THE STRAITS OF MALACCA AND SINGAPORE: STATUS OF THE DEFENSE BUILDUP

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Intelligence
The Straits of Malacca
and Singapore: Status of
the Defense Buildup
DIA review
completed.
State Dept. review completed
Secret
EA R2-10107C
September-198-2
Copy 3 3 6
STAT
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Directorate of Secret
Intelligence
The Straits of Malacca
and Singapore: Status of
the Defense Buildup
This paper has been prepared
OEA, also contributed. Comments and
queries are welcome and may be addresed to the Chief,
Southeast Asia Division, OEA,
This paper has been coordinated with the Directorate
of Operations and the National Intelligence Council
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Secret
EA 82-10107C
September 1982
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The Straits of Malacca
and Singapore: Status of
the Defense Buildup F_
Secret
Key Judgments Indonesia, Malaysia, and Singapore are in the early stages of a major
Information available defense buildup that will improve their capability to defend the Straits of
as of 1 September 1982 Malacca and Singapore. The buildup-spurred by the Soviet presence in
was used in this report.
Vietnam and, for Indonesia and Malaysia, the perception of a longer term
threat by China-is intended to improve surveillance and defense capabili-
ties over these straits and their eastern approach, the South China Sea. To-
tal defense spending this year by the three is budgeted at more than 70 per-
cent above the 1979 level:
? World War II vintage ships are being replaced by modern, missile-
equipped craft.
? Major improvements are being made in fighter and surveillance aircraft
fleets.
? A greater number of joint bilateral military exercises are being under-
taken. 25X1
At present, surveillance of the approaches to the straits is poor, and the
military forces of the three ASEAN states have a limited ability to defend
against an aggressor. Assuming their current five-year plans are carried
out and followed up by a continuing modernization effort, however, their
forces will pose a respectable challenge by the 1990s-at a minimum,
attaining the Singaporean goal of being a "poisoned shrimp" for a major
power aggressor. 25X1
Financial problems could stretch out implementation of plans for the
buildup. In Malaysia, where low raw materials prices have reduced foreign
exchange receipts, some planned
hardware procurements are being delayed and operations reduced. Al- _25X1
though we have not yet seen any reductions from planned levels in
Indonesian military programs, we expect economic constraints to force
delays in force improvements and encourage Indonesia to look abroad for
additional assistance and concessionary financing for future military
purchases. Even Singapore, with its varied, fast-paced economy, recorded a
sharp decline in export growth during the first half of 1982, perhaps
presaging some military budget cuts
FA 87-101070
September 1982
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The Straits of Malacca
and Singapore: Status of
_
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the Defense Buildup F
Importance and Vulnerabilities of the Straits
The Straits of Malacca and Singapore are one of the
world's busiest maritime passages forming the short-
est sea route between the Indian Ocean, the South
China Sea, and the Pacific Ocean. The waterway is a
lifeline for East Asian exports to European markets
and oil imports from the Middle East. The straits also
have strategic importance for the United States and
the Soviet Union because of the growth of their
Indian Ocean naval forces.
Use of other routes through the Indonesian archipela-
go would cause costly delays. The most viable deep-
water alternative is the Lombok Strait between Bali
and Lombok, although use of this strait adds four
days to a typical Japan-Middle East tanker run. Its
deep, 11-mile-wide channel already is used for super-
tankers too large for the Malaccan Strait. The Sunda
Strait to the Java Sea is the shortest alternative route
to the Malaccan/Singapore Straits, but the shallow-
ness of the Java Sea, local traffic congestion, and the
many offshore oilwells restrict its use. The Ombai/
Wetar is the third major strait through the archipela-
go. Should a dispute affect all of these options (all
involve Indonesian waters), traffic would be forced
around Australia-a route that would add more than
two weeks' travel time between the Indian Ocean and
The Straits of Malacca and Singapore are vulnerable
to interdiction either by mines or small craft armed
with missiles. Mines are particularly suitable because
navigable channels are narrow in places and tidal
currents are not a significant problem. The straits
were successfully mined by air in World War II by
the Allies. Neither the littoral states nor Australia has
the ability to clear the waters of mines quickly,
because they lack sufficient mine countermeasure
assets. The straits of the Indonesian archipelago are
equally susceptible to mining, with the exception of
the deep Ombai/Wetar Strait, which has strong tidal
currents.
Concerns Over the Straits and South China Sea
The Southeast Asian nations have long been con-
cerned that China will project its influence southward
into the South China Sea and the Singapore and
Malaccan Straits. Although still a long-run worry-
particularly for the Indonesians-the ASEAN na-
tions now publicly call the Soviet Union and Vietnam
the greater threat in the near term.
