Singapore has been the 'traffic king' in the golden waterway of Malacca for decades, lying down collecting tolls. But upon waking up, it found that Hainan, right at its doorstep, is quietly rewriting the rules of the game. The so-called 'pulling the rug from under' is nothing more than this. The landscape has truly changed.

This matter must start from the 'easy money logic' of Malacca, where a quarter of the world's crude oil and a fifth of goods must pass through here. Eighty percent of the oil imported by China from the Middle East takes this route. Singapore is stuck at the southern entrance of the strait; when ships arrive, they need to refuel, change crews, and handle paperwork. Just relying on this 'transit business' accounts for 7% of GDP. In the past, whether it was Chinese home appliances or European cars, using the Asia-Europe trade route meant having to look at Singapore's face. This geographical monopoly made them accustomed to 'lying down counting money'.

China has long not wanted to tie its lifeline to someone else's doorstep. Hainan's move is first in 'hardware'. Yangpu Port built four 200,000-ton berths in one go, allowing the world's largest container ships to dock directly, with an annual throughput capacity reaching 5.5 million TEUs. What about Malacca? There are 37 shallow spots in the strait, and a 200,000-ton oil tanker has to detour through the Lombok Strait, adding 2,000 kilometers.

Hainan has also established the 'Zhongguo Yangpu Port' as a registered port, with 64 international ship registrations and a total deadweight tonnage of 6.35 million. New ship tax rebates and exemptions for foreign ships directly attract shipping companies to settle here. In the past, ships had to stop in Singapore, but now Yangpu can accommodate large vessels and provide bonded services. Who would want to take the long route anymore?

Even more impressive is the 'software.' Hainan's processing value-added policy for the free trade port, such as exempting tariffs if the value of processed goods increases by 30% in Yangpu, allows Southeast Asian rubber and Middle Eastern crude oil to be processed in Hainan and sold directly as finished products domestically, eliminating the hassle of transshipment in Singapore.

In the first ten months before 2024, Hainan's imports and exports to ASEAN reached 48.29 billion, growing 45 percentage points faster than the province's overall foreign trade. Cargo ships from Indonesia and Malaysia head straight to Yangpu, and even Hainan chicken rice, loved by Singaporeans, has become a 'marketing code.' The chicken rice, which was brought to life by overseas Chinese in Wenchang in the past, has now transformed into a fresh food business delivered directly between the two regions.

What Singapore has not anticipated is that Hainan is not only seizing ports but also 'rules.' The pilot program for international transshipment, along with the free flow of funds for vessels and crew, has allowed Yangpu to become a 'maritime free trade zone.' Previously, shipping companies in Singapore had to deal with three parties (Singapore, Malaysia, Indonesia), but now Hainan can handle all procedures through one window.

The most aggressive aspect is the route layout: By 2025, Hainan will stabilize operations of 72 container shipping routes, connecting Southeast Asia to domestic 'cooperative shipping' routes through Yangpu. Thai rice and Vietnamese furniture will be distributed directly at Yangpu, and even Singapore's Changi Airport has to sign cooperation agreements with Haikou Meilan, claiming it's complementary, but in reality, it's diverting traffic.

There is also historical context. The Chinese community in the Strait of Malacca is deeply rooted, with 1.2 million overseas Chinese from Wenchang in Hainan spread across Southeast Asia. The labor ships that used to 'go south' have now turned into investment ships for the free trade port. Singapore has made money from Chinese culture for decades but did not anticipate that Hainan would turn the business from 'transit' into 'local presence' with the bond of 'same origin, same roots.'

For example, Singaporean hotel groups are opening branches in Hainan, and biopharmaceutical companies are clustering in Boao Lecheng. On the surface, it appears to be cooperation, but in reality, Hainan is using the 'front shop, back factory' model to turn Singapore's transshipment function into a part of the industrial chain.

The key issue is that Singapore has rested on its geographical advantages for too long, forgetting the power of 'human factors.' The sediment accumulation in the Strait of Malacca progresses by 500 meters each year; no matter how high the unloading efficiency of Singapore's port is, it cannot withstand the fact that large ships cannot enter. In contrast, Hainan is reclaiming land and developing 'wind-solar storage' green electricity, aiming for over 90% green electricity in its port area by 2027.

When Trump was still threatening China with tariffs, Hainan had already quietly diverted the flow of goods, funds, and people from Southeast Asia towards the South China Sea using free trade port policies. Singapore thought that controlling the strait meant controlling China's neck, but did not realize that China had created a 'new Malacca' at its doorstep, not a geographic choke point, but a high ground of the system.

This situation resembles the historical cycle when Malacca replaced Juhai and Singapore replaced Malacca. However, this time, the initiative does not rely on piracy for protection but on policy innovation in the era of free trade. Singapore's 'easy profit inertia' has lost to Hainan's 'resolute breakthrough,' not due to geography, but because they did not understand: when a market of 1.4 billion people decides to turn 'transit business' into 'local business,' no geographical monopoly can withstand the reconstruction of the system.

The winds and waves in the Strait of Malacca remain, but the cargo list on the ships has quietly noted 'stop at Yangpu.'