Monday, February 13, 2012

The Cost of Somali Piracy

The One Earth Future Foundation recently published an assessment titled The Economic Cost of Somali Piracy 2011 by Anna Bowden and Shikha Basnet. It concluded that Somali piracy cost between $6.6 and $6.9 billion in 2011, down from a figure of $7 to $12 billion in 2010. The shipping industry bore over 80 percent of these costs. While there was an increase in pirate attacks, successful hijackings were down, in part as a result of a more aggressive response from military forces conducting anti-piracy missions in the region.

The report attributed the costs to ransoms, higher insurance, security equipment and guards, re-routing of ships, increased speed and burning of more fuel, compensation of kidnapped seafarers, prosecutions and imprisonment, military operations, and the creation of anti-piracy organizations.

For an earlier companion piece by Kaija Hurlburt, see The Human Cost of Somali Piracy.

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