- Nigeria - Panafrica - Somalia
- Finance - Crime
Piracy in Somalia and Nigeria cause collapse of financial institutions
Somalia, Nigeria and the Gulf of Guinea, and the Malacca Straits cost the Global economy about $12 billion a year from piracy operations, experts have revealed.
UK think-tank Chatham House, Somalia, Nigeria and the Gulf of Guinea, and the Malacca Straits cost the Global economy about $12 billion a year from piracy operations with the biggest costs arising from re-routing ships to avoid risky areas, which are projected at between $2.4bn and $3bn.
Researcher Anna Bowden from the Colorado-based think-tank, the One Earth Future Foundation, which conducted research for the study, told reporters that nothing is being done to treat the root cause of piracy even though about $2bn is spent on naval operations off the coast of Somalia each year.
"Some of these costs are increasing astronomically. What is even more concerning is that all these are simply treating the symptoms. Almost nothing is being done to treat the root cause," Bowden was quoted as saying.
Chatham House added that the number of reported incidents of piracy rose over recent years, and the areas in which pirates operate have grown, regardless of international effort to patrol waters.
The research also noted that there had been some 1,600 acts of piracy, causing the death of over 54 people, since 2006 with the estimated amount increasing roughly five-fold since 2005.
The research by Chatham House shows that marine piracy activities in Somalia, Nigeria and the Gulf of Guinea, and the Malacca Straits costs the global economy between $7bn and $12bn a year, playing a role in the fall of world stock markets, and the collapse of large financial institutions in 2008.