Sunday, 27 February 2011

Somali piracy's end game nigh?

Two critical mistakes by Somali pirates could soon end their mayhem which has caused unprecedented damage to the global economy at the hands of so few. The first was their murder of four American hostages on February 22 and the second is that they have reportedly reached a multi-million dollar deal with the Islamic militant terrorist group, al-Shabaab, allegedly linked to al-Qaeda. In return for a safe anchorage at Harardhere and the release of pirate chiefs by al-Shabaab, the pirates will reportedly pay 20% of all ransoms to al-Shabaab, who captured Harardhere last year. This dramatically raises the stakes which can end in only one of two ways -- a far worse costly disruption to world trade or punitive military intervention both at sea and on land.

The latter move to deal with terrorists is a game changer, believes Wing Commander Paddy O' Kennedy, spokesman for the EU naval force operating in the Horn of Africa, because it could change the rules of engagement. Payments of ransoms to terrorists are illegal so any hostage sailors could find themselves languishing in squalid conditions for years, as opposed to months so far. Faced with such threats it is hardly surprising that the International Transport Workers Federation (ITF), an umbrella organisation representing 720,000 seafarers worldwide, sees "no alternative but to stop putting people and ships within their reach, with all the effects that could have on world trade and oil and food prices."

The ITF is now, therefore, advising seafarers and their trade unions to begin to prepare to refuse to go through the danger area. In a warning to shipowners, ITF said: "The risk of passing through the affected area and the knowledge of the inhuman manner in which captured seafarers will be treated amount to a breach of their duty of care to seafarers. It is also reckless, to a point, that should a seafarer be killed by a pirate attack while the vessel transits the high risk area, it would amount to corporate manslaughter. We call on the military to neutralise the threat caused by the use of mother ships."

There seems, however, to be a problem with mother ships in that the pirates have reportedly changed tack by seizing large fishing vessels as mother ships and using their hapless crews as human shields. It is, therefore, perhaps fatuous for the ITF to call on the military for this specific help unless such ships are entirely crewed by pirates. Its other pronouncements also betray woolly thinking. It calls on flag states, for example, to deploy naval assets to protect ships from piracy but but many tiny flag states, like St Vincent and the Turks & Caicos Islands, have scarcely two brass farthings to rub together and to expect them to take custody of convicted pirates is a fanciful notion. An American Nato admiral also advised that even a World War 2 naval fleet would be inadequate over such a vast area and called on merchantmen to be armed.

Belatedly, the ITF is coming round to the view that merchantmen should be armed but not by seafarers. Rather, they favour military personnel or private armed guards, subject to agreement by trade unions. It also calls on the UN to take all necessary measures to address the underlying, shore-based situation in Somalia which has allowed piracy to flourish, without saying what those measures should be. A long-term UN armed presence will have little appeal to America and European nations, given past experiences, already overstretched with current military obligations and straightened economic circumstances at home.

There is no doubt that arming of merchantmen will help but by itself is unlikely to end the pirate scourge. It is not just al-Shabaab that will be taking baksheesh but local officials who have been taking up to a third of ransom monies, much of which, claims John Drake, a piracy specialist with the security firm, AKE, "is already falling in al-Shabaab's hands."

Lightning punitive actions in all known pirate ports, with carefully planned rescue attempts of hostage sailors, seem to be closer. There is, of course, an alternative -- a complete boycott by all seafarers of the Arabian Gulf and much of the Indian Ocean. But in global economic terms the consequences of that would be disastrous, making the current $7-12 billion annual piracy cost look like small change. There would also be a political price to pay through more instability in a region already wracked by despised, corrupt and incompetent regimes. Egypt, for example, could have done so much more to deploy its 12 frigates on anti-piracy patrols and so cut down the loss of its Suez Canal transit fees. Even relatively stable neighbouring countries could have trouble coping with the loss of tourism revenue from cancelled cruise ship calls and other disruptions.

The time is surely nigh for condign punitive action of the kind Algiers received nearly 200 years ago, which permanently ended the centuries-old scourge of the Barbary pirates. It would, of course, have sad consequences as innocent parties would suffer along with the guilty but history clearly shows that down through the ages pirates have only ever respected one language -- applied superior force. It is not enough to sink them at sea. Their lairs must also be neutralised -- an action that has no legal bar.

Thursday, 17 February 2011

Containerisation's ugly side risks lives and costs billions

Global distribution costs have dramatically fallen since containerisation of shipping cargoes began in the 1950s but it has not been without a high price in risks to lives, ships, their cargoes and the environment. The causes are various, including poor training, cost cutting and, worst of all, deliberate fraud that denies governments and shipping lines billions of pounds in lost revenues every year.

