Topic: EEZ/Maritime
Australian Report Examines Industry and Government Entry into Maritime Security

Piracy studies tend to be heavy on the "need for regulation" side and light on the "fix piracy" side. One area where undisputed success has been shown has generated few studies. The use of armed guards aboard ships to deter pirate attacks is a solution that appears to not only have a 100% success rate but is hard to argue the pros and cons. It is important to speculate on potential risks and typically there is plenty of data to grind through to come to a prognostication.

A recent report by James Brown, part of the “Privateers in Australia’s Conflict and Disaster Zones research project” was funded by the Australian military. Brown is a former Australian Army officer with degrees in economics and strategy.

His focus has been on the use of private security contractors and his previous work did not display bias or agenda other than to better understand the sector.

Despite that lack of bias on land based private security, this report unfairly sets up the private maritime security industry as being problematic. His point is that government military entering the same sector will be more problematic.

He states, “Already private contractors and vessel protection detachments have shot and killed suspected pirates.” Fair enough. Killing "suspected pirates" may be a problem but other than the one incident, the author does not provide sufficient data to back up or illustrate that claim. Killing "actual pirates" is not a problem since the law of sea and the use of deadly force is on the side of the crew and security team that is being pirated. Despite the UN's attempt to make piracy a social disease, it is against the law to rob vessels at sea and killing pirates is a justifiable reaction. Laws governing piracy at sea are actually more problematic if the pirates surrender or are arrested.

Armed Security Guard At Sea
©Somalia Report, all rights reserved
Armed Security Guard At Sea

One Incident Does Not A Trend Make

The only negative incident Brown can cite is the case of Italian marines aboard the MV Enrica Lexie, an Italian-flagged oil tanker whose guards fired on fishermen, killing them after mistaking them for pirates. Massimiliano Latorre and Salvatore Girone said they fired two warning shots at what they thought were pirates, but were arrested for murder when it turned out that two Indian fishermen were killed. The Italians were eventually released on bail by the government of Kerala, India. What Brown doesn't tell you is that this incident happened about 10 to 20 miles off the South Western coast of India, 2,200 miles from Somalia and nowhere near the focus of his study. There is no evidence offered of problematic private security operators at sea. Quite the contrary, his numbers show the opposite to be true.

There is a lack of focus on the use of deadly force by Somali pirates who fire on commercial vessels manned by unarmed mariners from a wide spectrum of nations. To hold up one government created maritime security incident as problematic but ignore thousands of violent potentially violent attacks repelled is typical of the academic view of piracy where legislating legal entities somehow solves the actions of illegal ones.

Ship owners do not have to make contact or after action reports public and there is no proof either way that private security guards are a problem. So an assumption that they are, seems to go against academic due process. With 2012 recording few pirate attacks, no hijacked commercial vessels and the problem of piracy appearing to be on its way out, there may be even less reason to even debate the hypothetical concept.

There are still over 200 hostages in the region and there are numerous emotional and financial repercussions of sailing in that region, but focusing on complicating the solution rather than solving the root problem is counterproductive.

Organizations and governments are becoming more pragmatic about piracy. Statistically the UKMTO and other organizations have responded to Somalia Report’s criticism and began listing all kidnapped ships and mariners. It is slowly dawning that perhaps ship owners have abandoned their responsibility to kidnapped mariners and governments may have to save them.

Piracy is effectively over as a major threat to shipping but only because the presence of armed guards have denied the pirates the cash flow needed to fund new efforts. The ultimate discussion of who is responsible for protecting and rescuing crews, cargos and ships has yet to be addressed as an action item. So families and mariners are supposed to be content with hypothetical discussions like this.

The next real step is to focus on rescuing the growing number of land-based hostages, many of them taken off ships and left to their fates on land. Pirates are criminals, (never terrorists because that would prevent the payment of ransoms) so it makes sense that a direct response by putting armed on ships was the most logical and so far, the most effective response to pirate attacks. Reading the report it is clear the the shipping industry will never turn to their host nations to actually free their citizens or property so why would they seek their oversight? They chose flags of convenience and hired guns. Brown turns his attention to the “18 month boom” in the use of private security aboard commercials vessels. Before this period it was actually an accepted practice to provide armed guards on slow, high value ships, it just didn’t get much publicity. The insurance company mandate for security on ships. The government prodding in support of the industry came only after the tactic proved 100% successful.

Another glaring omission is the lack of data that actually helps the reader understands Brown’s main focus “The boom in PMSCs responding to the piracy threat in the Indian Ocean raises serious questions about the quality of the contractors.” There is no data in this report that defines the "quality of contractors" nor adds to the debate or decision making. We don’t hear from ship operators, insurance companies, security personnel, captains, pirates or even freely available legal experts. So even his helpful forays into state provided military security does not have the statistical data to make any point, good or bad.

Enter the Vessel Protection Detachments, or VPDs

Brown predicts that "by the end of next year almost 2000 naval personnel may be operating in the Indian Ocean under private hire to protect commercial interests." That is a stunning number if one compares that to the 2700 private hires in the region. Granted the navies won't be working on the cheap or in small numbers but it could dramatically change the effectiveness and cost of anti-piracy operations.

Private companies have been offering this service for ships that do not or cannot have armed guards on board for years but the ship owner was free to choose whether a small sniper team or a large fast vessel alongside would do the job better. If governments get involved it might open up a whole new set of problems.

The report says that, "The Netherlands, France, Spain, Belgium, and Italy all offer private shipping companies the opportunity to hire VPDs for use during transits of the Indian Ocean." The UK is missing perhaps because, "Almost one-third of piracy ransoms paid last year flowed through the UK and the majority of maritime insurers and PMSCs are based in London." The UK government is the main hub for both the security industry and the ransom payment industry.

Where this report does open a Pandora's box is the examination of the military getting involved in providing onboard security.

Vessel Protection Details or VPDs are a government hybrid that hope to extend the reach and legality of military support on commercial vessels. He brings up an example of Dutch government demanding that the ship owner pay half of the cost of the ten man teams the put aboard vessels. "So far, the Dutch have deployed 26 VPD missions and plan on deploying 100 teams with ten personnel each this year, and 175 next year. Total operating costs for Dutch teams are estimated at US$29m this year, of which shipping companies are expected to pay approximately half."

