U.S. chase of Somali pirate assets faces rough seas
Tue Apr 21, 2009
By Tabassum Zakaria - Analysis
WASHINGTON (Reuters) - The U.S. pledge to hunt down the fortunes Somali pirates amassed from capturing ships on the high seas may score political points but is unlikely to yield much bounty, experts say.
The millions of dollars that the pirates receive in ransom payments to release ships and their crews largely end up in Somalia, where lawlessness dominates and a fledgling government is trying to take hold.
U.S. Secretary of State Hillary Clinton last week announced that the United States would go after the pirates' illicit gains, saying, "there are ways to crack down on companies that would do business with pirates."
But experts say going after assets of Somali pirates is not the same as going after terrorists and drug traffickers.
"The model we've used to go after other transnational threats like terrorist financing doesn't necessarily apply easily in the context of piracy where you have a localized economy and industry in a safe haven," Juan Zarate, an analyst at the Center for Strategic and International Studies, said.
"It's very unclear where that localized economy actually touches the international financial system either formally or informally," said Zarate, a former counterterrorism official at the White House National Security Council and Treasury.
The ability of the United States to affect illicit financing derives from its ability to have influence, but it does not have much reach into Somalia, he said. "It's very hard to imagine how we're going to find and freeze assets of local pirates."
Fairly simple questions are difficult to answer without help from local authorities -- how to determine whether a boat is bought for fishing or for piracy? Who on land in Somalia would enforce any seizures of assets?
Somalia has been without an effective central government since dictator Mohamed Siad Barre was toppled in 1991. The United States wants to help the new government of President Sheikh Sharif Ahmed stabilize the African country.
Combating Somali piracy took on a higher priority for the United States after the U.S.-flagged Maersk Alabama container ship was attacked and its American captain held hostage this month. The U.S. Navy rescued the captain and killed three of the pirates.
TARGET CLANS, BUSINESS
Urging clan leaders and the Somali business community to help restrain piracy may lead to greater success against the pirates, said Princeton Lyman, an Africa policy analyst at the Council on Foreign Relations.
"Somalia does a lot of business in spite of its anarchy and lack of government, and there are very prominent Somali businessmen, and I'm sure they are directly or indirectly in touch with this whole business," he said. For example, Somalia is a large exporter of livestock to the Middle East.
Somali clans or business leaders might have an incentive to cooperate if they feared U.S. military action, he said.
"There is some worry about what the West will do. They would be concerned about growing threats of military action, although I think military action on land in Somalia would be a disaster," said Lyman, a former U.S. ambassador to South Africa and Nigeria.
Piracy is big business in Somalia and becoming more organized, with bigger ships supporting smaller ships, experts said. But the foot soldiers still use relatively low-capital tools for the attacks: a skiff, AK-47 rifles, and rocket-propelled grenade launchers.
Experts say one way to curb piracy would be to stop paying ransoms, but that becomes a difficult equation for ship owners weighing the threat to their crew and cargo.
"The real lever that we have to affect the funding of piracy is to drive an international campaign to stop the payment of ransoms," Zarate said.
"You have to do this on the front end because once the money hits the shores of Somalia, I don't think at this point we have the ability or the levers to affect the pirates or their networks," he said.
Peter Leeson, author of "The Invisible Hook: The Hidden Economics of Pirates," said going after the assets was in fact shifting the focus away from the criminals to the businesses.
"Notice we're shifting the blame from wealth destroyers, who are pirates, to wealth producers, which are legitimate firms that happen to sell stuff," said Leeson, an economics professor at George Mason University.
"It's like the lazy man's solution," he said.
(Editing by Deborah Charles and Paul Simao)