Seven Malta-flagged ships attacked this year
Seven Malta-flagged ships have been attacked by Somali pirates this year alone, according to Joseph Curmi, general secretary of the Malta International Shipping Council, which represents owners of ships registered in Valletta. Somalia and its Puntland...
Seven Malta-flagged ships have been attacked by Somali pirates this year alone, according to Joseph Curmi, general secretary of the Malta International Shipping Council, which represents owners of ships registered in Valletta.
Somalia and its Puntland region provide the ideal location to prey on shipping through the Gulf of Aden, the access route to the Red Sea and the Suez Canal. This is one of the world's most important trading lifelines, transited by more than 20,000 ships every year on the shortest, most economical route from the Far East to Europe and North America.
Piracy has led to a ten-fold increase in insurance rates for ships transiting the region since the beginning of the year. But this should not translate into higher consumer prices, Beppe Hili, managing director of Carmelo Caruana Ltd, says.
"The shipping companies will pass the increased cost on," he maintains. "But divide that cost by the number of cans of tuna you can fit into a container: it remains negligible."
Thomas Cauchi, operations manager at John Ripard & Son, agreed: "At the moment, we do not have any ships in the region, but I would expect the risk to be covered by war risk clauses," he said.
However, ship owners, shipping associations, insurers and transport unions are concerned about the situation and the risks they are facing. "If civil aircraft were being hijacked on a daily basis, the response of governments would be very different," Bimco, Intertanko, Intercargo and the International Transport Workers Federation said in a joint statement on September 29.
"Yet ships, which are the lifeblood of the global economy, are seemingly out of sight and out of mind. This apparent indifference to the lives of merchant seafarers and the consequences for society at large is simply unacceptable."
Bimco, an association of ship owners, managers and other players in the maritime industry, has issued an advisory to its members recommending that they route their "vulnerable" ships east of Madagascar and then around the southern end of Africa rather than risk the more direct route past Somalia, through the Gulf of Aden to the Suez Canal.
So far, only one major shipper, Maersk, has followed this path, according to an announcement on November 20. This will mostly affect the Danish company's tankers, with only three of its container vessels taking the long route.
But Intertanko, representing tanker owners and Intercargo, representing dry bulk carrier owners, both say their members are considering changing their routes, or have already done so. "A repeat of the crisis in the early 1970s, when the Suez Canal was closed and shipping was similarly diverted around the Cape of Good Hope, must be prevented at all cost," Intertanko said in a statement.
This has not yet impacted Malta or the Malta Freeport, and industry sources say it is unlikely to do so soon. A spokesperson for Valletta Gateways Terminal said it seemed unlikely that fast, high container vessels would opt for the long route, given that the most vulnerable ships appear to be those travelling at less than 15 knots with a relatively low freeboard.
Mr Curmi agreed, pointing out that the longer route would add up to two weeks to a voyage and increase costs, especially with the current high fuel prices.
Captain Uwe Malezki, managing director of Malta Freeport Terminals, said that even if container ships switched from a Suez route to one round the Cape of Good Hope, he would not expect the Freeport to lose business. "Cargo coming into the Mediterranean, whether from the West and Gibraltar or the East and Suez, would still need to go to a transhipment port," he remarked.
He pointed out that other major ports in the Western Mediterranean, including Algeciras, are operating at capacity, and expansion works there, at Fos in France and on the North African coast would take time to be completed. Malta, he implied, will maintain its strategic location for Mediterranean transhipment.
Mr Hili said the greater risk comes from the current financial crisis, which is reducing the demand for shipping as volumes of trade drop. Both he and Mr Curmi pointed out that shipping rates are dropping, in some segments more than others.
This trend has not yet hit container shippers, possibly because Christmas and the Chinese New Year are cushioning the industry, Mr Curmi explained. If the collapse in the market does extend to container vessels, the impact on Malta would be more direct than that of piracy, he believes.
And the international community is beginning to move more robustly to contain the threat of piracy. A Nato force is patrolling the area, as are others, including India. The US Navy has established a patrolled corridor through the Gulf of Aden, and the UN has imposed sanctions on Somalia and Somali pirates.
The European Union is also taking decisive action. After setting up a coordinating cell in September 2008, EU Navforce Somalia's Operation Atalanta is slated to start on Monday. Malta will be contributing one officer, Foreign Minister Tonio Borg said last week, to be based at the operational headquarters of EU Navforce Somalia at Northwood, UK. The 12-month, €8.3 million operation aims to protect merchant shipping from pirates, going some way to addressing shipowners' concerns.
Sources say it is almost impossible to expect the millions of square miles of ocean to be effectively controlled and prevent all possible pirate activity.
