Friday 29 Mar 2024
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This article first appeared in The Edge Financial Daily on October 9, 2017

KUALA LUMPUR: The planned Carey Island port development is necessary to handle future demand once Westports Holdings Bhd’s expanded terminal reaches full capacity in 2030, said Transport Minister Datuk Seri Liow Tiong Lai.

“Carey Island will be ready by that time,” said Liow, adding that the expected rise in Westport’s handling capacity to 30 million twenty-foot equivalent units (TEUs) is “not enough”.

In August, Westports announced it would expand its container terminal facilities by 10 more berths on top of its existing nine container terminals. The proposed Carey Island port-industrial city development, which will have a similar handling capacity of 30 million TEUs, signalled the government’s confidence that Malaysian ports can expect stronger volume going forward, Liow told The Edge Financial Daily in an interview. “We need to expand the current Port Klang Free Zone,” he said, adding that the planned development at Carey Island also involves the development of a free trade zone that will turn the island into an industrial city.

Based on the national Logistics and Trade Facilitation Masterplan, the government plans to develop Port Klang as a regional maritime centre to handle 16.4 million TEUs by 2020.

Although several shipping firms have moved their operations to PSA Singapore this year under new alliances, Liow dismissed concerns about the competitiveness of Malaysian ports, saying the moves were due to the firms’ internal restructuring. He highlighted the domestic economy’s strong growth, evidenced by a some 6% rise in internal cargo movement despite an 8% fall in transshipment volume over the last few months. “Our main concern now is to increase the supply of ports for ships to berth at,” he said.

Over at the KLIA Aeropolis, the government hopes the transshipment hub being developed by Malaysia Airport Holdings Bhd, in collaboration with Alibaba Group’s logistics arm Cainiao Network, will see over 50% of its cargo be shipped to other parts of Asean.

“Another 30% may be for local consumption, while the remaining 20% may go towards local industries for export,” Liow said. “We want local players to benefit from the [presence of] international logistics players,” he said, adding that the entry of foreign companies like the Alibaba Group’s Cainiao Network should not be viewed as a monopoly or hindrance to local logistics firms, but a good catalyst for the domestic logistics sector.

RM500 million will be invested by the government and private sector for the 60-acre (24.28ha) development over the next two years, which includes the RM29.5 million Lazada and Pos Aviation will invest to develop a 17.5ha e-fulfilment hub.

Federation of Malaysian Freight Forwarders president Alvin Chua said the 16 logistics companies Alibaba engaged from China are in talks with local service providers on assisting them in clearance, transportation, and door-to-door delivery of goods. “They will still employ local players to move their cargo [here],” Chua said.


 

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