The problem is that very few shipping companies operate with the flag of their host nation and even less want to be dictated to how to secure their ships. If anything, it would seem logical that a government forcing local shipowners to hire their government to protect them is going to drive more business to the flag of convenience countries.

Although Brown does not provide any new research he has an unbiased view of the existing data and the report is worth reading because it makes the point that having the deterrent on board the targeted ship is better than a Naval presence designed to deter. Brown correctly points out that putting national military under the direct control of a commercial ship captain is an invitation to disaster; essentially making a commercial vessel a warship.

“The private hiring of national military personnel (VPDs) is potentially even more problematic, raising a range of legal and political questions.” He explores this area enough to raise more questions than answers. This government forged solution may be more of a problem as he admits that VPD’s are, “often more expensive than private alternatives and often in short supply."

The report suggests that the apparently unregulated private sector now interface with the government sector to create a byzantine world of regulation in a lawless region even though the one incident were Italian armed forces who directly worked for the government of Italy.

Any discussion of private maritime security is always tainted with assumptions on the use of private security in Iraq. Assumptions that "cowboys" and violent acts translate directly from a war zone to the ocean are assumed. Despite numerous videos showing massive violence used by navies against pirates, there is still an obsession with private security companies using minimal force at sea and only when under attack.

What is missing from this report most is perhaps the most obvious. That pirates are essentially out of business because the multi national shipping industry fixed the problem of attacks themselves. They might not actually need to be told by governments how to run their ships safely.

The shipping and insurance industry, frustrated by years of inaction, promises and ridiculous solutions from governments simply came up with a solution that appears to work. His final takeaway that “There is a legitimate and long-term role for private companies to provide security at sea. But their use requires more regulation and coordination than we have seen thus far” is not supported by any evidence.

Brown’s premise that the government may have to regulate its own entry into the maritime security business does have merit based on the past inability of international governments to defeat piracy over the last decade.

Funny Numbers

Brown says, “No less than 26 per cent of civilian ships transiting the Gulf of Aden officially declare the use of armed PMSCs onboard,” which is misleading since just under half of ships have armed guards according to the UKMTO which actually briefs ships in Jebel Ali, UAE. The number may be much higher since ships do not have to register and there are a number of escort and regional security providers aboard ships.

Also the figures he presents are sometimes without context. It would be correct to say that “$4.58m and captured ships and crew are held for an average 158 days” but there are a handful of ships currently in pirate captivity that would generate that type of ransom. Of the six commercial ships held by Somali pirates, only the Liberian flagged Suexmax tanker Smyrni will reach a ransom of over $10M and the MT Royal Grace and MV Free Goddess may get $5M the rest have been abandoned like the Iceberg or Albedo or ransomed on the cheap like the Orna, all captured in 2010. If the current inventory is ransomed it would only generate a meager $20M. Dramatically less than the $140M supposedly collected by pirates in 2011.

Brown estimates that 2700 armed guards are operating onboard commercial ships. He also uses the figure "Individual contractors earn up to $500 per day and companies can charge out contractors for $1000 per day.”

Much like Oceans Beyond Piracy’s reverse "cost of piracy" calculator in which they confuse profits with costs, Brown’s own numbers don’t quite jibe.

One Earth Future took a WAG and guessed that “1 billion dollars per year on private armed guards." They also estimate that about 50 percent of commercial ships transiting across the Indian Ocean now have armed guards.

Brown figures that half that number use private security. He guesses that only 26% of the 23,000 ships that transit the Gulf of Aden for three days have minimum four man crews on board. That would be 5980 ship transits generating 23,920 days at a thousand dollars billed day is $23,920,000 per day (a typical transit can be 4 to 7 days) just for the minimum transit labor manpower cost and $100M for a four days GoA run.

Clearly these are not meant to be hard numbers but its a long way from Brown's stingy estimate to OBP's ridiculous estimate. Someone needs to check their math. Or fess up to not knowing the actual numbers. The reality is that the threat of piracy in the GoA at it's highest was less than one per cent and much lower now. Conversely the use of armed guards has increased along with the general drop of contact by pirates in the region.

The estimate of 2700 of private operators will be joined by 2000 military operators create a doubling of actors in the region also seems a little hard to believe.

The truth, once again, is that nobody knows the truth or the correct numbers.

The report has plenty of numbers that can be read as the author wants you to or as conversely defeating the point of the author: "9 out of 10 failed attacks by pirates on merchant ships were repelled by armed PMSCs" or "One company reports over 90 encounters with pirates, 18 of which were resolved through the firing of shots" but none bring clarity to the industry. The take away should be that 72 of those encounters were resolved with no action, BMP drills or simple warnings like magnesium flares. That would seem to be a good thing if the vast majority of pirate encounters are deterred by private security are peaceful.

The take away of this report seems to be that the last entity that should be involved in anti-piracy security should be the government so why should they be encouraged to regulate what appears to be a successful response to violence at sea?

Despite Pirates and International Naval Patrols, Fishermen Doing Well
By ZAKARIYE M 04/30/2012
Somali Fisherman
©Somalia Report
Somali Fisherman
Fishing has long been a livelihood for the people of Somalia, due to its 3,300 km coastline along the Indian Ocean and Gulf of Aden. Hamarweyne district in eastern Mogadishu, which serves as a popular fishing market, reported increased activity in recent months despite threats to fishermen from pirates, increased naval patrols, and illegal trawlers.

Hasan Ahmed Omer, deputy manager of Sunrise Restaurant (branch one) in the Hamarweyne Hotel at Via Roma, told Somalia Report that he spends at least $250 on fish per week for his customers and his net revenues are $130.

“We make our customers beef, chicken and fish, but lately our residents mainly demand fish. In December of last year we bought one kilogram of fish for 100Sh ($4.50) but now it is between 60 to 80Sh ($2.70 - $3.64),” Hasan explained. “It is less expensive so people now eat more of it. Now you can see several women roasting fish at night in Mogadishu's roads such as Via Liberia, which it connects to the Maka Al-mukarama to Villa Somali."

