Crime In The Maritime Industry

1.1 Introduction
Over the years, the shipping industry has been known to be the largest carrier of goods and passengers from one geographical location to another. For centuries approximately 80% of the world trade from raw materials to semi-finished and finished products travel by sea. More importantly after the Second World War the demand for seaborne trade has double every decade.
Unfortunately, the maritime industry has witness one of the world’s oldest form of crime called “Sea Piracy” erode the resources of this industry. It has originated as a petty fish theft and has developed into big business and cartels.
Modern pirates have gone sophisticated as pirates are now linked to organised crime and syndicates although they are often part

In 1981 The International Maritime Bureau (IMB), a quasi-governmental organization of the International Chamber of Commerce (ICC) was established. The primary aim of this organisation was to combat all types of maritime and trade crime, including documentary credit fraud, charter party fraud, cargo theft, and piracy. The IMB also publishes on its website Weekly Piracy Report. This report covers actual or attempted attacks irrespective of the ship been at sea berthed or anchored.
Of all these Pirate prone regions the coast of Somalia seems to have the highest rate of piracy activities around the Horn of Africa although report has shown a considerable decrease since 2013. See Table 1 a report by IMB from January 2010 – December 2014 showing attempted and actual attacks. .

1.2 Impact of Sea Piracy on Global Shipping Industry
Report from International Maritime Bureau (IMB) has estimated that Maritime Piracy costs between $1 and $16 billion per year.
However, it will be very useful to look at the impact of Sea Piracy on Global Shipping from two different perspectives. The Impact of Threat and the Impact of actual attacks. IMB as wells as most analysis have come from these two different angles.
Impact of Threat Impact of actual attacks

Increase Speed (Speed Adjustment) Cost of Uninsured Ransom, kidnapping/hijacking not covered by insurance
Re-routing

Maersk, one of the largest shipping Companies declared that they are re-routing 50 oil tankers around the Cape of Good Hope rather than the normal Suez Canal route in other to avoid the Horn of Africa. Other large shipping Companies are also thinking along these lines as a way of saving cost. The impact of these actions is so obvious. It will take more time for shipment to be delivered and will cost more. For example re-routing an oil tanker from the Suez Canal to the Cape of Good Hope on a trip from the Middle East to refineries in the Mediterranean doubles typical transport time from 15 to 30 days. This consequentially increases freight rate to more than 30 percent and lower competitiveness of traders especially for perishables goods and time sensitive goods such as