Pirates hijacking ships off the Horn of Africa and Somalia from 2005
to 2012 garnered well over a quarter of a billion U.S. dollars in ransom
and used the money for criminal activities worldwide, according to a
report released on Friday.
The study reveals the pirates engaged in human trafficking arms
trafficking, funding militias and money laundering through trade in the
stimulant known as khat, particularly in Kenya, as well as other illegal
activities that divert money from the legal economy that would
otherwise promote economic development, Reuters reports.
“Unchallenged piracy is not only a menace to stability and security,
but it also has the power to corrupt the regional and international
economy,” said Stuart Yikona, a financial sector specialist at the World
Bank and co-author of the report “Pirate Trails.”
It recommends a range of measures to combat the problem, including
steps to deal with illegal cross-border cash smuggling, anti-money
laundering measures and mechanisms to monitor financial flows through
the khat trade.
The study, conducted by the World Bank and the United Nation’s Office
of Drugs and Crime and based on interviews with former pirates,
government officials, bankers and others countering piracy, estimates
that piracy costs the global economy $18 billion a year in increased
trade costs. Attacks on ships off the coast of Somalia and the Horn of
Africa yielded between $339 million and $413 million in ransom money in
the seven years from 2005, it said.