The waters around the Horn of Africa (HoA) currently constitute the most pirate prone region of the world. Between 2008 and June 2010, 420 actual and attempted attacks were reported in this strategic corridor—which encompasses the Gulf of Aden, southern Red Sea and territorial seas of Somalia—accounting for roughly 70% of global incidents during this period. As of August 2010, Somali pirates were holding 18 ships and 379 crew for ransom, with average settlements now in the range of $3.5 to $4 million per vessel. Perpetrating groups have demonstrated an ability to operate far from shore as well as seize even the largest ocean-going freighters. This article examines how these groups operate, while also questioning whether the use of private security contractors to safeguard vessels constitutes a viable response to the ongoing piracy threat in the HoA.
Piracy in the HoA: Perpetrating Groups and Attack Dynamics
Historically, the Hobyo-Haradhere cartel (sometimes referred to as the Somali “Marines”) and syndicates based in Puntland dominated much of the Somali piracy scene. The Hobyo-Haradhere cartel was largely the product of one man, Mohammed Abdi Hassan “Afweyne,” a former civil servant, and it mainly operated out of Ceel-Huur and Ceel-Gaan (roughly 250 miles north of Mogadishu). By the end of August 2006, the cartel was thought to have between 75 and 100 armed men and a flotilla of at least 100 small motorized skiffs. Farah Hirsi Kulan (also known as “Booyah” and considered the “father of piracy in Puntland”) was key to the Puntland piracy scene, acting as the principal recruiter, organizer and financier for missions of several hundred pirates operating out of the Eyl area. Today, these players now compete with a diffuse mosaic of groups based in a number of coastal hamlets along the 1,900-mile Somali seaboard. The current main piracy hubs include Eyl, Garard and Ras Asir.
Membership in these gangs is fluid, although most personnel have a fishing background and are generally linked by common clan, blood or tribal allegiances. They do not espouse any particular ideological agenda and have no association with al-Shabab Islamist insurgents currently fighting the notional Somali government in Mogadishu.
Unlike the pirate-infested waters of Southeast Asia, the vast majority of HoA attacks—more than 93%—occur during daylight and last between 30 and 45 minutes. The most vulnerable ships are those that are easy to intercept and board, and which offer the greatest potential for a large payoff. In most cases, this means vessels traveling at 15 knots or less with low freeboards (the distance from the upper deck to the waterline) and medium-to-high tonnage.
While most incidents currently occur close to Somali shores, gangs have exhibited an ability to act extremely far out at sea. Somali pirates have been reported as far west as the Maldives and as far south as the Mozambique Channel, tending to “migrate” as weather conditions around the HoA deteriorate during the northeastern monsoon period. One particularly publicized attack, the hijacking of the Saudi-registered supertanker MV Sirius Star in 2008, occurred more than 500 nautical miles from shore. When attacks of this distance are mounted, pirates will operate from a “mothership” and then launch skiffs as they approach their intended target.
Once on board, the pirates will generally round up the crew and detain them below deck. Depending on the size of the hijacked vessel, they will either force the captain and his first officer to pilot the ship back to Somali waters or sail it themselves. The ship will then be docked at a port under the control of the pirates where it remains until negotiations for its release are finalized. Most vessels are currently being held in hamlets located along the northeastern Somali coast. Since attacks are short and the distance to be monitored so large, the probability of intercepting a “live” hijacking while it is underway is extremely low. This means that in most cases perpetrating gangs have little to fear from the various international navies currently patrolling off the HoA.
The cost of an attack obviously varies by complexity, but most amount to no more than $300 to $500 assuming a gang has its own boats. The more expensive part of an operation is the maintenance of the vessel during negotiations, which can add up to as much as $100 a day depending on the size of the ship and the number of hostages being held. In the case of smaller hijackings, costs are either “fronted” by the pirate leader (who also takes most of the ransom) or collectively borne by the gang’s members. For operations involving the seizure of large ocean-going freighters, however, outside investors usually provide the necessary funds. Since payments are made in cash and then transferred through the unofficial hawala remittance system, the money trail has proven difficult to follow. Nevertheless, law enforcement officials believe backing comes principally from mafia “bosses” based in Somalia, Lebanon, Dubai and Europe.
