How Somalia Pirates Actually Make Money
The Business Behind your Last Halloween Costume
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The Business Behind your Last Halloween Costume
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We’ve all heard of Somalian pirates
Whether you’ve dressed up as one or just read global news
You can’t go a month without hearing that pirates kidnapped another ship
In the world of 24/7 Surveillance, Pirates still cost shipping companies up to $5 Billion/yr
Here's how
Whether you’ve dressed up as one or just read global news
You can’t go a month without hearing that pirates kidnapped another ship
In the world of 24/7 Surveillance, Pirates still cost shipping companies up to $5 Billion/yr
Here's how
First, a quick recap of Somalia to introduce how Piracy Came to
Somalian has been a country in turmoil for decades
In addition to a 30 Year ongoing Civil War
Only 1.8% of the land is Arable (able to grow crops)
All this leads to Somalia’s Per Capital GDP of ~$100 per person
Somalian has been a country in turmoil for decades
In addition to a 30 Year ongoing Civil War
Only 1.8% of the land is Arable (able to grow crops)
All this leads to Somalia’s Per Capital GDP of ~$100 per person
Somalia does have the Longest Coastline of any African nation
Massive fishing industry then right?
Nope, foreign cos dump toxic waste in Somalian waters killing most of the Tuna
All of these are prerequisites lead to very little opportunity for other job opportunities
Massive fishing industry then right?
Nope, foreign cos dump toxic waste in Somalian waters killing most of the Tuna
All of these are prerequisites lead to very little opportunity for other job opportunities
How Pirates Operate
1. LOCATE A TARGET
- Ideal targets are Luxury cruises or oil tankers from rich countries (US, UK, etc) with slow avg speed
2. FINANCING
-Single pirate operation costs an avg. of $30k to carry out.
- Typically, 3-5 Investors buy shares in each Pirate heist
1. LOCATE A TARGET
- Ideal targets are Luxury cruises or oil tankers from rich countries (US, UK, etc) with slow avg speed
2. FINANCING
-Single pirate operation costs an avg. of $30k to carry out.
- Typically, 3-5 Investors buy shares in each Pirate heist
Next, THE ATTACK
- Crew: 4-20 Somalians
- Chase: Pirates follow ships up to 800 miles off the coast.
Once close, Pirates switch to 1 or 2 small “chaser boats”
They then use rope and ladder to board the ship.
- Crew: 4-20 Somalians
- Chase: Pirates follow ships up to 800 miles off the coast.
Once close, Pirates switch to 1 or 2 small “chaser boats”
They then use rope and ladder to board the ship.
Why doesn't the Ship under attack fight back or escape often?
1. Large boats are slow & not easy to turn
2. Civilians are on board, so a boat captain has innocent lives to lose. Pirates, though, have very little to lose.
3. Pirates come equipped with AK-47s & Rocket Launches
1. Large boats are slow & not easy to turn
2. Civilians are on board, so a boat captain has innocent lives to lose. Pirates, though, have very little to lose.
3. Pirates come equipped with AK-47s & Rocket Launches
Next, the NEGOTIATION
Once on board, Pirates direct the ship to the nearest port.
Negotiation can last up to 6 mos
What Pirates want depends on the ship:
1. Oil Tankers: the asset is the oil for resale
2. Passenger Ships: asset is cash paid via ransom
Once on board, Pirates direct the ship to the nearest port.
Negotiation can last up to 6 mos
What Pirates want depends on the ship:
1. Oil Tankers: the asset is the oil for resale
2. Passenger Ships: asset is cash paid via ransom
Because of incentivizes (innocent lives/cargo needing to be delivered)...
An agreement is always always reached.
An agreement is always always reached.
Finally, SPLITTING THE LOOT
No matter the Loot that is agreed upon (Cash/Oil), here’s how it’s paid out:
30%: Investors funding Operation
10%: Port who looked the other way during the kidnapping
60%: Split between the attackers (with $10k paid to the first boarder of ship)
No matter the Loot that is agreed upon (Cash/Oil), here’s how it’s paid out:
30%: Investors funding Operation
10%: Port who looked the other way during the kidnapping
60%: Split between the attackers (with $10k paid to the first boarder of ship)
Who pays the ~$5 billion lost by shipping companies each year?
Just like most, these costs are passed on to you and me
Where the consumer pays a hidden piracy tax on goods imported from overseas
Just like most, these costs are passed on to you and me
Where the consumer pays a hidden piracy tax on goods imported from overseas
So next time you're thinking about starting a new income stream...
Never forget the lucrative opportunity and status you may enjoy as the next Investor of a Piracy Operation 😉
Never forget the lucrative opportunity and status you may enjoy as the next Investor of a Piracy Operation 😉
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