MELISSA BLOCK, Host:
A few weeks ago, our Planet Money team laid out the business model behind Somali piracy. We heard from a Danish ship owner named Per Gullestrup, whose boat was hijacked by pirates. He was surprised by how courteous the pirates negotiator had been. Still, they haggled for months over the amount of a ransom payment. Eventually, they came to an agreement. The Dane got his ship and his crew back; everyone went home. But as Chana Joffe-Walt recently discovered, the story doesn't end there.
CHANA JOFFE WALT: Per Gullestrup dropped the money from the sky for the pirates, from a helicopter on a Friday morning. He got his crew released. They headed home. The pirates headed wherever pirates go. And then Saturday morning, Per Gullestrup is in his kitchen in Copenhagen and his cell phone rings, and it's Mr. Ali, the pirate negotiator.
BLOCK: After the hijack when he got ashore and he got back to his home in Somaliland, I was almost called, you know, courtesy call and he would - just wanted to say that he made it home. He told me that he had to walk, I believe it was 80 miles or 80 kilometers, over land through the mountains to get home.
JOFFE WALT: So he called you to check in to tell you he was doing okay.
BLOCK: Yeah, you could certainly say that.
JOFFE WALT: What did you say? You just said, you know, thanks for the information, glad you're home safe?
BLOCK: Yeah, we started talking because I was curious about the inner workings of the system, you know, and I started asking him which pirate clans have been involved in our ships, and trying to get better understanding of the mechanics of it all. And he was very forthcoming with that.
JOFFE WALT: So these two men, ship owner and representative of the guys who stole his ship and bribed over a million dollars out of him, they start talking and they talk and talk and talk. Gullestrup would say hey, what was happening that day you guys suddenly raised the price, what was that about? And Mr. Ali would say, oh, yeah, there was this thing and hey, what about that time you guys did such and such? It was a lively exchange. Mr. Ali actually told me this, too. I called him in Somaliland. He says his actual name is Ali Mohammed. And he told me, yeah, they had a lot to talk about, and toward the end of the conversation, they exchanged emails.
BLOCK: The emails are on a daily basis, two or three emails a day. But also, probably...
JOFFE WALT: You send each other two or three emails a day?
JOFFE WALT: What are you emailing about?
BLOCK: We talk about the issues of piracy, or this or that.
JOFFE WALT: Per Gullestrup says actually, it doesn't really feel that weird to talk.
BLOCK: Once it was all over, it was like having computed - I'm sorry to say - it was having computed a business deal. And when you complete a business deal with somebody, you're not necessarily an adversary afterwards.
JOFFE WALT: In fact, you can leverage that relationship, use it to your advantage in future business dealings. Think about Gullestrup's position here for a sec. He's a ship owner. He wants to get rid of any future piracy costs, or at least keep them as low as possible. But it's not like he has the assistance of U.S. Navy SEALs to blow pirates out of the water whenever he wants. The ship owners are kind of figuring this out on their own, and they don't really know who they're dealing with, how the pirates are organized, who's in charge. Economists would look at this, and they would say, what's going on here is about market power. The pirates, they're colluding, sharing information in an unregulated environment. And meanwhile, Gullestrup and his shipping buddies, they have a hard time with basic stuff, like figuring out the market rate for piracy ransoms.
BLOCK: The owners are escalating the ransom payments because they're not really coordinating how to deal with pirates. The pirates, on the other hand, are extremely good at sharing information. And we know for a fact through Ali, amongst others, that they do have piracy workshops.
JOFFE WALT: What does that mean, a piracy workshop?
BLOCK: Well, the pirates of the various clans, elders are getting together, and they will exchange information.
JOFFE WALT: Mr. Ali, he gets something for helping out, too. See, Ali Mohammed, he doesn't see himself as a pirate. He says he agreed to negotiate for pirates so he could get to know what their business is like so he could start his own business.
BLOCK: If I become an expert on piracy and try to milk that, I think it is a legit business. The news media and global news media will need somebody who is going to be an authority, to report from the inner feelings of a pirate, and to report whether pirates are going to stay around for a long time or not, and how to eliminate piracy.
BLOCK: We have tried to, you know, help him with that by giving him credentials as an expert in piracy, locally. And also, he's trying to establish himself as a piracy consultant. So it's a two-way street. I mean, it's quid pro quo. It's not like we're bosom buddies, okay? I mean, this is a business relationship.
JOFFE WALT: Right. But do you ever talk about, like, do you know anything about his life?
BLOCK: Yeah, no, I do. I mean, he's a very kind person, in talking to him. And he has a wife up in north Somaliland; he has a son. He has a large herd of camels. He sent me an email that said that he's allocated three - I don't what - what do you call camel babies? I mean, they're not called camel babies. They're called something else. But he's allocated three camels to me, which I'm - you know, I'm honored.
BLOCK: Three newborns, yeah.
JOFFE WALT: How come you gave them to him?
BLOCK: Because that was a good gesture from my part. It's those little things that count.
JOFFE WALT: So, from haggling over million-dollar ransom payments to goodwill baby camels - calves, they're called.
Chana Joffe-Walt, NPR News.
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