In 1989 the former Somali government estimated approximately 32 types of fish were available in the Somalia's territorial waters. Today it is unknown what types of fish are available, but one vendor explained what he catches on a regular basis.

“Most Somali people catch and cook popular fish called ‘Jedar', 'Safiti', and ‘Yunbi' which are the most expensive types of fish and the ones people like to eat the most. ‘Danberi’, ‘Safiti’, ‘Tartabo’, ‘Kibili’, and ‘Qajar’ are less expensive,” Abdi Shakur, a 47 year old fisherman in Hamarweyne, told Somalia Report.

“Today, when we went out on our large boats, we caught 25 Jedar and more than 46 Danberi in the Indian Ocean. We sold them all to restaurants and civilians," he added.

Researchers at Benadir University linked eating local fish to healthy living.

"The benefits of fish oil are in vitamin A, fish-liver oils. It essential for the health of the eyes structure and functions of the cells of the skin and mucous membranes. Vitamin D from fish oil is essential and helps with memory. Local fish is believed to be healthier and more reasonably priced than the imported fish," Dahir Ahmed Warfa, a bio-chemistry lecturer and second deputy director of high nurse classes in Benadir University, told Somalia Report.

“All the respondents agreed that many benefits can be gained from processing fish locally,” he added.

Most fishermen are busy in March and November, but lack the resources to fish effectively. Somalia's Transitional Federal Government (TFG) established programs to assist the fishermen including providing some equipment and training, according to Abdi Hakin Aden, the secretary of state minister of minerals and natural resources.

“Our ministry established and encouraged private fishing cooperatives which are engaged in fishing and marine tasks. Due to those efforts made by the TFG members and its fishing administration, the production of fish increased enormously. Consequently the fish became abundant in Mogadishu markets in March, April and November in Somalia,” he told Somalia Report.

Further south in al-Shabaab controlled Marka, 100km from Mogadishu and capital city of Lower Shabelle, fishermen are also reporting a better season.

Mahad Abdi Salaam, a fisherman in Lower Shabelle, told Somalia Report how vital fishing is to the local economy.

“Fishing is the first useful thing in Marka and the efforts of residents of Lower Shabelle mainly depend on the fish meat. If the local fish is processed internally, it saves cash outflow, creates employment, and provides fresh, less pricy and healthy fish,” he explained.

Threats to Fishing, Fishermen and Fish Markets

Fishermen have faced a myriad of challenges including threats from pirates who steal their boats and equipment as well as international naval patrols that sometimes mistake fishermen for pirates, according to Farah Qare, first commander of the sea force in southern Somalia.

Somali Fishermen
©Somalia Report
Somali Fishermen
"There are several challenges due to sea criminals along the Somali coasts and security is not effective resulting in pirates, increased transportation costs, and delayed humanitarian supplies. To remedy this, there must be an end to foreign warship intervention, illegal fishing and trawling, and toxic dump. We need to form strong Somali coastguards,” he told Somalia Report.

Fishermen are not the only ones affected by challenges in the fishing industry. Bakara Market in Mogadishu was closed on Friday and several Somali policemen refused to allow patrons to enter after local businessmen complained about illegal shops in the market.

“We called for the businessmen to shift illegal shops out of Bakara within the next four days. We will be destroying illegal buildings on Tuesday morning because we will not allow people to sell fuel and Khat in the market or set up illegally. We will use bulldozers in order to clear out illegal shops in the market,” Ahmed Odin, deputy chairman of businessmen in Bakara, told Somalia Report.

Local businesses are concerned this may affect them even though they sell fish, not khat.

“I fear my restaurant will be destroyed tomorrow because it is located in an illegal position and now I am preparing to move another place. Somali policemen demanded that we follow their orders and take our goods within four days,” Hodan Warsame, manager of Fatxi Restaurant (branch two) in Bakara Market, told Somalia Report.

Although threats to fishermen, fish markets and the fishing industry continue in Somalia, this increase in fishing activity is finally a turn towards the positive.

Three Major Contractors But Three Different Stories
PMPF Training Base in Bosaso
©Somalia Report, all rights reserved
PMPF Training Base in Bosaso

After the London Conference on Somalia in February of this year, numerous private side meetings in the United Kingdom, United Arab Emirates (UAE) and Somalia have touched off a spate of rumors of who will emerge the winner in the push for a viable land-based, anti-piracy business.

The first rumor claimed US player Bancroft Global Development was in discussions with high-level UAE officials about an anti-piracy program to be based in Mogadishu’s old harbor. This is the same location Somalia’s Transitional Federal Government (TFG) planned to put up the original Saracen anti-piracy program.

Rumors of a Somali-based, UAE funded initiative between the UAE and Bancroft began in the late fall of 2011 and were sparked when Bancroft started their unofficial rehabilitation of a 7-meter skiff in the Mogadishu harbor last year.

Much of the discussion was that Bancroft might step in to take over the Saracen contracts that were cancelled by TFG Speaker Sharif Hassan Sheikh Aden. When Bancroft was asked to provide Protective Security Detail (PSD) training materials for TFG President Sheikh Sharif Sheik Ahmed, it was assumed they would be stepping into the cancelled Saracen contract. According to Somalia Report's sources, the owner of Bancroft Global, Mike Stock, returned from meetings in Abu Dhabi three weeks ago. The UAE was believed to be behind the Saracen contract and the sponsor of the current Puntland Marine Police Force (PMPF) program based in the port city of Bosaso.

Somalia Report contacted Mr. Stock who said his company was asked to provide coursework for Ugandan soldiers operating under the African Union Mission in Somalia (AMISOM) who trained up a protective detail for President Sharif. This was essentially the same program planned by Saracen but structured differently and via AMISOM and the TFG.

Bancroft Global Development is a fully authorized provider of services to AMISOM in support of the TFG, and Mr. Stock denied any involvement or interest in anti-piracy programs in Somalia.

