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ALEX CHADWICK, host:

From oil prices now to actual piracy. The pirates still holding a Ukrainian cargo ship off the coast of Somalia are there. The freighter is called the Faina. It's surrounded by six U.S. war ships, and a Russian frigate is on the way. Jeffrey Gettleman is Nairobi bureau chief for the New York Times. Jeffrey, we hear that someone on board this ship says the ransom they're looking for is now lowered from $20 million to $8 million. What's the truth of this? Do you know?

Mr. JEFFREY GETTLEMAN (Nairobi Bureau Chief, New York Times): That makes perfect sense. I don't know exactly what this person said and to whom, but what I have been reporting, and what I have been told is that the ransom is going to keep decreasing, and it's most likely going to end up around five million dollars.

So, let me explain why. These Somali pirates have seized dozens of ships this year, and they usually charge between one and two million dollars to give the ships back. This ship, because of the publicity and because of the concerns about the cargo, all these armaments that could fall into the hands of insurgents in Somalia, that is thought to be a very important bargaining chip for the pirates. So the belief has always been that they're probably going to get more on this ship than they usually get, and five million dollars is then a number that has been bandied about a lot here in Nairobi.

CHADWICK: OK. What I don't understand is, they're surrounded by U.S. warships. A Russian warship is on the way. How can they get anything?

Mr. GETTLEMAN: They're essentially trapped. I mean, there's really nowhere for them to go. But the problem is, they have hostages. They have 20 people, the crew members, on the ship, and there's about 50 armed pirates on the ship, and it would be very difficult to free them by force.

An added complication is all the armaments and explosives on board. You have millions of pounds of weapons on this ship and a lot of explosives. And if there was a fire fight on board, that whole thing could blow up and kill everybody on it and cause an enormous environmental disaster if that thing sinks to the bottom of the ocean. So I think a lot of people are being very cautious about their options here. The belief now is, the easiest way to solve this is pay the pirates their money, free the ship, free the crew, get the cargo out of the hands of these guys, and then figure out a comprehensive way to deal with the pirate problem.

CHADWICK: How do you pay ransom to a pirate now? Do you wire something to a Swiss bank account? I mean, if you send a raft of money out to this ship, why wouldn't you just grab the pirates and the ransom as soon as they try to leave?

Mr. GETTLEMAN: Well, it's not like you can write a check, that's for sure. I mean, basically, this is a cash business. These guys want cash, American dollars, preferably hundreds. That's how they deal. Once a number is agreed upon, there are going to be intermediaries that will deliver this cash to the pirates. They will count it up. They have sophisticated machines to check if any of the bills are marked, or if they're counterfeit. And what usually happens is, once they get the money, they're in the driver seat, and they tell the ship owners and whoever else is involved, we will leave the ship in 24 to 48 hours. And you must let us leave freely, or we're not going to give up the ship.

Now, there have been two previous instances this year where French commandos have attacked pirates. In one case, the pirates had given up the ship. They had been payed the ransom, and as they were heading back, the French attacked them and took them to prison and killed a couple of them. So, these pirates aren't stupid. They know if they just take the money and then start motoring back to shore, they could get blown out of the water.

CHADWICK: Right!

Mr. GETTLEMAN: So, there's going to be some complicated arrangements here to guarantee their safe escape from this naval noose that is now around them.

CHADWICK: Jeffrey, you're a correspondent for perhaps the most distinguished newspaper in the world. You're supposed to cover politics and finance and all these kind of important things. You're covering a pirate story!

Mr. GETTLEMAN: Yeah, it's pretty absurd. You know, 20th century pirates, but they mean serious business, and this is a big story in Somalia. A lot of people are very interested because pirates seem to be something of a long gone romantic era, and people make Johnny Depp jokes and things like that. But in Somalia, it's big business. I mean, here is a country that has totally collapsed. There's almost no economy whatsoever. And these guys can net one to two million dollars by a couple of days of, you know, dangerous work.

CHADWICK: Jeffrey Gettleman, reporting from Nairobi. Jeffrey, thank you.

Mr. GETTLEMAN: Thank you.

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