Masing (second left) going through his winding up speech for his ministry with Assistant Minister of Infrastructure and Ports Development Datuk Julaihi Narawi (right) at the DUN building today.
KUCHING: The state government has requested the federal government to revisit or review the exemption of the Cabotage Policy implementation, says Infrastructure and Ports Development Minister Tan Sri Datuk Amar Dr James Jemut Masing.
In his ministerial winding up speech, Masing told the august House that an in-depth study on the policy’s impact should be conducted before it causes permanent damage to local shipping and shipbuilding industries.
“Effective June 1 2017, the Ministry of Transport announced the exemption of the Cabotage Policy for sea cargo transportation services, general and containerised, for the following sectors: from any port in Peninsular Malaysia to any port in Sarawak, Sabah and the Federal Territory of Labuan and vice versa; between ports within Sarawak; and between ports within Sabah.
“The exemption of the Cabotage Policy has created stiff competition between foreign and local domestic ships. From an analysis carried out from January to July 2019, foreign ships have accounted for about 12.4%, or 2,504, Twenty-foot Equivalent Units (TEUs) of local sea containerised cargo (laden) transportation out of the total 20,279 TEUs outbound from Kuching Port to Pelabuhan Klang,” Masing said.
He added that out of aforementioned figure, about 1,635, or 8.1 per cent , TEUs were direct to Port Klang, 302, or 1.5 per cent, TEUs were transshipment to local Malaysian ports and 567, or 2.8 per cent, were transshipment to foreign ports.
Masing also highlighted that foreign participation in local sea cargo containerised transportation was expected to increase.
“This alarming situation, if not curbed, will erode or undermine our shipping and shipbuilding industries in Malaysia and Sarawak, in particular. The plying of foreign ships between our local ports may also pose a threat to our security.
“Current records show that Sarawakians own about 60 per cent of Malaysia’s flagship registration, and Sarawak also has been well-known for its private sector driven shipbuilding industry. The fact is that a majority of the shipyards in Malaysia are located in Sarawak, and both of these activities generate economic growth and provide job opportunities to our locals in Sarawak,” Masing stressed.
He also said that the supposed bringing down of prices of goods in Sabah and Sarawak from the policy’s exemption had not yet been proven.
“With the Cabotage Policy, which has been blamed for the higher cost of goods in Sarawak and Sabah, this exemption was aimed at bringing down the prices in both states, which unfortunately has not been proven yet,” Masing said.
He also informed the august House that his ministry had written to Prime Minister Tun Dr Mahathir Mohammad to raise their concerns on this issue.