Pirate Stock Exchange Open for Business

For those still peddling the line that piracy is carried out by poor, starving Africans, victimized by evil European fisherman, this article not only provides evidence to the contrary, but speaks to the advanced nature of it in both a business and social sense.

It is a lucrative business that has drawn financiers from the Somali diaspora and other nations—and now the gangs in Haradheere have set up an exchange to manage their investments.

[...] “Four months ago, during the monsoon rains, we decided to set up this stock exchange. We started with 15 ‘maritime companies’ and now we are hosting 72. Ten of them have so far been successful at hijacking,” Mohammed said. “The shares are open to all and everybody can take part, whether personally at sea or on land by providing cash, weapons or useful materials … we’ve made piracy a community activity.”
[...] “The district gets a percentage of every ransom from ships that have been released, and that goes on public infrastructure, including our hospital and our public schools.”

Reading the article, I almost think I’m reading Global Guerillas. As pirates continue to extend their reach offshore, and Western nations continue to needlessly devise ridiculous non-lethal anti-pirate weapons, despite the fact that the problem of piracy was solved centuries ago with firearms, it would seem naive to believe a few semi-coordinated naval ships unwilling to actually use lethal force will solve the problem. If anything, I’d wager that piracy will actually increase due to the international naval presence as that will drive up the profit margin for successful raids, similar to the failed American War on Drugs where the DEA serves only to maintain and ensure the profitibility of drugs.

Lastly, given a previous Wired article discussion of the international side of the business, this blogger wonders whether such a new “stock exchange” will further internationalize the business past the traditional diaspora connections and secondly, whether this could be an early attempt, or even precedent for similar “black stock exchanges” in other illicit businesses such as drugs, weapons, people and other smuggling for example. If decentralization and internationalization are key driving forces in crime and terrorism, it would seem that “publicly traded criminal enterprise” may be a logical extension. Readers?

Younghusband

Younghusband
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October 7th, 2009

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Making pirates hostes humani generis again

It be a Pirate Flag!
Image from Nick Humphries

“[L]ast year less than one-half of one percent of ships transiting the Horn of Africa were attacked, and most of those attacks were not successful.” Despite those low odds Max Boot goes on to argue in Pirates, Then and Now (Foreign Affairs subscription required) that governments should “make ship owners and insurers take the problem [of piracy] more seriously”. His reasoning is twofold: 1) piracy threatens sea lanes through which half the world’s cargo and a third of Europe’s oil is shipped; and 2) “piracy may wind up underwriting an extreme Islamist movement”. Granted, those are pretty serious stakes. However Boot refuses to do any sort of cost-benefit analysis to determine whether taking the problem “more seriously” is in our interest. He just seems to be itching to hang those scurvy seadogs.

Not to say that the article is pointless. It is a great read for his sweeping history of piracy from the 17th century and his overview of anti-piracy strategies to those from the age of sail. For example:

Countries took a dozen or so steps to safeguard the seas during the pirate wars that stretched roughly from 1650 to 1850. These included changing public attitudes, hiring private pirate hunters, rooting out corruption, improving the administration of justice, offering pardons to pirates who voluntarily surrendered, increasing the number of naval ships dedicated to antipiracy duty, cooperating with other nations, convoying merchant ships, blockading and bombarding pirate ports, chasing pirates both at sea and on land, and, finally, occupying and dismantling pirate lairs.

These days ship owners and insurance companies accept increased insurance premiums due to paying out million-dollar ransoms on that less than half of one percent of ships hijacked. It is probably cheaper than sending the navy in, and arming up crews will only escalate the violence, right? Boot replies:

Similar concerns once led airlines to tell crews not to resist hijackers. This approach changed after 9/11, and one hopes it will not take a similar disaster at sea for ship owners to reconsider their policies.

Boot suggests some policies that would help close the gap between modern times and the 17th century. First of all, the US and UK need to stop the shrinkage of their fleets and buy more warships (Boot recommends the LCS). Until the fleet gets back up to scratch, let private security companies fill the gap. That said, Boot thinks reviving letters of marque might be a step overboard (to coin a phrase). The biggest problem that needs tackling is the legal situation: there are no clear-cut rules of engagement. Pirates picked up by military forces are treated as civilians and the web of international human rights laws and conventions make prosecution convoluted. Much like terrorists, there exists no international criminal court for suspected pirates. As German defence minister Franz Josef Jung said: “No one wants a Guantánamo of the sea.”

