Scott, thanks for that introduction, and for inviting me here today. I want to thank API for the work that it does promoting U.S. business and commerce, and for organizing this important event. It is my pleasure to be here and to speak to an audience with so much experience and expertise. I look forward to hearing from you following my remarks.
Piracy off the coast of Somalia is a critical issue for the United States, the international community, and the global economy. Since 2008, Somali pirates have hijacked 175 vessels and attacked at least 445 others. They have kidnapped 3,000 crewmembers from over 40 countries, and are still holding 241 hostages today. They hijacked 27 ships last year and six already this year. There are ten ships currently being held by Somali pirates. Three are tankers.
While piracy at sea is certainly not a new problem, its modern reincarnation has new impacts. Piracy off the coast of Somalia threatens one of the principal foundations of today’s modern interconnected global economic system -- the freedom of navigation. In a globalized world, the impact of piracy in one area of the world can cause a ripple effect across the globe. People in countries around the world depend on secure and reliable shipping lanes for their food, their medicine, their energy, and consumer goods brought by cargo ships and tankers. By preying on commercial ships in one of the world’s busiest shipping lanes, pirates off the Horn of Africa threaten more than just individual ships. They threaten a central artery of the global economy -- and that means that they threaten global security.
In 2007 and 2008, pirate attacks began to escalate dramatically. A vicious and reinforcing cycle was forming. Motivated by escalating ransom payments – which grew into the millions of dollars – and a lack of other opportunities to make money quickly, more and more Somali men took to the sea. Piracy, as a result, went from a fairly ad hoc, disorganized endeavor to a highly developed transnational criminal enterprise. Flush with money, pirates were also able to improve their capabilities and expand their operations further and further from shore.
To make matters worse, Somalia offered pirates near ideal conditions. Piracy is a prime example of the dangers and problems that can arise from the presence of ungoverned spaces in our globalized world. In places off the coast of Somalia where pirates operate – throughout the coastal areas in Puntland and parts of central Somalia – the lack of governance and weak institutions provide them with safe haven. With more than two thousand miles of coast line and with the Gulf of Aden to its north, Somalia sits along one of the world’s busiest shipping lanes. This high volume of trade means that there is virtually an endless variety and supply of ships for Somali pirates to target. Over time, tankers and other high-value ships became prized targets for potential high ransoms that raised the bar on the amounts demanded by and paid to pirates for individual ships and crews. The fact that many tankers are ‘low and slow’ makes them particularly attractive targets.
Piracy emanating from Somalia represented a perfect storm for the international community – a weak state in a strategically essential location that harbors a rapidly growing transnational criminal enterprise and which threatens a vital artery of the global economy.
The U.S. government has made it clear that it will take all appropriate measures to protect our citizens, safely recover hostages, and bring hostage takers to justice. Just months into office in 2009, the Obama administration was confronted with the hostage taking of the American captain of the MAERSK Alabama, a U.S.-flagged ship carrying a cargo of food aid. The President authorized the use of force to rescue the captured captain, and after a tense standoff, U.S. Navy Seals successfully freed the captain. And just hours before the State of the Union address last January, President Obama ordered U.S. Special Forces to rescue an American and a Danish aid worker being held hostage on the ground in Somalia. The health of the American hostage Jessica Buchanan was deemed to be in jeopardy and the President ordered U.S. forces to rescue her. This dangerous but ultimately successful mission demonstrated our resolve.
In the past, there seemed to be no limit to the growth of piracy. Today, through the collective efforts of the international community and the private sector, we are now seeing signs of clear progress. In 2011, the number of successful pirate attacks fell by nearly half. There has been a significant drop in the numbers of ships and crew held hostage. In January 2011, pirates held 31 ships and 710 hostages. In early May of 2012, pirates hold ten ships and 241 hostages – a roughly 70 percent decline. This is still an unacceptable number, but clearly we are making progress. This morning, I’d like to talk to you about the U.S. response to Somali piracy and why I think our efforts, in conjunction with the efforts of the international community and the private sector, are having an impact.
In combating piracy, the United States has pursued an integrated multi-dimensional approach toward combating piracy that focuses on:
From the beginning, the United States has led and adopted a multilateral approach focused on addressing piracy as a shared challenge most effectively addressed through broad, coordinated, and comprehensive international efforts. In January 2009, the United States helped establish the Contact Group on Piracy off the Coast of Somalia to both prompt action and coordinate efforts to suppress Somali piracy. It has grown from 29 initial participants to nearly 70 nations and international organizations today. It also includes international and maritime industry organizations.
