Nigeria, Others Spend $500m Annually On Piracy- Report

Nigeria and other countries in the Gulf of Guinea are spending over $500 million annually to keep piracy at bay.

A new report by Stable Seas, a transnational maritime security research organization, said that with several attacks and kidnappings each year, much of that cost was tied not to the value of stolen ships or cargo but related to anti-piracy measures.

The report noted that for three consecutive years, the Gulf of Guinea had been the world’s most dangerous shipping route that spans 2.5 million square kilometers, recording more than half of the global attacks at sea.

The Gulf of Guinea borders 20 countries and is a key route for everything from steel to soda in a region that relies heavily on imports.

The report said: “For every $1 pirates steal or extort from African victims, Gulf of Guinea governments spend around $524 on counter-piracy efforts.

“Piracy gains are considerably lower, estimated at only about $5 million a year. The vast majority – $4 million – comes from ransoms paid by non-African entities seeking the release of non-African hostages.

It said that oil theft was a lucrative business model that netted pirates up to $25 million a year in the early 2010s, but far more difficult to pull off versus the swift raids being conducted now.

The report noted direct losses were due to ransoms paid for local hostages and the value of goods, stressing that oil stolen at sea were from $1 million to $1.2 million per year.

According to the report, “This number is significantly lower than it was a decade ago when oil theft at sea was more common and a greater share of hostages taken by kidnappers were West and Central Africans.

“Ransoms for non-African seafarers have climbed sharply in recent years, more than doubling from an average of $15,000 per non-African hostage in 2014, to as much as $40,000 in 2019. In comparison, West African fisher and oil worker ransoms have remained between $3,000-4,000 or as low as $1,000 per person.

“These low direct costs to African nations have created the perception among some that Gulf of Guinea piracy and armed robbery are greater problems for international shipping companies and foreign seafarers than they are for African nations.”

Stable Seas stressed that the lost government revenue estimated at $1.4 billion per year was as much as double the best estimates of the direct costs of piracy paid by international navies, intergovernmental organisations and the global marine transportation private sector each year.

The report estimated the piracy costs of twelve nations, specifically the area that stretches from Cote D’Ivoire in the northwest to Angola in the southeast. This area accounted for 95 percent of the region’s piracy and armed robbery incidents over the last three years and 93 percent of all Gulf incidents since 2010.