In fact, I agree with Boot on all accounts. These are all good suggestions — especially the comments about preventing the deterioration of navies and the proposal for new laws for processing captured pirates. These things need to be done, regardless of the current craze over piracy. Note that I am agreeing in the general while disagreeing with Boot’s position as it is stated specifically in this article. It seems to me that Boot is too focused on piracy itself. It reminds me of how the security community a few years back was overly focused on “the terrorists”. Remember: terrorism is a tactic, not an entity. The same could be said of piracy. And like terrorism, tackling root causes could be more effective (and economic) than simply blasting each individual Blackbeard out of the water. Remember what Kaplan said: Anarchy on Land Means Piracy at Sea.

Related: Being realistic about maritime terrorism

Munro Ferguson

MF
Date

April 27th, 2009

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Anti-pirate water cannon

force-80-anti-pirate-cannon

Got pirates? Then you need the Force 80 Anti-Pirate water cannon!

force80_bat_2

With a range of 90 meters, a flow rate of 1320 gallons per minute (by comparison a firefighters “attack line” pushes 300 gpm) this is an impressive piece of non-lethal weaponry.

Via PirateSafe.

Chirol

Chirol
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April 12th, 2009

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Kaplan’s Latest on Piracy

Thanks to Chief Wiggum for a head’s up on Kaplan’s latest article in the New York Times entitled “Anarchy on Land means Piracy at Sea”
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PIRACY is the maritime ripple effect of anarchy on land. Somalia is a failed state and has the longest coastline in mainland Africa, so piracy flourishes nearby. The 20th-century French historian Fernand Braudel called piracy a “secondary form of war,” that, like insurgencies on land, tends to increase in the lulls between conflicts among great states or empires. With the Soviet Union and its client states in Africa no longer in existence, and American influence in the third world at an ebb, irregular warfare both on land and at sea has erupted, and will probably be with us until the rise of new empires or their equivalents.

Somali pirates are usually unemployed young men who have grown up in an atmosphere of anarchic violence, and have been dispatched by a local warlord to bring back loot for his coffers. It is organized crime carried out by roving gangs. The million-square-miles of the Indian Ocean where pirates roam might as well be an alley in Mogadishu. These pirates are fearless because they have grown up in a culture where nobody expects to live long. Pirate cells often consist of 10 men with several ratty, roach-infested skiffs. They bring along drinking water, gasoline for their single-engine outboards, grappling hooks, ladders, knives, assault rifles, rocket-propelled grenades and the mild narcotic qat to chew. They live on raw fish.

The skiffs are generally used to launch attacks on slightly larger crafts, often a fishing dhow operated by South Koreans, Indians or Taiwanese, taking the crews prisoner. In turn, they use the new ship to take a larger vessel, and then another, working up the food chain. Eventually, they let the smaller boats and crews go free. In this way, over the years, Somali pirates have graduated to attacking oil tankers and container ships; the bigger the vessel, the higher the ransoms, which the pirate confederations can then invest in more sophisticated equipment.

Read the rest here.

Incidentally, Michael Waller at Politicalwarfare.org, who I recently saw speak, recommends “speaking” to pirates in a language they can understand. He recommends shoot-on-sight orders with which I wholeheartedly agree. A few dead pirates hanging from the bows of American warships wouldn’t hurt either. More on that soon.

Munro Ferguson

MF
Date

April 11th, 2009

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“Stop calling them pirates”

So says the FP’s Annie Lowery:

It’s a sorry, sorry state of affairs. And it suggests two things to me.
First, pirate exhaustion looms. (Though we’ve tested the limits on this blog, and found them boundlessly wide.) At one point, the pirates seemed a welcome distraction. Not so much any more—people are dying, Somalia is a failed state. Second, as others have suggested, we should stop calling them pirates and start calling them something like “maritime terrorists,” to end any remaining romanticization.