“Bancroft has not signed any contracts with the TFG. Bancroft mentors AMISOM, and through AMISOM, mentors the TFG. Bancroft is not engaged in any anti-piracy or maritime operations, with the exception of helping the TFG repair and operate one unarmed boat in and around Mogadishu Seaport. That boat had been in country for approximately a year, inoperable, since it was delivered by an unknown donor,” he told Somalia Report.

Bancroft Global Development is a Washington, DC-based 501(c)3 non-profit organization that operates out of a $5 million dollar mansion on embassy row. They began quietly in Somalia by providing demining training and have expanded their services to assist AMISOM. Their funding is then reimbursed by the US and other donors.

Stock wanted to make it clear that “all Bancroft activity in Somalia is conducted in strict compliance with the Arms Embargo."

Bancroft’s IRS Form 990’s listed $9M in revenue in 2009 and $14M in 2010. Their beginning as a demining-focused charity and hiring of foreign contractors has expanded their role as a major training resource for untested African soldiers sent to fight in Somalia. Bancroft also gets revenue from their man camp/hotel near the Mogadishu airport. The UN’s Somalia Eritrea Monitoring Group (SEMG) recently investigated Bancroft's activities and found them in full compliance with the long-standing arms embargo.

Enter Halliday Finch

Halliday Finch is a Nairobi-based security and communications firm run by ex-British military officer, Sam Mattock. They have long touted a potential training and anti-piracy program with the TFG announcing a signed contract last month. The exact details are not known, but it appears this program is following a well-worn path of Somalia government fishery income collected and shared with an outside contractor. This model has not fared well in the past.

Old Puntland Coast Guard SOMCAN boat
©Somalia Report, all rights reserved
Old Puntland Coast Guard SOMCAN boat

The first major commercial endeavor began in 1999 with Hart Security in Bosaso followed by SOMCAN in the early 2000’s. Some of today’s pirates, such as Garaad who was recently arrested by the Iranian Navy, were graduates of the Bosaso-based enterprise. Now Halliday Finch is attempting to replicate the model through a simple agreement with the TFG.

A December 19, 2011 contract between the TFG Minister of Defence Hussein Arab Essay and Halliday Finch International is much different. ‘Halliday Finch’ has been replaced by HFI, a company based in the British Virgin Islands, with any money raised going into an anti-piracy task force (APTF) joint venture fund.

The new Mogadishu-based joint venture will be called “Somalia Maritime Services” (SMS), according to their contract.

The contract claims that $52M will be invested over the next two years with a total estimate of $900M in revenue over the ten-year life of the project. HFI had three months from the signing of the contract to raise $25M. It is not known if that was raised, but the TFG did announce they signed another contract at about the time that the first contract expired.

Oddly the program seeks to reduce “Somali piracy activity” (not poaching) by 50% within the first year. The revenue split is 51% for Somalia and 49% for HFI to be generated from “Fishing Revenue and Maritime Offences Revenue”. Currently it is not known what licensing and penalty systems are in place since the TFG has yet to pass a law against piracy although there is a law awaiting a vote.

In speaking with Somalia Report, Sam Mattock, the CEO of Halliday Finch, made it clear they operate under legal guidelines.

“We have not deployed yet and will not without (UN) approval. We would be operating on land for the first 2 years. That said, we consider 12nm of sea from the coastline to be land, so there would be some maritime activity, but mainly for mobility and as part of the training programme.

The operation is predominantly an anti piracy operation in the early stages. This will quiet naturally develop as time passes and capacity increases to counter illegal fishing, smuggling and waste dumping. However, the critical point is to establish the basis from which to control in a professional manner the issuing of fishing licenses thus allowing revenue to flow into the exchequer.

We of course seek PL's and Galmadug's approval and cooperation to assist in their area and believe we will bring with us substantial investment and follow up development into the region to warrant that approval. This is a political negotiation and should be done by the TFG, which we would play no part in."

But with local player Halliday Finch waiting, Bancroft not interested, the PMPF proceeding under the UN Somalia Eritrea Monitoring Group’s (SEMG) scrutiny and no anti-piracy law in effect, it remains to be seen if any of these programs will be fully endorsed.

Meanwhile the increasingly aggressive anti-piracy efforts off shore have already resulted in three incidents involving Kenya, the US and an unknown nation in which fishermen were killed mistaken for pirates or al-Shabaab.

It seems that despite the overwhelming majority of experts, international members and the UN agreeing that a land based solution to piracy is imperative, the three most promising and professional providers are all saddled with archaic three-decade-old restrictions that will prevent elimination of piracy any time soon via compliant means, including the 1992 arms embargo.

In 2005 the TFG signed a two year $55M contract with New York based Top Cat Security that quickly fell apart due to US State Department International Traffic in Arms Violations (ITAR). In 2008, French PMC Secopex said they had signed a three-year, $75-$150M contract that included a bodyguard for then President Abdullahi Yusuf Ahmed. Two years later on August 11, 2010, CEO Svein Johnson of Dominica-based Clear Ocean signed a “Letter of Endorsement for the Implementation of Marine Resource Management in Somali territorial waters and its Exclusive Economic Zone” designed to secure income and develop the fisheries sector with Minister Yosuf Hassam Ibrahim. Nothing came of the ship-based program.

And last month Halliday Finch and TFG Minister of Defence, Hussein Arab Essay officially announced they had signed a contract to create a national coast guard. The press release states, “TFG Ministry of Defence Announces Creation Of A National Coastguard”.

The press release goes on to say that, “The TFG Ministry of Defence announced the establishment of the Somali Anti Piracy Task Force Coast Guard, in association with Halliday Finch International, a Nairobi-based private security company. The new force will be part of the Somali National Security Forces, and will consist of land, sea and air components.

Halliday Finch is seeking both national and private donors to fund the operation. Qatar, Mauritius, Nigeria and Angola have expressed interest, and the firm has already secured the $52 million required for the first year of operation. Halliday Finch has predicted that the 10-year project will cost approximately $900 million, and the organization hopes that some proportion of the funding will eventually come from domestic revenue streams, including the sale of fishing licenses.

This funding proposal is similar to the Hart Security program in which the company sold fishing licenses and conducted anti-piracy operations on behalf of the Puntland government in exchange for 51% of the revenue.