After nearly 60 years of container shipping it seems incredible that there are still no mandatory instruments requiring the weighing of containers at ports, nor guarantees that all those involved in transport and handling of containers are fully informed of the state of packing, stowage, lashing and security of the cargo. Belatedly, that may start to change following the International Labour Organization's (ILO) forum, to be held in Switzerland, February 21-22, on safety in the supply chain in relation to packing of containers.

But global agreement on any issues is ponderously slow and for containerisation issues that is a tragedy, for the price of tardy deliberations will see more lives lost, injured and cargoes ruined. The public are largely unaware that container handling and transport problems are not confined to sea-borne journeys. It could be, for example, that in Britain more than 75% of lorries are not loaded safely. In 2009 officials from the Health and Safety Executive (HSE) and Vehicle Operator Services Agency stopped 40 vehicles during 3 days of checks in Wrexham, Birmingham and Humberside. The majority needed remedial action to make the loads safe for onward travel and unloading. The problem is exacerbated by containers because loads are hidden until opened. Over a 3-year period in Britain, 14 people were killed and over 2,000 injured by cargo falling from vehicles when they were being loaded or unloaded. On the roads fatalities also occur because poorly restrained container loads can cause multi-vehicle accidents.

Preventable losses are huge and much of it stems from inadequate training and cost cutting. In 1999 one in three shipping containers was found at fault, claimed the UK P&I Club, the world's largest marine mutual insurer. This meant one in six container journeys caused cargo damage costing owners $5 billion every year. Today that figure must be far higher.

Best practice will not defeat the unscrupulous

Much of the problem could be cut by using the right packaging and installing the loads correctly. But before any container is stuffed it should be thoroughly inspected for problem areas like holes, protruding nails, inadequate lashing points and porous rust patches, plus any residues from previous cargoes that could contaminate a new cargo. Stretch and shrink wrapping offer good protection against water and air bags can be quickly installed as alternatives to conventional shoring. These are all common sense measures and ably explained in the P&I Club's video: "If you think any fool can stuff a container think again!* but they are no protection against unscrupulous container stuffers bent on deliberately overloading their containers or falsifying cargo documents.

David Cockroft, ITF's general-secretary, said: "So far, best practice and self regulation have failed to stop the worst kind of accidents, and we are therefore recommending that international mandatory instruments be developed that guarantee that those handling and moving containers are informed of their weight, state of packing, stowage and securing, as well as their centre of gravity and whether or not any fumigants or dangerous substances are present." This clearly shows the need to make weighing of containers at embarkation ports a key mandatory requirement. Many container stuffers may overload their containers unwittingly but a scale fitted to a pallet truck and forklift would cost only £800 and £2,000 respectively so there is no excuse for feigning ignorance or relying on guesstimates. The temptation to overload deliberately, however, is huge because shippers can save so much by swindling shipping lines and governments out of billions of pounds every year.

The purpose of the ILO forum is partly to reach consensus on a common approach throughout the supply chain for the correct applications and enforcement of the appropriate standards for packing containers. Such lucubration, however, should not be an excuse for tardy deliberations, during which more lives will be lost and injured. Incorrectly stuffed and overloaded containers can sink ships. Given the size of the latest box ships being launched or considered, including 12,000 TEU vessels, the loss of just one such ship could cost over £1 billion in cargo losses alone.

It is bad enough that ships must cope with monster killer waves that could sink the largest of vessels without giving nature a helping hand through human shortcomings, deliberate or otherwise. It also reflects badly on an industry that has known of the problems for decades but only now is tardily starting to address them to remove the ugly side of the business.
*For a copy visit:

Friday, 11 February 2011

Somali piracy --- sympathy is not enough

The recent Somali pirate attack on the Beluga Nomination 390 nautical miles north of the Seychelles plumbed new depths of barbarity. It brings nearer the likelihood of an irremediable military strike on all known pirate ports harbouring the mother ships which give the pirates the range to attack over 1,000 miles from their shores.

The incident on January 22 involved taking aside three captured seafarers for punishment as reprisals for an abortive attempt by the Seychelles coastguard to free the hostages, during which one Somali pirate was shot dead. The tortures reportedly included keel hauling and hanging seafarers up by their ankles while their heads were under water. At least one sailor was murdered in cold blood, bringing the total murdered so far to over 40.

