SARAWAK Chief Minister Abang Johari Openg last night joined the growing voices in Sabah and Sarawak calling on Putrajaya to scrap the controversial cabotage policy.

“The time has come to abolish the cabotage policy and allow foreign ships to ply directly to Sarawak ports,” he said in a special live interview, Bersama Ketua Menteri Sarawak (Together with the Chief Minister of Sarawak) on TV1 in conjunction with his 100 days as chief minister.

Abang Johari, who marked his 100 days in office last Saturday, said he had already appealed to Putrajaya to review the policy as he sides with critics who blamed the policy for the higher prices of goods in Sabah and Sarawak compared with the peninsula.

He said scrapping the policy “should have happened a long time ago”.

Implemented on January 1, 1980, the policy was aimed at protecting and promoting the national shipping industry and allowed only Malaysian-flagged ships to transport goods in the nation’s territorial waters.

As a result, all imported goods destined for the two Borneo states were diverted first to Port Klang before being trans-shipped in Malaysian-flagged ships. The plan was to turn Port Klang into the container hub port of the country.

Critics of the policy said it hampered economic growth and fair competition as the trans-shipment cost resulted in higher prices for goods in Sabah and Sarawak.

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.

The call to abolish the policy has also polarised the country with people in the Borneo states asking why must they pay more for goods and those who believe it is needed to protect the local shipping industry.

The Sarawak chief minister said the high cost of imported building materials had affected development in the state as the cost of providing basic infrastructure – roads, water and electricity – was higher than in the peninsula.

“Before, there might be reasons for such a policy,” Abang Joahri said, as the state had no container ports and a low import volume in the 1980s.

He said things have now changed as the ports in Kuching, Sibu, Miri and the deepwater Bintulu port could all handle containerised cargo.

“The volume of imports has also increased due to the increase in international trade between Sarawak and other foreign countries.”

In January, Transport Minister Liow Tiong Lai announced at the Sabah Port Forum in Kota Kinabalu “the government is currently reviewing the cabotage policy for further liberalisation to ensure affordable cost of goods and services”.

He, however, said the high prices of goods in Sabah was not because of the cabotage policy and shipping costs, but weak distribution channels, high handling charges and inefficient inland transportation. – April 25, 2017.