Strait of Malacca: will it be the next flashpoint in a war over seaborne cargo passage after Hormuz?

The shipping route—which carries roughly 40% of global trade and around 80% of China’s imported oil—has long been regarded as vulnerable to disruption. Southeast Asia’s divisions will make any crisis much harder to contain.

The confrontation between the US and Iran over the Strait of Hormuz has shown how easily chokepoints can be militarized and how quickly economic fallout can spread. The same logic applies to Malacca, except that here, the consequences would cut to the heart of Asia’s economies.

Indonesia, Malaysia and Singapore border the strait and jointly manage it, but have no common framework to deal with pressure in their own waters. Existing cooperation has largely been limited to operational issues such as piracy and safety, but that approach is poorly suited to geopolitical pressure.

Recent discussions between Jakarta and Washington on expanding defence cooperation indicate the Trump administration could be seeking a greater role in the region.

Earlier this month, the two announced a major defence partnership and discussed the possibility of expanded US military overflights through Indonesian airspace. Jakarta has stressed that nothing has been finalized, but even limited access would enhance US ability to monitor—and project forces across—this corridor linking the Pacific and Indian oceans.

Southeast Asia’s response to Hormuz remains fragmented, though Singapore’s approach is worth considering. It has emphasized the principle of freedom of navigation and adherence to international law, arguing that paying tolls for safe passage through the Strait of Hormuz, as Iran is demanding, would set a dangerous precedent for the Malacca Strait.

Malaysia has taken a different route, negotiating a deal that allows several of its ships to cross the waterway. Indonesia, meanwhile, continues to hedge between Beijing and Washington, even as it explores closer defence ties with the US. But this could be interpreted as alignment by China, potentially drawing Jakarta more directly into a US-China confrontation it has long sought to avoid.

There is no immediate threat to Malacca, but the strait is uniquely exposed to tensions between China and the US both because of its geography and its role in the global economy.

Chinese strategists have long worried that in a conflict, US forces could threaten the sea lanes that carry much of its imported oil, a vulnerability former President Hu Jintao famously termed the “Malacca Dilemma.” Washington has far greater capacity to project power in this area than China does, thanks to its naval reach and network of allies and partners.

The war in Iran has underscored Beijing’s Achilles’ heel. In a crisis—whether over Taiwan, the South China Sea or other points of tension between the two powers—the Strait could be drawn into US-China competition. The impact wouldn’t be confined to China: disruption would reverberate across global supply chains, raising energy costs, delaying trade flows and intensifying economic shocks worldwide.

Beijing has spent billions trying to mitigate that risk, building pipelines through Myanmar, investing in the China-Pakistan Economic Corridor and even Arctic routes. But so far none offers a viable substitute for Malacca.

It’s time for Indonesia, Malaysia and Singapore to take a unified approach to maritime security governance of the waterway. Countries are beginning to diversify their options, and this should continue. Thailand, for example, is already pushing ahead with plans for a land bridge linking the Indian and Pacific oceans that would in theory allow it to bypass Malacca altogether.

Yet, none of that is a substitute for Asian unity, particularly among the nations that manage the waterway. They should consider upgrading existing arrangements with more robust joint patrols and develop clearer mechanisms for what to do if conflict breaks out. Above all, they need to present a unified front to both Washington and Beijing and resist the temptation to strike separate deals, which weakens their collective leverage.

Failing to do so would make the Strait of Malacca yet another contested artery of international trade. In an era of intensifying geopolitical rivalry, the costs of such fragmentation would be felt far beyond Southeast Asia. The global economy can’t afford another shock. ©Bloomberg

The author is a Bloomberg Opinion columnist covering Asia politics with a special focus on China.