The Contact Group’s meetings enable interaction between states, regional and international organizations, and industry. A number of specialized working groups were established within the Contact Group to address a variety of subjects, including naval coordination at sea; judicial and legal issues concerning captured pirates; liaison with industry; public diplomacy programs in Somalia to discourage piracy; and most recently, a working group to focus on and coordinate efforts to disrupt the pirate enterprise ashore. Many of you may be familiar with Working Group 3, until recently co-chaired by the U.S. Maritime Adminstration and U.S. Coast Guard, which was very effective in communicating industry views and concerns to government and intergovernmental policy makers. The Republic of Korea recently assumed the chairmanship of Working Group 3 from the United States. We’re looking forward to continuing to support this very important forum for liaison with the maritime industry.
Through its five working groups, the Contact Group draws in international expertise and adopts a problem-solving approach toward addressing piracy. This coordinated international engagement has spawned significant and effective action.
In this regard, the Contact Group helps to synchronize the many efforts underway to utilize resources effectively, prevent duplication, and maximize the impact of national international efforts. Private sector contributions to these efforts would be welcome. One activity that your firms may wish to consider would be contributions -- in cash or expertise -- to the Trust Fund to Support Initiatives of States Countering Piracy off the Coast of Somalia. General or designated donations for particular projects are possible. For example, Shell, Maersk, BP, and Japan Shipping recently announced a combined donation to economic capacity-building projects in Somalia. We would welcome similar donations by U.S. industry.
There’s another interesting international effort currently underway. RAPPICC stands for the Regional Anti-Piracy Prosecutions Intelligence Coordination Centre in the Seychelles. Early this year, the UK and the Seychelles decided to move forward on RAPPICC, which will be located on an old Seychellois Coast Guard base. The RAPPICC will be an information fusion center that facilitates the capture and prosecution of the financiers, investors and ringleaders of Somali piracy. It will be part of a larger “Crime Campus” with a 20-person holding facility for use in conducting interviews.
The UK allocated over one million dollars in initial funding and proposed that RAPPICC be initially led by the British Serious Organized Crime Agency. The Seychelles agreed. The U.S. is now examining possible support to and participation in RAPPICC.
The issue of armed robbery and piracy has also become a significant component of our bilateral diplomatic engagements with other countries. When we engage in diplomatic talks with countries as varied as India, Indonesia, Nigeria, and Brazil, this issue is on the agenda. It is a shared challenge that many countries have an interest in seeing addressed.
In West Africa and the Gulf of Guinea, we are working with our partners on a related but different problem. Their situation varies from Somali piracy; we shouldn’t conflate the two. Piracy and armed robbery in the Gulf of Guinea is not systematic hostage taking for ransom. Instead, it is often illegal oil bunkering abetted by corrupt regional actors. Recent UN Security Council Resolutions encourage States of the Gulf of Guinea region to develop “a regional framework to counter piracy and armed robbery at sea, including information-sharing and operational coordination mechanisms in the region.” Towards that end, the United States, led by the U.S. Africa Command, has supported regional organizations in their efforts to address the problem.
Another way that government can help is by increasing security at sea. As you know, as pirate attacks increased, the United States, NATO, the EU, and many other national navies responded.
The United States established Combined Task Force 151 – a multinational task force charged with conducting counter-piracy naval patrols in the region. It operates in the Gulf of Aden and off the eastern coast of Somalia, covering an area of over one million square miles. In addition, there are a number of coordinated multinational naval patrols off the Horn of Africa. NATO is engaging with Operation Ocean Shield, the European Union has Operation ATALANTA, and other national navies in the area conduct counter-piracy patrols and escort operations as well.
On any given day, up to 30 vessels from as many as 20 nations are engaged in counter-piracy operations in the region. This force includes countries new to this kind of effort, like China, India, and Japan. U.S. and international naval forces have thwarted pirate attacks in progress, engaged pirate skiffs, and successfully taken back hijacked ships during opposed boardings. We have also sought to create a safe transit corridor for commercial shipping vessels. U.S. Naval Forces Central Command has worked with partners to set up a nearly 500-mile long transit corridor through the Gulf of Aden. This transit zone is heavily patrolled by naval forces and used by some countries for convoy operations. The corridor has helped reduce the number of attacks within the transit zone, but it also has had the side effect of pushing pirate activities further out to sea.
