SEPANGGAR in Sabah will have its port’s capacity raised from handling 280,000 containers to 500,000 containers a year to spur the poor performance of local industries.

Sabah deputy chief minister and Trade and Industries Minister Wilfred Madius Tangau said programmes are now being formulated by his ministry to incentivise the small- and medium-size enterprises to raise their output.

He said this will ensure local industries will hit the volume needed to make Sepanggar a profitable port of call for liners over the next couple of years.

“The industry contribution to the Sabah gross domestic product at present stood only at 7.5%.

“We need to hit around 30% to be able to achieve a progressing economy,” he said during a Trade and Industries Ministry function in Kota Kinabalu today.

Tangau said plans are afoot to make Sepanggar a premier transhipment hub to end the control of Port Klang as a major port of call in the country.

Paperwork for the upgrades is already with Putrajaya and Sabah is presently waiting for the RM1.8 billion federal allocation for the purpose.

He said port upgrades will take around two years to complete once the funds are available.

“We want direct shipments to Sabah and to make sure there will be no more need for the ships to go all the way to Port Klang in future,” he said.

Tangau said Sabah industries face higher cost of exports and lengthy period of delivery for goods because ships had to go to Port Klang or elsewhere first before they could ship out.  

“This include shipping goods to China, which is ridiculous,” he said, referring to how Sabah is closer to China than Port Klang in Selangor.

Sabah industry players have for years lamented the cabotage policy that saw all goods shipped into the country having to go through Port Klang first.

Local or international shipping firms with a written permit eventually were allowed to drop goods in Sabah under a partial liberalisation of the law.

But shipping liners refuse to stop at Sepanggar because of the low shipping volume which makes it unprofitable for ships. – September 4, 2018.