No hindrance to continue small vessel trade between Indonesia, Malaysia, says Dr Wee

PETALING JAYA: There is no hindrance to continue small vessel trade between Malaysia and Indonesia, says the Transport Ministry.

Datuk Seri Dr Wee Ka Siong clarified that the Indonesian Consulate-General's claims on cabotage policy governing trade vessels between Malaysia and Indonesia had been inaccurate.

"It is regrettable that economic affairs counsellor Muhammad Muhsinin Dolisada, from the Indonesian consulate-general in Sabah, has caused some confusion due to inaccuracies in the counsellor’s claims, as reported in local media recently.

"Comments appearing in the Daily Express broadsheet and later reproduced by other online media quotes Muhammad as saying that “trade conducted off Tawau’s waters and Kalimantan, Indonesia, is currently done with wooden hull ships and smaller vessels, which were not recognised under the International Maritime Organization’s (IMO) regulations.

"Under cabotage limits, the IMO restricts trade to be conducted with steel hull vessels.

"This is a misleading statement by Muhammad, who had mistakenly attributed the issue to Malaysia’s cabotage policy, as it relates instead to non-convention vessels from Indonesia," said Dr Wee in a statement on Thursday (May 19).

He said the Transport Ministry will continue to monitor the issue, while the Marine Department has been instructed to explain the matter to the Indonesian consulate-general in Sabah.

Dr Wee also explained that the cabotage policy is regulated under the Merchant Shipping Ordinance 1952 (MSO 1952) and not under IMO’s regulation as mentioned.

Subsection 65L (3) of the MSO 1952 provides an exemption from Section 65L to Malaysian Registered Vessels with net weight under 15 tonnes, licensed under Section 475 MSO 1952 (boat license); licensed under MSO 1960 (Sabah) and (Sarawak); and owned/leased by Malaysian Government, State Government, or Port Authority.

"Secondly, Muhammad’s comments relate to trade 'currently done with wooden hull ships and smaller vessels' which weigh less than 15 tonnes and are therefore not subject to the cabotage policy in Malaysia which requires all vessels involved in domestic shipping to have a valid Domestic Shipping License (DSL).

"Instead of the cabotage policy, this issue concerns the recognition of trading certificates for Non-Convention Vessels (typically vessels below 500 gross tonnage) from Indonesia mostly used to conduct barter trade," said Dr Wee.

He added that in December 2018, Malaysia together with eight other Asean member states (except Myanmar then) signed an MOU on the Mutual Recognition of Certificates for Non-Convention Vessels (NCV).

Under this MOU, Malaysia recognises NCV certificates as prescribed by the central maritime administration of the respective flag state.

The Marine Department allows the entry of NCVs from Indonesia to Malaysian ports on the condition that they comply with and possess the necessary safety certificates as prescribed by Indonesia’s Directorate General of Sea Communications, to be carried onboard Indonesia’s NCVs, he said.

This is practised throughout Malaysia in managing barter trading vessels from Indonesia, including Sabah and Sarawak.

"The Transport Ministry clarifies that there is no hindrance to continuing small vessel trade between Malaysia and Indonesia.

"We are always open to discussion and dialogue.

"We invite foreign missions and other stakeholders to dialogue with the Transport Ministry in order to understand related transport and logistics matters and policies under the Ministry’s purview," said Dr Wee.

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