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Policy that victimised Sabah, S’wak for 30 years
Published on: Tuesday, May 09, 2017
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By Datuk John Lo
Like quite a few issues, Sarawak takes time to join us to lobby for a better deal for the people in E Malaysia.

The Sarawak Chief Minister for finally spoke out against the heinous and economically obnoxious Cabotage Policy on 25th April 2017. He called for its abolishment. Sarawak Industrial Development and Entrepreneurship, Trade and Investment Minister Datuk Amar Awang Tengah Ali Hassan again confirmed their opposition on 2 May 2017.

Datuk Teo Chee Kang has also said that it should be reviewed. With the two state governments now in the fray, chances of saying “good riddance to bad rubbish” to the discriminatory policy are better than never before.

A senior person from one of the Chinese Chambers claimed that this policy had been abolished – Let me say this to him in great certainty, this “millstone” of unbearable burden is still very much around our necks.

I also want to say, with a high degree of disgust to those Sabahans who are trying to defend this policy, you are defending the indefensible. No way any genuine and concerned Sabahan will condone this policy.

After more than 30 years, this policy has done nothing good for Sabahans except to enrich the shipowners at the expense and suffering of Sabahans. Let me ask these shipowners the undermentioned questions so that the whole policy can be put in national interest perspective.

Have the shipowners built up the shipping capacity for Malaysia? This is the most common excuse they use – Cabotage Policy is required for capacity building in shipping. After 30 years of protection, tax free concession, have the shipowners used all the privileges accorded to them by the Federal Government to build up a regional or international company? The answer is ZERO. Why? What is their excuse? Want more privileges?

This “Cabotage Policy TONGKAK” is more than 30 years old. Shipowners, please grow up and be counted.

Be man enough to own up you are useless. You are nothing compared to the shipping companies in Singapore, Hong Kong and Taiwan. You are best at victimising Sabahans only.

Evergreen of Taiwan has grown from nothing to becoming the largest container shipping company in the world in the last 30 years. It has also built up EVA airline which is a major airline in Taiwan. Which Malaysian shipping company is comparable or a fraction to Evergreen? Or compare with Norway with a population of slightly over 5 million population. It’s shipping industry, including cruise liners, is world class. Within the same period, the Malaysian shipping companies have grown from exactly “nothing to nothing”.

Have the shipping companies earned substantial foreign exchange for Malaysia? I challenge them to produce their foreign exchange earnings to prove their worth/performance in the last 30 years. How much foreign exchange can they earn when most of them are no better than little boys in international shipping. The blue ocean is just too deep and scary for these over protected Malaysia ship-owners. Their uselessness will be shown clearly if they are willing to compare their foreign exchange earning capacity with successful shipping companies in other countries.



I also want to challenge the ship-owners to proof their worth in nation building. What is the percentage of your contribution to our GDP or GNP in comparison to your fellow shipowners in other maritime nations?

Have they generated a lot of employment for Malaysians? I doubt it. They can prove me wrong and I will be happy to apologise. My suspicion is that there are more non-Malaysians than Malaysians working in this little, stunted Malaysian shipping industry. I am sorry to add that this is not an industry. It is “child play” compared to other countries’ successful shipping industry. Malaysian shipping companies are dwarfs compared to those in other countries.

Have these shipowners been given sufficient privileges? I want to ask, what more do they want?

After years and years of income tax exemption and monopolistic protection at the expense of Sabahans, their achievement is anything but insignificant and paltry.

Some parties have asked Sabahans to be patient. For what and how long more? Another 30 years?

Surely, anyone with a bit of brains can see that Sabahans are being victimised by this policy and W Malaysians have been spared all along. Why?

I want to urge the political leaders and other concerned Sabahan to remember that in-fighting for the abolition of this dreaded policy, they must also fight for the removal of the BLOCK EXEMPTION AGAINST COMPETITION under the Anti Competition Act that the Federal Government has given the shipowners. This exemption is potentially worse than the Cabotage Policy. Sabahans must etch these TWIN EVILS in our mind. We cannot afford anything to hinder competition in shipping. A good example is MAS. The Federal Government kept on giving MAS all sorts of protection and yet it needed many multi-billion bailouts. Worst was Federal Government did not allow foreign airlines to land in KK. Had this policy not been abolished, Sabah would never have a tourism industry like today.

Building of SICC [Sabah International Convention Centre] and TAED [Tanjong Aru Eco Development Project] would have remained a distant dream.

The financial grant of more than RM1 billion from the Federal Government to build up Sepangar cannot be used as an excuse for continuation of Cabotage Policy. It is no cause for celebration unless the Cabotage Policy will be abolished and the Block Exemption Against Competition taken away. The reverse is true.

If the Federal Government wants to have a good economic return from this investment, it must allow the shipping industry to grow and expand freely.

We also cannot trust the “sweet words” of the current Minister of Transport. Once bitten twice shy.

Sabahans have been bitten by empty promises from successive Transport Ministers too many times.

Enough is enough. Any intending Sabahans wishing to contest in the next General Election under MCA can prove their worth by calling on their President to abolish the Cabotage Policy. Otherwise, the voters know what to do.

Any country wanting to have economic growth must have 3 important “life-line arteries” in the economy sorted out. They are air transport, shipping and internet and/or WIFI. These have special significance as we are on an island with a sparse population in the whole of Borneo. There have been some improvements in air.

Not the best but ok. It is shipping that can and will be the biggest drawback, the biggest blockage, the highest hurdle for the realization of MUSA VISION FOR SABAH.

The successful implementation of Musa Vision will require a lot of economic restructuring.

We cannot afford to have the Cabotage Policy and the Block Exemption Against Competition blocking us from attaining this vision. Sabah must have a competitive shipping industry to back up the Musa Vision.

These “two economic evils” will deter export oriented investors coming to Sabah.

I have said it before and now say it again. The fight for the abolition of Cabotage Policy and Block Exemption against Competition is not an opportunistic occasion for personal and/or political party gain.

All Sabahans must unite behind the State Government. It is a battle between a small number of shipowners with big cable connection in the Federal Government and all Sabahans. We, the 4 million Sabahans, must forcefully convey in a crystal-clear message to Putrajaya and the Minister of Transport that we are more important politically than the shipping companies.



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