LOA-1
Concern over Soviet intentions in the area increased
in 1980 when the USSR signed a defense and oil 25X1
exploration agreement with Vietnam. The agreement
commits the Soviet Union to assist Vietnam in explor-
ing for oil and gas on Vietnam's continental shelf and
in the South China Sea-the eastern approach to the
straits. The worries of the ASEAN states are fueled
not only by concerns over Soviet strategic interests it
the area but by Vietnam's sweeping claims over the 25X1
South China Sea that conflict with the claims of
China and each ASEAN nation except Singapore.
Since 1979 the Soviets have maintained a naval 25X1
presence in the area.
With modification, the Vietnamese facilities could 25X1
provide a base for air cover for Soviet naval operations
in the South China Sea down to the straits.
In addition to the external threat, the littoral states 25X1
have to cope with piracy and smuggling, perhaps the
most acute security problems in the area. The combi-
nation of high Indonesian tariffs and the proximity of
Singapore as a commercial entrepot makes smuggling
profitable. The Indonesians lack both the surveillance
and patrol craft to interdict this traffic. As to piracy,
attacks have been on the increase; more than 40 major
incidents have occurred over the past two years. Four
oil tankers were attacked within the space of five
weeks last year.
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Figure 1
Sea Routes Through the Malacca and Singapore Straits
Boundary representation is
not necessarily authoritative.
Secret 2 25X1
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Straits of Malacca/Singapore
The funnel-like Strait of Malacca runs for 500 miles
separating the Malay Peninsula from the Indonesian
island of Sumatra. Over 200 miles wide at its western
entrance, the strait constricts to 8 miles at its eastern
end adjoining the Strait of Singapore and has a
navigable channel less than 2.5 miles wide at some
points. The navigable channel has a minimum depth
of 23 meters, allowing it to handle full vessels up to
225,000 deadweight tons.
The 70-mile-long Singapore Strait completes the
interoceanic link. Bound by the Malay Peninsula and
Singapore on the north and the Islands of the Riau
Archipelago on the south, the strait has a minimum
breadth of 3.2 miles, with a navigable channel 1.8
miles wide at this point.
Around 180 ships enter the Malacca/Singapore
Straits daily. More than 1.3 billion barrels of oil
transit the straits each year, in 1981 about half of
Japan's oil came through this waterway. South Korea
and Taiwan depend on the straits for nearly all their
oil. The straits are also the primary sea link for
manufactured goods and raw materials sold by the
East Asian economies to Europe. In addition, the
straits play a vital role in commerce between the
littoral states-Malaysia, Indonesia, and Singapore.
As to military traffic, 65 Soviet naval vessels entered
the straits last year. The United States also uses the
straits to service its Indian Ocean Squadron out of
the Philippines and Hawaii.
Current Defense Capabilities
Indonesia, Singapore, and Malaysia have only a limit-
ed capability to conduct surveillance over the straits
and their approaches much less defend them. Modest
naval forces are their strongest military asset. Indone-
sian resources include three corvettes armed with
guns and Exocet missiles, seven older frigates, two
submarines, and numerous patrol craft suited to
inadequate maintenance, a poor logistics system, and
lack of trained personnel limit the performance of the
Indonesian Navy.
Malaysian and Singaporean naval forces are more
modest; neither has a deepwater capability. Their
fleets consist mainly of patrol craft effective in coastal
areas and in the straits themselves.
The Indonesian and Malaysian Air Forces have mini-
mal strike capability. Malaysia has only five or six
obsolete Canadair Tebuan fighters for ground attack.
Both forces suffer from a shortage of experienced
pilots, lack of technicians, and inefficient aircraft
maintenance. The Singaporean Air Force is more
impressive, possessing a strong ground attack capabil-
ity comprising two attack squadrons equipped with 34
A-4S Skyhawks.
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Maritime surveillance of the approaches to the straits
is another serious shortcoming. Singapore currently
has no aircraft dedicated to surveillance, although
Embassy reports indicate it plans to buy three E2C
Hawkeye reconnaissance planes from the United
States; Malaysia's surveillance effort is poor because
of crew and maintenance problems. Indonesia has a
large airborne search force, but it too suffers from a
lack of trained personnel. Coverage by land-based
radar in each of these states is inadequate.
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? Vietnam's dispute with Indonesia centers on 12,000
square miles in the South China Sea north of
Grand Natuna Island-a region where oil and gas
strikes by US firms have raised hopes for
exploitation.
? Hanoi is at odds with the Philippines over the
Spratly Islands, where both countries have built up
military forces.
