This is an excerpt from the remarks given by the Assistant Secretary of the State Department’s Bureau of Political-Military Affairs, Andrew J. Shapiro to the Center for American Progress in Washington, D.C. on the 27th of March. The full text is available here. The underlined emphasis is mine.

Private Sector

Another integral part of the response to piracy has been the critical role played by the private sector in taking measures to prevent and deter attacks. Perhaps the most significant factor in the decline of successful pirate attacks has been the steps taken by commercial vessels to prevent and deter attacks from happening in the first place. We have found that the best defense against piracy is often simply vigilance on the part of the maritime industry.

In response to the growing threat, we worked with the shipping industry to expand and develop its implementation of industry-developed “best management practices” to prevent pirate boardings before they take place. These include practical measures, such as:

• proceeding at full speed through high risk areas;
• employing physical barriers such as razor wire;
• posting additional look-out;
• reporting positions to military authorities; and
• mustering the crew inside a “citadel” or safe-room in the vessel when under attack.

These steps, when properly implemented, remain some of the most effective measures to protect against, and repel, pirate attacks. Recognizing the value of these measures, the U.S. government has required U.S.-flagged vessels sailing in designated high-risk waters to take additional security measures. Nevertheless, we remain troubled that there are still commercial ships travelling through pirate-infested waters that have yet to implement proper security measures. Approximately 20 percent of all ships off the Horn of Africa are not taking proper security precautions. Unsurprisingly, these account for the overwhelming number of successfully pirated ships.

However, we must also recognize that even when fully implemented best management practices do not guarantee security from pirates. As a result, we have also supported the maritime industry’s use of additional measures to enhance their security – such as having armed security teams on board. To date, not a single ship with Privately Contracted Armed Security Personnel aboard has been pirated. Not one.

These teams serve as a potential game-changer in the effort to counter-piracy. While many expected these teams to be made up of undisciplined “cowboys” that would cause an increase in the violence at sea, from what we have seen so far this has not been the case. We have not seen cases of pitched battles at sea between pirates and armed security personnel. In fact, in most engagements, the situation ends as soon as pirates are aware an armed security team is on board. In most cases, as pirates approach a ship the armed security teams will use flares or loudspeakers to warn the pirates. If the pirates keep coming, they will fire warning shots. That is usually when the interaction ends. Pirates break off the attack and turn their skiffs around and wait for another less protected ship to come by. These teams therefore have served as an effective deterrent.

However, when a vessel is successfully hijacked our foremost concern is always about the safety of the crew, regardless of nationality. The U.S. government is acutely aware of the dilemma that ship owners face when ships and sailors are taken hostage. While the safety of the crew is critical, we must all acknowledge that submitting to pirate ransom demands only ensures that future crews will be taken hostage. The United States has a long tradition of opposing the payment of ransom, and we have worked diligently to discourage or minimize ransom payments. While some may consider this the cost of doing business, every ransom paid further institutionalizes the practice of hostage-taking for profit and promotes its expansion as a criminal enterprise. We strongly encourage flag States, shipowners and private parties involved in hostage crises to seek assistance from appropriate U.S. government sources in their crisis management procedures.

The enormous ransoms that are paid out make the kidnapping-for-ransom industry incredibly lucrative. The average ransom is now at $4.5 million per incident and has reached as much as $12 million. We also know that lucrative industries fight hard to stay in business. Indeed, despite the decline in successful attacks, the overall number of attempted attacks actually increased slightly in 2011 compared to 2010. In light of the pirates growing difficulties at sea, we have seen pirates shift to targeting hostages on land, such as with the captured American and Danish aid workers. Pirates’ ability to adapt means that the maritime industry and the international community must be constantly vigilant in assessing the effectiveness of self-protection measures.