Spreading the Pirate Booty Around

Somali pirate town Boosaaso. (Photo: Jehad Nga/The New York Times)

Who’s making money from the piracy that’s flourishing off the coast of Somalia?

The pirates themselves seem to be raking it in. As the Guardian reports, pirates have made about $30 million from ransom payments this year, according to U.N. estimates; and they are demanding $25 million for the return of their latest capture, the Saudi supertanker Sirius Star.

Increased piracy also provides a welcome revenue stream for private military contractors like Blackwater Worldwide. As Wired reports, Blackwater hires itself out like mercenaries of centuries past to protect ships against pirates. Anti-Piracy Maritime Security Solutions, for example, charges $30,000 per boat for its piracy protection, according to NPR.

Another piracy profiteer: coastal Somali villages.

In the Somali fishing town Eyl — the “piracy capital of the world” — the local economy is booming, thanks to the 12 foreign ships being held hostage off its coast by hundreds of pirates who bring their business — using plundered money — to the village.

New businesses in the town, including hotels built to accommodate pirates, are dependent on its criminal economy. The Guardian quotes one of the town’s tea vendors:

When the pirates have money, I can easily increase my price to $3 for a cup.

It is good to see that inflation is alive and well somewhere.