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Sabah proposes scheme to offset logistics cost
Published on: Friday, February 17, 2017

THE State Government plans to propose to the Federal Government a Sabah Freight Equalisation Scheme to offset the higher logistics cost.

Chief Minister Datuk Seri Musa Aman said the initiative should be in place until industries here could match imports and ships won't leave Sepanggar Port half empty.

"One of the main strategies we will look into is the proposed scheme through which laden containers for import and export are provided financial support. The benefits of such a scheme outweighs the costs as it provides the impetus for industrial growth that will generate employment, increased incomes and accord equal competition in the international markets," he said at the forum.

In addition, the State would set up a Sabah Logistics Council to provide overall coordination on strategy, policies and regulation relating to the logistics sector, he said.

"The transport and logistics sector is a major contributor to the economy. Transshipment initiatives and the various strategies outlined to combat logistics issues in Sabah will serve as a catalyst for the growth of industries in Sabah and help create jobs.

"Ultimately, we endeavour for the initiatives to lower the cost of doing business in Sabah as well as reduce living costs," he said.

Although, Sabah ports still have a long way to be a global player in the shipping industry, Musa said the possibilities are endless as the Sepanggar Bay Container Port is directly linked to Far East ports and centrally located within the Brunei, Indonesia, Malaysia, Philippines – East Asean Growth Area, or BIMP-EAGA, attracting foreign direct investment to Sabah.

Besides, he said 80 per cent of import cargoes in containers are shipped via Port Klang, Singapore and Johor instead of Sabah at present.

Citing various initiatives to improve the port operations, Musa said efforts are being done to further intensify the State's downstream activities like palm oil that can lead to resource based industries and non-resource based industries like manufacturing to support the maritime logistics in Sabah.

Meanwhile, Suria Group Managing Director Ng Kiat Min said Suria Group will be undertaking the construction of the dedicated cruise terminal at the Kota KInabalu Port in support of Cruise Tourism which is the sixth Entry Point Project under the Tourism National Key Economic Area.

She also noted the expansion of the Sepanggar Bay Container Port was crucial to balance the container imbalance with presently stood 80 per cent import and 20 per cent exports.

"The proposed master plan is expected to serve as a blueprint to further develop the seaport and logistics industry in Sabah for the next 30 years," she said. – Jason Santos

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