Sea Piracy and Armed Robbery in the Gulf of Guinea and Its Effect on Shipping Cost and Nigeria’s Economic Growth

Abstract

Due to the increasing rate of economic damages of insecurity to the Nigerian maritime industry, with cases of loss of revenue to the federal government occasioned by; high freight charges for Nigeria-bound cargoes, high insurance premium charged on both ships and cargoes, and total boycott of the Nigerian ports by most shipping lines. The researcher has been led to carry out research on sea piracy and armed robbery in the Gulf of Guinea and its effect on shipping costs and Nigeria’s economic growth. This research was set out to realize some specific objectives, while research hypotheses were formulated in this regard to address the objectives of this study.Design/methodology/Approach: The research adopted an ex-post facto design. Data were sourced through secondary means from the Nigeria Maritime Administration and Safety Agency’s (NIMASA) statistical bulletin, EViews version 12, and statistical forecasting and modeling were used. A simple regression analysis was used to model the relationship between the dependent and independent variables in the research hypothesis, which was tested at 5% level of significance. The result of the analyses indicated that the model shows that piracy inversely relates to the economic growth of Nigeria. It also found out that there is a significant relationship between piracy and armed robbery, and the cost of shipping due to premiums paid because of piracy activities. This research has revealed that Nigeria’s maritime sector is bedeviled by various crime-related activities that affect revenue generation and contribution from this sector. Effective ways of curbing this menace have been highlighted in this work. This paper will provide NIMASA with reasonable information on the activities of pirates in the Nigerian waters and how to curb their excesses, and may act as a working document.