Wednesday, July 28

Shipping bodies want Cabotage Policy retained

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KUCHING: The Sarawak and Sabah Shipowners Association (SSSA) and Sarawak Shipping Association (SSA) strongly support the Cabotage Policy, saying its abolishment would be detrimental to local ship owners and the shipping industry.

This declaration from the two associations came following a recent public call by Chief Minister Datuk Abang Johari Tun Openg for the Cabotage Policy to be abolished.

During a live interview last week, the Chief Minister stated that: “It is time to abolish cabotage so that ships from overseas can come straight to Sarawak.”

The abolition of the policy, he said, could reduce the prices of goods for Sarawakians as the policy had been widely blamed for the price disparity of goods between West and East Malaysia.

In a statement, the two associations highlighted that it was common misconception that foreign ships could not sail directly to Sarawak or vice versa.

“For the past 20 to 30 years or more, all logs, plywood and sawn timber are directly shipped from Sarawak to various countries like China, Hong Kong, Taiwan, Japan and others.

“Containerised carriers and other cargo ships are also calling on Sarawak’s ports directly from these foreign countries,” they said in an April 27 statement.

In fact, the Cabotage Policy has been partially liberalised to allow foreign vessels to carry transhipment cargo from major ports in West Malaysia – such as Port Klang and Tanjung Pelapas Port – to Kuching, Bintulu and Sebangar Bay, Kota Kinabalu, without the need for a domestic shipping licence, they added.

While the liberalisation has been ongoing for several years now, the associations acknowledged that desired results “have yet to be seen”.

Because of its role in regulating the shipping industry, the associations reaffirmed their support for the Cabotage Policy.

The move to abolish the policy would be unwise as the policy prevents foreign vessels from lingering and operating in the states’ waters, the statement added.

They said the policy is widely imposed by many neighbouring countries like Indonesia, Philippines and even developed economies such as the US and Japan.

“Under our own Cabotage Policy, only foreign vessels registered with a domestic shipping licence which is valid for only three months, are allowed to transport cargo between local ports.

“It is just like our immigration laws. If a foreigner wants to work in Sarawak, he has to apply for a Work Permit,” explained the associations.

Touching on the issue of price difference of goods between East and West Malaysia, the associations said it was unfair to blame the Cabotage Policy for this, adding that it was more likely caused by the imbalance in economic development between the two regions.

“It is not the Cabotage Policy which impedes trade but the imbalanced economic development between East and West Malaysia.

“This has to be addressed systematically and strategically,” they said.

Commenting on this issue, Deputy Chief Minister Tan Sri Datuk Amar Dr James Jemut Masing, who is also Minister for Infrastructure Development and Transportation, said we must first look at the interests of both shippers and consumers while bearing in mind that there are more consumers than there are shippers.

“Local shippers must justify their stance in supporting the policy,” he argued.