Study to address cabotage issue
Published on: Wednesday, August 20, 2014
Kota Kinabalu: An interim report entitled Development of Logistics and Trace Facilitation Masterplan, which is a comprehensive study on the cabotage policy by the Federal Economic Planning Unit (EPU), has been completed.Chief Minister Datuk Seri Musa Aman (pic) assured that the State and Federal governments have been working closely to address the cabotage issue that has been a cause for concern among various groups, including the business community in Sabah.Hence, the State Government had persuaded the EPU to undertake a comprehensive study on the matter.
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"It is our understanding that all relevant stakeholders will be engaged at some point in the study. As such, I expect that some of you will be called to give your input," he said in his speech at the Malaysia International Chamber of Commerce and Industry's (MICCI) annual luncheon at Magellan Sutera, here, Tuesday.His speech was delivered by Deputy Chief Minister-cum-Industrial Develop-ment Minister Datuk Raymond Tan. Musa was responding to MICCI Sabah Chairman Brig Gen (R) Datuk A. Arulprasagasam, who had earlier in his speech raised the cabotage issue.He said the current cabotage policy was a key issue faced by the business community in Sabah as it had in one way or another contributed to the high cost of doing business in the State.
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Arulpragasam said the issue cannot be left "hanging forever" and it was MICCI's desire to see that the Federal Government grant a full liberalisation of the cabotage policy, though ship owners might not be agreeable."It is wishful thinking that giving large subsidies to ship owners to keep the shipping and logistics costs down will solve the major part of the problem," he said.
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Arulprasagasam said MICCI believed the solution would be to designate Sepanggar as the second transhipment hub port after Port Klang.He added that by doing so, the high cost of shipping and logistics can be tackled and, at the same time, serve and tap the potential Brunei-Indonesia-Malaysia-Philippines East Asean Growth Area (Bimp-Eaga) market with its existing population of more than 70 million.Arulprasagasam contended that Sepangar was ideally located to tap the vast economic potential in the Bimp-Eaga region, and if Malaysia waited any longer, the country would lose out to its neighbours."The Sabah Branch of MICCI appeals to the State and Federal governments to implement the 'one-country-one-price' policy before the GST kicks off next year in order to be fair to each and everyone," he said.On MICCI Sabah's call for the Government to defer the first revision of the minimum wage for Sabah for a while longer, the Chief Minister assured that it was unlikely a review would result in a drastic upward revision of the minimum wage without good reason."It has always been the intent of the Government to review it periodically to ensure that it is up to date. Such reviews normally take into consideration the median income, productivity growth and inflation, among others," he said."I hope that the business sector would appreciate the necessity of a minimum wage. I believe everyone here agrees with me that any person holding a decent job should be paid a decent wage. "I believe the answer to poor work quality and productivity lies more in skills and productivity enhancement than in wage suppression," he said.Musa said in Malaysia there were a number of incentives available to firms undertaking human resource training and development, productivity improvements and research and development, with the incentives normally taking the form of tax deductible expenditure or investment tax allowances."These incentives are designed specifically to address the problem of poor work quality and productivity. I urge all businesses in Sabah to make good use of it," he said.Arulpragasam had earlier said that the call might not be well received by the politicians or the unions but based solely on work output and work ethics experienced so far a review in the near future was not justifiable."Already companies are moving into mechanisation to keep costs down to a manageable level and this could result in lots of unemployment," he said.On another note, Musa said despite an eventful 2014, Sabah still registered favourable trade and investment figures with an increase registered in both exports (five per cent) and imports (11.4 per cent) up to June. Tourist arrivals to Sabah between January and May this year also showed an increase of 8.7 per cent compared to the same period last year."Having said this, we expect that growth of the tourism sector will be moderated by events that happened in the first half of 2014. We expect the Chinese market to be especially affected in the short term, but believe that things will return to normal in the medium to long term," he said.Musa, who is also State Finance Minister, said prices in Sabah remained quite stable in the first six months of this year, with the Consumer Price Index showing a marginal increase from 108.7 in January to 108.8 in June this year.Compared to the same period last year, prices have only increased by 2.3 per cent on average, he said, adding that on the whole, barring unforeseen developments, prices in the State can be expected to be relatively stable for the rest of the year. Musa said the State Government had always been a business-friendly government."We believe that business and industries with the right support from the Government can play a major role in bringing prosperity to the State. We are always mindful of the fact that the decisions and the steps that we take today can have a bearing on the State's future," he said.Towards this end, he was appreciative of the role that MICCI Sabah plays in bringing together the interests of business and industries in Sabah, and in highlighting to the Government concerns and issues that required redress.Later, Tan also witnessed 12 companies, including Petronas presenting their respective sponsorship for the 8th Sabah International Expo 2014 or SIE2014 that is chaired by Federation of Sabah Industries President Datuk Seri Wong Khen Thau.Stay up-to-date by following Daily Express’s Telegram channel.
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