Current Rates % (for periods not exceeding 7 days)

Notes * This information is kindly provided by Aegis Defence Services Ltd. www.aegisworld.com

The island of Ambon (Seram)

The Malacca Strait, as defined

This waterway is the key chokepoint for East Asia’s commerce, and has historically provided rich pickings for pirates.  This has been the only major threat to shipping until 2003-2004, and has been deemed manageable.  However, recent tactics and a number of worrying incidents suggest an increased interest in attacking ships in the Straits, and a serious intensification of the weaponry and techniques used.  Attackers are increasingly immediately using automatic weapons and rocket-propelled grenades – which have traditionally been tools used much more by the region’s insurgent groups, rather than pirates – to try to bring vessels to a halt.  They are increasingly operating in organised groups, using multiple vessels both to attack their targets, and transfer their booty afterwards.  They are increasingly turning to kidnap for ransom, holding hostages in areas of conflict where there is no possibility of legal recourse.  They are increasingly coming from areas where there is a pervasive presence of Islamist extremists, and they are showing increasing determination.  All of these developments have been occurring despite increased regional naval efforts to improve Strait security.  They are all in stark contrast to the smaller-scale piracy which prevailed before, and are a development of concern.  The effect of the above is that pirates in the Strait are now largely indistinguishable from terrorists, in terms of tactics employed and weapons used, as well as their potential to cause significant damage to shipping.

The Strait is also a terrorist target.  In late 2004 Usama bin Ladin (UBL) explicitly spoke about the advantages of hitting ‘enemy’ countries in their economies, as an effective way of damaging them; he has touched on this theme several times before, and his statements have been disseminated widely among Islamists around the world.  The Jemaah Islamiyah (JI) regional terrorist group, closely linked to UBL’s Al-Qaida (AQ) network, has absorbed his economic targeting agenda, has had and may be trying to regain a maritime capability, and has shown interest in the traffic in the Malacca Strait.  Sinking or damaging a major vessel in the economically strategic waterway of the Malacca Straits would risk seriously disrupting global maritime trade, while the use of a hijacked ship to damage or blockade a major regional port would have enormous political and presentational impact worldwide.  It is impossible to tell the motivation of the people behind a particular attack, and any terrorist group interested in assessing the vulnerability of shipping in the Straits is effectively indistinguishable from a ‘standard’ pirate gang.  Both will use similar weapons, similar clothing, and similar means of approaching the target.  

The late 2004 tsunami temporarily disrupted attacks against ships.  A combination of a substantial multi-national Naval presence, chaos on shore and disrupted coastal navigation led to an effective pause in piracy for two months.  However, piracy resumed near-normal levels by mid-2005.   The strategic importance of the Straits has led to Naval co-operation agreements between adjacent states, but it will be some time before there is enough effective practical co-operation to deter the attackers, particularly in international waters.  Poorly-defended ships will therefore continue to be at threat in the Straits for the foreseeable future. *

Over the course of 2005 and the first half or 2006, security in the Straits has been greatly improved, in part due to pressure from the shipping community on the authorities to improve the situation because of additional premiums being charged by war underwriters. On 7 August 2006, the Joint War Committee removed the Malacca Straits from its listed areas.