E. A. Technique (M) Bhd managing director Datuk Abdul Hak Md Amin
KUALA LUMPUR: The establishment of a shipping fund is long overdue and needs to be looked into with urgency to help local players survive and for the shipping industry to flourish at the same pace as other industries in Malaysia.
Malaysia Shipowners’ Association (MASA) chairman Datuk Hak Md Amin (pic) said discussion on setting up the fund has been on-going between the association, Bank Pembangunan Malaysia Bhd and the Ministry of Finance (MOF).
However, there is no final say on the criteria of eligible recipient as well as the act of disbursement.
“To make it worse, local ship owners and other players in the industry are facing difficulties in getting financing for activities in the shipping industry, including the purchase of new vessels and so on.
“This was due to the relatively high interest rate of between 7% and 8% imposed by banks compared to overseas’ banks which charged between 1% and 2%,” he told Bernama in an interview.
Hak said that discussions on the establishment of the shipping fund stalled temporarily due to changes in Bank Pembangunan’s top management.
“MOF said the fund with a value of RM2bil was there, but as I’m aware, discussions have been ongoing for more than two years now,” he pointed out.
Elaborating further, Hak said the fund offered attractive interest rates as opposed to commercial loans but with low interest rates, local shipping companies can compete with those in Singapore, South Korea and Japan.
“Overseas banks offer very low interest and I believe this fund should be extended to ship owners who are in distress and need financing,” he stressed.
In the 2014 Budget, the Government formulated the Logistics Sector Master Plan which provided the strategic direction for the development of logistics infrastructure and supply chain, as well as, review of regulations and laws.
Under the plan, RM3bil in soft loans were allocated under the Maritime Development Fund, through Bank Pembangunan Malaysia, to help the industry grow.
The fund was aimed at providing financing for the development of the shipping industry, shipyard construction, oil and gas, as well as, maritime-related support activities.
As for the Malaysia Shipping Master Plan (MSMP) which has been discussed over the years, it was finally endorsed during the Malaysia World Maritime Week 2017 in September.
The master plan, aimed at revitalising the industry, was launched at the event by Transport Minister Datuk Seri Liow Tiong Lai with most industry players hoping to see progress made on plan.
Hak said all stakeholders were fully engaged in the long-awaited shipping master plan and how it would propel Malaysia as a powerhouse in the maritime industry, regionally. - Bernama
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