United States: Authorities fine SMB Offshore USD 238 mn for bribery

Netherlands-based SMB Offshore NV and its US subsidiary SMB Offshore USA agreed to pay a USD 238 mn fine for bribing foreign officials in Brazil, Angola, Equatorial Guinea, Kazakhstan and Iraq, in violation of the Foreign Corrupt Practices Act (FCPA). The corruption case targeting the maker of offshore oil drilling equipment involves Angola’s state-owned oil company Sonangol, Brazil’s Petrobras and Equatorial Guinea’s GEPetrol, among others.

Russia: Five states reach broad agreement over Caspian status

Russian Foreign Minister Sergei Lavrov stated all five Caspian Sea states had reached agreement on important outstanding issues regarding its legal status. Lavrov made the announcement after he had met with counterparts from Kazakhstan, Iran, Turkmenistan and Azerbaijan. The Convention on the Legal Status of the Caspian is set to be signed at the 5th Caspian Summit in Kazakhstan in 2018. The legal status of the Caspian Sea has been under discussion since the collapse of the Soviet Union in 1991. If it is designated to be a sea, the five littoral states would divide the area into sovereign territorial waters. If declared a lake, the Caspian’s resources would be divided equally among the five nations.

Tunisia: Authorities seize container with 20 kg of explosives in Tunis

Customs officers seized a container imported from Turkey containing 20 kg of explosives hidden among clothes and handbags. Local media reported that the consignment, which was seized from Tunis’ La Goulette Port, was to be ultimately shipped to Algeria. Tunisia experiences high levels of smuggling, though seizures of explosive materials are rare.

Yemen: Gunmen attack vessel off Hodeidah

Two skiffs with armed men on board attacked a merchant vessel 20 nm southwest of Hodeidah in the southern Red Sea. No further details of the attack were immediately disclosed, although the Dubai-based UK Maritime Trade Operations (UKMTO) centre issued a warning to other vessels in the region indicating that the pirates were still at large.

PGI Analysis: There has been a significant uptick in armed attacks against vessels in the waters off Yemen since the hijacking of the Aris 13 bunkering tanker in March, which served to alert pirates that many vessels in the region were failing to take adequate anti-piracy measures. Houthi militants have also mounted attacks against commercial vessels in the Red Sea since October 2016, adding another dimension to maritime insecurity in the region.

China: Beijing, Panama to begin free-trade deal negotiations

 Panama and China are set to begin negotiations in June 2018 for a free-trade deal after Panama severed ties with Taiwan and declared its compliance with the “One China” policy, which is a pre-requisite for any ties with Beijing. Panama made the switch in allegiance in June 2017, and Beijing has expressed its desire to deepen commercial ties. Beijing said it is also looking to send its state-owned companies to build infrastructure in Panama including ports. Panama President Juan Carlos Varela already signed 19 deals during a visit to Beijing in November.

Japan: Tokyo to deport six North Korean sailors

 Japan has announced it will deport six of 10 North Korean sailors who were rescued from a small wooden boat off northern Japan, according to AFP. Three of the sailors have been arrested on suspicion of theft after they admitted to taking electronic products, including fridges and TVs, from a remote Japanese island where they landed briefly to take refuge. The men were arrested by the coast guard off Hokkaido after drifting into Japanese waters. The incident comes amid escalating tensions with North Korea over its nuclear missile programme.

Philippines: Robbers steal from container anchorage at Manila anchorage

 Three robbers boarded a container ship at Manila anchorage and escaped with ship’s stores when duty crew sighted the assailants. Crew mustered and raised the alarm, prompting the assailants to flee the vessel.

PGI Analysis: Reports of petty thefts at Manila anchorage have increased since mid-2017, and authorities have urged crew to remain vigilant while at anchor. The reason for the rise in thefts is unclear, although many vessels are operated by a skeleton crew with insufficient capacity to conduct sufficient rounds due to the downturn in international shipping.

Bangladesh: Authorities issue warning to ports over low pressure system

 Bangladesh’s Meteorological Department instructed the ports of Chittagong, Cox’s Bazar, Mongla and Payra to hoist cautionary signal number one after a low-pressure system developed in the Bay of Bengal. The department is expecting the system to intensify and move north-northwest. Smaller vessels in the area have been advised to take caution and stay close to port.

Sri Lanka: Colombo sells Hambantota port to Beijing despite opposition

Sri Lanka has formally handed over commercial responsibility for its main southern port to a Chinese state-owned company in exchange for USD 292 mn of a total USD 1.12 bn deal, despite widespread opposition to the decision. The deal, signed in July, will see China Merchants Port Holdings take the port for a 99-year lease as part of China’s major “One Belt, One Road” infrastructure connectivity initiative. The plan has prompted widespread protests by trade unions and opposition parties, prompting the government to make some revisions to limit China’s role to running commercial operations while Colombo will maintain security controls. The US, India and Japan have also raised concerns that China might use the port as a naval base.


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