PUTRAJAYA has agreed to a partial liberalisation of its controversial cabotage policy in Sabah and Sarawak by allowing cargo vessels of any flag to ply from any port in Peninsular Malaysia to any port in Sabah, Sarawak and Labuan, beginning June 1.

Prime Minister Najib Razak announced this in Sandakan this morning.

“The exemption applies only to cargo vessels from any port in Peninsular Malaysia to any port in Sabah, Sarawak and Labuan,” he said at the “Ekspresi Negaraku” event.

He said that with the exemption, there should no longer be talk of rising prices of goods in Sabah and Sarawak.

The cabotage policy was implemented on January 1, 1980, with the aim of protecting and promoting a strong national ship-owning industry.

Under the policy, only vessels registered in Malaysia are allowed to load and unload cargoes in all domestic ports.

The policy was also aimed at making Port Klang the container hub port in Malaysia.

It also had ignited a long-standing debate that the policy was the root cause of the higher costs of many consumer goods in Sabah and Sarawak, compared with the peninsula.

In 2014, DAP’s Kota Kinabalu MP Jimmy Wong said the policy was the main cause of a 30% hike in the prices of goods in Sabah.

Sabah, which due to its distance from Port Klang suffered the most from the policy, had for years campaigned for its abolishment.

Sarawak only joined the call for the scrapping of the policy two weeks ago when Chief Minister Abang Johari Openg, on his 100th day in office, spoke about it in the live interview, “Bersama Ketua Menteri Sarawak” (With the Chief Minister of Sarawak) on TV1 .

Shipowners in the two states are predictably against lifting the policy.

The Sarawak and Sabah Shipowners Association and Sarawak Shipping Association have said any move to abolish the policy will have serious repercussions on the local shipping industry.

Its president Pierre Song said its abolishment would cause 18,000 sailors working on 3,000 ships to be out of a job. – May 7, 2017.