Over recent years, Somalia has emerged as the world's pirate capital. By the end of September, Somali pirates staged 73 attacks, out of 199 reported worldwide; 47 took place between July and September. The number now stands at over 95.
Somalia and its Puntland region provide the ideal location to prey on shipping through the Gulf of Aden, the access route to the Red Sea and the Suez Canal. This is one of the world's most important trading lifelines, transited by more than 20,000 ships every year on the shortest, most economical route from the Far East to Europe and North America.
Piracy has led to a ten-fold increase in insurance rates for ships transiting the region since the beginning of the year. But this should not translate into higher consumer prices, Beppe Hili, managing director of Carmelo Caruana Ltd, says.
"The shipping companies will pass the increased cost on," he maintains. "But divide that cost by the number of cans of tuna you can fit into a container: it remains negligible."
Thomas Cauchi, operations manager at John Ripard & Son, agreed: "At the moment, we do not have any ships in the region, but I would expect the risk to be covered by war risk clauses," he said.
However, ship owners, shipping associations, insurers and transport unions are concerned about the situation and the risks they are facing. "If civil aircraft were being hijacked on a daily basis, the response of governments would be very different," Bimco, Intertanko, Intercargo and the International Transport Workers Federation said in a joint statement on September 29.
"Yet ships, which are the lifeblood of the global economy, are seemingly out of sight and out of mind. This apparent indifference to the lives of merchant seafarers and the consequences for society at large is simply unacceptable."
Bimco, an association of ship owners, managers and other players in the maritime industry, has issued an advisory to its members recommending that they route their "vulnerable" ships east of Madagascar and then around the southern end of Africa rather than risk the more direct route past Somalia, through the Gulf of Aden to the Suez Canal.
So far, only one major shipper, Maersk, has followed this path, according to an announcement on November 20. This will mostly affect the Danish company's tankers, with only three of its container vessels taking the long route.
But Intertanko, representing tanker owners and Intercargo, representing dry bulk carrier owners, both say their members are considering changing their routes, or have already done so. "A repeat of the crisis in the early 1970s, when the Suez Canal was closed and shipping was similarly diverted around the Cape of Good Hope, must be prevented at all cost," Intertanko said in a statement.
This has not yet impacted Malta or the Malta Freeport, and industry sources say it is unlikely to do so soon. A spokesperson for Valletta Gateways Terminal said it seemed unlikely that fast, high container vessels would opt for the long route, given that the most vulnerable ships appear to be those travelling at less than 15 knots with a relatively low freeboard.
Mr Curmi agreed, pointing out that the longer route would add up to two weeks to a voyage and increase costs, especially with the current high fuel prices.
Captain Uwe Malezki, managing director of Malta Freeport Terminals, said that even if container ships switched from a Suez route to one round the Cape of Good Hope, he would not expect the Freeport to lose business. "Cargo coming into the Mediterranean, whether from the West and Gibraltar or the East and Suez, would still need to go to a transhipment port," he remarked.
He pointed out that other major ports in the Western Mediterranean, including Algeciras, are operating at capacity, and expansion works there, at Fos in France and on the North African coast would take time to be completed. Malta, he implied, will maintain its strategic location for Mediterranean transhipment.
Mr Hili said the greater risk comes from the current financial crisis, which is reducing the demand for shipping as volumes of trade drop. Both he and Mr Curmi pointed out that shipping rates are dropping, in some segments more than others.
This trend has not yet hit container shippers, possibly because Christmas and the Chinese New Year are cushioning the industry, Mr Curmi explained. If the collapse in the market does extend to container vessels, the impact on Malta would be more direct than that of piracy, he believes.
And the international community is beginning to move more robustly to contain the threat of piracy. A Nato force is patrolling the area, as are others, including India. The US Navy has established a patrolled corridor through the Gulf of Aden, and the UN has imposed sanctions on Somalia and Somali pirates.
The European Union is also taking decisive action. After setting up a coordinating cell in September 2008, EU Navforce Somalia's Operation Atalanta is slated to start on Monday. Malta will be contributing one officer, Foreign Minister Tonio Borg said last week, to be based at the operational headquarters of EU Navforce Somalia at Northwood, UK. The 12-month, €8.3 million operation aims to protect merchant shipping from pirates, going some way to addressing shipowners' concerns.
Sources say it is almost impossible to expect the millions of square miles of ocean to be effectively controlled and prevent all possible pirate activity.
Over recent years, Somalia has emerged as the world's pirate capital. By the end of September, Somali pirates staged 73 attacks, out of 199 reported worldwide; 47 took place between July and September. The number now stands at over 95.