Halliday Finch may be mimicing the clan based construct of Somali politics. Toby Constantine, the director of Halliday Finch, is the brother of Sam Mattock's wife, Harriet, and is married to the daughter of Toby Moffett who is a Washington DC lobbyist hired by the Puntland government until September 2012 to work on oil related issues, specifically to see if Conoco will try to revive their 1980's era oil leases in Puntland. As of January of this year, Puntland announced the commencement of oil drilling in conjunction with Africa Oil.

Fishing Free for All

Fishing Boats in Puntland
©Somalia Report, all rights reserved
Fishing Boats in Puntland

The most recent and reliable studies on potential fishing revenue were conducted in the mid 2000’s. Today there is no clear estimate of what riches remain under the Somali seas, despite efforts to raise revenue through fishing licenses. Rough estimates range of potential gross income from fisheries range between $100M and $300million but do not account for the mostly illegal fishing and rely on the creation of a massive EEZ stretching 200 miles out to sea. But there is no clarity on when or whether the 200 mile deep Somalia EEZ will be formalized and exactly how the foreign fishing fleets will be dealt with or how fines will be enforced except by seizing ships and crews until fines are paid.

Additionally there are overlapping and competing regional fishing agreements sold from regions like Puntland, Somaliland and Galmadug. Somalia Report has tracked foreign fishing vessels freely operating from Hobyo and much of Puntland's fish stock is picked up by Yemeni dhows. Armed European and Asian factory fishing fleets still operate off the eastern coast of Somalia but little is known of how much is lost via this commercial form of piracy.

The Halliday Finch program is to include all of Somalia including Puntland and Somaliland with the caveat that, “Puntland’s Administration is already on board, and has agreed to plans to locate the initial training camp in Bosaso.” In the first phase, 500 individuals (yet to be identified, but likely to come from the coastal communities) will be trained by international consultants and Somali security forces. Bosaso still has the abandoned SOMCAN patrol ships rotting away in the harbor.

According to source documents provided to Somalia Report, Halliday Finch signed a 90-day “Letter of Appointment” with the APTF run by the former dean of East African University, Professor Muhyadin Ali Yusuf, on September 27, 2010. The goal was to “identify credible and secure partners with the capacity to plan and execute an operation of this scale” and has “the financial resources to apply to such a strategy.”

The draft contract (which is different from the final signed document) is not dated or signed, provides for:

“In consideration of the Company providing the Services; and upon the Appointed Auditor’s receipt of the Funds and or the Fishing Revenue; the TFG hereby undertakes to pay the Company via the Appointed Auditor as follows:

i) The TFG shall pay the Company a Project Management Fee which shall cover all costs incurred by the Company to implement and manage the National Coast Guard Strategy. This fee shall be payable three (3) months in advance pursuant to the Company’s quarterly invoices sent to the Appointed Auditor (herein annexed at Schedule 4 is a Summary of the Estimated Budget for first twelve (12) months of the Project Management Fees); and

ii) The TFG shall pay the Company a fee equivalent to the sum of thirty percent (30%) of all Fishing Revenue for the duration of this Agreement pursuant to the Company’s invoices sent to the Appointed Auditor. Thereafter, that is, after the expiration of this Agreement, the TFG shall pay the Company a sum equivalent to two percent (2%) of the Fishing Revenue in perpetuity pursuant to the Company’s quarterly invoices sent to the TFG.

For the avoidance of doubt, the Parties agree that all the Fishing Revenue shall be deposited in an account managed by the Appointed Auditor. The TFG shall invoice the Appointed Auditor quarterly for the sum equivalent to seventy percent (70%) of the Fishing Revenue; and HF shall invoice the Appointed Auditor quarterly for the sum equivalent thirty percent (30%) of the Fishing Revenue; and after the expiration of this Agreement the Company shall invoice the TFG a sum equivalent to two percent (2%) of the Fishing Revenue in perpetuity.

The Parties agree that subject to the Company receiving its thirty percent (30%) portion of the Fishing Revenue; that the Company shall pay the operational costs of the APTF from its said portion for the duration of this Agreement, and that the TFG or the Ministry of Fisheries shall not be liable for the same.

Clearly HFI was able to drive a harder deal in their new contract.

Big Money In A Little Country

The contract surprisingly provides for damages of $72 million dollars if breached by the TFG, Ministry of Fisheries or the APTF. There is no sense of where the TFG would find that enormous sum when they can't even pay their own soldiers on a regular basis. The $900M in revenue or fines over ten years also seems to come from the same thinking process.

Professor Muhyadin Ali Yusuf was also the official that seized $3.6 million from Salama Fikira for ransom drop on May 24, 2011. The money was intended to free the MV Suez and MV Suez and MV Yuan Xian, but confiscated by the government and never returned although the official story is that the money was taken to the National Bank for safekeeping. The security contractors were convicted and fined in June 2011 and allowed to leave after a presidential pardon. It is not known where those funds went.

The Halliday Finch agreement references $97,520 in expenses and salaries that occurred on or around November of 2010 for a trip to Kuwait. The costs included $14, 500 in “cash expenses to refurbish the offices of the APTF and pay for staff salaries”. There is an additional cost generated by Halliday Finch $ 80,000 for the CEO (Sam Mattock,) three staff members and legal advisors. There are $3,020 in airfares with hotel accommodations provided free of charge by Ability Logistics, according to the initial agreement.

The Mogadishu-based Saracen PSD contract may have been cancelled but the Bosaso program, now managed by a new company called Sterling Corporate Services, is still on track to remove pirate bases in coastal Puntland. The Puntland Marines were renamed as the Puntland Marine Police Force (PMPF) last year and even has their own website which clearly says that the program is funded by “international donors, including the UAE”.

In August 2011 the TFG called for the creation of a Somalia Marine Force which sought to combine the training program in the north and south into a nation wide program. Approximately 150 Somalis from the TFG will be sent to Bosaso for training with the PMPF in the next few weeks. The TFG has also notified the UN of their support for the UAE sponsored program.

