Transport minister says the current inactivity in the ports are only a short-term ripple effect due to the move by Ocean Alliance to relocate operations to the Port of Singapore.
He said the country’s competitiveness, particularly at Port Klang, remained unaffected despite the move by Ocean Alliance, led by CMA CGM, to relocate its operations to the Port of Singapore.
“It is only a short-term ripple effect due to the move by Ocean Alliance, and mergers and acquisitions of CMA CGM,” he said in a statement issued after the 3rd national logistics task force meeting on Thursday.
Liow said with two out of three shipping alliances operating in Singapore, shipping lines would find it more challenging to operate, especially transhipments, in the island nation.
“It makes more sense for each of the alliances to locate its hub in different ports so that it can compete leveraging on the strength of its supply chain.
“But now, they are competing within a single hub in the same port without deriving any strategic advantage. Instead of having a pool each for themselves, they are now competing within a single pool.
“It is not far-fetched to say that with shipping lines intensifying competition against one another in Singapore, Port Klang will potentially become an attractive alternative hub in the future. It is a golden opportunity for shipping lines,” he said.
Liow added that Malaysian ports were expected to grow exponentially with a steady increase in total trade.
“In 2016, our total trade stood at RM1.48 trillion while for the first seven months up to July 2017, it has surpassed RM1 trillion, the fastest pace ever.
“Total indigenous throughput for the first eight months in 2017 for Port Klang grew 5.5% to 2.85 million twenty equivalent units (TEUs) against 2.70 million TEUs recorded in the same period in 2016.”
He said cargo volume was also expected to increase with the setting up of regional distribution centres in the vicinity of the ports.
In addition, Malaysia’s ports have stayed focused on attracting cargo from the Southeast Asia region, he said.
On the Malaysia Shipping Masterplan, Liow said he was confident it would bring the shipping industry to greater heights.
Liow said he would chair the Malaysia Shipping Council which has been entrusted to look into re-energising the Malaysian shipping industry.
Speaking on measures to improve Malaysia’s Logistics Performance Index (LPI), he said the NLTF would collaborate with the Malaysia Productivity Corporation to address the challenges and bottlenecks in the logistics and trade facilitation sectors.
“We will form focus groups which will deliberate and present proposals to the NLTF. Hopefully, this structured approach can help improve our LPI rankings in future,” he said.
On the RM30 million last-mile connectivity to Port Klang initiative to improve the quality of roads to cater for heavy vehicles operating in the vicinity of Port Klang, the minister thanked the Public Works Department and agencies involved for the timely implementation of the project which is expected to be completed next month.
Liow also urged Malaysia Airports Holdings Berhad (MAHB) to monitor the upgrading work at the former Low-Cost Carrier Terminal to ensure it is completed on time and operational by year-end.
“(Alibaba founder) Jack Ma will be visiting Malaysia in November. We must be prepared to leverage on his visit, particularly the state of readiness of DFTZ,” Liow said, referring to the Digital Free Trade Zone located at KLIA Aeropolis.
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