I have to wonder who reads about or watches coveragegallery-somali-pirates-pi-0041 of Somali piracy and envisions Long John Silver or Jack Sparrow. I’m pretty imaginative but Somali piracy doesn’t exactly jive with Treasure Island or Pirates of the Caribbean. Maybe it’s just me but “Avast, ye scurvy dog!” just doesn’t fit the image of a Somali standing on a tanker or freighter, waving an RPG around while waiting for a helicopter to drop a bundle of cash. Maybe a century or two from now history and popular culture will have polished the Somali pirate up a bit and some enterprising author or movie director will have a go at the romantic and swashbuckling adventures of Abdul Hassan.

I’m not too keen on any new terminology that contains the word terrorist. It’s a term bandied about too easily and too often and doesn’t, in my opinion, fit the nature of a Somali pirate. There’s a bit of a difference between a sustained, murderous campaign of bloodshed and holding ships for ransom.

I think a more fitting term would be one that indicates criminality rather than terrorism. “Maritime armed robbers” or “blue water hijackers” or maybe something simple like “pirates.”

Younghusband

Younghusband
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January 4th, 2009

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On the potential Japanese naval dispatch to Somalia

Shot of MSDF Flag by Kamoda

My first reaction to hearing about prime minister Aso’s push to get the Japanese Maritime Self Defense Force in the Gulf of Aden helping to combat piracy was bandwagoning. Here is a typical example of Japan showing international leadership… six months late. That elusive seat on the UN security council does require that Japan show some leadership.

Still, the timing seems odd and there is already a whole swack of countries with a military presence in the Gulf of Aden. Why now? As the Asahi notes “deliberations are unlikely to start in earnest until April at the earliest, after the passage of the fiscal 2009 budget.” Prime minister Aso will have a hard time pushing anything through before then. Aso is suffering serious confidence issues. With the concerns of the electorate focused solidly on the economy and pensions, I would hope Aso would know not to go the route of Shinzo Abe. Read the rest of this entry »

Chirol

Chirol
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December 11th, 2008

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Anti-Pirate Security Initiative

In 2003, in response to legal loopholes regarding confiscating WMD related materials and increasing concern by the US and others about proliferation, the US launched the Proliferation Security Initiatve (PSI). The beauty of the PSI is that it is not a formal organization. There is no secretariat, annual meetings, dues and so forth. Most importantly, there are no new additional laws, rules or protocols for participating countries to pass, accept or follow. It is a type of coalition of the willing in which member countries navies cooperate in boarding and searching ships suspected of carrying illegal WMD related materials.

For example, a Madagascar flagged ship is suspected of carrying nuclear technology to Iran. The US is following it but does not have a legal agreement with Madagascar (just a random country as an example) to board each other’s ships. However, fellow PSI participant Australia just happens to. The US then asks Australia to stop and board the ship in line with its pre-existing bilateral agreement. Thus, it is a beautiful, flexible and so far successful organization.

It is always difficult to form a new international organization, especially something to deal with piracy where issues like deadly force, detention, prosecution and so forth are involved. Using the PSI as a model, I suggest forming something similar for dealing with pirates, whether in Somalia, West Africa, S.E. Asia or elsewhere. Thus, I recommend the White House form a group to compile existing maritime laws (maybe YH knows some?) to investigate how a type of ad hoc group can be established to fight this ongoing threat.

Curzon

Curzon
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November 21st, 2008

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Hostile Takeovers or Good Corporate Governance?

Somali piracy has become a major news item, and most are blaming Somalia’s chronic anarchy. In truth, the pirates have become a highly organized business that originates in the stable civic society of Puntland in the north, not the chaos of the warring south.

le-ponant-mv-faina-sirius-star.jpg
Somali pirates who previously targeted small vessels have grown in sophistication and have now hijacked luxuy liners, container ships, and now supertankers.

Somali piracy has been headline news over the past half year. In April, pirates off the coast of Somalia took control of Le Ponant, a French luxury yacht. In October, the Ukrainian cargo MV Faina was captured, which included in its hold 25 armormed tanks. And earlier this month, a tanker carrying oil up to $100 million in value was hijacked off the coast of Somalia. Shipping “war insurance”—covered previously at CA here—is becoming expensive, as ships such as the Sirius and Le Ponant, previously thought to be beyond the grasp of pirates, are now seen as vulnerable. The range of the Somali pirates is growing as well. Until just last month, ships were thought to be safe if they kept 200 nautical miles from Somalia, but the Sirius Star was 450 nautical miles from the coast when it was hijacked in a lightening 16 minute takeover. Read how another tanker captain avoided capture with S-manuevers and other unpredictable navigation here.

