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Saturday, September 27, 2008

There be pirates 


The New York Times is running a very interesting story about the pirates of Somalia, who have made a great living seizing vessels far into the Indian Ocean and holding the crews and cargo for ransom. This has been a successful strategy, because in any given case it is easier to pay than fight. The once stalwart Brits have called off the Royal Navy because they cannot figure out how to navigate international human rights law, while Sarkozy's France has found its inner Boosh.

In the current case, however, the pirates may have grabbed the wrong ship:

The gun-toting, seafaring thieves, who routinely pounce on cargo ships bobbing along on the Indian Ocean, suddenly found themselves in command of a vessel crammed with $30 million worth of grenade launchers, piles of ammunition, even battle tanks.

Turns out that Ukraine sold a bunch of weapons to Kenya, and the hostages include Russians.

Oops.

Both Kenya and Ukraine are American allies, so the United States Navy is in hot pursuit.

Proud, nationalist Russia does not want the United States to rescue their people, so their navy is not far behind.

This is not going to end well for the Somali pirates who grabbed the ship in question. Even if the Americans would hold their fire to protect the hostages, a close examination of the Vladinator's record indicates that he cares more about Russians not yet taken hostage than those who already have been.

Finally, as a chief financial officer I was very interested in this sticky risk-of-loss issue:
The $30 million in Ukrainian arms were bought by the Kenyan government, one of America’s closest allies in Africa.

“This is a big loss for us,” said Alfred Mutua, a spokesman for the Kenyan government.

But, Mr. Mutua was quick to add, since the ship had not reached Kenya yet, the cargo was still the Ukrainians’ responsibility.

The Ukrainians do not ship Ex-Works? If I were selling weapons to Africa, I would want to be paid via letter of credit and have risk of loss to pass my on my dock.

12 Comments:

By Blogger D.E. Cloutier, at Sat Sep 27, 10:08:00 AM:

1. The Ukrainian government paid ransom money in the past.

2. The Russians took no aggressive action to rescue Russian seamen in the hands of Somali pirates in the past.

3. Re: Ex-works. This was a government bid. The buyer makes the rules. If you don't like them, you don't make an offer.

Remember the Golden Rule: Those with the gold make the rules.

I give most overseas governments 30-day, 60-day, or 90-day credit terms. I'll deliver to any legal destination. And I'm your "competitor." Guess who gets the new business.  

By Blogger TigerHawk, at Sat Sep 27, 10:18:00 AM:

As usual DEC, you would kick my butt!

All good points.  

By Blogger Ray, at Sat Sep 27, 11:42:00 AM:

The piracy mess is, in some part, the meeting of an international legal regime designed by comfortable First World lawyers in spacious window offices in the New York skyline with people whose lives are literally worse than the worst punishments those lawyers are willing to contemplate.

Life in prison with free food? Wonderful! Turn over to your "local government" for trial? As if the relevant authorities aren't on the take ...

Punishments from an earlier, harsher era are likely to be a better deterrent, although it's worth remembering that piracy from the Barbary States only ended when they were colonized by powers capable of enforcing law and order generally and consistently.  

By Blogger joated, at Sat Sep 27, 12:46:00 PM:

Oops, indeed!  

By Blogger Purple Avenger, at Sat Sep 27, 02:37:00 PM:

We need to revive the old Q-ship notion.  

By Anonymous Anonymous, at Sat Sep 27, 03:22:00 PM:

The Q-ship would be good. But today activists would track those ships and post on the internet to help the pirates.

Still, a good idea and worth trying.

Piracy is on the rise for exactly the reason given - each single payoff is rather cheap for the operator. Usually far less than the value of the ship and cargo.

The navies of the world could stop piracy with 1% of their resources. But politically they have to take united and coordinated actions.

If we obey the lawyers and fool around with international courts to stop pirates the matter is hopeless.  

By Blogger commoncents, at Sat Sep 27, 03:37:00 PM:

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By Blogger Rebecca, at Sat Sep 27, 11:02:00 PM:

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By Blogger Grumpy Old Man, at Sun Sep 28, 07:12:00 PM:

In the Lebanon war, so the story goes, terrorists kidnapped some Russians. They were found dead by the side of the road with their virile members in their mouths.

No Russians were kidnapped in Lebanon after that.  

By Blogger Georg Felis, at Sun Sep 28, 10:25:00 PM:

One would think a modern Q-ship would be much easier to create. Think a heavy weapons platoon of Marines with sat-phone slipped on the ship by small craft, in communication with a Predator drone sneaking along behind and at a high altitude. If nothing happens, slip the Marines off before you dock and sail away. Any pirates that come a callin' can be driven away with Javelin/50HMG fire, tracked back to their mamma ship by the Predator, and given a little going away present to discourage future endeavors.  

By Anonymous Anonymous, at Mon Sep 29, 01:36:00 AM:

Time to bring back the old metheod aginst these pirates HANG THEM and AMNESTY INTERNATIONAL BE DAMNED  

By Blogger Dawnfire82, at Tue Sep 30, 01:44:00 PM:

Apparently, the weapons were intended for delivery to the Sudanese rebels.

http://www.strategypage.com/htmw/htmurph/articles/20080930.aspx  

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