When pirates attack ships off the coast of Somalia, it also has an effect thousands of kilometers away. At least indirectly. Because in times of globalization everything is connected to everything else.
Hamburg - In the first three months of this year, 33 merchant ships were attacked by pirates worldwide, the Association of German Shipowners (VDR) warned, citing data from the International Chamber of Commerce on Wednesday (April 10). This means there were already 20 percent more attacks than in the same period last year. Around 90 percent of world trade travels via international sea routes - pirate attacks in this country indirectly cause prices to rise.
VDR on increase in pirate attacks: “We are watching developments with concern”
According to the shipping association, ships from India were primarily attacked by pirates in January, February and March, followed by ships with German involvement. “We are watching this development with concern,” explained VDR managing director Martin Kröger. The safety of ships and sailors must be guaranteed, Kröger continued. This is the only way to ensure the smooth flow of international trade. According to the figures, the waters of Bangladesh were the most dangerous: seven raids took place there, six near Indonesia, five each near Somalia and the Singapore Strait, and four near Angola.
In addition to piracy, the difficult geopolitical environment in the Red Sea, large parts of the Black Sea and the Indo-Pacific is currently challenging shipping, Kröger explained. Two Somali gang members confirmed to Reuters that they benefited from the distraction of Houthi rebel attacks a few hundred nautical miles further north to return to piracy after relatively quiet years. According to the International Maritime Bureau, piracy activity was at its highest in 2011, with 237 ships attacked.
Impact on shipping routes: detours and increased shipping speeds
Long detours, a switch to aviation and reduced trade volumes are consequences of the threat of piracy, according to an analysis by the Institute for the World Economy (IfW) from 2022. In response, ships also increase their speed so that pirates are less likely to get on board. The shipping companies would also equip their ships “with armed guards, electric fences, barbed wire, water cannons and other defense mechanisms,” it said. In addition, there would be higher insurance premiums, ransom payments and the need for an increased military presence.
All of this is reflected in higher transport costs. “This is likely to be reflected, at least in part, in rising consumer prices,” the IfW continued. 60 percent of German exports are carried out via international sea routes. “The freedom and security of trade routes is important for the German economy. Increasing attacks on ships ultimately endanger German prosperity,” said the Foreign Office in 2021. According to the IfW, the total costs of piracy are difficult to quantify, but estimates range from seven to 12 billion US dollars (around 7.5 to 12.9 billion euros) per year.
Key in the fight against piracy: increased naval presence – and poverty reduction
The German Navy is particularly important for protection, as its participation in international operations makes a significant contribution to curbing the danger of piracy and ensuring safety on the world's oceans, emphasized the shipping association. According to VDR, what shipping companies and crews can do themselves is limited. In addition to securing the ships with water cannons or fences on the Rehling, this involves, among other things, observing warnings and registering in reporting systems. India recently increased its presence in the region's seas.
The IfW also confirmed that the increased naval presence in the affected regions off the Somali coast was a right step that has contributed to the decline in piracy since its peak in 2011. “Piracy at sea is and remains a problem that must be taken seriously by the international community,” the IfW experts continued and warned: “In the long term, however, only an improvement in living conditions in the affected countries can prevent people from becoming criminals Activities must take place to support themselves and their families.”