Our last blog provided an overview of what’s happening in the South China Sea. Tensions between China, Vietnam, and the Philippines give shippers reason for a bit of worry, but the violent protest riots in Vietnam have actually affected some shippers.The basics of what happened in Vietnam, largely in response to China’s deployment of an oil rig in Vietnam’s 200-nautical mile exclusive economic zone, is as follows:

• Thousands of workers took to the streets, striking, protesting, demonstrating, and even rioting.
• Hundreds of factories were smashed, most with foreign owners from China, Taiwan, or Korea.
• Around 15 factories were burnt down.
• Many factories closed to avoid violence from the demonstrations/riots.
• Wall Street Journal puts the confirmed death total at 6, with over 100 people being injured (other sources have estimated the death toll to be significantly higher).
• Thousands of Chinese fled Vietnam to avoid further violence.

With international shipping being so prolific in the South China Sea, it is hard to imagine that all the tension there would have no effect on it.

Obviously, it’s in Vietnam that shipping must have had some disruption with the violent demonstrations and Chinese people fleeing the country by boat. APL provided a good inside look at exactly how this all affected international shipping there.

The APL Vietnam team reported on the disruption caused by Vietnam riots:

Terminals are reporting a 20-30% drop in export volumes this week, with carriers reliant on the China/Taiwan trade impacted most. Inbounds will take longer to clear as factories delayed pick-up. This will likely compound the congestion at Cat Lai Port faced lately. Origins are urged to ship to VICT, Cai Mep or other terminals. At this point for this week APL sailings, we maintain a 10-15% shortfall.

International shipping has certainly not stopped; but, by the above information APL shared, the Vietnam riots have obviously had a significant effect.

Thankfully, the rioting has ceased.

Here’s a quick update that came in on Vietnam’s anti-China riots which torched businesses and left some people dead.

Seamaster Global shared this info from General Manager Jereemy Tan of G Link that the situation in Vietnam has stabilized and visits have been made to the factories that have been destroyed in Vietnam Singapore Industrial Park.

When we put out a Shipping News Alert on the situation last week, we included a table of shippers/venders in the affected area. Seamaster has worked hard contacting these shippers and provided an updated table on where the shippers are at in terms of recovering and returning to work from the rioting.

Here’s the update on shippers in Vietnam affected by the riot.

Vietnam to Take Legal Action Against China?

As the area in Vietnam works to recover from the anti-China protests and rioting, Vietnam is considering legal action against China.

Reuters reports:

Vietnamese Prime Minister Nguyen Tan Dung said his government was considering various “defense options” against China, including legal action, following the deployment of a Chinese oil rig to waters in the South China Sea that Hanoi also claims.

The Philippines have already done as much. Back in March, the Philippines filed a case to an arbitration tribunal over China’s claims to the South China Sea.

Beijing refuses to take part in the case and warned Manila that submitting it would seriously damage ties between China and the Philippines, according to Reuters.

You can bet that China will be angry if Vietnam also takes the dispute over waters in the South China Sea to international law for mediation.

China has expressed that it wants to settle all territorial disputes with its neighboring countries on the South China Sea through one-on-one talks. Of course, this makes sense with China being much bigger than any of them.

The unilateral action of putting their oil rig in disputed waters and surrounding it by ships to protect it doesn’t support China’s desire to negotiate their claims to the water.

“There is a vast gap between the words and deeds of China,” Vietnamese Prime Minister Nguyen Tan Dung was quoted as saying in the Reuters article.

While relations between China and Vietnam continue to deteriorate, Vietnam is strengthening ties with the Philippines and the United States.

 

 

 

INTERNET SOURCES:

http://blogs.wsj.com/chinarealtime/2014/05/21/four-workers-of-state-owned-mcc-died-in-vietnam-riots/

http://www.reuters.com/article/2014/05/22/us-vietnam-china-idUSBREA4K1AK20140522