain prepared to embark an armed security team they are looking for more cost effective solutions than at the height of Somali piracy. The result has been a consolidation of the maritime security industry and an overall reduction in the prices charged to shipowners. An unintended consequence of the reduction in prices is that several maritime security companies have met financial troubles with at least 2 going bankrupt and others needing financial bailouts. Equally unintended are the means some maritime security companies have employed to provide security at a lower cost, including using non-European personnel, untrained personnel and 2^nd rate equipment.

However as long as maritime security exists and more importantly is seen to exist it does provide a deterrent factor to Somali pirates, which coupled with the onshore situation suggests that we will not see- at least short term- a return to the 2009-2011 situation.

An Evolution of Piracy?

While Somali piracy may not return to 2009-2011 levels it is equally important to realise that we could see an evolution of the model.

Somali pirates have always concentrated on taking and holding vessels as the means to ransom. However there is a growing realisation among them that hostages are equally as valuable- even if ransoms are much lower. The benefits to pirates by taking hostages as opposed to ships is that hiding them is much easier. One need only look at the recent releases of Michael Scott Moore (kidnapped Gaalkacyo 2011); crew of the Asphalt Venture (held since 2010) and the crew of the FV Prantalay 12 (taken in 2010). In all 3 cases hostages were held for several years and ransomed for significant amounts- Michael Scott Moore was exchanged for $1.6 million.

With foreign hostages on their own without a vessel being worth ransoms, it is definitely possible that Somali pirates could seek to expand that model. Perhaps we could see Somali piracy becoming something more akin to the kidnap threat in the Gulf of Guinea? Certainly it is an option that is considered by Somali pirate groups.