The pirates’ expansion of their area of operations demonstrates how they adapt their tactics in response to international efforts. The expanded use of mother-ships has made pirates more difficult to interdict and more effective at operating during the monsoon seasons, which previously restricted their activities. Mother-ships have extended the pirates’ reach far beyond the Somali Basin, all the way to the west coast of India. Somali pirates now operate in a total sea space of approximately 2.5 million square nautical miles – an area equivalent to the size of the continental United States. This makes it difficult for naval or law enforcement ships and other assets to reach the scene of a pirate attack quickly enough to disrupt an ongoing attack. There is just too much water to patrol.
Navies can’t be everywhere. That’s why we need the maritime industry’s ships themselves to become tougher for pirates to seize. Indeed, the best defense against piracy is often simply vigilance on the part of the maritime industry. The private sector is now playing a major role in deterring and preventing pirate attacks.
In response to the growing threat, we’ve worked with the shipping industry to develop and implement “best management practices” to prevent pirate boardings before they take place. These include practical measures, such as:
These steps, when properly implemented, remain some of the most effective measures to protect against pirate attacks. Recognizing the value of these measures, the U.S. government has required U.S.-flagged vessels sailing in designated high-risk waters to take additional security measures. Nevertheless, we remain troubled that there are still commercial ships travelling through pirate-infested waters that have yet to implement appropriate security measures. Approximately 20 percent of all ships off the Horn of Africa are not taking proper security precautions. Unsurprisingly, these account for the overwhelming number of successfully pirated ships. Take the case of the Smyrni, a tanker that was taken by Somali pirates earlier this month. The Smyrni was transporting a valuable cargo of oil that was loaded in Turkey and was destined for Indonesia. What is noteworthy and unfortunate about the Smyrni hijacking is that it was avoidable. The ship had no embarked security team on board and took a dangerous course. It was easy pickings for the pirates.
However, we must also recognize that even when fully implemented, best management practices do not guarantee security from pirates. As a result, we have also supported the maritime industry’s use of additional measures to enhance their security – such as embarking armed security teams. To date, not a single ship with Privately Contracted Armed Security Personnel aboard has been pirated.
These teams serve as a potential game-changer in the effort to counter-piracy. The IMO is examining the issue of internationally recognized standards for the use of Privately Contracted Armed Security Personnel. In most engagements, the situation ends as soon as pirates are aware an armed security team is on board. Pirates often break off the attack and turn their skiffs around and wait for another less protected ship to come by. These teams therefore have served as an effective deterrent.
Best Management Practices and Privately Contracted Armed Security Personnel are not an either/or choice. They should be used together and tailored to the specific needs of particular ships and transit plans.
When a vessel is successfully hijacked, our foremost concern is always about the safety of the crew, regardless of nationality. The U.S. government is acutely aware of the dilemma that shipowners face when ships and sailors are taken hostage. While the safety of the crew is critical, it’s also a fact that submitting to pirate ransom demands ensures that future crews will be taken hostage. The United States has a long tradition of opposing the payment of ransom, and we have worked diligently to discourage or minimize ransom payments. While some may consider this the cost of doing business, every ransom paid further institutionalizes the practice of hostage-taking for profit and promotes its expansion as a criminal enterprise. We strongly encourage flag States, shipowners, and private parties involved in hostage crises to seek assistance from appropriate U.S. government sources in their crisis management procedures.
The enormous ransoms that are paid out make the kidnapping-for-ransom industry incredibly lucrative. The average ransom is now at $4.5 million per incident; one ransom totaled $12 million. And as I’m sure you know, tankers command the highest ransoms. Total ransom payments paid to Somali pirates increased from approximately $80 million in 2010 to $140 million in 2011. The average ransom demanded has soared from roughly $150,000 in 2005 to $4.6 million in 2011. In light of the pirates’ growing difficulties at sea, we have seen pirates shift to targeting hostages on land, such as with captured aid workers or tourists at beach resorts. Pirates’ ability to adapt means that the maritime industry and the international community must be constantly vigilant in assessing the effectiveness of self-protection measures.
The United Kingdom’s February conference on Somalia explored a wide range of global initiatives to speed assistance to Somalia, promote a credible political transition, sever the terrorist group al-Shabaab’s financial lifelines, and counter piracy and kidnapping operations. The United States welcomed the United Kingdom’s initiative to create an international task force to discourage the payment of ransoms to pirates, terrorists, and other groups, as well as prevent the illicit flow of money and its corrosive effects. We are participating in this task force and doing everything in our power to make it more effective.
