Ransom insurance was becoming a necessity in Australia’s international trade
A ransom up to $4 million was paid through Australian companies and insurers to Somali pirates who seized a bulk carrier in 2008.
Many shipping firms are employing armed guards and considering longer, more expensive voyages to avoid pirate hot spots east of Africa.
The ransom was paid to recover an Australian cargo of 50,000 tonnes of lead and zinc aboard the Panama-flagged container ship Stella Maris.
The carrier, with a crew of 20 Filipinos, was seized by Somali pirates in the Gulf of Aden in June 2008, Australian Shipping chief executive Llew Russell said.
Ransom insurance was becoming a necessity in Australia’s international trade, 99 per cent of which travelled via sea, Mr Russell said.
“You’ve got to pay the ransom,” he said.
If companies refused to negotiate ransoms, crews would not be willing to ply the seas off Somalia or other hot spots, including the Strait of Malacca.
Piracy is costing the global economy $7 billion a year.
Some Australian shippers were so wary of running the gauntlet off Somalia, as they head towards the Suez Canal, they were now rounding the Cape of Good Hope at an extra cost of $2 million per container ship and another two weeks added to the voyage, Mr Russell said.
Piracy in Somalia was so lucrative there was a black-market stock exchange in the country listing some 72 pirate “firms”, he said.
Three Australian vessels, including a livestock carrier, were attacked and boarded by pirates last year, International Chamber of Commerce crime services manager Cyrus Mody said.
The attacks involved Australian-flagged or managed tugs and carriers in the Singapore Straits and off the coast of Brazil.
But Mr Russell said a much larger number involved attacks on foreign ships carrying Australian goods.
One Australian ship’s master was lucky to survive an attack in which pirates fired rounds into his control room.
In October, an Australian-owned and operated tug towing a barge was chased by two pirate boats that were being monitored by a Singaporean navy ship.
The pirates still managed to board the ship and steal property, the ICC said.
Source: The Herald Sun
