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Piracy at sea is not a concept which nowadays can be only related to the pages in adventure novels or the stories about freebooters, buccaneers, corsairs and pirates. The temptation of a “business” which potentially represents huge profits found in a merchant ship with limited resources and training for the defence of their security[1] has lead, especially during the last decades, to a reappearance of the problem derived from illegal acts.
Not less fearful than their predecessors, pirates nowadays keep on showing themselves as cruel and desperate criminals in lots of cases, and they do not doubt to hurt their victims, sometimes even unnecessarily. The attacks are usually violent and crewmembers´ damage and/or death are produced many times. However, the effects of these attacks spread out further than their direct victims, as the maritime companies suffer significant economic losses derived from their cargo robbery, the rise of insurance premiums and the ransoms paid for vessels and their crew kidnapped; and indirectly their reputation is a disgrace to their clients (especially the other parts of the contracts of affreightment and consequently additional costs arise.
Nowadays maritime piracy is not a problem which only concerns to those devoted to the maritime commerce or which is typical of a particular region; it is actually a worldwide problem of international nature. The situation regarding piracy at sea has decidedly become unacceptable; but as hard as it may seem, we have to look at this problem from the perspective of the governments and their politicians’ point of view. Thus, while violent robberies are inexcusable, the frequency of these attacks and the amount stolen are quite small if they are compared to the frequency and amount of similar crimes on land. Therefore, in spite of the pressure from different sources to establish national and international procedures to help fight this phenomenon, and the material resources to do so, these attacks are not necessarily a priority or of special concern to the politicians.
To all this, we have to add the potential risk of a disaster derived from the environmental damage produced due to a collision or a grounding during an attack, in the various events when a ship gets out of control in the track during a pirates´ attack.
From mid nineties to 2005, in a persistently desperate way, SE Asia goes on being the place in the world where there are more incidents, as around 50% of all the pirates´ attacks which come to light are produced here. Other regions as NE Asia, Indonesia, W Africa, Somalia and S America are also eaten up by this curse that threatens the maritime commerce.
Piracy in Somalia is not a new phenomenon, but until the middle of the present decade the incidence of piracy was quite limited. In 2005, however, the incidence[2] grew from less than 5 to 35. In 2006, it declined considerably to a mere ten incidents, only to grow in 2007 to 31 pirate attacks. In 2008, the problem virtually exploded, going from being an irritation to a major global concern with an unprecedented rise in pirates´attacks. Now navies from at least 17 states, organized around three multinational taskforces, are patrolling Somalia’s seas. So far in 2009, 79 ships have been attacked and 19 ships and their crews taken hostage. However, as well-publicized cases of pirates being released after capture have demonstrated, legal constraints on the action of some states and confusion about the legal powers of others have been noticed. Naval or police action cannot provide any long-term solutions to piracy in Somalia. It is very difficult to deal with a law and order problem in a lawless country. Only addressing the root causes, including the internal problems of the country, a way to stop piracy will be offered. The naval presence may, however, reduce the severity of the problem, and improving or clarifying the legal framework in which navies operate will certainly help.
The problem worsens with the lack of information derived from the incidents that are not reported, making it more difficult to face the general situation. The IMO[3], in a conservative way according to many experts, consider that only one out of two incidents is officially checked.
Lots of reasons explain this trend towards not reporting about the attacks carried out by pirates. Thus, the shipowners are usually reluctant to release the pirates´ attacks their ships experience; and this is for different reasons:
- Firstly, they frequently notice indifference from the coastal countries in whose waters the attacks are produced, which increases their belief that the reports of the piracy incidents do not provide them with any tangible profit.
- Secondly, the financial aspect of the question also has a relevant influence in this attitude towards not reporting, as the insurance companies can increase their premiums basing on the increase of risk they have to cover. The reports may promote the crew complaints with the help of trade unions in order to ask for a pay rise due to the fact that they are forced to sail in dangerous seas. The fear that the information about the incidents may be used by their competitors to comparatively stress a lower security of their operations, leads to increase their reluctance when reporting the incidents.
- Finally, from a complete documentation of the attacks, we can deduce that the shipowners were aware of the existing risks that the attacks could happen and even so they failed to protect their employees properly: there was a possibility that this argument would be used in legal battles where there could be proceedings about compensation complaints for damage or death of crewmembers.