In a press release issued by the International Transport Workers Federation (ITF) on February 2, BIMCO, the International Chamber of Shipping, Intercargo and Intertanko all declared their outrage at such cold-blooded murder, adding: "We express our deepest sympathy to the seafarers involved and to their anxious families." But sympathy can never be enough and nor is the industry's repeated calls to urge governments to empower their naval forces to take fast and robust action against pirates and the vessels under their control, before passing ships are boarded and hijacked.

As explained in my last report on Somali piracy headed: "Somali piracy may cripple global logistics," Admiral Mark Fitzgerald, commander of NATO allied joint task force, Naples, said: "We could put a World War 2 fleet out there and it would still not be able to cover the whole ocean." He advocated arming merchant ships in the Horn of Africa.

The ITF has so far opposed the arming of merchant ships for understandable reasons but it and the shipping industry must realize that if they take no action to defend their ships with lethal force then the logic for a crushing military strike on known pirate ports against all fishing vessels large enough to act as mother ships is incontrovertible. Even ITF's General-Secretary, David Cockroft, recently chastised the majority of those who make the most from shipping for "Doing little or nothing." Insurance companies, it could be said, even have a vested interest in playing no part in a resolution as they are making far more money since jacking up premiums 4-5 fold than they are paying out in ransoms.

The ITF believes this latest atrocity marks a shift in the behaviour of Somali pirates and that shipowners and their crews will be re-evaluating the current determination to ensure this vital trade route, through which 40% of the world's sea-borne oil trade passes, will remain open. This will include alternative routes like around the Cape of Good Hope, which would severely raise transport costs and delivery times. Piracy is already estimated to have cost the global economy between $7 billion and $12 billion a year but that does not include the impact on just-in-time production techniques.

Shipping's supine response exacerbates seafarers' woes

Shipping lines and their trade bodies may bluster indignantly about the piracy menace but their supine response so far has only encouraged ever-more piratical attacks, which now sees an estimated 500 seafarers imprisoned in squalid conditions for many months. Underlying this discreditable response is the industry's preference for the "calculated risk" approach and the fact that their increased costs can be passed on to consumers hard hit by the credit crunch. Such nonchalant thinking, however, is particularly dangerous for developing countries dependent on subsidised staples like wheat. Last September this blog site warned about the consequences of Somali piracy on Egypt's economy, which could see Suez Canal transit fees plummet, and chastised the Egyptian regime's shameful refusal to deploy its 12 frigates adequately on piracy patrols. "There could also be incalculable damage to Egypt's economy through the loss of billions of dollars in canal transit fees which could destabilize the whole country," I warned. So far, estimates reveal that Egypt is losing $642 million a year as ships reroute to avoid the canal, a sum equivalent to a quarter of money spent on food subsidies. Sadly, that instability exploded last month as discontent over annual food inflation hit 18%, the world's highest. There may be other reasons for Egypt's social discontent but Somali piracy is not unconnected to the country's economic woes.

History shows punitive action works

Fortunately, at long last some shipping lines are taking more robust action to defend their ships, and according to Wiki-leaks, ex-SAS officers are being hired by foreign shipping firms through a private commercial firm. But some believe that these hired officers are seen as bait because the shipowners believe that the Royal Navy will intervene to rescue them and free their vessels. Such a scenario seems unlikely but it raises concerns that the Royal Navy is being forced to act as an international police force because other navies are failing to pull their weight off the Horn of Africa, not least Egypt. This is a pity because even a very small military response has already been effective. In November 2008 the Royal Navy shot dead two Somali pirates while repelling an attack on a Danish cargo ship off the Yemen coast. American navy officers at the time ascribed a sharp fall in pirate attacks in the first half of 2009 to this British intervention.

It would surely be far more effective, therefore, if decisive action was taken against all known pirate ports harbouring the pirates' mother ships. There is, undeniably, a tragic element in such punitive action in that innocent fishing vessels would be sunk along with the guilty but when pirates ply their trade they declare war on many nations and in any war collateral damage is unavoidable. There is also the safety of hostage seafarers to consider.

There is no legal bar to such action as the UN Security Council Resolution 1851 authorises military action against piracy on Somali territory. But if such action is considered too punitive then the only other effective means must include the arming of ships passing through the infested seas. The former initiative, however, would be much cheaper and quicker and there are historical precedents to prove its effectiveness. For centuries the Barbary pirates were the scourge of the Mediterranean and the Atlantic but when their Algiers stronghold was bombarded in 1816 and 1824 and their ships sunk their stranglehold was broken permanently and 1,000 Christian slaves released unharmed. It is to be hoped that it will not take centuries to eradicate the Somali pirate scourge.