Somali sea gangs lure investors at pirate lair

[[R_H]]

Reuters

HARADHEERE, Somalia (Reuters) - In Somalia's main pirate lair of Haradheere, the sea gangs have set up a cooperative to fund their hijackings offshore, a sort of stock exchange meets criminal syndicate.

Heavily armed pirates from the lawless Horn of Africa nation have terrorized shipping lanes in the Indian Ocean and strategic Gulf of Aden, which links Europe to Asia through the Red Sea.

The gangs have made tens of millions of dollars from ransoms and a deployment by foreign navies in the area has only appeared to drive the attackers to hunt further from shore.

It is a lucrative business that has drawn financiers from the Somali diaspora and other nations -- and now the gangs in Haradheere have set up an exchange to manage their investments.

One wealthy former pirate named Mohammed took Reuters around the small facility and said it had proved to be an important way for the pirates to win support from the local community for their operations, despite the dangers involved.

"Four months ago, during the monsoon rains, we decided to set up this stock exchange. We started with 15 'maritime companies' and now we are hosting 72. Ten of them have so far been successful at hijacking," Mohammed said.

"The shares are open to all and everybody can take part, whether personally at sea or on land by providing cash, weapons or useful materials ... we've made piracy a community activity."

Haradheere, 400 km (250 miles) northeast of Mogadishu, used to be a small fishing village. Now it is a bustling town where luxury 4x4 cars owned by the pirates and those who bankroll them create honking traffic jams along its pot-holed, dusty streets.

Somalia's Western-backed government of President Sheikh Sharif Ahmed is pinned down battling hard-line Islamist rebels, and controls little more than a few streets of the capital.

The administration has no influence in Haradheere -- where a senior local official said piracy paid for almost everything.

"Piracy-related business has become the main profitable economic activity in our area and as locals we depend on their output," said Mohamed Adam, the town's deputy security officer.

"The district gets a percentage of every ransom from ships that have been released, and that goes on public infrastructure, including our hospital and our public schools."

RISK VS REWARDS

In a drought-ravaged country that provides almost no employment opportunities for fit young men, many are been drawn to the allure of the riches they see being earned at sea.

Abdirahman Ali was a secondary school student in Mogadishu until three months ago when his family fled the fighting there.Given the choice of moving with his parents to Lego, their ancestral home in Middle Shabelle where strict Islamist rebels have banned most entertainment including watching sport, or joining the pirates, he opted to head for Haradheere.

Now he guards a Thai fishing boat held just offshore.

"First I decided to leave the country and migrate, but then I remembered my late colleagues who died at sea while trying to migrate to Italy," he told Reuters. "So I chose this option, instead of dying in the desert or from mortars in Mogadishu."

Haradheere's "stock exchange" is open 24 hours a day and serves as a bustling focal point for the town. As well as investors, sobbing wives and mothers often turn up there seeking news of male relatives missing in action.

Every week, Mohammed said, gang members and equipment were lost to the sea. But he said the pirates were not deterred.

"Ransoms have even increased in recent months from between $2-3 million to $4 million because of the increased number of shareholders and the risks," he said.

"Let the anti-piracy navies continue their search for us. We have no worries because our motto for the job is 'do or die'."

Piracy investor Sahra Ibrahim, a 22-year-old divorcee, was lined up with others waiting for her cut of a ransom pay-out after one of the gangs freed a Spanish tuna fishing vessel.

"I am waiting for my share after I contributed a rocket-propelled grenade for the operation," she said, adding that she got the weapon from her ex-husband in alimony.

"I am really happy and lucky. I have made $75,000 in only 38 days since I joined the 'company'."

[Themightytom]

Wow now we can invest in crime?
Oh wait...

[Rogue 9]

Sounds like a big, fat target to me. If they're motto is "do or die," I see no reason not to oblige them.

[Coyote]

Ayn Rand would be proud. See, the Libertarian dream is alive and well, as these enterprising venture capitalists have shown.

Truly, making money is God's work.

[salm]

I wonder if they can build a regular industry with the money they gain from piracy and slowly move on to more peaceful jobs. I doubt it, but at least then this whole priate thing would have some up sides.

[Coyote]

Actually, didn't a lot of the piracy start because Somali fishermen, who had once just quietly caught fish, were enraged that unscrupulous European businesses (*coughcoughmafiacoughahem*) were randomly dumping toxic waste off the coast of Somalia because there was no government that could oppose them? This killed off the fish and left the Somalis with boats, desperation, and firearms, so, hey...

So maybe they can use this money to fund attacks on the actual assholes dumping the toxic waste in the first place (if that is indeed what the impetus behind all this was)...

