KOTA KINABALU: The cabotage policy must be liberalised or even abolished in order to make Sepangar Port a regional transshipment hub, state Special Tasks Minister Datuk Teo Chee Kang (pic) said.
"The cabotage policy, insofar as it applies to Sabah, should be re-evaluated by the Federal Government," said Teo, who is Liberal Democratic Party (LDP) president.
Both Sabah and Sarawak have been asking for the scrapping of the policy, which generally allows only Malaysian-flagged ships to transport goods to the two states and has been widely blamed for the higher cost of goods.
Teo said the move would be in line with the state government's plan to upgrade Sepangar Port and elevate its position in the region.
It would also help Sabah's standing in the region's economy, he added.
Teo's statement comes in the wake of Sarawak Chief Minister Datuk Amar Abang Johari Tun Openg's call to repeal the policy.
Teo said Sabah has an open economy where "our business community trades with people and businesses in the international community, and funds could flow as investments across the border."
"When the time comes, we need to put in place policies and incentives which will attract more foreign vessels to call at Sepangar Port," he said.
However, Teo said, it was just common perception that the cabotage policy is the main cause of costlier goods in Sabah.
"I think it is just one of the many causes. I doubt very much that in the event the cabotage policy is abolished, the price of goods in Sabah will drop overnight.
"But we can expect more competitive freight charges for domestic routes, which would reduce logistics costs as a whole," he said.
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