? Malaysia disputes Vietnam's claim to sovereignty
over Amboyna, a small, barren sand island in the
southern part of the Spratlys that was occupied by
Vietnam in 1977.
Via Additional Transit Time Via
Straits of
Malacca Sunda
Lombok
Strait
Ombai/
Wetar
Strait
Australia
Japan-Straits of Hormuz
(15.5) 1.7
4.3
4.3
15.5
Vladivostok-Aden
(17.9) 1.6
3.8
3.8
15.1
Cam Ranh Bay-Aden
(11.5) 1.9
5.0
7.1
19.8
Subic Bay-Diego Garcia
(9.6) 3.0
1.7
3.1
14.2
Pearl Harbor-Diego Garcia
(22.2) 3.0
7.0
5.0
2.3
? Thailand, with Vietnamese troops in neighboring
Kampuchea, is also concerned by the oil agreement.
Bangkok proclaimed a 200-mile exclusive economic
zone to protect its interests:
The dispute also brings the Soviet Union into rival
jurisdictional claims between China and Vietnam.
China claims the Spratly and Paracel Islands, al-
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Figure 3
Occupied Islands in the South China Sea
Name
Spratly Islands
Amboyna Cayb
Chinese Name
(Pinyin)
Nansha Qundao
Chinese Vietnamese Namea Philippine Claimed by
Characters Name
Quan Dao Truong Sa Kalayaan China, Vietnam, Philippines,
Presently
Occupied by
Philippines,
Malaysia (some), Taiwan Vietnam, Taiwan
hi tt'tl Dao An Bang Kalantiyaw China, Vietnam, Philippines,
Malaysia, Taiwan
Central Reef
Huayang Jiao
+ fl8 fit
Commodore Reef C
Siling Jiao
aJ 4 fi
Cong Do
Flat Island
Antang Dao
-
Itu Aba Island
Taiping Dao
Dao Thai Binh
Lankiam Cay
Yangxin Zhou
ill
-
Loaita Island
Nanyue Dao
i
Dao Loai Ta
Namyit Island
Hongxiu Dao
F
Dao Nam Ai (Nam Yet)
Nanshan Island
Mahuan Dao
Vinh Vien
Northeast Cay
Beizi Jiao
1t ?
Dao Song Tu Dong
Pearson Reef
Bisheng Dao
Sand Cay
Dao Son Ca
Sin Cowe Island
Jinghong Dao
Dao Sin Tonh
Southwest Cay
i ?
Dao Song Tu Tay
Spratly Island
Dao Truong Sa
Thitu Island
Zhongye Dao
cI
Dao Thi Tu
West York Island
Xiyue Dao
Dao Ben Lac
Paracel Islands
Xisha Qundao
Quan Dao Hoang Sa
Pratas Island
Dongsha Qundao
* i'
-
aVietnamese names are shown without diacritical marks.
bMalaysian name is Pulau Kecil Amboyna.
C Malaysian name is Terumbu Laksamana.
Vietnam
China, Vietnam, Philippines, Taiwan Vietnam
Rizal Reef China, Vietnam, Philippines, Philippines
Malaysia, Taiwan
Patag
Ligaw
Panata
Kuta
Binago
Lawak
Parola
Hizon
Rurok
Pugad
Lagos
Pagasa
Likas
China, Vietnam, Philippines, Taiwan Philippines
China, Vietnam, Philippines, Taiwan Taiwan
China, Vietnam, Philippines, Taiwan Philippines
China, Vietnam, Philippines, Taiwan Philippines
China, Vietnam, Philippines, Taiwan Vietnam
China, Vietnam, Philippines, Taiwan Philippines
China, Vietnam, Philippines, Taiwan Philippines
China, Vietnam, Philippines, Taiwan Vietnam
China, Vietnam, Philippines, Taiwan Vietnam
China, Vietnam, Philippines, Taiwan Vietnam
China, Vietnam, Philippines, Taiwan Vietnam
China, Vietnam, Taiwan Vietnam
China, Vietnam, Philippines, Taiwan Philippines
China, Vietnam, Philippines, Taiwan Philippines
China, Vietnam, Taiwan China
China, Taiwan Taiwan
MALAYSIA
CHINA
Northeast
C~
Southwest Cay
Sou
Lys Shoal
Thitu Menz,es orkat
Reels Reef OYork Island
Sub, Reef Thitu Island
bang Flat Island
10
th
Western Reef
Loasta Reef
Beets
Tr,dent Shoal
Occupied by
0 China 0 Philippines
0 Vietnam 0 Taiwan
o so 100 Kilometers
0 50 100 Nautical Miles
0
NanshanO
d p`h
0
Bares ,nter
0
h
res
Barb
Reed Tablemuunl
Ire que,s
Leslie Bsnk
Sandy Shoal
I
Lord Aouklarrd
Shoal
?Laita Island
o
Itu Abe lslsnd00Sand Cay
T~zard aank
Gana ONamyit Island LReef
Reels
Disuocery Great Reef
China
Se
Sin Cowe IslandOue15
e
Johnson Atoll
Fiery Cross Reel
Cuarteron
Reel
London Reels
Central ReetO
Ladd West East
Reel O Reef Reef
Spratly'
Island
Bark
Webber
L,a
Bitters
Reel
Reel
Pearson;
0 Reef
Alison I Cornwallis
Reef
South Reel
Island Reef
Jankoon
Atoll
Hepps Reel
Mischief Reel
Second Thomas
Shoal
Pigeon
Reef
Sand Ca
'sup Arr a
Anna
Reel
Commodore O
Barque tnvestrgetor Reef
Canada Reel Shoal
Marreeles
Beef
Seialluee
Reel
Royal Charlotte Reef
Ardasror
Reefs
114 eoenda,y r~pr~aenmt~on is
of eecessa,oy emhontaova.
