Flag states rally to support seafarers abused by pirates by Will Watson
[dropcap]W[/dropcap]hile it is anecdotally known that seafarers are suffering brutal abuse at the hands of pirates operating in the Indian Ocean, Gulf of Guinea and other areas, there has been no central repository for information relating to this pattern of brutality… until now.
Last year, the Oceans Beyond Piracy (OBP) project, funded by the One Earth Future Foundation, held a series of working group meetings. One outcome was an ongoing series of reports on the financial cost of piracy. Another outcome was a document called the Declaration Condemning Acts of Violence Against Seafarers. The Declaration, better known as The Washington Declaration, was signed in August by the Republics of the Marshall Islands, Liberia and Panama— the world’s three largest flag states. In the declaration, the three flag states agreed to share details concerning pirate attacks with the International Maritime Bureau (IMB) of the International Chamber of Commerce. The IMB will remove information from the reports that specifically identifies seafarers, their ships and vessel owners and operators. But, for the first time, this process will allow for researchers, scholars, journalists and others to find the true impact of piracy— the abuse of seafarers.
Now, a fourth flag State, the Commonwealth of the Bahamas, has signed the Declaration. The world’s fourth largest flag state signed the Declaration at a luncheon ceremony hosted by the Women’s International Shipping and Trading Association (WISTA) at the Connecticut Maritime Association (CMA) sponsored Shipping 2012 conference in Stamford. But the IMB isn’t satisfied with just having the Big Four on record as opposing pirate brutality.
The IMB is taking the Declaration to the International Maritime Organization (IMO) in May in hopes that many more flag States will agree to share information. The Paper to be presented at the Maritime Safety Committee (MSC 90) meeting is being co-sponsored by the IMB, the Republics of the Marshall Islands and Panama, Intertanko and the International Transport Workers Federation (ITF). The Declaration was also promoted at the Plenary meeting of the United Nations Contact Group on Piracy off the Coast of Somalia (CGPCS) that was held in New York at the end of March.
[pullquote style=”1″] Financial cost of piracy tops $7 billion in 2011 [/pullquote]
An updated report issued by OBP now shows that piracy cost the world over $7 billion during 2011. The report raises concerns about the cost of Somali piracy to the world economy. Approximately 80% of all costs are borne by the shipping industry, while governments account for 20% of the expenditures associated with countering piracy attacks. The report estimates the 2011 economic cost of piracy was between $6.6 and $6.9 billion.
“The report assesses nine different direct cost factors specifically focused on the economic impact of Somali piracy,” explained Anna Bowden, the report’s author, “Over the past year we have had substantial cooperation from maritime stakeholders which has helped to ensure the figures are as reliable as possible.”
The breakdown of the most notable costs includes $2.7 billion in fuel costs associated with increased speeds of vessels transiting through high risk areas, $1.3 billion for military operations, and $1.1 billion for security equipment and armed guards. Additionally, $635 million is attributed to insurance, $486 to $680 million is spent on re-routing vessels along the western coast of India, and $195 million is the estimated cost for increased labor costs and danger pay for seafarers.
The vast majority (99%) of the billions spent are attached to recurring costs associated with the protection of vessels — costs which must be repeated each year. This figure is in sharp contrast to the $38 million spent for prosecution, imprisonment, and building regional and Somali capacity to fight piracy. Average ransoms increased 25% from approximately $4 million in 2010 to $5 million in 2011. Although the total cost for ransoms was $160 million for 2011, money collected by pirates represents a mere 2% of the total economic cost. While ransoms provide the incentive for Somali pirates to attack vessels and hold hostages, they represent a disproportionately small cost compared to the nearly $7 billion spent to thwart these attacks.
“The human cost of piracy cannot be defined in economic terms,” Bowden added. “We do note with great concern that there were a significant number of piracy-related deaths, hostages taken, and seafarers subject to traumatic armed attacks in 2011. This happened in spite of the success of armed guards and military action in the later part of the year.”
Officially launched at a press conference held at the Royal United Services Institute for Defence & Security Studies (RUSI) in Whitehall, London, the paper was presented to maritime experts and international press. The report will be used to raise important issues for the Oceans Beyond Piracy Working Group, which is expected to release recommendations for a better coordinated, and longer-looking strategy against piracy in July 2012.
This article was written by Will Watson, Deputy Commissioner of Maritime Affairs at Republic of the Marshall Islands and Vice President – Government Affairs and Governor at Maritime Security Council. This article was reprinted with the permission of the Council Of American Master Mariner’s (CAMM) and first appeared in the April 2012 edition of Sidelights. The publication of the report was made possible through the support of the One Earth Future Foundation, sponsor of the Oceans Beyond Piracy Project, which sponsors project initiatives in London and India.