Maritime piracy in Southeast Asia and freight rates
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ACDE Seminar
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This issue of maritime piracy is of significant concern to maritime security and trade. Although there have been studies to assess the costs of maritime piracy and its trade implications based on the assumed increase in freight rates, so far there has been no empirical investigation to verify whether maritime piracy really does have an impact on freight rates.
This study tries to investigate this by examining the recorded freight rates for six of Southeast Asia’s busiest trade routes against the number of maritime piracy incidents. The focus is on Southeast Asia due to its strategic location which serves major shipping routes. This paper further serves to fill in a gap in the literature concerning the relationship between maritime piracy and freight rates. The examination results seem to indicate that maritime piracy incidents in Southeast Asia do not have a significant effect on freight rates along the six routes covered in both the container and tanker shipping markets. These findings will have significant strategic implications for the shipping industry and trade/development implications not only for ASEAN countries but also for Australia.
Updated: 15 October 2024/Responsible Officer: Crawford Engagement/Page Contact: CAP Web Team