Somalia pirates free MV Panama after $7 million ransom paid

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MOGADISHU (Reuters) - Somali pirates freed the Liberian-flagged container ship MV PANAMA seized last December after receiving a $7 million ransom Tuesday, pirates holding the ship told Reuters.

The vessel was hijacked on December 10 en route from Tanzania to Mozambique with a crew of 23 from Myanmar.

"We received the agreed ransom of $7 million early in the morning after long negotiations. Now we have abandoned the ship and it is sailing away safely," a pirate who gave his name as Abdi told Reuters.

Somali piracy is estimated to cost the world economy billions of dollars a year and international navies struggle to combat the menace, especially in the Indian Ocean due to the vast distances involved. The shipping industry has warned that seaborne gangs pose an increasing threat to vital sea lanes.

The pirates are becoming increasingly violent and are able to stay out at sea for long periods using captured merchant vessels as mother ships.

(Reporting by Mohamed Ahmed; Editing by David Clarke)