The UN Arms Embargo prevents companies and even the TFG from training or supplying equipment. The decades old arms embargo was designed to stop the flow of weapons to Mogadishu-based militias but has been at odds with recent TFG efforts to stabilize the country and fight piracy using foreign contractors, most of whom want to train and equip Somalis to patrol their waters, manage what is left of the fisheries and fight piracy.

Puntland On A Roll

Puntland Marine Force on Fox News
Fox News
Puntland Marine Force on Fox News

Meanwhile further north in Bosaso, the PMPF received another large shipment of supplies and equipment from the MV Noora Moon, according to their website. This was the second major delivery to the Puntland-based effort. The PMPF aim is to remove pirate sanctuaries by late summer using a combination of local troops, professional mentors, impressive equipment (including helicopters, ships and large overland vehicles) and providing a robust program of follow-on development.

Last month the PMPF moved into Eyl, the home of Puntland President Mohamed Farole, and is beginning to establish forward operating bases along the northern and eastern coast of Puntland.

They appear to be on track to remove pirates from Puntland before the SEMG releases their next report this summer, which could be another potentially embarrassing situation for the UN which pushes for Somalia to solve their own problems yet manages to hinder them using the thirty-year-old arms embargo and the threat of potential financial sanctions and travel bans.

The PMPF, recently featured on Fox News, was featured negatively in two of the SEMG reports and has been a lightening rod for criticism despite its high profile and deep-pocketed sponsor. In addition to the UN efforts to stall non-compliant programs, the media has also not been friendly to contractors in Somalia. The New York Times and Associated Press chose to feature Bancroft Global's Roger Rouget as a colorful former mercenary, rather than the less sensational job of training Ugandan soldiers to fight in urban environments. The same media outlets also wrote negative stories about Saracen with the inference that there was some negative aspect of the anti-piracy program.

Halliday Finch and their TFG counterparts have escaped the same scrutiny by hiring the former head of the UN’s anti-piracy program, John Steed, who confirmed to Somalia Report that the company has kept relevant agencies informed including the SEMG and will continue to do so in order to meet all guidelines.

Puntland and the TFG have officially notified the UN of their intent to support the PMPF but the UN still considers the PMPF non-compliant because the yet to be confirmed donor has not officially notified the UN Security Council of their intention to support anti-piracy operations. Since Puntland is not a member of the UN, it cannot notify the UN. Although Somalia is a member of the UN, the TFG is not an official government and cannot notify the UN either, according to officials who spoke to Somalia Report, leaving the notification process hanging. The notification, the UN official said, must come from the donor nation.

Despite the UN’s call to regional authorities in Somalia to establish “a system of governance, rule of law, and police control in lawless areas where land-based activities related to piracy are taking place.” The UN has also spent an inordinate amount of time investigating the very firms that have been hired by the Somali government to follow that lead. The UN ban has been continually ineffective in deterring major violators like al-Shabaab, Ethiopia, Kenya, their proxy militias and pirate groups.

The next UN SEMG report is due in July, just before the TFG is transitioned into a permanent government and the deadline President Farole has given the PMPF to end piracy in his regions.

Force Welcomed by Mayor and Locals but Not by UN SEMG
Puntland Marine Police Forces Train in Bosaso
© Somalia Report, all rights reserved
Puntland Marine Police Forces Train in Bosaso

The controversial Puntland Marine Police Force (PMPF) sent a small unit to begin operations in the coastal town of Eyl. Sources in Eyl, and with the PMPF, confirmed to Somalia Report that the initial convoy will start construction of an airstrip, water-drilling and will establish a small base from which to support anti-piracy operations. Security operations will also begin in conjunction with the local government. This is the second time the force has been deployed to a coastal area, but the move to Eyl may be the first major show of force that the Puntland government has made in their fight against piracy.

Puntland President Farole was born in Eyl and appeared there in 2010 to warn the pirates that his forces would return.

The move is also in line with a number of recent efforts from in other regions like Galmadug and Somaliland to crack down on piracy on land.

The PMPF has also brought on an additional 400 or so new recruits which will bring the current total strength to about half of the eventual expected 1000 men.

Eyl, A Former Pirate Center

It's not immediately clear what the the timing of the Eyl visit was triggered by but the recently pirated MV Leila was in Eyl this week before being ordered to leave by locals. The pirate-controlled ship had initially docked off Bargal but angry residents sent it away forcing the pirates to anchor the vessel off Eyl for one day. When the pirates encountered equally hostile reaction from the mayor and townspeople, the ship set sail for Hobyo where it remains.

MV Leila
Neptune Maritime
MV Leila
Eyl has been free of piracy since mid 2010 but was once home to about a dozen hijacked ships, featured in news reports and was the home of the now famous lobster fisherman turned "pirate king" Boyah. Boyah is now in prison in Bosaso and piracy in general has moved southward to Galmadug.

Piracy and Media Battle

Although the arrival of a Somali security force to the remote coastal town should be heralded as a major step in the land based battle to end piracy, the event is not without controversy.

The PMPF was targeted by the UN Somalia-Eritrea Monitoring Group (SEMG) group as being "a major force for instability" in the region with the report's assumption based on a single media comment by President Farole's son that the new force would be used by Puntland to attack Somalialand. . So far this has not occurred. The first training mission was in a deployment to the town of Qaw on the border of Somaliland and by coincidence the new unit was instrumental in assisting a number of survivors of a failed smuggling run. The event brought attention to the unfettered ability of coastal smugglers to bring humans and weapons between Yemen and Somalia.

There have been curious events leading up to this deployment. For example, the PMPF was just positively featured in a high level Fox News live broadcast featuring Oliver North. Less than two days later two disparaging articles appeared in the South African press. The most recent press release from the PMPF to announce the move to Eyl shows a sophistication in media relations that may indicate a new conflict while the identical talking points in both South African publications with the coordinator of the SEMG listed as the source may reveal a looming back room media brawl.

The SEMG is slated to release another report this summer and according to SEMG provided comments it is clear that another attempt to shut down the program is coming. The SEMG maintains that the Puntland program violates the arms embargo. The appearance of two South African-based articles by Ivor Powell in the Independent Online and Mel Frykberg of the New Age, directly mentioning UN employee Matt Bryden and/or the SEMG as their source, with identical talking points. The former article says, "SEMG co-ordinator Matthew Bryden confirmed the company had failed to seek or secure authorisation from the international authority to operate as a private military contractor in Somalia after being fingered in the Monitoring Group’s June 2011 report."