Somali pirates are well equipped with access to a wide assortment of both basic and more advanced weaponry, including assault rifles, heavy and light machine guns, anti-ship ordinance and rocket-propelled grenades (RPGs). Most of these arms appear to be sourced from illegal bazaars and dumps in Somalia, Ethiopia and Sudan or bought directly from Yemeni gun dealers. Although outfitted with an array of guns and other battle-related materiel, syndicates are generally low-tech. Contrary to popular wisdom, the use of night vision goggles, global positioning systems, satellite phones and automated ship identification units is rare.
The basic objective of an attack is to extort money from shipowners by seizing their vessels and cargo. As noted, average settlements now amount to around $4 million, which is more than double the figure a mere 22 months ago. Last year, Somali gangs netted an estimated $50 to $150 million in total ransoms, with one case involving the Greek-owned Maran Centarus running to a staggering $7 million. Since the essential aim is to elicit as large a payment as possible, violence is typically not a feature of attacks (unlike incidents off West Africa and Indonesia). In most cases, hostages are treated relatively well and reports of abuse and forced starvation appear unfounded. Indeed, between 2009 and mid-2010, of the 1,381 seafarers taken hostage in acts of piracy off the HoA, only five were killed.
Countering Piracy off the HoA:
The Role of Private Security Companies
Growing international concern with the piracy problem off the HoA has prompted a number of private security companies (PSCs) to make their services available to protect commercial vessels transiting the region. Prominent examples include Eos Risk Management, Hollowpoint Protection, Anti-Piracy Maritime Security Solutions, Secopex, Gulf of Aden Group Transits, the Hart Group, the Olive Group, ISSG Holdings Ltd., Muse Professional Group Inc and Xe Services. According to David Johnson, the chief executive officer of Eos Risk Management, business opportunities for these firms have more than tripled since 2008.
PSCs have aggressively engaged the shipping industry, arguing that they constitute a vital force multiplier to existing naval patrols in the Gulf of Aden by providing professional protection that is uniquely tailored to the specific requirements of their customers. The range of services currently on offer has spanned the spectrum from advice and training to active defense (both lethal and non-lethal), escort support and hostage-rescue. An implicit point in the PSC case is that their presence obviates the need for shipowners to arm their own crews. This is an important consideration as most mariners are generally not well versed in the controlled use of light weapons and do not have combat experience; not only would this leave the ship in jeopardy, it would also place the crew in extreme danger by exposing them to a situation for which they have little (if any) training.
Several parties have actively backed the growing PSC presence off the HoA. The United States has been especially favorably inclined, with Vice Admiral William Gortney—the commander of the 5th Fleet—acknowledging that coalition maritime forces simply do not have the resources to provide round-the-clock surveillance for a region that measures more than two million square miles in area and sees transits in excess of 20,000 vessels a year. European shipowners have been equally as supportive. In Germany, for example, there has been a growing trend toward flagging vessels in open registry countries so that mercenaries can be taken on board to protect personnel and cargoes (which is not allowed under German law).
A number of maritime insurance companies have also welcomed the growing interest of PSCs in the Gulf of Aden. Certain firms have slashed premiums by as much as 40% for ships hiring their own security—bucking a trend that has otherwise seen rates escalate by as much as 400% since 2008. In late 2008, the British-based Hart Group launched the first joint venture with an insurance company, whereby the latter offered discounted rates for ships sailing past Somalia using the former’s guards.
Despite these endorsements, there are a number of arguments against using PSCs for policing duties in the HoA. First, many firms have yet to develop clear rules of engagement or seek legal advice about the legal consequences of opening fire against suspected criminals. Accidental death or injury as a result of an exchange could, as a result, expose shippers to potentially crippling liability claims or even criminal charges.