[salm]

Actually, didn't a lot of the piracy start because Somali fishermen, who had once just quietly caught fish, were enraged that unscrupulous European businesses (*coughcoughmafiacoughahem*) were randomly dumping toxic waste off the coast of Somalia because there was no government that could oppose them? This killed off the fish and left the Somalis with boats, desperation, and firearms, so, hey...

So maybe they can use this money to fund attacks on the actual assholes dumping the toxic waste in the first place (if that is indeed what the impetus behind all this was)...

Yeah, not only that but also asshole fishing companies (not only mafia but regular companies) from Europe and Asia used the oportunity overfish the region like hell. That´s one reason why i acutally have some sympathy for the pirates.

But then, they probably can´t find the waste dumpers and overfishers. I mean, if a load of modern warships in the region can´t find pirate vessles why would crappy pirate ships be able to find waste dumpers?

[PeZook]

Just wait. They simply need to gain enough money, manpower and arms to take over as the de-facto government of Somalia, start collecting taxes, buy a few used patrol boats and then start enforcing their claim on territorial waters and collecting protection money tolls from passing ships

We either get that, or a few decades of civil war and misery as pirate factions strive to get their share of the Somali pie. It almost seems sometimes like the damn country would be better off even if the West supported and armed some brutal tyrant in order for him to take over.

[Ryan Thunder]

Meh. They're gathering, which makes them an easy target. Just press the button and obliterate them. One tomahawk missile costs what, a few million dollars? Certainly, less than they'll try to extract from our shipping companies.

[Simon_Jester]

This vaguely reminds me of the origins of joint stock companies in England; the early companies were run and financed by the same sort of rich investors and intercontinental sailors who had previously been running and financing acts of piracy against Spain in the Caribbean.

Unfortunately, the Somalians are trying to get into the game 400 years too late, and the role of "massive prosperous global shipping hegemon that started out as a bunch of raggedy pirates on the edge of the relevant world" is already taken.

[Stark]

Meh. They're gathering, which makes them an easy target. Just press the button and obliterate them. One tomahawk missile costs what, a few million dollars? Certainly, less than they'll try to extract from our shipping companies.

You're an imbecile. I'm pretty sure Sea Skimmer said this before, but this entire problem exists because shipping companies pay them off. If we're to kill all the poor people who chase giant corporate handouts, we should start at home.

It's an interesting (and bad) situation made absolutely hilarious by impotent internet rage. 'You made my football team country look bad!'

[Sea Skimmer]

Yeah, even before the pirates had amassed literally hundreds of hostages as they have now, shipping companies refused to agree to military action, and they sure as shit haven’t changed that opinion even though the world now has a huge surplus of shipping. Back in 2000-2001 everyone had every ship busy as hell (building up this huge economic bubble that popped recently) and risked losing a fortune if a ship was damaged. It was more economical to negotiate for two months and pay a few million then have a SEAL team shoot up the bridge.

That is why this train wreck has gotten so absurdly bad instead of having been nipped in the butt years ago when it was still small scale. I do believe we have forum members who have personal experience in the US Navy in some of those early incidents too.

[Stark]

This article is interesting in that regard; the money pumped into the 'pirate community' is such that they attract and maintian civilians directly in related industries AND have a functional finance system. It's like an MMO emergent economy, only extremely dangerous.

[Ryan Thunder]

You're an imbecile. I'm pretty sure Sea Skimmer said this before, but this entire problem exists because shipping companies pay them off. If we're to kill all the poor people who chase giant corporate handouts, we should start at home.

But STARK, they can't accept the handouts if they're dead, now, can they?

Yeah alright, conceded.

[Aeolus]

Wow now we can invest in crime?
Oh wait...

That's actually not without precedent. Investing in Piracy was actually rather common in the 16th and 17th centuries. It was a pretty good investment at the time.

[[R_H]]

Ayn Rand would be proud. See, the Libertarian dream is alive and well, as these enterprising venture capitalists have shown.

Truly, making money is God's work.

Yup. It's still quite impressive what they've achieved. Earning 75K in 38 days doesn't sound too bad either and at least some of the money is going to the infrastructure in the area.

[CJvR]

I have stoped being amazed at the international spinelessness regarding piracy.
The worlds shipping lines can have as many pirates as they are willing to fund quite frankly.
How to combat piracy has been known for centuries, you starve it with convoys and you kill it by destroying it's bases.
How to promote piracy has also been known for centuries, you send out lone ships to be captured, you provide a market for the ill gotten gains to be sold and you accept the existance of safe havens for the pirates.
Considering the current policies one can only conclude that nations and shipping lines are of the opinion that we have to little piracy in the world.