Which Side Is Telling the Truth?

Conversely both the Somali and Puntland governments provided copies of notification letters sent to the UN to Somalia Report. It remains to be seen how the UN can both deny and confirm that the PMPF program is an official Somali government activity.

Numerous reports have called for land-based solutions to piracy, but the long standing UN arms embargo requires proper notification to the UN by a member state to announce training, importation of weapons or equipment into Somalia. There is a five day period during which any member state can protest. No such protest has been lodged against the Puntland based program.

Based on the death toll and fighting inside the country and even out to sea, the SEMG has been ineffective in preventing the flow of weapons to groups as varied as al-Shabaab and pirates, or even prevent the entry of member states like Kenya and Ethiopia. Kenya's invasion was quickly turned into a paid AMISOM contract and Ethiopia's successful incursions are simply ignored. AMISOM has been effective in defending the TFG using American paid for weapons via Uganda but even the SEMG's own investigation noted the direct flow of those weapons to al-Shabaab.

The reports Their reports are detailed in nature, but often rely on gossip from singular anonymous sources. The SEMG, a Nairobi-based group, has never actually entered Puntland, and their political bias and lack of due diligence has led to a number of embarrassing incidents. One related to the Puntland anti-piracy training, in which the coordinator was witnessed by hotel staff, accusing two highly regarded South African journalists of being mercenaries. This after the UN (who handles all flight notifications) tipped off Somaliland authorities to seize a scheduled refueling of a Armenian-chartered cargo plane supplying the PMPF. No weapons were discovered on the plane, and Somaliland officials finally demanded a $600 bribe to release the aircraft and crew. The UN had to publicly apologize when it was discovered that the claim of the investigating group that Eritrea was flying weapons into Baidoa was fabricated. Their previous claim that Puntland's government received money from pirates and was a virtual criminal organization have been progressively softened in each report but never fully supported or withdrawn. All of this leads to much bad blood between the Somali government and the UN's attempts to control it.

The head of Puntland's anti-piracy program, Abdullahi Ahmed Jama, told Lloyd's List that the UN's concerns with transparency, weapons and legal framework had all been addressed. The training entity for the PMPF was Sterling Corporate Services with funding for the program coming from the Puntland's major trading partner, the United Arab Emirates. The UN, through its member states, support a number of counter piracy programs but they are typically framed in support and training to institutions and not direct action. There are other proposed plans like the Halliday Finch program which proposes a $52 million multi year program to create a coast guard. Halliday Finch is a security company and communications advisor to the TFG Minister of Defence and calls their program the Anti Piracy Task Force (APTF). They recently began advertising sixty positions in the area of maritime protection training.

Special Maritime Training Team (HF0111111) We are looking to assemble an international team of 60 men who will recruit, train and deploy in an advisory capacity for the Somali Government in an anti piracy role. The candidates must have a Special Forces, Marine, or other military speciality.

They must have prior experience of training men in Africa and a proven track record of success at doing so. Language ability is a bonus. Ideal Candidates would be from UK, US, EU, or South Africa but will accept the right man from any country.

There have been numerous attempts by foreign companies to create, train or implement a Somali coast guard or maritime force. The deployment to Eyl by the PMPF seems to be the first credible move by a foreign-backed, foreign-trained but locally trained and locally supported and staffed group to end piracy. Documents provided by Somalia's Transitional Federal Government (TFG) to Somalia Report and mentioned in the press release, show official notification by the TFG last year to begin a program. Official reports issued in 2010 and 2011 from the UN show an ongoing concern that the force is in violation of the 20 year old UN Arms Embargo. Both IGAD and the TFG have asked the UN to lift the non functional arms embargo so Somali forces can battle the very threats that the UN has been unable to stop.

The Notification Letter

UN Notification Letter
UN Notification Letter


The Press Release:


At the request of the Mayor of Eyl, in conjunction with the President of Puntland and the Somalia Transitional Government. The Puntland Maritime Police Force (PMPF) arrived at Eyl (Indian Ocean) from Bosaso (Gulf of Aden) to begin supporting long term security and anti piracy program to the townspeople.

On Thursday, the 1st of March 2012, a task force from the PMPF arrived in Eyl, Puntland, Somalia with the mission from the President of Puntland, Dr Abdirahman Sheikh Mohamed Mohamud Farole (Commander and Chief of all Security Forces), to help the residents in securing the town and adjacent areas against threats of piracy and any other threats to civil society.

The PMPF Task Force, numbering one company of Marine Police Force officers and support elements, completed a mishap-free 480-kilometer convoy from Bosaso, arriving to a warm welcome offered by the local population of Eyl.

Approximately 100 citizens turned out the greet the PMPF Task Force about 2 km outside Daawad, the western part of Eyl, and an even larger crowd showed up to welcome the Marines as they entered the eastern portion of the city, a seaside village which lays between the sea and steep rock faced cliffs.

The Mayor of Eyl, Muse Osman Yusef, stated, “The people of the community of Eyl are very happy to welcome the Puntland Maritime Police Force,” adding, “we are looking forward working with the PMPF Task Force.” His remarks were echoed by the Eyl Chief of Police Mahad Ahmed Mohamud who said, “we are very happy to welcome the PMPF Task Force,” and, “we want to give them our confidence and work with them to ensure the security and stability of our village.”

Between 2008 and 2010, Eyl was a notorious pirate safe haven. The town is known for having been the birthplace of modern day Somali piracy. As recently as last week, a pirated ship MV Leila attempted to dock offshore and was ejected by the community who no longer accept piracy in their midst.

The PMPF Task Force is tasked to work with Eyl’s community leaders to remove piracy and prevent the problem from returning. According to the wishes of the Eyl leadership, the PMPF will establish a Forward Operating Base (FOB) and logistics airstrip. Plans are to maintain the force as a permanent presence, providing security and stability in Puntland’s vibrant coastal region to support community governance.

