China is raising their security level on Chinese-flagged vessels transiting the Strait of Malacca; this according to documents obtained through Lloyd’s of London. Shipping companies have been advised to implement Security Level 3, the highest state of alertness under the International Ship and Port Facility Security Code. This was placed in affect on 2 July 2019 by the Chinese Ministry of Transport. Singapore currently disagrees with their assertion.
An increase to Security Level 3 is an exceptional measure applied only when there is credible information that a security incident is probable or imminent. The ministry did not specify the reasons behind the increased alert level. An internal email alert from China Ocean Shipping Company (Cosco), Energy Transportation suggested the threat was from Indonesian parties. The oil and gas shipping unit of state conglomerate China Cosco Shipping Group reported they received information that, “a certain Indonesian organization is preparing to attack Chinese ships when passing through the Strait of Malacca.” The Cosco email was delivered on 2 July, when they raised their warning to Security Level 2 for its vessels.
Close to a quarter of global trade is shipped through the Strait of Malacca, one of the busiest waterways in the world. This waterway is situated between the Malay Peninsula and the Indonesian island of Sumatra. It is also a strategically important choke point for Chinese oil imports from the Middle East Gulf region.
Piracy is a constant threat to vessels transiting the narrow, 900 km-long stretch of water. Although the number of incidents appears to have dropped significantly in recent years, this Chinese security alert may shed some light on current threats. There had been a 92 percent decrease in piracy and sea robbery incidents in the Strait of Malacca and Singapore in 2015-2018, according to a recent report by the Information Fusion Center, a multi-national maritime security information center based in Singapore. Dryad Global, a maritime security intelligence company, said China had raised the security level to the highest threat warning available. “The raising of the threat level for Chinese-flagged vessels has been unexpected, particularly as the regional dynamics within and surrounding the Malacca Strait are stable” Dryad said in a statement. It is unusual to see this dramatic an escalation of security for Chinese vessels. There is currently no known reporting to indicate that local groups involved in piracy possess the intent or capability to employ new methods in targeting large ships. The last significant incident within that region was the Johor Port dispute between Malaysia and Singapore. “However, there are no significant geopolitical tensions which would link logically with the increased Chinese threat level,’’ it said. Dryad said “there are no regional narratives or emerging threats which would support the Chinese decision’’ and that “it is likely that China is reacting to a specific threat known only to China.’’
Lloyd’s List Intelligence data indicates that 80 out of the 135 active ships owned/operated by Cosco are flying the Chinese flag, including 13 of 41 very large crude carriers (VLCC). Of the 80 ships, 53 are larger than 50,000 dwt. Some VLCCs plying from South America or Africa to east Asia choose to transit via the Sunda Strait between Java and Sumatra instead. Brokerage sources report that the move by the Chinese ministry would have limited immediate impact on freight rates as the number of China-flagged ships serving international trade is relatively small. However, rates might start to increase if the tensions heighten and more vessels are forced to make detours.
In response to China’s security warning, the Maritime and Port Authority of Singapore (MPA) reported on 5 July 2019 that there has been no information on immediate threats to ships sailing through the Straits of Malacca and Singapore or to Singapore-registered ships. MPA was responding to media queries on China raising its security warning to the highest level for its vessels heading through the Straits of Malacca.
"The Port of Singapore will maintain the current security level 1 as per the International Ship and Port Facility Security (ISPS) Code and Singapore’s security agencies will continue to be vigilant," said MPA. It added that "regardless of the security level", all ships sailing through the Straits of Malacca and Singapore are "advised to be vigilant and implement the relevant security measures as per ISPS ships security plan."
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