As mentioned at the beginning, the result of all this is that only half the piracy incidents at sea is considered to be reported.
These incentives concern the coastal nations in whose waters the attacks take place in a similar way. Their incompetence to patrol their waters properly is usually an added difficulty. Corruption in these regions is often generalized. The guards may get commissions, always tempting when the salary is very low, for turning a blind eye to the pirates´ activities. In some incidents, the navy and/or the coast guard units are actively involved; in this case, their respective governments have very strong incentives for not promoting the spreading of reports where a corruption which they do not want to come to light may be easily seen. In certain cases, coastal nations are really suspicious of promoting acts of piracy. Another consideration is that the pirates´ attacks and the haul obtained during them may be a help to the almost always bad local wealth. Piracy eradication may be incompatible with the local inhabitants´ welfare and therefore it is possible that local governors do not get much interest or support in its achievement in many cases. Local governments may not be aware of the real extension of the problem and as a result, they tend not to assign the suitable resources. The low percentage of reported attacks contributes to perpetuate this situation. In other cases, the governments may be aware of the importance of the problem, but they do not supply their naval units properly or provide themselves with a land infrastructure according to their needs. In areas in The Philippines where the guerrilla warfare is usual, above all in the South islands of Muslim majority, members of the local Coast Guard unit have rejected to fight against the insurgents who are better armed and equipped and are responsible for lots of pirate attacks.
Because of the global nature of the problem of piracy at sea, the need of a cooperative solution with international character prevails, as its negative ramifications spread and affect a whole maritime industry and society in general. However, this solution at an international level has unfortunately turned out almost impossible to get for the time being. Thus, while all the participants would benefit from a world without piracy, each one seem to have their own incentives so as not to contribute to the solution of the problem and as a result of that, the attacks go on. The need to solve the piracy problem presents a second question in order to get its eradication: How to lead into cooperation?
The solution to this “second problem” can be divided into two. On the one hand, mechanisms in the industry which individually act towards this collective aim must be established; on the other hand, institutional mechanisms which keep the intervening elements together must be created. All this has the purpose of reaching a global and collective solution to the situation. The establishment of measures against piracy at sea shows disadvantages and it represents a genuine example of what is known as public property. One of the characteristics of any public property is its no-exclusiveness, i.e. given the lack of an organization controlling the costs of the services provided, all the existing payees try to avoid the covering costs in spite of the fact that all of them get a profit of the service; as a consequence, it is necessary to produce incentives which encourage all the beneficiaries to contribute. The other characteristic of a given property is its indivisibility; thus, a participant may have produced and paid a given property which at the same time provides profits to other participants, even though these have not contributed to pay the costs, becoming what in Anglo-Saxon terminology are named free-riders. A solution to this dilemma is making beneficiaries of this service to those nations that have contributed. On the other hand, a suitably convincing means of coercion should be established so that everybody is forced to pay their resultant share, being the charge an instrument which could turn out useful to this purpose. The establishment of a strong control structure is an essential previous requirement to any coercive action so much to that its absence up to now has been one of the main causes which has ruined all the initiatives and efforts to solve the piracy problem depending on a collective action.
The undertaken actions to reach any system of international collective answer to the problem of piracy will probably come to nothing due to the difficulties in finding a consensus. Unfortunately, for many people piracy at sea has not reached the level so that an arranged action is considered necessary yet. The financial losses seem to turn out tolerable for the maritime industry, so piracy has been seen as an inconvenience more than as a real problem to face. In this sense, ship operators (and their governments) might consider that the costs of paying occasional ransoms are less than the costs of taking steps to prevent occasional hijackings such as rerouting or arming merchant ships. It is said that payment of ransoms has tended to keep the level of violence associated with piracy off Somalia relatively low; and while individual ransom payments can be significant, the small percentage of ships operating in the area successfully attacked and captured reduces the overall risk in the eyes of some commercial entities[4]. As such, the payment of occasional ransoms might be viewed by ship operators and their governments as a regrettable but tolerable cost of doing business, even if it encourages more piracy.
