Yong Teck Lee:
"This is my promise to you, that our struggle continues and I will
always be by your side"...."Trust and integrity of the leaders are
fundamental to the future of a country or a government or, in our case,
SAPP as a serious political party of the future"
Send us yours to publish
2009 Jan 3 - SAPP supports abolishment of Cabotage Policy
SAPP supports the call for the
abolishment of Cabotage Policy
Kota Kinabalu (Jan 3, 2009): Sabah Progressive Party (SAPP) supports
the call by the Federation of Sabah Manufacturers (FSM) to abolish the
Cabotage Policy which is designed to protect the local shipping industry
to grow and be competitive.
SAPP Treasurer General Datuk Wong Yit Ming in a statement said that the
policy hinders the growth of the manufacturing industry in Sabah and
Sarawak. Sabah will always have to "play catch up" with those from
peninsular and this will pose a major challenge to the success of the
Sabah Development Corridor.
The policy deprives Sabah Industries, the competitive abilities to survive
let alone compete with her peninsular counterpart. Unless the policy is
abolished, there is no where for us to compete fairly, openly and ideally
due to the unlevel playing field.
"The cost of doing business in Sabah will be higher due to the high
freight charges especially for raw material imported from overseas as they
would have to be transshipped via Port Klang contributing to double
handling cost," adds Wong, "even if Sabah is nearer to most of the trading
nations such as China and other Far East countries."
Wong says, "Currently consumers’ goods including food products (such as
rice being a staple food) in Sabah are very much higher than those in
Peninsular. Why do poor people in Sabah have to pay more and subsidized
the rich in peninsular? The cabotage has contributed to the high price of
"Adding salt to the hardship faced by the people of Sabah, even
pharmaceuticals products such are more expensive than peninsular. A simple
headache relief such as panadol would cost higher here than in peninsular.
This make a mockery of the State Government’s plan to achieve zero poverty
level by 2010.
The lopsided policy benefits majority shipping companies based in
peninsular, while Malaysians in Sabah are made to pay more to satisfy the
needs of the so called shipping industry. A majority made to help the
minority, this policy should not have been there even from the beginning.
It has been exploited to form cartel which is a way to monopolize the
business. Thus, benefits only the major players in the shipping industry.
The Sabah State Government is obligated to use their influence with the
Federal Government to open up the ports around Sabah. This can be done by
granting a special exemption from the Cabotage Policy for Sabah. The
Sepangar Bay Container Port Terminal should be made a National Load Centre
in Sabah. They should also resolve the high costs of imports and exports
in Sabah to a reasonable level by the providers of port services.
In their intention to develop, protect the port and shipping services and
industry, the Government should subsidize vessels plying between East
Malaysia and Peninsular Malaysia in order to the lower the freight charges
and benefit the people of Sabah. The government should not do it at the
expense of East Malaysia through the lopsided cabotage policy.
DAILY EXPRESS NEWS
FSM says again: Cabotage policy protects shippers, not consumers
03 January, 2009
Kota Kinabalu: The Federation of Sabah Manufacturers (FSM) again called on
the Federal Government to abolish the Cabotage Policy to stop
monopolisation by shipping cartels in the country.
Its President Datuk Wong Khen Thau suggested an open policy that would
allow foreigners to "do business with Sabah".
According to him, the Cabotage Policy is basically to protect the local
It allows Malaysian ships to form a cartel, thus allowing them to control
the shipment of goods from Peninsular Malaysia to Sabah and Sarawak.
Such monopoly allows them to dictate shipping charges which is unfair to
Wong also described the Cabotage Policy as a basic hindrance.
"In Sabah the price of goods is 20-30 per cent higher than in the
peninsula as a result of this. This is not fair to the consumers. The best
thing to do is open up so foreigners can also participate.
"It's good for us to do export. Competition will bring down prices. It is
for the whole industry to survive, " Wong said.
In September last year, the FSM voiced their grievances about the cartel's
intention, citing escalating fuel prices, to increase the emergency bunker
surcharges (EBS) for 20-feet and 40-feet containers.
In a joint declaration with Chambers of Commerce and trade associations,
the FSM urged the government to stop the plan and to set up a body to
control the surcharge price stressing.
They argued that the shipping lines had only in June the same year
increased the EBS. For sometime, the EBS for a 20-ft container was RM1,253
while for a 40-ft container, RM2,506.
As the price of fuel went down, the shipping companies in a joint
statement announced through the Press in Labuan that it had revised the
EBS and effective Nov. 15, the rate for a 20-ft container will be slashed
down to RM709 while that for a 40-ft container to RM1,418.
Wong, while acknowledging the revision, said this was not enough.
"Because on the other hand they have increased other charges. At the end
of the day it still adds up to over RM2,000, " he said. He said the FSM
was not against the Cabotage Policy.
"Other countries like the US and Australia have the Cabotage Policy,
because they have competition. They have a choice, to go by land, for
instance. Similarly in the country, it is okay if it is from Penang to
Trengganu or Tawau to KK or to Kuching.
"But not between Peninsula Malaysia, Sabah and Sarawak, which are
separated by sea. There is no other wayÉit must be opened up, " Wong said.
Deputy International Trade and Industry Minister Datuk VK Liew promised to
make an announcement on the policy after a six-month study and it is due
Federal Government was seriously considering suspending the policy.
Meanwhile, Daily Express attempts since before Christmas to get shippers
to publicly confirm if the recent lowering of the charges announced in
Labuan also applied to Sabah received poor response.
DAILY EXPRESS NEWS
The Cabotage policy must go, says FSM
27 January, 2008
Kota Kinabalu: The Federation of Sabah Manufacturers (FSM) said the
Cabotage Policy should be scrapped to lure more foreign investments to the
country and in particular, Sabah.
Its President Datuk Wong Ken Thau said with the Sabah Development Corridor
(SDC) due to be launched later this month, the current policy could
potentially scare investors away due to the high cost of doing business in
the State and hinder the export sector.
He also said the policy was a burden to the people of Sabah as they had to
pay 20 to 30 per cent more for items compared to their counterparts in the
Wong stated that the policy is not relevant anymore and called for an open
sea policy to enable foreign-registered ships to enter the domestic
He said the move would mean Malaysian ships have to be competitive and as
a consequence of which freight charges would be lower.
The Cabotage Policy, which was implemented on January 1980, was a move by
the Government to reserve the transportation of goods in domestic trades
to ships flying the Malaysian flag.
It was deemed necessary then as only a small number of
Malaysian-registered ships were plying the coastal routes as well as to
encourage local registering of ships and incorporation of local companies
participating in domestic shipping.
The policy came into effect under the Merchant Shipping Act 1952, which
provided for the appointment of a Domestic Shipping Licensing Board (DSLB)
to regulate and control the licensing of ships engaged in domestic
shipping between any port in Malaysia.
With the implementation of the policy, foreign vessels or those without
licences from DSLB were prohibited from moving cargo from one port to
another in Malaysia.