KUCHING: Chief Minister Datuk Amar Abang Johari Tun Openg’s advocacy of abolishing the cabotage policy shows that he is ignorant of how the policy can affect Sarawak’s shipping industry, claims state DAP chairman Chong Chieng Jen claimed.
“He is detached from reality and ignorant of the effect of the cabotage policy as far as it affects Sarawak’s shipping industry,” he told a press conference at state DAP headquarters here yesterday.
Chong cited a statement by the Association of Owners of Ships and Forwarding Agents, which called for the government to review the decision to abolish the cabotage policy, stating that DAP Sarawak also sided with the association.
“Basically, the cabotage policy is a policy whereby foreign shipping agents and ships are restricted to one or two ports in the country and as far as transfer of cargos within the country, it has to be done by local ships or shipping agents.
“As for Sarawak, over the past few years, there has been liberalisation of this cabotage policy whereby ships from China, Middle East and other countries were allowed to come directly to Sarawak ports without going to Port Klang. So there’s a direct shipping line,” he explained.
According to him, the cabotage policy as practised in the state presently requires that goods or cargos originally from Peninsular Malaysia to be shipped to Sarawak using only local shipping agents and ships to protect the state’s shipping industry.
“However, once the government abolishes the cabotage policy, all those foreign vessels will be allowed to transport cargos from Peninsular Malaysia to Sarawak.
“Once this is open, a lot of foreign vessels with shipment from Kuala Lumpur to Kuching…along the way for this stretch, they can take in further cargos and this will ultimately affect our local shipping industries.”
Chong estimated that some 3,000 people who are involved in the shipping industry would be adversely affected, and half of these people would be out of jobs within the next six months to a year.
Asked if the scrapping of policy would lead to cheaper price of goods, Chong who is Kota Sentosa assemblyman believed that it would not.
“Shipping cost as a whole does not add much to the cost because mainly there are a lot of imported goods that can be shipped directly from China or other countries to Sarawak already.
“It (abolishment of cabotage policy) does not help. The increasing price of goods is caused by our depreciating ringgit. That is the main cause of our inflation in Malaysia, and in Sarawak in particular.”
On grounds that the abolishment of cabotage policy could reduce cost implication because it would avoid double-handling, Chong said there were policies that could be formulated to reduce the cost of handling.
“The abolishment of this policy will not do away with this double-handling as well in most cases.”
He also noted that the other aspect that the government should look into if it was concerned about shipping cost would be on the privatisation of stevedoring services by Kuching Port Authority (KPA) and other ports in Sarawak.
“Last year, the government decided to privatise the stevedoring policy of KPA. That is the direct cause to the increasing shipping cost,” he claimed.
In view of these circumstances, Chong urged the government and Abang Johari to review their decision to abolish the cabotage policy.
“Do not kill our shipping industry. After all, all the other countries are practising such policy. The situation may be different in Sabah where there is no direct shipping arrangement from overseas. But in Sarawak, the situation is a lot different,” he pointed out.