World's First Pirate 'Stock Exchange' in Somalia - Facts Analysis

Story:

There is a pirate ‘stock exchange’ in Somalia where locals can invest in pirate gangs planning hijacking missions.

Analysis:

The message says that Somalia has a pirate stock exchange where locals can invest in pirate gangs for planning their hijacking missions. The story is a fact.

Somalia is known for its piracy and pirate activities over the years. Many pirates carrying guns have been terrorizing the shipping lanes around the horn of Africa and the Indian Ocean. The gangs hijack the ships and vessels and make tens of millions of dollars from ransoms, even though nations have increased anti-piracy operations off the coast of Somalia. You can study the detailed report of pirate activities in Somalia here. These pirates have opened the world’s first pirate “stock exchange” in the year 2009, in a village called Haradheere, located at about 250 miles (400 km) northeast of Mogadishu, the capital of Somalia. This is a cooperative stock exchange, where local investors can invest their money, weapons or other useful materials to help their favorite pirate crew in planning hijacking missions and share the resulting profits off pirates’ ransoms. This bustling pirate stock exchange is open 24 hours a day, and the business has become so good that the town now is filled with many luxury cars and other high priced goods. Mohammed, a well known former pirate is reported to have said:

“Four months ago, during the monsoon rains, we decided to set up this stock exchange. We started with 15 ‘maritime companies’ and now we are hosting 72. Ten of them have so far been successful at hijacking.”

The pirate stock exchange became so profitable that it also attracted financiers not only from Somali diaspora, but also from other nations as well. Although the risks in undertaking a hijacking mission are great, the rewards are plentiful; reports say that a typical payoff now is 100 times more than what it was in 2005, also the number of attacks has rocketed. Mohammed explains:

“Ransoms have even increased in recent months from between $2-3 million to $4 million because of the increased number of shareholders and the risks.”

And below is the response of a piracy investor in Somalia stock exchange:

“I am waiting for my share after I contributed a rocket-propelled grenade for the operation, I am really happy and lucky. I have made $75,000 in only 38 days since I joined the ‘company’.” – Sahra Ibrahim, a 22-year-old divorcee, who claims that she got the weapon from her ex-husband in alimony.

However, it is important to note that Somalia was not always a country of piracy. Haradheere used to be a small fishing village in the past. Somalia government collapsed in 1991, following which its territorial waters could not be enforced. As a result of this, many foreign fleets exploited Somalia’s waters, stealing their fishing stock and thereby destroying the livelihoods of Somalians. At the same time, the Chinese began exporting to Europe freely through Suez canal, leaving the ex-fishermen of Puntland (northeastern state of Somalia) with billions of dollars in cargos floating past them. So these fishermen turned to pirates. Since then, the pirate activities in Somalia kept rising. In the consequent years, famine and disease struck Somalia badly, with not much effective government at the centre. The famine that occurred in July 2011 was declared by UN as one of the worst droughts in Somalia in the past 60 years. You can read all about it here. The latest significant change in Somalia is that the piracy attacks have dropped considerably since the month of July this year.