Maritime piracy cost more than $12 billion dollars in 2010

Maritime piracy cost more than $12 billion dollars in 2010

2011-01-14 12:27:21 GMT+7 (ICT)

LONDON (BNO NEWS) - Researchers have said that maritime piracy cost the global economy up to $12 billion dollars last year, with Somalia-based pirates responsible for 95 percent of the costs, the DPA news agency reported on Friday.

The study by the One Earth Future Foundation, an American organization, said some 1,600 acts of piracy have been recorded since 2006, causing the deaths of more than 54 people.

The main direct costs of piracy include ransom, piracy insurance premiums, the rerouting of vessels, naval deployments by countries, prosecutions and organization budgets aimed at fighting piracy.

Ransoms have skyrocketed to an average of 5.4 million dollars, compared to 3.4 million dollars in 2009 and 150,000 dollars in 2005. As a result of hundreds of hijackings in recent years, Somali pirates have been able to cash in tens of millions of dollars.

The study estimated the total ransoms paid in 2009 and 2010 at 425 million dollars. If excess costs incurred in negotiations and delivery fees were added, the total could be around 830 million dollars for the two years.

The recent wave of piracy began with the seizures of vessels off the Somali coasts in 2005. Other areas of piracy risk include the Gulf of Guinea, the Malacca Straits and off Nigeria.

Ships are patrolling the shipping lanes near Somalia in an effort to reduce hijackings, but the anti-piracy force has warned that attacks are likely to continue. Most hijackings usually end without casualties when a ransom has been paid.

Currently, Somali pirates are holding at least 26 vessels with a total of 601 hostages, according to the European Union Naval Force - Somalia, which keeps a record of pirating incidents.

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