MINISTER: CABOTAGE POLICY MAY BE LIBERALISED FURTHER

Kota Kinabalu, June 24, 2009: The Government is not ruling out the possibility of further relaxing the cabotage policy but wants to study the effectiveness of the so-called selective liberalisation of the policy from June 3.

Deputy Minister of International Trade and Industry (Miti), Datuk Jacob Dungau Sagan said it would take some time before the effect of the relaxation of the cabotage policy by the Transport Ministry could be really gauged.

"We will study it in detail first before making any commitment," he said when asked on comments from participants at the Sabah Investment and Trade Dialogue and Seminar on the Manufacturing and Services Sectors at Magellan Sutera Harbour here Tuesday.

During the dialogue that was chaired by Sagan together with State Industrial Development Minister Datuk Raymond Tan who represented Chief Minister Datuk Seri Musa Aman, many of the participants blamed the cabotage policy for the non-competitiveness of Sabah products in the outside market.

Most comprehensive was Federation of Sabah Manufacturers (FSM) President Datuk Wong Ken Thau who said the recent decision by the Government to liberalise the policy was welcome although "unfortunately it only benefits Sabah a little" since it only involved containarised transhipment cargoes.

 "We are not condemning the policy because we know it is to protect the local shipping industry but at the same time we cannot forget other industries in Sabah, as well," he said.

Wong said a similar policy was also being imposed in developed countries like the United States but its states are well connected by road unlike Malaysia where the only way to send containers from Sabah and Sarawak to Peninsular Malaysia and vice versa was by sea.

According to him, it was good that the Government had made the first move and now it is just a matter of taking one more step, that is to apply the liberalisation of the policy to locally-manufactured goods from the peninsula.

He added that with the 1Malaysia concept mooted by Prime Minister Datuk Seri Najib Tun Abdul Razak it meant the government needs to consider the needs of the people first.

"I think if it is really 1Malaysia there should not be that much difference in the price of goods between Sabah, Sarawak and West Malaysia," he said, while criticising Miti for focusing too much on the peninsula, particularly the Klang Valley.

"It is said that Sabah and Sarawak are the fixed deposits (of the BN government) so let's show that we meant it," said Wong.

He also disagreed with Tan who had earlier stated that while there is a need for more containers of goods to come to Sabah the shipping policy was not the main cause of the price disparity between East and West Malaysia.

Other participants said it is 43 per cent cheaper to send goods from Port Klang to China than to the Sepanggar Port, while some urged the Government to consider subsidising the shipping companies so that the cost of transhipment would be reduced.

Commenting on the suggestion, Sagan said it was worth considering since it involved the people's socio-economics just like when the Government was willing to introduce new measures to lessen the people's burden during the fuel price hike crisis.

"So maybe, in this respect, it can be done for the shipping companies."