VIDEO: Why is the Strait of Malacca so Important to the World’s Economy & Military

Today, we are going to talk about the Strait of Malacca  and why it is so important to the world’s economy and military. World trade, which involves a large portion of the world’s energy supplies, must move through some “choke points” between producing areas and their final destination. The Straits of Malacca is one of these “choke points.”

The Malacca Strait, which connects Indonesia, Malaysia, and Singapore, has long been a major trading route into and out of Asia, and it is regaining prominence. This has been in continuous use since antiquity, with Roman, Greek, Chinese, and Indian traders all taking advantage of this natural river. It is now the world’s second-busiest waterway. From the 15th century to the present, its strategic importance has made it a centre of international strife.

The Suez Canal‘s opening in 1869 only added to the Strait’s importance, as it became a crucial connection between the Pacific and Indian Oceans, cutting the gap between Europe and the Far East in half. More recently, it has acted as the key transit route for essential commodities needed to fuel Asia’s and the world’s fast-growing economies. In 2010, nearly half of the world’s total annual seaborne trade tonnage passed through the Strait of Malacca and the neighboring Straits of Sunda and Lombok, according to figures from the United Nations Conference on Trade and Development (UNCTAD) Study of Maritime Transport 2011.

Malacca’s economic importance to Asia and the broader global economy will rise as the region’s economies develop. In 2011, approximately 15.2 million barrels of oil were extracted every day and passed through the Strait of Malacca, the shortest sea route between African and Persian Gulf suppliers and Asian markets. This is approximately 19 times the volume that passed through the Panama Canal over the same time span, and four times the volume that passed through the Suez Canal.

The Strait of Malacca is one of the world’s most important shipping lanes, both economically and strategically. The strait links major Asian economies such as India, Thailand, Indonesia, Malaysia, the Philippines, Singapore, China, Japan, Taiwan, and South Korea. It is also the largest channel between the Indian Ocean and the Pacific Ocean. The Strait of Malacca is part of the Maritime Silk Route, which runs from the Chinese coast to the Southern tip of India to Mombasa, then through the Red Sea to the Mediterranean through the Suez Canal, then to the Upper Atlantic region to Trieste, the northern Italian hub with rail links to Central Europe and the North Sea.

Every year over 94,000 vessels travel through the strait, making it the world’s busiest strait, transporting up to 25% of the world’s traded goods, including crude, Chinese manufactured goods, coal, palm oil, and Indonesian coffee. The Strait carries about a quarter of all oil transported by sea, mostly from the Persian Gulf suppliers to Asian Markets. The Strait carried an estimated 13.7 million barrels per day in 2007, rising to an estimated 15.2 million barrels per day in 2011.

It is also one of the world’s most congested shipping choke points, as it narrows to just 1.5 NM at the Phillip Channel near Singapore. The maximum size of the vessel that can pass through the Strait is known as “Malaccamax” which means that the Strait’s minimum depth of 25 meters is inadequate for some of the world’s largest ships.

Between 1978 and 1994, there were 476 incidents in the Straits including oil spills, with an average of 30 accidents each year. Oil tankers make up about 36% of the vessels passing through the Straits. 

Furthermore, when it comes to military matters, the Strait of Malacca plays a vital role. The Chinese military’s progress has focused on their forces’ ability to participate in anti-access or area-denial operations. An anti-access area denial strategy is based on the premise that while a state cannot defeat the US in a traditional war, it can invest in less costly alternatives that limit the US’ ability to deploy its advantages. Through the implementation of its ‘Air-Sea War’ doctrine, the US has developed a way of thinking about how to fight this form of strategy, i.e., matching a particular capacity to a specific need in order to optimise the outcome while mitigating risk.

So, when it comes to Malacca Strait, we draw conclusions. The Strait of Malacca are important for global trade and regional cooperation advancement. The Strait is vulnerable to social, political, and natural disasters, but it also offer great economic and social growth opportunities.