Indonesia sought to reassure the international shipping community they will not have another potential “pay-to-pass” scenario on their hands at the Strait of Malacca.
Indonesia’s top foreign diplomat said the country will not pursue tolls on ships passing through the strait, seeking to calm concerns after its finance minister floated the idea at a symposium in Jakarta earlier this week.
“As a trading nation, Indonesia supports freedom of navigation and expects open sea lanes,” Indonesian foreign minister Sugiono said Thursday. “Indonesia is not in a position to impose such charges—that would not be appropriate.”
A day prior, finance minister Purbaya Yudhi Sadewa on Wednesday questioned whether it was “right or wrong” that Indonesia does not charge tolls on vessels transiting the waterway, which runs between the country’s largest territory, Sumatra, and peninsular Malaysia.
“If we split it three ways between Indonesia, Malaysia and Singapore, that could be quite something, right?” he joked.
The idea of a toll was floated as Iran has reportedly installed a tool booth system for ships seeking the Strait of Hormuz. The Hormuz, which is a supply chain chokepoint that typically harbors the transit of 20 percent of the world’s oil and natural gas supply on a given day, has seen a fraction of traffic pass through due to safety concerns stemming from the war in Iran.
Iranians have reportedly charged as much as $2 million for some commercial vessels to travel through the Strait of Hormuz. That’s on top of the concerns shipowners and crews already have regarding a potential attack.
But the Strait of Malacca would have much wider implications from a cargo trade standpoint, with the Ports of Singapore and Malaysia’s Tanjung Pelepas sitting at the channel’s southern entrance. Another major regional transshipment hub, Malaysia’s Port Klang, lies near the midpoint of the strait.
An estimated 22 percent of the world’s maritime trade passes through the 550-mile strait, according to the Washington-based Center for Strategic and International Studies. Malaysia’s Marine Department said more than 102,500 ships, mostly commercial vessels, transited through the Malacca Strait in 2025, up from around 94,300 in 2024.
Asia-to-Europe or intra-Asia trade lanes often go through the strait, and vessels carrying cargo from other apparel manufacturing countries including Bangladesh, India, Pakistan and Myanmar are likely using the passage.
A levy on Malacca traffic would be illegal under the United Nations Convention on the Law of the Sea (UNCLOS).
“Indonesia is in a position where, as an archipelagic state, it must of course respect UNCLOS,” Sugiono said. “Historically, UNCLOS includes an understanding and an agreement that recognizes us as an archipelagic state, as long as we do not impose tolls or fees on the straits within our territory.”
Purbaya walked back initial concerns after Sugiono’s comments, telling reporters Friday: “I wasn’t serious about it. We had never planned to charge a fee…we understand our commitments to UNCLOS and we will uphold them.’”
Like the Strait of Hormuz, it is not a constructed waterway like the Panama Canal or Suez Canal that is controlled by one country. The Strait of Malacca is primarily controlled and managed by the three states bordering it: Indonesia, Malaysia and Singapore.
As bordering states, Indonesia, Malaysia and Singapore are legally obliged not to “hamper transit passage,” and there “shall be no suspension of transit passage” under any circumstances.
Diplomats at Malaysia and Singapore have both taken a pro-free passage stance since Sadewa’s comments.
Malaysian foreign minister Mohamad Hasan told a forum on Wednesday that no unilateral decisions can be made about the strait, noting that Malaysia, Singapore, Indonesia and Thailand conduct joint patrols to ensure the waterway remains open.
Vivian Balakrishnan, the foreign minister of Singapore, has said passage through the Malacca and Singapore straits must remain free and open, stressing that the city-state does not support efforts to restrict navigation or impose new costs on vessels using the route.
“We do not have tolls. All of us are trade-dependent economies,” Balakrishnan told CNBC at the Converge Live event in Singapore Wednesday. “All of us know it is in our interest to keep it open.”
Balakrishnan said Singapore has told both the U.S. and China the city-state operates on UNCLOS.
“We will not participate in any attempt to close or to interdict or to impose tolls of traffic, maritime traffic, and overflight in this age,” Balakrishnan said.