505370 (546016) 10-82
The Spratly Islands
China, Vietnam, Philippines, Malaysia, and Taiwan all
have claims to one or more of the Spratly Islands.
Soufhnre
Reels
Templer
Bank
_N
Balabac \ Strait
Pines Pubs
Balambee5ae 5l 1.r J Banggi
Seahorse Shoal
Sulu
Sea
Cagayao '
Sulu
\ Islands '
N
14
12
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Table 2
Military Air Assets of the Littoral States a
F-5E Tiger 11 14
Singapore F-5E Tiger II 24
F-74/74S Hunter 18
a Excluding trainers.
b Australian aircraft assigned to the Integrated Air Defense System
and stationed at Butterworth Field, Malaysia.
Tebuan 5-6 PC-130H 3
A-4S 31
BAC-167 19
Strikemaster
Force Modernization Efforts
Efforts to increase force capabilities began in the late
1970s, receiving a financial boost from rapid econom-
ic growth and, for Indonesia, rising oil prices. The
buildup has concentrated on the purchase of modern
ships and aircraft and the introduction of new missile
systems. These countries are also targeting improved
personnel training.
When completed, the modernization programs will
improve maritime and air surveillance capabilities
and enable the three countries' armed forces to
present a credible deterrent. The countries are im-
proving early warning and air defense capabilities by
using ground-based and airborne surveillance sys-
tems, and by adding advanced fighter aircraft and
antiaircraft missiles. Maritime defenses are being
bolstered with the addition of missile-equipped attack
craft.
Indonesia's five-year defense development plan
(1979-83) is the most ambitious modernization effort
in 20 years. The plan is also more outward looking
than previous efforts that concentrated on internal
stability. Jakarta has upgraded and redeployed mili-
tary forces to positions bordering the South China Sea
and has expanded its airbase and support facilities at
Grand Natuna Island. Since 1979 Indonesia has
procured about $1.3 billion worth of new air and
naval equipment. Fourteen new naval combatants
have been added-including Exocet-equipped frig-
ates-while the Air Force has received new A-4s and
F-5s, as well as helicopter and transport craft. Jakarta
has also purchased a new ground-based radar system
from France and is in the process of acquiring Boeing
737 aircraft for surveillance. In addition, senior Indo-
nesian defense officials have approached the United
States Government to buy some F-16 fighters and
Harpoon antiship missiles.
The Fourth Malaysian Plan announced in March 25X1
1981 called for $4.3 billion to be spent on defense
during 1981-85, continuing the force expansion began
in 1979 that was intended to double the armed forces
by 1983. The plan envisions procurement of tanks,
armored personnel carriers, artillery, naval combat-
ants, and attack and fighter aircraft, as well as the
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1,764
1,788
2,503
2,622
1,406
1,466
2,026
2,917
506
622
712
791
3,677
3,877
5,242
6,331
Table 3
Indonesia, Malaysia, and Singapore: Real Defense Spending a
Indonesia
Malaysia
Singapore
Total
1,386
1,878
1,906
1,025
975
1,095
386
421
512
2,798
3,274
3,514
2,068
1,166
488
3,723
a Deflated using national GDP deflators.
b Converted at June 1982 exchange rates.
