Treasure Ship

Why not?
A ship is a good place to hide crew members. Let's just imagine you do something Steven Seagal would do—you try to take the ship back. You send in Special Forces. You get onboard—that's the easy part. But you have no idea where the pirates are, how many pirates are onboard, and where they're holding the hostages. That means you simply can't be quick enough to guarantee that none of the hostages are killed.

What do the pirates do with their money?
The easy answer is they spend it. You see lots of brand-new pickup trucks and villas spreading all over the port of Eyl. There are brand-new hotels and restaurants catering to the pirates, a whole entertainment industry. There are lots of ways to spend your money—for example, they can also marry [an additional] new wife, which is allowed in Somalia.

So pirate loot has created whole new economies.
Yes. They also invest it in new hardware, like fiberglass boats, weapons and, of course, bribes to officials and militia warlords. It would be quite easy for warlords to take over one of the pirate ports—they have more manpower than the pirates have. And the Islamic movements could clamp down on piracy very hard if they liked. So I think lots of money is flowing into their coffers as well.

In some parts of Somalia, the pirates are treated like local heroes. Why?
Off the coast of Somalia, you will find a lot of high-seas trawlers from different nations conducting illegal fishing operations to the tune of $300 million per year. The vessels that the Somali [fishermen] have are no match for these bigger ships. Somali fishermen started to complain in the mid-1990s that their nets got destroyed, that their boats got rammed and capsized and all that stuff. This is one thing that the fishermen keep in mind when they're talking about pirates—they're fighting back. Many see them as young resistance fighters that are fighting against the Western system and milking it to the best of their capability. Also, the pirates earn quite a lot of money. They've created a boom along several coastal areas, which means they're earning quite a living, basically, for the whole community.

Piracy has picked up a lot this year. What's the impact on the global shipping industry?
If you take a look at the freight rates, you will see that international shipping is one of the victims of this global economic meltdown. Freight rates are falling through the floor, which means shipping is losing a lot of money. Many ships will be retired or put at anchor for a while. [In hijacking cases] you're talking about $2 million per ship—that is quite costly, especially for smaller shipping agencies. They will go bankrupt.

Why don't big tankers have security onboard?
Security guards cost money. That's one explanation. The second is, if you have cargo of a volatile nature, you don't want to have a fire fight onboard. You have, for example, chemical tankers, tankers with aviation fuel, and oil tankers like the Sirius Star. If you're the master of such a ship, you don't want to have people shooting it out onboard.