Second, many states do not allow armed vessels to enter their territorial waters as this runs counter to the established right of “innocent passage.” Having armed guards on board a ship would be likely to significantly enhance the legal complexities and costs of any journey that entails multiple ports of call, which is the case for most commercial container carriers. Egypt already requires all commercial vessels to forfeit any weapons that they might have before entering the Suez Canal, which is creating eight-to-ten hour backlogs. Abu Dhabi also recently announced that it plans to confiscate weapons on any ship traveling through its territorial waters, which could potentially create delays of up to six hours.
Third, traditional flag states generally do not register ships that carry weapons. The employment of armed guards would therefore be likely to encourage a shift to “open registry” countries (or flags of convenience/FoCs) such as Belize, Honduras, Liberia, Panama, the Bahamas and Bermuda—all of which are characterized by considerably more lenient standards and legal requirements. As noted, this is already occurring in Europe. If the trend continues, it will exacerbate what is already a remarkably opaque and unregulated industry.
Fourth, PSCs are expensive. Providing a robust external escort costs between $10,000 and $50,000, depending on the length of the accompanied trip, while an on-board three-man security detail can cost as much as $21,000 a day. Although larger owner-operators may be able to contemplate such outlays, they are well beyond the means of smaller “mom and pop” shipping companies. Unfortunately, it is these entities that constitute the bulk of attacks in the HoA, presently accounting for around two-thirds of all hijackings in the region.
Fifth, PSCs could trigger an inadvertent arms race with pirates—thereby potentially placing vessels in even greater risk of being caught in a hostile exchange. As noted, most gangs presently neither act to cause structural harm to the vessels they hijack nor do they injure those they capture: the basic objective is to lever these “assets” for ransom. If pirates encounter vessels with heavily armed security details, however, there is a high likelihood that they will move to elevate their own threshold of violence and storm vessels with an active intent to use lethal force against anyone they confront. In the words of Cyrus Moody, a senior manager with the International Maritime Bureau, “If someone onboard a ship pulls a gun, will the other side pull a grenade?” Such a prospect has definitely informed the threat perceptions of shipowners, with most “happy” to pay ransoms rather than contemplate the costs that could result from a major firefight that leads to the wholesale loss of a vessel, its cargo and crew.
Finally, there is no public registry of the different companies providing armed guards to commercial vessels, which makes auditing the standards and personnel of these entities difficult. In most cases, shipping companies are forced to rely on the “sales pitch” of the PSC in question, which is unlikely to provide the basis for an objective assessment of the security to be provided. In addition, because owner-operators seek to minimize their overhead operating costs as much as possible, the probable tendency will be to hire the cheapest PSC on offer. In the absence of a formal vetting procedure, there is no way to ascertain whether this price is genuinely cost effective or merely reflective of a “fly by night cowboy outfit.”
Long considered a scourge of the past, piracy continues to flourish off the HoA. Gangs have access to a wide array of weapons, are prepared to act far from shore and are clearly capable of seizing even the largest ocean-going carriers. While the use of PSCs may offer some deterrent value, the potential costs of hiring these firms would appear to outweigh the benefits. Moreover, employing PSCs have no effect on the land-based “push-factors” in Somalia that lie at the root of the problem, notably poverty, underdevelopment and above all a lack of internal governance.
Dr. Peter Chalk is a Senior Policy Analyst with the RAND Corporation, Santa Monica, California. He has worked on a range of projects examining transnational security threats in Latin America, Africa and Asia. He is Associate Editor of Studies in Conflict and Terrorism—one of the foremost journals in the international security field—and serves as an Adjunct Professor with the Naval Postgraduate School in Monterey, California.
 International Maritime Bureau, Piracy and Armed Robbery at Sea: Annual Report, 2009 (London: International Chamber of Commerce, 2010); International Maritime Bureau, Piracy and Armed Robbery Against Ships: Report for the Period 1 January – 30 June 2010 (London: International Chamber of Commerce, 2010).
 Carolyn Bandel and Kevin Crowley, “Somali Pirate Attacks Sink Premiums as Insurers Leap Aboard,” Bloomberg, August 2, 2010.
 Bruno Schiemsky, “Piracy’s Rising Tide: Somali Piracy Develops and Diversifies,” Jane’s Intelligence Review, January 20, 2009.