The Government of Puntland seeks to create a climate for normalization of trade, good governance and related reconstruction and development. Eyl was once one of the largest fishery centers in Somalia harvesting lobster, tuna and other high value products for the local and international market. Piracy and lawlessness destroyed much of this income and the community will work with the government to rebuild their maritime industry.

The PMPF was created by the government of Puntland in 2010 with the help of donor nations. The indigenous national law enforcement program promotes peace and stability through hiring, training and equipping Somali to bring stability to their nation. The PMPF directly addresses and supports United Nations Resolutions 1772,1950, 2015 and 2020. The program also supports the goals of the various International Contact Group on Somalia. This law enforcement also reflects the overwhelming conclusion of international experts that the solution to piracy in this region must be land-based, Somali-driven and sustainable. Dr. Abdiwell Mohamed Ali, The Prime Minister of Somalia, officially notified the United Nations in November 2, 2011 of Somali’s intention to begin training and equipping an anti-piracy force.

The goal of the PMPF is to deter, detect, and eradicate piracy. In addition the PMPF will prevent illegal fishing, stop coastal related crimes and protect marine resources as well as continue its mission of delivering much-needed humanitarian relief supplies to the Somali people.

Celebrations Come Amid Scourge of Piracy and Illegal Fishing
By JD 02/10/2012
Mohamed Abukar Hassan, Deputy Commander, Somali Navy
Somalia Report
Mohamed Abukar Hassan, Deputy Commander, Somali Navy

Although Somalia has become a well-known hub for pirates, the country once boasted a powerful naval force, which today celebrated its 50 year anniversary at Mogadishu's Second/Sugunto Lido Beach. Before the fall of the government in 1991 Somalia had half a dozen small Russian built ships that quickly fell into disrepair.

Somalia's Transitional Federal Government (TFG) President Shiekh Sharif Shiekh Ahmed, Deputy Prime Minister and Minister of Defense Husien Arab Issa, Chief Commander of Somali Navy Admiral Farah Ahmed Omar (known as Qarre), and hundreds of marines participated in the celebration, which marked the founding of the navy on February 10, 1962. The Russians provide military aid until 1977 when the US stepped in and beefed up Somalia's Naval capability.

In 2009 the navy began a program to build up a force of 5000 sailors, beginning with the first class of 500 men graduating in December of that year. The job of Admiral Farah was once called "the worst job in the world" by the BBC, who pointed out that a navy without ships would have a hard time defending Somalia. The Somali Navy recruits are paid $60 a month, which is not much in comparison with the millions promised by pirates for the same skill sets.

President Sharif Shiekh Ahmed spoke proudly of the Naval forces, “I am really so glad to see these well trained marine forces. Congratulations on your 50th anniversary, the government renews these forces and knows you need more support. There are a number of international naval forces in our seas to fight pirates, but pirates are still hijacking vessels. I am saying to international countries that Somalia's naval forces can only erase the pirates' power so they should support these marine forces,” said the president referring to the NATO and EU NAVFOR anti-piracy missions.

Throughout the speeches, the underlying theme was that the Somali Navy only lost its capability and credibility after the nation collapsed in the early 1990s, which then allowed piracy to flourish, and now is the time for the marines to reclaim their lost power and dignity.

“Now they are ready to play their role, which is to remove illegal fishing vessels, to remove those planting poisons (dumping toxic waste) in our sea and to fight pirates. I hope that they will succeed in all their duties and soon they will keep the security of coasts of the country,” said President Sharif.

“We have to restore our dignity. We've got these committed forces - a lot of young men and women are now ready to support their own country - but they need support,” he added.

Although admitting they need help, the president did not specify exactly how the TFG would support the marines to guard their 3,300 kilometer coastline. Last year a visiting TFG delegation to Turkey submitted a €250 million ($330 million) proposal for the funding of two search-and-rescue ships and six coast guard boats. Other countries like Kuwait and UAE have promised funding for anti-piracy programs that would involve a coast guard but not a navy. A navy is a military force to guard the maritime region whereas a coast guard is a police force that guards the shoreline and interfaces with the justice system.

Somali Navy Capabilities

The TFG said they had 'many speedboats' and 'hundreds of marine forces,' but would not specify exactly how many are active today, admitting that much of the funds are directed toward the land battle against the hardline Islamic group, al-Shabaab, throughout southern Somalia. The Somali Navy consists of small fishing skiffs with heavy machine guns mounted midships.

The Navy of Somalia
The Navy of Somalia

Piracy flourishes in central and northern regions, rather than out of Mogadishu, the capital of the country and the home of the TFG. Pirates and kidnapped ships are found in coastal areas of Puntland, Galmudug and Galgadud region, which mainly under the control of the pro-government Ahlu Sunna wal Jamaa (ASWJ) miltia.

The Somali Navy trained, but without ships were forced to join the army in fighting al-Shabaab, leaving Puntland and Somaliland and other regions to fight their own battles at sea.

To that end, Puntland has created the Puntland Marine Police Force, with the blessing of the TFG, to battle pirates and illegal fishing. Galmudug has said they will create a force and Somaliland has a small and underfunded Coast Guard that protects its coastline.

For a more thorough look at the Somalia Navy, read Somalia Report's investigation into its capabilities and mission.

Pirates Say "They" Are the Marines

Pirates often claim they only emerged after their country collapsed and spiraled into chaos, leaving fishermen to defend their waters from illegal fishing and dumping. Some groups call themselves "Coast Guards" and insist they prevent toxic dumping, illegal fishing and plundering of the seas. Statistically only about 6% of pirate attacks are on fishing vessels and typically to use them for motherships.

“We are defending the security of our sea, so we are the marines of Somalia. We are doing this job without any order or support from the Somali government, but we did get millions of dollars within short time for defending the seas,” a pirate in Harardhere told Somalia Report, referring to hijacking and ransoming vessels.

“Pirates were fishermen who trying to seek revenge after illegal foreign fishing vessels destroyed their equipment, but now pirates like me are not fishermen. The new pirate generation is seeking only to get large sums of money within a short time,” said Mohamed Ahmed, another pirate in Bari region.