Russia is out to rule the waves in South-East Asia

Press, Volume CXVI, Issue 34133, 21 April 1976, Page 18

Russia is out to rule the waves in South-East Asia

(By

GRANVILLE WATTS.

N.Z.P.A.-Reuter correspondent)

SINGAPORE. The Soviet Union has begun a “rule the waves” campaign in South-East Asia spearheaded by its Navy and huge Merchant Navy. The build-up of the Soviet Navy ir. the Pacific and Indian Oceans is being matched by a dramatic increase in the numbers of Russian merchant vessels visiting South-East Asian ports. Japanese shipowners claim that the expansion of the naval and merchant fleets is aimed at controlling the sea routes by commercial as well as military strength. The Russians are also busy cn land, setting up cultural treaties, holding exhibitions, and improving their trade and banking position. While providing strong backing for Hanoi, the Russians appear keen to make friends and to gain influence among the non-Communist countries of the Association of South-East Asian Nations. Singapore Special Soviet attention is being paid to Singapore, the world’s fourth largest port and strategically placed between the Indian Ocean and the Pacific Ocean. The Soviet Union and Singapore recently concluded a cultural agreement which will soon see the Bolshoi or another top Russian ballet company arriving in Singapore, and the Singapore Foreign Minister (Mr S. Rajaratnam) will visit Moscow for talks this month. Mr Rajaratnam visited China last year, and the Soviet visit follows a longstanding invitation. The trip, however, is unlikely to please the Chinese, who view growing . Soviet influence in South-East Asia as a direct threat to themselves. Peking recently welcomed the strong stand taken by the Australian and New Zealand Governments in warning against the Soviet naval build-up. Softer line Observers say that with the softer line taken by Peking against the United States military presence in the area, and warmer links between China and Japan, a “stop Russia club” appears to be emerging. Although the main con-

cern has been with the increase in Soviet Navy forces, interest is now focusing on the activities of Russia’s huge merchant fleet — in terms of cargo capacity now the largest in the world. Russian shipping has shown a big increase in such ports as Singapore and Hong Kong, and some shipowners are unhappy at the low rates the Russians are able to charge. The Japanese Shipowners’ Association has said Soviet shipping in the area is cap able of carrying cargoes at rates 20 to 40 per cent below those offered by vessels of the non-Communist world. Package The association says the Soviet Union has a national policy of expanding its naval and merchant shipping strength as a package. Part of its naval budget has been transferred to the merchant fleet, while some of' the crew on merchant ships are naval personnel, it says. The increase in Soviet merchant shipping has been impressive in Singapore, where 718 Soviet vessels called last year — an average of two a day. On one day in March the Soviet cruise liner Maxim Gorky was moored alongside Singapore’s Liner Wharf, the Soviet training vessel Professor Yushchenko lay anchored in the harbour, and a Soviet Merchant Navy photographic exhibition was opened in Singapore. A Russian spokesman said: “As more Soviet ships will call at Singapore for loading, unloading and repairs, we feel that those in the Association of SouthEast Asian Nations Merchant Navy circle should have a glimpse of our merchant marine activities.” He said Russia’s new fiveyear plan would provide further carrying capacity of about five million tonnes for the merchant fleet. The Russians also have a joint venture with Singapore in the Singapore-Soviet Shipping Company, which was formed in 1967 and trades round the world.

Mr Ng Quee Lam, chairman of the company, said recently: “Soviet liner services are independent of the shipping conferences, and so the rates of freights are highly competitive.” Russia also has a huge fishing fleet in the Indian Ocean, and more and more of these vessels are calling at Singapore for repairs, bunkering, and supplies. Last year 25 Soviet vessels were repaired in Singapore at a total cost of s7.Bm. This year two Singapore shipyards have signed contracts for repairing 19 Russian vessels at a total cost of s2sm. Bank a success A Soviet success story in Singapore has been the Moscow Narodny Bank. Although the bank’s official reason for existence is to finance South-East Asian regional trade with the Soviet Union, its banking licience, granted by the monetary authority of Singapore in 1971, allowed it to take on local lending and deposit business, and it rooted itself fast in the lucrative property markets of the early 19705. By 1973 official figures shoed it had built up the ; largest earning assets, including loan business, of any bank in Singapore, worth about SNZS6Om — 14 per cent of total bank earning assets in Singapore. A year later its loans alone were worth s6som, well ahead of its nearest : rival, the First National City Bank of America.

The business was built up

with a careful lack of ostentation. Typically, Moscow Narodny Building, the bank’s new headquarters office building opened late last year, is smaller and less eye catching than the tower blocks housing its nearby local rivals. Although Moscow Narodny burned its fingers on one or two loans, notably the local property-based Mosbert Group, which went into receivership owing the bank more than s4om — it still remains one of the biggest banking forces in Singapore. The pattern of growing Soviet influence in Singapore is repeated, as far as shipping is concerned, in Hong Kong, where the number of visiting. Russian vessels has increased dramatically in the past few years. The number of Russian ships calling in Hong Kong jumped from a mere two in 1961 to 123 last year. Heng Kong shipping circles feel that the Soviet shipping expansion, together with the cheap rates offered, is aimed at dominating- the pea freight trade in the region. The amount of Hong Kong goods shipped out by Soviet vessels was reported to have increased last year to 102,000 tonnes — four times more than the previous year. Thailand In Thailand, the Soviet Union appears to be making big efforts to gain influence and counteract the newfound popularity of China. But how they are doing to remains an elusive field of study. Thai newspapers clutch at straws in the wind such as reports that the Soviet Embassy in Bangkok has increased its electricity capacity in recent months. Right-wing political organisations allege that Russian money and influence is behind some of the strikes, Left-wing demonstrations and student movements which have taken place in Thailand since the 1973 uprising. Indonesia In Indonesia, the Soviet Union seems keen on reestablishing its influence after being frozen out after the unsuccessful Communist coup of 1965. During Indonesia’s leftward lurch under former President Sukarno during the 19605, the Soviet Union poured money into several big developments, including a giant steel project, a small nuclear reactor, and a sports stadium to accommodate 100,000 spectators in Jakarta. Although the first two projects were abandoned half-finished after 1965, and no new ones have since been

completed, the Russians have just finished building the second biggest .embassy building in Jakarta after the United States mission. And plans are on the drawing board for a hydroelectric scheme in Java, which would be the first project financed and built by the Soviet Union since the coup. Instead of giving support to Left-wing Independence forces fighting in Portugues Timor, the Soviet Union made it clear it was more interested in relations with Indonesia, and remained silent. More warning. — New or improved warning systems had been installed at a further nine railway level crossings throughout the country, the Minister of Railways (Mr McLachlan) said today. — (P.A.).