Chatham House There are increasing pressures to develop land-based approaches to Somali piracy. By making use of non-traditional data sources including local market data and satellite images, this paper by Anja Shortland is intended to be an objective analysis of who benefits from pirate ransoms.
Significant amounts of ransom monies are spent within Somalia, but conspicuous consumption appears to be limited by social norms dictating resource-sharing. Around a third of pirate ransoms are converted into Somali shillings, benefiting casual labour and pastoralists in Puntland.
Data analysis is complemented by examination of satellite imagery to establish where the beneficiaries are located. Pirates probably make a significant contribution to economic development in the provincial capitals Garowe and Bosasso. Puntland’s political elites are therefore unlikely to move decisively against piracy.
The positive economic impacts of piracy are spread widely and a military strategy to eradicate it could seriously undermine local development. However, coastal villages have gained little from hosting pirates and may be open to a negotiated solution which offers a more attractive alternative.