US$2.5m donation to help keep Straits of Malacca safe

Vincent Wee, Business Times 8 Jul 09;

(SINGAPORE) Safety, security and the environment in the Straits of Malacca and Singapore will be boosted through the Nippon Foundation's US$2.5 million contribution yesterday to the Aids to Navigation Fund to help maintain navigational equipment in the world's busiest strait this year.

'I do not think I can emphasise enough the huge importance of the Straits of Malacca and Singapore for the littoral states and the waterway's many users,' Malaysia's Transport Minister Ong Tee Keat said when receiving the contribution at a ceremony in Kuala Lumpur yesterday.

'We know that for centuries the Straits have been used for international trade, and played an important role in the geopolitical development of the littoral states and their rise as trading nations,' he said. 'This role has grown even more significant in these modern times to meet the increasing demands of consumers around the world.'

The Straits are a vital sea lane between the East and the West, carrying about 40 per cent of global sea trade and more than half of the world's total oil trade. As a result, they are one of the world's busiest waterways, with annual traffic of 94,000 vessels.

The Aids to Navigation Fund was set up to receive voluntary financial contributions from user states and other stakeholders to maintain navigational aids in the Straits. The fund is administered on a rotational basis between the three littoral states for a period of three years each. Malaysia is the fund's first host, and as such, chairs the Aids to Navigation Fund Committee.

The Aids to Navigation Fund was formally launched during the first Aids to Navigation Fund Committee Meeting in Penang last year and started operating with an initial contribution of US$1.35 million from the Nippon Foundation. This contribution was used to assess all 51 aids to navigation in the Straits and was in addition to an earlier pledge by Nippon Foundation to contribute one-third of the sum required to maintain the aids for five years. Running costs are expected to be US$7.4 million this year.

The fund comes under the auspices of the Cooperative Mechanism, which groups the littoral states of Malaysia, Indonesia and Singapore and user states of the Straits through an arrangement to promote cooperation and share the burden of ensuring the waterway remains safe, secure and open.

The fund, now in its second year of operation, is attracting growing support. But Mr Ong said yesterday there needs to be greater emphasis on getting more stakeholders to contribute.

Besides Nippon Foundation, the United Arab Emirates, the Malacca Strait Council of Japan and the Middle East Navigation Aids Service have contributed.

In addition, India contributed to the fund specifically to set up a tidal, current and wind measurement system in the Straits, while Greece made a contribution of US$1 million through the International Maritime Organization.

Japan foundation puts $9million in Malacca Strait safety
MSN News 7 Jul 09;

A Japanese foundation said Tuesday it would contribute nine million dollars towards ensuring safety on the Malacca Strait, through which thousands of Japanese vessels pass annually.

The Nippon Foundation, a Tokyo-based group which has been shouldering part of the cost of maintaining navigational aides on the narrow waterway and the Straits of Singapore, said the money would be paid out over five years.

"There is a potential for an accident to happen. If it involves crude oil tankers, there will be a major oil spill. This could disrupt international trade," foundation chairman Yohei Sasakawa told AFP.

"We must take preventive measures before a disaster takes place," he said at a signing ceremony to grant the money to a multinational fund.

Sasakawa urged ship owners to contribute to the navigation safety fund, to combat threats faced by ships plying the vital artery for world trade.

"Our contribution accounts for one-third of the total cost to maintain the safety equipments. Ship owners must contribute to keep the strait safe. It is a dangerous strait as it is full of oil tankers," he said.

The fund, set up last year, is managed by the three littoral states -- Malaysia, Indonesia and Singapore, which take three-year rotating terms. Malaysia is the current chair.

The United Arab Emirates, India and Greece have also contributed to the fund.

A total of 7.4 million dollars will be spent this year on maintaining navigational aides including lighthouses, beacons, and buoys to guide ships through the congested waterway and prevent collisions.

A Japanese transport official at the ceremony said that at least 94,000 ships sail the narrow strait annually, and that 20 percent are Japanese vessels -- mostly large crude oil carriers.

The Malacca Strait, one of the busiest waterways in the world, is vital to Japan's national interests as more than 80 percent of its oil passes through it.