Indonesia Floats Idea of Malacca Strait Toll

Indonesian Finance Minister Purbaya Yudhi Sadewa suggested on Wednesday that Indonesia, Malaysia, and Singapore could impose a toll on ships passing through the Strait of Malacca. He cited Iran's reported move to control passage and impose tolls on ships in the Strait of Hormuz as a potential model.

The minister later tempered his remarks, stating, "If only it could be like that. But it is not like that." Indonesian officials have privately indicated there is no current appetite in Jakarta to seriously pursue the idea.

The Strait of Malacca connects the Indian and Pacific Oceans and carries more than 40% of the world's seaborne trade.

Regional and International Reactions

The suggestion has drawn swift responses from key regional players:

• Singapore: Foreign Minister Vivian Balakrishnan stated Singapore would not participate in any attempts to impose tolls, asserting that the right of transit passage is guaranteed for everyone.
• Australia: Defence Minister Richard Marles said Australia is "completely committed" to the United Nations Convention on the Law of the Sea (UNCLOS) and freedom of navigation.

Analysis from Euan Graham of the Australian Strategic Policy Institute described the suggestion as a potential "trial balloon" to test regional reaction, noting it highlights differing perspectives on vital interests.

Background and Context

• Indonesian politicians have previously floated the idea of a levy for the strategic waterway.
• The suggestion has drawn increased attention following recent strategic developments related to the Strait of Hormuz.
• Any toll proposal would likely face opposition from major trading nations, including the United States and China, which rely on the strait for oil and goods transport.