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Count the cost of piracy

Companies ought to incorporate bespoke private maritime security services into their business model, according to a maritime security firm.

There is also the human cost of piracy, and while it is not quantifiable in economic terms, crews are being taken hostage, some killed, some being held for up to 18 months.

Typhon is due to launch its marine convoy protection service this year. The company’s offering involves accompanying ship operators in transit through piracy hotspots such as the Gulf of Aden, the Gulf of Guinea, the Arabian Sea and the Indian Ocean. Although there has been a reported decrease in reported piracy off the coast of Somalia, attacks are escalating in the Gulf of Guinea and Indonesia. The company points to the International Maritime Bureau’s “Piracy and Armed Robbery Against Ships Report 2012”. These three places out of eight reported the highest incidence of piracy for the year: Indonesia (81 per cent), Somalia (49pc), Nigeria (27pc). The remaining five locations listed were Togo (15pc), Red Sea (13pc), Gulf of Aden (13pc), Malaysia (12pc) and Bangladesh (11pc).

Typhon CEO Anthony Sharp said: “Figures suggest reported piracy off Somalia is decreasing. However, the pirate action groups are still out there, and according to Russian Navy Rear Admiral Vasily Lyashok, Somali pirates are flexible and can quickly adapt to new strategies, have become better organised and enhanced by a support network, have satellite communications, shore bases, depots, arsenals, training facilities for their pirates, and a single leader. Western naval analysts also say they are extending their range to the Oman sea. The reported decrease in piracy in Somalia has a lot to do with an extended period of monsoonal weather, the re-routing of vessels to the western Indian coastline rather than around the Cape of Good Hope, the presence of foreign naval forces and the use of private maritime security firms to deter pirates. There has also been widespread under-reporting of piracy incidents to avert escalating insurance premiums.

“With falling naval budgets across the globe, there is a chance that countries will begin to reduce the level of security they can offer and eventually, they will withdraw their navies from some of the world’s most dangerous waters. Should this happen, the attacks will escalate as the threat is still there and the pirate networks are heavily armed. Companies that need to transport goods across high-risk waters need to incorporate a bespoke security model into their plans.

“Then there are also locations where we are seeing not only an escalation in piracy but a rise in the level of violence used in those attacks. The coast of West Africa or the Gulf of Guinea is one example. Around 30,000 ships transit through this trade route annually, including ships transporting oil and gas. Illegal oil bunkering and LNG theft is big business for pirates off the coast of West Africa. Billions of dollars-per-year of oil revenues to Nigeria are being lost as a result of illegal oil bunkering. Piracy impacts on regional nations not just in terms of the trading of goods, but also in terms of the perception of how secure prospective visitors and investors will think they are. Essentially foreign direct investment is affected – something that doesn’t bode well for countries looking to improve their standing on the world stage”.

About Typhon

It describes itself as the first naval-grade private convoy protection for 220 years. Typhon is operated by senior ex-RN and RM officers. The board includes Simon Murray CBE, General Lord Dannatt, General Deverell and Admiral Ulrich (USN 4*).

IMO welcome

Meanwhile the United Nations agency the International Maritime Organization, the International Chamber of Shipping (ICS), BIMCO, the Oil Companies International Marine Forum (OCIMF), the International Association of Independent Tanker Owners (INTERTANKO), the International Association of Dry Cargo Shipowners (INTERCARGO), the International Parcel Tankers Association (IPTA), and the International Shipping Federation (ISF), have welcomed the recent decrease in the number of attempted and successful attacks against ships by Somalia-based pirates operating in the Gulf of Aden and the western Indian Ocean.

This decrease may be attributed to a combination of factors, including: the presence of naval forces disrupting pirate operations; implementation of self-protection measures on board merchant ships and better situational awareness of where the threats are; coupled with more effective action ashore in Somalia by the Somali authorities and the international community.

The organisations say that they remain convinced that the only long-term solution to piracy is to establish effective government and implement the rule of law ashore in Somalia. However, until that is achieved, there can be no room for complacency. Any reduction in the level of protection of merchant ships could lead to a resurgence of pirate activities. Piracy must continue to be suppressed through the visible presence of and robust action by, the world’s navies, consistent with international law.


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