The loss suffered by national economies as a result of piracy is difficult to estimate. At first glance, the overall loss applicable to piracy seems small in relation to the total value of goods transported by sea. Clearly a company whose cargo is prevented from reaching its destination on time will lose money besides the cost of paying ransoms; the damaging economic effect on piracy in the Somali region can be seen. The consequences are not limited only to companies whose vessels are hijacked; of wider concern is the growth of insurance premiums[5] for ships that need to pass through the Gulf of Aden that is slowly being blocked as a viable shipping route[6]. If the cost of extra insurance becomes prohibitive, or the danger simply too great, shipping companies may avoid the Gulf of Aden and take the long route to Europe and North America around the Cape of Good Hope[7].
The effects of the pirates´ attacks may result on a bigger or smaller potential risk depending directly on the time used to make their criminal act, taking into account that they carry out most of their acts on restricted or congested waters. Ships that remain unattended during and immediately after a pirate attack may in fact one day get involved in a collision for this reason if these attacks go on happening. In the period between 1996 and 2005, 25% of the attacks were carried out against oil tankers. In several occasions, ships sailed unattended with the autopilot for about an hour; we can easily imagine a scene where a VLCC[8] sailing for example through the congested waters of the Malacca and Singapore Straits, can easily collide with another ship or run aground. The resulting oil spill may cause an environmental damage perhaps more serious than the one in Exxon Valdez.
At the beginning of 1990, most of the attacks in SE Asia took place in the Phillip Channel with a length of about 20 miles (the South half of the way between Singapore Island and Indonesia). In this area, which is the W-E crossing way, all kind of ships with conventional cargo, containers and oil tankers were attacked.
The oil tankers sailing to the E generally sail loaded and they come from the Persian Gulf harbours. The data related to the ships that sail through this area show that the highest possible interval between the crossing of two ships in the same direction is of about twenty minutes and the distance between two ships sailing in opposite directions is of no more than one mile many times. The inherent risks to sailing through these restricted waters from the safety point of view means that a VLCC oil tanker Captain with a suitable disposition of lookouts and other responsibilities about sailing, while passing through these restricted and strongly congested waters, does not have available personnel to keep a suitable security against a pirate attack.
From the beginning of 2008 most attacks have been taking place in the Gulf of Aden, therefore being the previous considerations referred to SE Asia applicable. It is considered a strategically important international waterway through which a third of the world’s crude oil is carried. Over 20,000 vessels pass through this area each year. The Gulf of Aden lies between Yemen and Somalia and connects the Indian Ocean to the Red Sea and the Suez Canal.
The serious potential consequences, derived from the fact that an oil tanker may sail with no crew on the bridge for some minutes during a pirates´ attack and therefore with no control, are evident. In a recent incident and after a pirates´ attack, these abandoned the ship with the haul leaving the whole crew gagged and about seventy minutes went by until they could set themselves free and take the control of the bridge up again. If this incident had taken place in the Phillip Channel or in the Gulf of Aden, a disaster would have been unavoidable. In March, 1989 the world got terrified of the ecological and environmental damage caused by the Exxon Valdez disaster. Taking the accident situation of this oil tanker to a similar event taking place in the Phillip Channel or in the Gulf of Aden, the result could be catastrophic[9]. Apart from the consequences derived from the sea pollution, it could be possible that the fairway or channel in those areas would be blocked to sailing and fishing for some time[10]. However, it is an unfortunate fact in life that lots of people never see the potential risks even though they are high. It has often been said that only the day when a serious maritime problem happens as a consequence of an act of piracy, the governments will assign the necessary resources to make sure that no more attacks will happen.
The maritime industry has adopted a reactive attitude at great sea accidents or incidents as a consequence of which different international maritime regulations have taken effect in order to avoid other similar events (the “Achile Lauro” hijacking in 1985 and the subsequent diplomatic initiative carried out after it by Austrian, Egyptian and Italian Governments as triggers of the SUA Convention[11] in Rome in 1998; the “Herald of Free Enterprise” accident in 1987 as a trigger of the ISM Code[12], later included as an amendment in Chapter IX in the SOLAS, which came into effect in two phases depending on the kind of ship -1st of July, 1998 and 1st of July, 2002 respectively-; the 11S attack against the Twin Towers in New York as a trigger of the ISPS Code[13], later included as an amendment in Chapter XI in the SOLAS, which came into effect on 1st July, 2004). Therefore, we have to take into account that, as there may not be a second opportunity in the case of oil spill for this reason, it is necessary that instead of the reactive attitude, which as we have just seen were adopted after the episode of different serious accidents, a preventive attitude should be established with the purpose of avoiding them; not admitting those risks and failing to take the necessary steps to avoid a catastrophe of these dimensions with an act of piracy could be an irresponsibility.
