Asia held hostage
19.11.2008
By Keith Wallis
HONG KONG - As maritime piracy in the Gulf of Aden and east coast of Africa threatens to spiral out of control, Asia's shipowners and political establishment warn that more must be done by the international community to tackle the problem.
This was reinforced on Wednesday when the Hong Kong Shipowners' Association called for preventive action by the world's navies as well as for humanitarian help in war-torn Somalia.
Arthur Bowring, association managing director, said piracy "is a problem that must be solved as soon as possible". His view is likely to be shared by the Asian Shipowners' Forum when its seafarer committee meets in the Malaysian capital of Kuala
Lumpur on Friday. The forum represents 13 shipowner associations in Asia, including groups in Japan, South Korea and Southeast Asia, whose members together own about 40% of the world's merchant fleet.
Asian shipowners have stepped up their campaign for an international solution to the piracy problem following a spate of hijackings and attempted seizures by pirates since the beginning of November. Anti-piracy watchdogs based in Kuala Lumpur said there had been more than 10 attacks in about a week.
The most audacious was the seizure of the fully-loaded 300,000 deadweight tonne supertanker Sirius Star off the coast of Kenya last weekend. The Saudi Arabian-controlled ship was the biggest prize so far for the pirates (2 billion barrels of oil), who have so far been content with taking ships around a tenth the size of the tanker.
Since the hijacking of the Sirius Star, pirates have seized the Delight, a Hong Kong-registered 43,000 deadweight tonne cargo vessel carrying a consignment of wheat flagged to Iran and a Greek-owned bulk carrier. They also attacked a Thai fishing boat with 16 crew on board on Wednesday, although it was unclear if the trawler had been seized, said the Kuala Lumpur-based Piracy Reporting Center, part of the International Maritime Bureau.
The recently abducted boats are reported to be moored off the coast of lawless Somalia, where they will be held for ransom along with 15 other ships and more than 250 sailors. Among the group is a Ukrainian ship carrying 33 fully armed Russian tanks intended for southern Sudan that was captured in September, and the Sirius Star with its cargo of crude worth US$100 million.
Pirates also hijacked the Japanese chemical and oil tanker Chemstar Venus over the weekend, just as they released a South Korean chemical tanker, Stolt Valor, following a ransom payment reportedly amounting to $1.1 million. Most vessels captured in the busy shipping lanes of the Gulf of Aden fetch on average a ransom of $2 million.
According to statistics from the International Maritime Bureau, the spate of recent hijackings has brought the number of attacks this year to more than 90, twice the total for last year. According to the BBC, piracy off the coast of Somalia has cost up to $30 million in ransoms so far this year.
The surge in the number of attacks has prompted several Asian nations to plan a response with force of arms.
India was the first to take action, deploying on October 18 a navy warship to conduct anti-piracy patrols along the route Indian merchant vessels normally take during passage between Oman and the Gulf of Aden.
In a statement released at the time by India's Directorate General of Shipping, the move was described as "an essential part securing energy supplies". "The presence of the Indian navy in the area will help to protect our sea-borne trade and instill confidence in our seafaring community, as well as function as a deterrent for pirates," the statement added.
On November 11, the Indian warship was successful in fighting off a hijacking attempt of an Indian merchant vessel in the Gulf of Aden, according to Indian media. And on Tuesday night, the Indian navy claimed its frigate Tabar had fired on and sunk a pirate "mother ship" after coming under attack from the illegal vessel.
Japanese Prime Minister Taro Aso has also reaffirmed moves to seek a change in the law that would allow vessels belonging to the Maritime Self-Defense Force to be deployed to the Gulf of Aden and nearby waters to deter pirates.
He told lawmakers this week, "We need to study measures at an early date. It would be too late if a Japanese ship came under attack by pirates or its crew were taken hostage." Japan's constitution created after World War II prevents Japan from taking proactive military action.
Japan's anti-piracy efforts have mainly come through the Nippon Foundation, which has previously given money and other help to fight piracy in the Malacca Strait, in association with the Japan Coast Guard.
South Korea is also mulling plans to send a destroyer and navy special forces to combat piracy in the Gulf of Aden. Rear Admiral Yoon Young-sik confirmed South Korea was considering joining the multinational naval force patrolling the Arabian Sea and Indian Ocean.
South Korea recently deployed the destroyer Dae Jo Yeong on a goodwill tour to the Middle East that included a visit to Manama, Bahrain. Observers said South Korea could send the stealthy Gang Gam-chan Ham, one of six KDX-II class destroyers in the Korean navy, to help coalition anti-piracy patrols off Somalia.
Defense Ministry spokesman Won Tae-jae said a bill allowing the deployment of military forces to the Gulf of Aden and Arabian Sea would be submitted by the government to the National Assembly before the end of the current session in December. KDX-II class destroyers are equipped with helicopters and precision-guided missiles.
European Union member states on November 10 agreed to send a fleet of warships to the region to combat pirate attacks. Code-named Operation Atalanta - the armada will be the EU's first-ever naval action. The North Atlantic Treaty Organization (NATO) and the United States Navy's 5th Fleet are also in the area amid a flotilla of warships from the UK, Canada, France, Turkey, Germany and Russia.
Meanwhile, Hong Kong Shipowners' Association managing director Bowring said the attack on the supertanker Sirius Star showed the pirates' operating zone had extended to include the main oil trade route from the Arabian Gulf to Europe and the United States.
Consequently, "The risk to shipping is extremely high and getting worse. Pirates are well armed, well organized and superbly efficient," he said.
Moves to end piracy would have to include "both preventative and defensive action by the world's navies to protect the safe passage of world trade" and "the provision of aid and humanitarian work in Somalia". This would help "restore a working government and install effective law enforcement along the Somalia coast".
Bowring continued, "While there are some preventative measures that can be put in place by the owner and master of the ship, there is very little more that can be done in the event of an attack. The terrifying nature of the attack, with no apparent shortage of firepower and ammunition, means that the seafarers and the ship itself are under threat of severe injury and damage. And boarding of ships by the pirates under such conditions is unpreventable."
He pointed out that seafarers are not trained in the use of arms and merchant ships are not warships. But they are now trading through areas within which the potential for attack is extremely high.
One other solution, which has already been adopted by two or three shipping lines, is to avoid the Gulf of Aden completely and sail around the Cape of Good Hope off the southern tip of Africa. While this would add between 15 and 20 days sailing to a normal east-west voyage, it would also increase costs for owners and operators that would eventually find their way into consumers' pockets and such a move had the potential to further disrupt global trade.
Higher insurance costs could further erode profitability of Chinese and other Asian companies exporting to the increasingly important European market. The main trade route to Europe, China's biggest export market last year, is through the treacherous waters to the south of the Suez Canal approach, with the alternative requiring a long and fuel-guzzling detour around Africa.
Chinese goods to Europe are predominantly consumer goods, toys and garments, where profit margins are already tight due to fierce competition.
Asian exporters are already feeling the pinch from the global downturn.
"A few months ago, I had five out of six containers already on their way to the port returned because the client suddenly called and said he couldn't secure the payment,'' Umar Chotob, Indonesian owner of furniture exporter CV Java Marindra Jaya, told Bloomberg News. "The impact of the financial turmoil is remarkable. It's overwhelming.''
Last month, Singapore's exports had the biggest decline in more than six years on falling demand for the island's electronics and drugs. Non-oil domestic exports fell 15.3% from a year earlier, the island's trade promotion agency said on November 17.
Keith Wallis is East Asia editor of Lloyd's List