 Kerin Backhaus, “Piracy in the Puntland Region of Somalia,” OilPrice.com, May 12, 2010.
 Bosasso is also home to pirate gangs, but does not act as an operational base per se. Kismayo used to be a prominent den, but syndicates have mostly been driven out since al-Shabab took over the city a couple of years ago.
 Peter Chalk, “Piracy off the Horn of Africa,” Brown Journal of World Affairs 16:2 (2010): pp. 91-92. See also Stig Hansen, Piracy in the Greater Gulf of Aden: Myths, Misconceptions and Remedies (Oslo: Norwegian Institute for Urban and Regional Research, 2009). It should be noted that a number of Somali gangs have recruited across lineage lines to ensure they have the best and most experienced personnel available.
 Indeed, al-Shabab is vehemently opposed to Somali pirates, viewing them as common bandits that act contrary to Islamic principles. During the brief period of rule under the Islamic Courts Union, the incidence of piracy in Somalia dropped markedly and al-Shabab has vowed should they ever regain full control over the country they will immediately move to eradicate any gangs that continue to operate from Somalia’s shores. While there have been some reports of certain pirate syndicates splitting their ransom payments with Islamist insurgents to obtain more powerful weaponry, there is no concrete evidence to support these assertions. Additionally, Somali pirates already have access to arms sources, including Yemeni gunmen and illegal munitions dumps/bazaars in East Africa, particularly in Sudan and Ethiopia. For further details on the supposed link between pirates and insurgents in Somalia, see Jeffrey Gettleman, “In Somali Civil War, Both Sides Embrace Pirates,” New York Times, September 1, 2010.
 Personal interviews, maritime specialists, Copenhagen, Denmark, March 2010.
 Personal interview, Royal Australian naval officer, Canberra, Australia, July 2009. See also “Countering Piracy Off the Horn of Africa: Partnership and Action Plan,” U.S. National Security Council, December 2008.
 Personal interviews, maritime specialists, Copenhagen, Denmark, March 2010; International Maritime Bureau, Piracy and Armed Robbery Against Ships: Report for the Period 1 January – 30 June 2010 (London: International Chamber of Commerce, 2010), pp. 20-21.
 Robert Worth, “Pirates Seize Saudi Tanker Off Kenya: Ship Called the Largest Ever Hijacked,” New York Times, November 18, 2008; Sharon Otterman and Mark McDonald, “Hijacked Supertanker Anchors off Somalia,” New York Times, November 19, 2008.
 Personal interviews, Royal Australian naval officer and maritime specialists, Canberra, Australia, July 2009 and Copenhagen, Denmark, March 2010. While the ship is at dock, supplies are rendered from “vendors” working on shore. In many ways, piracy has served to stimulate a cottage service industry in pirate dens such as Eyl and Garard and most locals in these communities have little motivation to see the practice eradicated (as it is viewed as an economic lifeline).
 Some vessels are also being held in Hobo (on the coast of Puntland) and Hobyo.
 There are currently around 14 international navies with a collective contingent of around 30 ships patrolling in or near the Gulf of Aden. These include both unilateral deployments and coalition forces operating under the auspices of Combined Task Force 151, the European Union’s Atalanta flotilla and NATO’s Operation Ocean Shield.
 Hansen, p. 38.
 Chalk, “Piracy off the Horn of Africa,” p. 91; Patrick Mayo, “Kenyan Firms Make Killing from Piracy,” Daily Nation, July 23, 2010; Jaindi Kisero, “Mystery of Sh164bn Smuggled into Kenya,” Daily Nation, June 9, 2010; Raymond Gilpin, Counting the Costs of Somali Piracy (Washington, D.C.: U.S. Institute of Peace, 2009), p. 2.
 Personal interviews, maritime security specialists, Copenhagen, Denmark, March 2010.
 “Pirates Seize Singapore Cargo Ship in the Gulf of Aden,” BBC, June 28, 2010; Tristan McConnell, “Battle Rages in Pirate Hub Over $7 Million Ransom,” Times, January 19, 2010.
