A Rising Tide of Piracy
    Category: Maritime Economy By : Callum Halliday Read : 638 Date : Tuesday, March 15, 2016 - 05:43:28

    Though President Joko “Jokowi” Widowo has focused his administration on becoming a “maritime axis,” Indonesia continues to have a serious, and growing, problem with piracy. In 2010, there were only 26 incidents of piracy in Indonesia, while last year to September, the number had risen to 86. So even as incidents of pirate attacks have been declining worldwide in recent years, Indonesia is one of the few places where attacks are on the rise. Somalia, once the most pirated nation on earth, did not register a single pirate attack in 2015. Sadly, Indonesia has replaced Somalia as the world’s most dangerous place for piracy. Indonesia accounted for 29% of all 245 pirate incidents in 2014 (full year data is not yet available for 2015), according to the London-based International Maritime Bureau (IMB), an NGO that tracks global piracy.

    Some Indonesian shipowners would like to see more government action on this problem. “I don’t think the government has done enough because there is still a lack of certainty and assurance of security in the water,” says Bani Mulia, managing director of major shipping firm PT Samudera Indonesia, whose family is also the controlling owner of the listed firm. “It should be the government’s role to enforce more security in the waters of Indonesia,” he says.

    Bani speaks from experience, as a Samudera Indonesia vessel was captured by Somali pirates off the coast of India in 2011, resulting in a 46 day hostage situation for the crew, resolved through a negotiated settlement with the pirates. Bani hopes Indonesia doesn’t become known as the new Somalia, which could hurt Indonesia’s attractiveness to investors and raise the costs for shipping and security for the shipping industry. “I don’t want us to have to implement what we have to when our ships go into a risky area like Somalia,” says Bani.

    While it is mostly non-Indonesian vessels that are attacked, Bani notes that everyone suffers higher costs and greater risks if piracy goes up in the country. “More costs associated with shipping goods within the archipelago doesn’t help in bringing down logistic costs,” says Bani. In other words, piracy can potentially worsen Indonesia’s already expensive and inefficient logistics networks.

    Piracy is run like any other organized crime, pirates are looking to maximize their profits within minimum risk and expense. Most attacks being perpetrated are highly organized and typically target bulk carriers, specifically those holding large quantities of oil, as oil is virtually untraceable and easily sold into world markets.

    Noel Choong, head of the Kuala Lumpur-based IMB’s Piracy Reporting Center, believes that the Jokowi government is taking steps to combat piracy but is struggling to come to grips with a complex issue. “The results were very encouraging with many areas showing a high drop in attacks and some areas recording zero attacks. However, unfortunately other new areas of attack emerged as pirates shifted their operations,” says Noel. Yet Noel has reasons to be hopeful. “If Indonesia increases its patrols in high risk areas then we may see a drop,” says Noel.