Prosecution, Incarceration, and Pirate Networks
Now let me turn to another aspect of our response – our efforts to deter piracy through effective apprehension, prosecution and incarceration of pirates and their supporters and financiers. Today, over 1,100 pirates are in custody in 20 countries around the world. Most are or are expected to be convicted and sentenced to lengthy prison terms.
An important element of our counter-piracy approach involves renewed emphasis on enhancing the capacity of states – particularly those in the region – to prosecute and incarcerate suspected pirates. The United States is currently supporting efforts to:
We are moving in the right direction in this area. Last year, a new maximum security prison opened in northern Somalia to hold general convicts and convicted pirates. Nevertheless, the capacity and willingness to prosecute and incarcerate pirates is limited. Countries in the region that might be able and otherwise willing to prosecute Somali pirates in their national courts often decline to do so because they do not want to squeeze more pirates into their already overburdened prison systems. In this regard, we are in some ways a victim of our own success. We are apprehending more pirates at sea, leading to more crowded prisons. Expanding the capacity to prosecute and incarcerate pirates is a real challenge and is one that the international community, including the governments of flag states and ship owners, will have to work hard to address. Your industry can also support this important effort by contributing to the Trust Fund. I encourage all of you to do that.
As piracy has evolved into an organized transnational criminal enterprise, it is increasingly clear that the arrest and prosecution of pirates captured at sea is insufficient on its own to meet our longer term counter-piracy goals. Most pirates captured at sea are often low-level operatives. The sad fact is that prosecution is often a limited deterrent for men lacking employment opportunities onshore and who are willing to venture hundreds of miles out to sea in nothing more than a small boat. An untold number of pirates are lost at sea every year. Part of what makes piracy seem so intractable is that despite these dangers, the lack of other economic opportunities in coastal communities means there is no shortage of willing recruits for pirate organizers to choose from.
After an intensive review of our strategy last year, Secretary Clinton approved a series of recommendations which constitute a new strategic approach. A focus on pirate networks is now at the heart of our strategy. We are using all of the tools at our disposal in order to disrupt pirate networks and their financial flows. We are focused on identifying and apprehending the criminal conspirators who lead, manage, and finance the pirate enterprise, with the objective of bringing them to trial and disrupting pirate business processes. Often, the best way to attack organized crime is to follow the money. That’s how the U.S. put some nefarious criminals behind bars. Pirate organizers receive income both from investors and ransom payments, and disburse a portion of the proceeds of ransoms back to these investors. Already, the United States has convicted one Somali pirate negotiator.
The Contact Group recently endorsed this approach and formed a new working group, under Italy’s leadership, to assist in multilateral coordination to disrupt the pirate enterprise ashore. We are working to connect law enforcement communities, intelligence agencies, financial experts, and our international partners to promote information sharing and develop actionable information against pirate conspirators. This effort will include tracking pirate sources of financing and supplies, such as fuel, outboard motors, and weapons.
Situation on the Ground in Somalia
All of the policies I’ve described help us to combat piracy. But the only long-term solution to piracy is the re-establishment of stability, responsive law enforcement, and adequate governance in Somalia. This will require concentrated and coordinated assistance to states in the region and credible governing authorities in Somalia to build their capacity to deal with the social, legal, economic and operational challenges to governance, effective law enforcement and economic development. To that end, the United States continues to support the Djibouti Peace Process, the Transitional Federal Government (TFG), and other regional authorities working toward these same goals. In February, Secretary Clinton attended the London Conference on Somalia, which the United Kingdom convened to galvanize high-level international support for Somalia’s political transition.
However, acknowledging the difficult situation on shore doesn’t preclude progress at sea. While there is no simple solution to modern-day piracy, we are having a positive effect on what was seemingly an intractable transnational problem.
The U.S. response to piracy also shows how we as a government can address new and emergent transnational challenges. Addressing these threats requires us to be flexible and innovative in how we respond. It also requires agencies across the U.S. government to work together so that we bring every tool that we have to bear – including our diplomatic, military, law enforcement, economic, and intelligence tools.
There isn’t just one single thing we can do, or just one policy we can implement, that will end piracy. Reducing and mitigating the threat posed by piracy will be long, hard work. But it is clear that the multifaceted nature of our response is having an impact. As pirates continue to adapt, we need to stay vigilant and continue our efforts. The security of your ships, the region, and the global economy depend on it.
Finally, we come to the question of what you can do to insure the safety of your crews and vessels. They key actions should be:
With that, I thank you for your attention, and will be glad to take your questions.