The safety question in the aerial navigation gained a greater importance after the destruction of Pan American flight 103 over Lockerbie (Scotland) on 21st December, 1988. Similarly, so that the maritime world become aware of the situation and realise what the threat piracy represents, it seems sadly necessary that there has to happen a disaster to the environment after a grounding or collision of an oil tanker while suffering a pirates´ attack or a dramatic increase of insurance rates to enhance the willingness of the shipping industry to invest into better security. Unfortunately, it only seems a question of time.
[1] The English terms “safety” and “security” are both translated into Spanish as “seguridad” and in order to distinguish them, the terms “protección” for “security” and “seguridad” for “safety” are used. From the conceptual point of view, we have to distinguish between the terms security (protection against crime, which is mostly used for measures preventing attacks, sabotage or theft through passive and active measures) and safety (protection against physical and occupational or other types or consequences of failure, damage, error, accidents, harm or any other event which could be considered non-desirable).
[2] According to the statistics of the International Chamber of Commerce’s Piracy Reporting Centre (ICC-PRC).
[3] International Maritime Organization (specialized agency of the UN responsible for the adoption of measures tending to improve the sailing security and for the fight against the marine contamination of ships. It is also involved in legal matters, including issues related to legality, compensation and facilitation of international maritime traffic).
[4] If a few years ago ransoms were in the tens to hundreds of thousands of dollars range, nowadays they have hovered between half a million and two million dollars, although recent reports indicate that demands have shot up again.
[5] In May 2008, insurance underwriters at Lloyds of London designated the Gulf of Aden a “war risk” zone subject to a special insurance premium. London-based ocean marine insurers have raised rates for ships making the voyage through the Gulf of Aden and the Suez Canal. These levels of increase can only be estimated because of the competitive nature of the ocean marine insurance business. One group of London insurance brokers and underwriters estimates extra premiums at $10,000 to $20,000 per trip through the Gulf.
[6] More and more shipping companies are opting to take the long route around the Cape of Good Hope. For example, Maersk announced in December 2008 that some of its slower vessels, as well as those without an adequate freeboard will not be allowed to transit the Gulf of Aden, a journey that can take up to three weeks longer than going through the Suez Canal and the Gulf of Aden.
[7] Rerouting vessels to avoid the Gulf of Aden and other waters near the Horn of Africa adds additional transit days and fuel costs to shipping companies. The costs vary the type of ship and the frequency of voyage, according to the U.S. Department of Transportation (for example, circumnavigation rather than transiting the Gulf of Aden/Suez Canal increases the annual operating cost of an oil tanker “by reducing the delivery capacity for the ship from about six round-trip voyages to five voyages or a drop of about 26 percent. The additional fuel cost of travelling via the Cape of Good Hope is about $3.5 million annually”). See in this sense, U.S. Department of Transportation Maritime Administration, “Economic Impact of Piracy in the Gulf of Aden on Global Trade”, December 2008.
[8] Very Large Crude Carrier (a large oil tanker between 200,000 and 300,000 tons dwt).
[9] The most prominent example of a crash caused by a pirates´attack is the collision of the hijacked tanker Nagasaki Spirit and the containership Ocean Blessing in 1992 in the middle of the Malacca Straits.
[10] If the Straits of Malacca were to be blocked by a terrorist attack, ships would have to make a detour of roughly 1,000 miles, leading to higher freight rates and consequently also to higher commodity prices. Considering that 80% of Japan’s oil is imported from the Middle East, such an attack would clearly have a significant impact on the world economy.
[11] Convention on the Suppression of Unlawful Acts against the Safety of Maritime Navigation.
[12] International Safety Management Code.
[13] International Ship and Port Facility Security Code.
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