 Chalk, “Piracy off the Horn of Africa,” p. 93. See also Jeffrey Gettleman, “Somali Pirates Seize Up to Five More Ships,” New York Times, April 7, 2009.
 Piracy and Armed Robbery Against Ships: Annual, Report 2009, p. 13; Piracy and Armed Robbery Against Ships: Report for the Period 1 January – 30 June 2010, p. 11.
 “Private Security Companies Called in to Combat Somali Piracy,” The Strategist, September 10, 2009; Katherine Houreld, “Companies Hire ‘Shipriders’ Against Somali Pirates,” Associated Press, June 5, 2009; Sandra Jontz, “Hired Guns Secure Ships, Stir Controversy,” Stars and Stripes, February 15, 2010.
 “Splashing and Clashing in Murky Waters,” Economist, August 20, 2009.
 See, for instance, “‘Ships Need Armed Guards,’ Says Security Firm Chief,” FeralJundi.com, October 20, 2008.
 Personal interviews, maritime security and defense officials, London, May 2009.
 Jacquelyn Porth, “Piracy Off the Horn of Africa Threatens Relief Efforts, Trade,” America.gov, October 31, 2008.
 Patrick Hagen, “German Owners Swap Flags to Protect Against Pirates,” Lloyds List, June 14, 2010.
 “Private Security Firms Join Battle Against Somali Pirates,” Fox News, October 26, 2008; “Economic Impact of Piracy in the Gulf of Aden on Global Trade,” U.S. Department of Trade, undated; “Piracy Could Add $400m to Owners’ Insurance Cover Costs,” Lloyds List, November 21, 2008.
 “Private Security Firms Join Battle Against Somali Pirates”; “Potential Hikes in Shipping Rates Involving Gulf of Aden Transits,” Gerson Lehrman Group, September 29, 2008.
 “Private Security Firms Join Battle Against Somali Pirates”; Houreld; Jontz.
 See, for instance, Nick Blackmore, “New Tricks: Examining Anti-Piracy Tactics,” Jane’s Intelligence Review, December 21, 2009.
 “Suez Gun Law Catches Carriers in Cross Hairs,” American Shipper Magazine, August 12, 2010.
 See, for instance, Peter Chalk, Laurence Smallman and Nicholas Burger, Countering Piracy in the Modern Era: Notes from a RAND Workshop to Discuss the Best Approaches for Dealing with Piracy in the 21st Century (Santa Monica, CA: RAND Corporation, 2009), p. 5; “Ships Need Armed Guards.”
 For an interesting analysis on the use of open registry countries and their potential interplay with crime and terrorism, see Catherine Meldrum, “Murky Waters: Financing Maritime Terrorism and Crime,” Jane’s Intelligence Review, May 15, 2007.
 Personal interviews, International Maritime Bureau, London, May 2009 and private security consultant, Hong Kong, February 2010. See also Tim Fish, “Private Security Firms Step Up Anti-Piracy Ops in Gulf of Aden,” Jane’s Navy International, August 18, 2010.
 Chalk, Smallman and Burger, p. 3.
 Gettleman, “Somali Pirates Seize Up to Five More Ships”; Blackmore.
 Cyrus Moody, cited in “Private Security Firms Join Battle Against Somali Pirates.”
 Comments made during the “Countering Piracy in the Modern Era: The Best Approaches for Dealing with Piracy in the 21st Century,” workshop, RAND Corporation, Pentagon City, Virginia, March 2009.
 Houreld; Steven Jones, “Implications and Effects of Maritime Security on the Operation and Management of Vessels,” in Rupert Herbert-Burns, Sam Bateman and Peter Lehr, Lloyd’s MIU Handbook of Maritime Security (London: CRC Press, 2009), p. 107.
 The International Marine Contractors Association (IMCA) has produced a simple checklist to evaluate a potential PSC’s suitability. The auditing document includes such matters as the contractor’s company structure, their recruitment standards, training procedures and competency/professionalism of their guards. Although somewhat useful, the checklist necessarily defaults to a self-evaluation, which may or may not be accurate.