Cabotage law between east and west Malaysia to be scrapped

Malaysia is abolishing its 30-year old cabotage law between the east and west of the country from 1 June.

Malaysian Prime Minister Datuk Seri Najib Tun Razak announced earlier this week that it would be exempting the states of Sabah and Sarawak in East Malaysia as well Labuan from the cabotage law.

The cabotage law was started in the 1980's as way of promoting Port Klang in west Malaysia as a national load centre, however, it has been blamed for high shipping costs between east and west Malaysia. Najib said the changes to the cabotage law were made after calls from the leaders of both Sabah and Sarawak.

Analyst Alphaliner commented: “The move will affect Malaysian flagged container carriers operating on the cabotage routes including MTT Shipping, Shin Yang Shipping, Harbour Link Lines, PDZ Lines and Chong Fui Shipping.”

Posted 10 May 2017

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Marcus Hand

Editor, Seatrade Maritime News