Budgeted.
construction of new bases to improve capabilities
across the board. The government intends to acquire
A-4 attack planes and more F-5s. Guided missile
corvettes and mine hunters also are in the plan. A
follow-on phase would provide further equipment and
the support organizations needed for the new forces.
Singapore has been committed to developing a credi-
ble deterrent force since its independence in 1965.
Realizing that its small size, strategic location, and
economic prosperity make it vulnerable to aggression,
Singapore has developed a strategy that calls for
making such an attack on it unacceptably costly. The
US Embassy in Singapore estimates that by next year
a sophisticated air defense system incorporating
surface-to-air missiles, F-5E and A-4S aircraft, and a
ground radar command center will be operational.
The Embassy further reports that since the Falklands
confrontation, Singapore officials have indicated
greater urgency in improving early warning and com-
mand and control capabilities and intend to buy three
E2C reconnaissance aircraft
Growing Economic Constraints 25X1
Although military spending plans still remain largely
on track, the global recession is beginning to cause
these countries to review their planned spending lev-
els. The weak oil market is cutting deeply into
Indonesia's foreign exchange earnings. Oil export
earnings are presently running some $10 million per
day below 1981 rates. As a result, Indonesian Govern-
ment receipts have also been reduced-taxes and
royalties on the petroleum industry account for some
60 percent of Jakarta's revenues. In a similar fashion,
the Malaysian balance of payments and terms of
trade have deteriorated as tin, rubber, and timber
prices dropped sharply in 1981, resulting in the first
decline in export revenue since 1975. Manufactured
exports, which grew rapidly in 1980, fell 17 percent
last year; demand was particularly weak for electroni25X1
components and textiles. Even the well-balanced Sin-
gaporean economy is beginning to feel the impact of
the recession. Growth in real GDP fell to 7.3 percent
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in the first quarter of 1982-the worst performance in
four years. Output in the electrical goods and elec-
tronics sector declined by nearly 7 percent; in the first
half of 1982 export growth slowed.
Implications 25X1
Recession-induced cuts in defense budgets will, we
believe, probably lead Malaysia and Indonesia to put
less pressure on the United States and other suppliers
for early delivery of advanced military aircraft and 25X1
The tightening economic situation has already affect-
ed the Malaysian defense budget. Prime Minister
Mahathir has indicated to Malaysian Defense offi-
cials that military spending goals for 1981-85 will not
be met on schedule. DIA reports that there are
indications that this year's defense budget may be
reduced as much as 20 percent and that cuts next year
may be even greater. In July the Malaysian Air Force
postponed the planned purchase of 16 F-5 E/F fight-
ers because of a moratorium on such purchases by the
Finance Ministry. According to the Air Force Chief
of Staff, only essential equipment and training will be
funded through 1983. In addition, the activation of
additional Malaysian combat units has been canceled
for budgetary reasons. As a result, Malaysian defense
expenditures in the first three months of 1982 were
almost 30 percent below year-earlier levels.
Although we believe Indonesian military programs
have not yet been affected by the recession, they are
likely to undergo cutbacks should oil prices not rise
from current levels as most analysts now expect. In
such a case, we believe Indonesia will look abroad for
additional aid and concessionary financing of military
purchases. Both general force improvements-train-
ing, barracks modernization, and ground force expan-
sion-and improvement of military capabilities along
the strategic northern flank of Indonesia-Sumatra,
Kalimantan, and Sulawesi would be slowed. We do
not believe plans for the acquisition of advanced
defense systems will be shelved but rather stretched
over a longer period of time.
Singapore's defense budget is the least likely to be
affected by the global recession in our view. The city-
state boasts a well-balanced economy that can ride
out even extended recession. Furthermore, the current
modernization effort will be essentially complete with-
in the next year or two.
perhaps ask to stretch out purchases. Certainly there
will be increased pressure for US credits.
ing a mix of Harpoons, Exocets, and Gabriels, we
believe the share of Harpoon acquisitions in future
planned acquisitions may drop. In any case, we expect
the United States to remain the supplier of choice for
most advanced weapons systems even if economic
pressures increase comparative shopping in Europe.
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Even with delays in planned hardware purchases, we
believe the military forces of the three littoral states
will evolve into a more credible deterrent as the 25X1
decade progresses. Purchases of defense systems have
already made these states a more potent force than
they were only two or three years ago. Added surveil-
lance capability will greatly improve the usefulness of
these systems. Proper training and maintenance re-
main the most significant constraint on the efficacy of
advanced weaponry in Indonesia and Malaysia. More-
over, we believe defense cuts could come in these
areas, exacerbating existing deficiencies and thereby
negating the usefulness of newly acquired defense
systems. 25X1
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