Piracy pushes up project logistics costs

Piracy remains one of the biggest threats to vessels moving project cargo along Africa’s West and East coasts. Crew and cargo are often held hostage for long periods of time with the result that projects either come to a halt until the cargo can be delivered or they have to be re-sent from the point of origin. This increases costs tremendously and can ultimately lead to business pulling out of the continent. According to David Butler, managing director of Control Risks Southern Africa, piracy off the African coasts is far from under control. “There have been 93 incidents – including 20 hijackings – this year alone,” he said. “In fact, around the Horn of Africa, piracy seems to be on the increase. We have also seen a significant increase in piracy further down the coast as far as Mozambique.” According to Butler, piracy has become a multimillion-dollar business in Africa. “The ransoms are high and they are being paid. The gains are therefore very lucrative. If the vessel and cargo owners don’t pay the ransoms demanded they run the risk of crew and cargo being held hostage for months and even years in some cases.” One vessel and its crew has been held captive by Somalian pirates now for at least two and a half years and counting, said Butler. The bigger risk, however, is death. “The pirates are getting more violent and less tolerant. We are seeing an increase in the violence against crews with some pirates even reneging on deals struck through negotiations.” He said while there had been fewer incidents of piracy off the Somalian coast in 2012, this could change in the very near future. “There has been less piracy as security has been at an alltime high, with many navy vessels patrolling the area. But as Europe continues to face economic woes, this could mean they will recall their navy vessels to save costs. That will have a negative impact.” CAPTION David Butler … ‘Piracy off the African coasts is far from under control.’