GULF OF GUINEA: Piracy rates-spikes in 2019, not unusual but concerning

GULF OF GUINEA: PIRACY RATE-SPIKES IN 2019 NOT UNUSUAL BUT CONCERNING

Piracy rates in the Gulf of Guinea are the highest in the world, with Nigeria accounting for the bulk of incidents in the region. In 2018, the International Maritime Bureau of the International Chamber of Commerce recorded 22 piracy incidents in Nigerian waters, compared to 14 in the third quarter of this year. Only Indonesia, which has had 11 reported piracy attacks so far this year, compared to 25 incidents in 2018, presents a comparable threat.

However, since August pirate attacks in the Gulf of Guinea have occurred increasingly within the exclusive economic zones of neighbouring and nearby states. At least 71 foreign crew have been abducted by armed pirates in Benin, Cameroon, Nigeria, and Togo. Some of them have been released, almost certainly in exchange of a ransom – sometimes within two weeks following their abduction – but the marked escalation underscores deeper threats to the growing number of maritime shipping companies and offshore oil-sector service providers in the area. This was evidenced on 3 December, when heavily armed pirates on speedboats seized a fully loaded crude oil tanker that had left Bonny Island export terminal, a key mid-stream export facility in the oil-rich Rivers state, south-eastern Nigeria.

In line with our repeated warnings, the threat of kidnap for ransom (K&R) in the Gulf of Guinea will remain high against the backdrop of low oil prices, which are struggling to surpass USD60 per barrel since the oil price crash in 2014. This made K&R more attractive, as hijacking for cargo has become unprofitable and requires much more logistical planning and capacity. Nevertheless, Nigerian pirates have many years of experience in conducting similar attacks, and have become increasingly professionalised.

Although the recent surge in attacks is concerning, it does not indicate a significantly different trend from historical rates. Rather, the recent surge confirms previously identified trends: that piracy in the GoG ebbs and flows with some correlation to counter-piracy measures by the Nigerian navy or macroeconomic trends. While 2018 started out with several high-impact attacks on vessels, there were hardly any at the beginning of this year. What is notable, however, is the geographical reach of the incidents, which either signals better equipment, which enables pirates to travel longer distances undetected, or the organised crime networks conducting the attacks have spread their launch points geographically to other littoral countries. As the number of K&R incidents in the region continues to top global piracy scores in the coming years, it is likely that the pirates conducting the abductions will become increasingly professionalised in hostage negotiations. Ultimately, this could reduce the threat to human safety of the victims, while reducing uncertainty for those with duty of care obligations as deliberations will become more structured and predictable.

This is likely to have implications to insurance premiums, which will increase in countries like Benin, Cameroon, or Togo, but will largely remain unchanged for Nigeria, which is already considered a piracy hotspot.

THIS ARTICLE FIRST APPEARED IN THE NOVEMBER EDITION OF THE SUB-REGIONAL INTELLIGENCE MONITOR FOR EAST & SOUTHERN AFRICA

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