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Another Malaysian shipping body speaks out against lifting of cabotage

The Malaysia Shipowners Association (Masa) has belatedly chimed in with a reaction to the exemption of cabotage policy which kicked in at the beginning of this month.

Local reports said Masa is encouraging the government to consider a review of the policy, including exemption being restricted to just the International Transhipment Container trade to all ports in Sabah, Sarawak and Labuan, and not include indigenous, locally-made products from Peninsula Malaysia and all types of cargoes.

Masa chairman Faizul Ismail said in a statement a clearer explanation is required on whether the exemption will only affect general and containerised cargo or whether it would be applicable to all cargoes.

Faizul highlighted the risk of abuse of controlled and subsidised goods distributed by the federal government when they are carried by foreign-flagged ships. “These goods may not land in East Malaysia, when proper controls are not in place for the foreign flagged ships. This is not the case when goods are carried by Malaysian-registered ships and discharged fully at ports there,” he reiterated.

There is also the risk of local shipowners being driven out of the market if they cannot compete with the foreign-flagged shipowners and operators.

Faizul also noted that the exemption from the cabotage policy could lead to the potential “dumping” of old ships from neighbouring countries to trade in Malaysian waters and there should be a cap on the age of these vessels before they are allowed to to trade in Malaysian waters.

The Sarawak and Sabah Shipowners Association (SSSA), the Sarawak Shipping Association (SSA) and Shipping Association Malaysia (SAM) had already commented on the issue as early as last month, urging the government to reconsider lifting the three-decade old cabotage policy.

Partial exemption from the policy on transhipment containers from major Peninsula Malaysia container ports such as Port Klang and Port of Tanjung Pelepas to major container ports in Sarawak and Sabah has also been in place for some years now.

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