Some analysts write fearful tracts that the pirates have links with terrorists and extremists, that the chaos is a direct result of international neglect of Somalia, and try to link pirates to the islamist insurgency that control much of the south or the recent terrorist bombings in Somaliland. This is nonsense. The origins of Somali piracy are not found in the southern half of the country, where a “transitional government” is dueling the Union of Islamic Courts with the half-hearted assistance of the Ethiopian military. Somali piracy originates in Puntland, a self-declared autonomous region of Somalia at the horn, hailed for years by policymakers as a model of a stable Somali state. Read the rest of this entry »

Curzon

Curzon
Date

October 2nd, 2008

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Kaplan on the Benefits, and Innocence, of Piracy

As U.S. Navy warships continue to surround the Ukrainian cargo ship holding weaponry in the Gulf of Aden recently hijacked by Somali pirates—who, realizing the reality of their situation, decrease their ransom daily—our patron saint Robert D. Kaplan writes about an unintended benefit of piracy: multilateral cooperation among the world’s navies.

The one upside of piracy is that it creates incentives for cooperation among navies of countries who often have tense relations with each other. The U.S. and the Russians cooperate off the Gulf of Aden, and we might begin to work with the Chinese and other navies off the coast of Indonesia, too. As a transnational threat tied to anarchy, piracy brings nations together, helping to form the new coalitions of the 21st century.

Kaplan also gives a beautiful summary of what life is like as a pirate, abridged and bolded below by myself:

Somali pirate confederations consist of cells of ten men, with each cell distributed among three skiffs that are ratty, and roach-infested, and made of decaying wood or fiberglass. A typical pirate cell goes into the open ocean for three weeks at a time, navigating by the stars, equipped with only drinking water, fuel, grappling hooks, short ladders, knives, AK-47 assault rifles, and rocket-propelled grenades. They bring millet and qat (the local narcotic of choice), and they use lines and nets to catch fish, which they eat raw. One captured pirate skiff held a hunk of shark meat so tough it had teeth marks all over it. Their existence is painfully rugged.

The classic tactic of Somali pirates is to take over a slightly larger dhow, often a fishing boat manned by Indians, Taiwanese, or South Koreans, and then live on it, with the skiff attached. Once in possession of a dhow, they can seize an even bigger ship. As they leapfrog to yet bigger ships, they let the smaller ships go free. Because the sea is vast, only when a large ship issues a distress call do foreign navies know to look. If Somali pirates hunted only small boats, no warship would know about the piracy.

Off-hand cruelty is the pirates’ signature behavior. “Forget the Johnny Depp charm,” one Navy officer told me. “Theirs is a savage brutality not born of malice or evil, like a lion killing an antelope. There is almost a natural innocence about what they do.”

Chirol

Chirol
Date

June 3rd, 2008

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Bye Bye Sovereignty

The UN resolution allowing other countries to violate Somalia’s territorial waters in pursuit of pirates (as discussed before here) has passed.

The UN Security Council has unanimously voted to allow countries to send warships into Somalia’s territorial waters to tackle pirates. The resolution permits countries that have the agreement of Somalia’s interim government to use any means to repress acts of piracy for the next six months.

Somalia’s coastal waters are near shipping routes connecting the Red Sea and the Indian Ocean, and the country’s government is unable to police its own coastline. Consequently, piracy is rife off Somalia’s 1,800 mile-long coast, says the BBC UN correspondent Laura Trevelyan. The resolution was drafted by France, the US and Panama.

Our correspondent says France originally wanted to expand the motion to allow piracy to be tackled in other areas, such as West Africa. China, Vietnam and Libya said they voted for the measure because it only applies to Somalia, and does not affect the sovereignty of other countries. But diplomats say the Security Council action is significant because it is using the force of international law to allow navies to chase pirates and armed robbers.

Security Council envoys are holding separate meetings in Djibouti with the Somali government and the opposition at a luxury hotel on the shores of the Red Sea.

Once you go down this route, what are the chances it will be undone? How long will it be until Somalia could realistically fight piracy as well as the West? I imagine the resolutions 6 month period of validity is a direct result of tricky questions like this.