More studies to decide future of cabotage policy, says Transport Ministry

KUALA LUMPUR: Further studies will be conducted by the Transport Ministry on the direction of the nation’s cabotage policy, the Dewan Rakyat was told.

Minister Anthony Loke said engagement with stakeholders was ongoing in an effort to find a win-win situation for all, particularly foreign investors, telecommunications companies and local shipping industry players.

“The ministry will study in detail the impact, industry needs as well as micro and macro aspects in determining the direction of the policy,” he said in a written reply to Lim Guan Eng (PH-Bagan) on Thursday (March 9).

Lim had asked about the status of cabotage exemptions for high-tech companies in repairing undersea cables in order to restore investor confidence and attract investments.

The national cabotage policy does not ban foreign-flagged vessels from repairing undersea cables in Malaysian waters.

Such vessels can enter Malaysian waters and need only apply for an electronic domestic shipping licence before they can start work, a process that takes three days for approval.

Introduced in January 1980, the policy was revoked by the former Pakatan Harapan government for cable repair works in April 2019, exempting submarine cable maintenance vessels from applying for a domestic shipping licence.

However, the cabotage policy was reintroduced by the Transport Ministry on Nov 16, 2020.

The re-imposition of the cabotage policy for submarine cable repair works saw critics arguing that it could deter foreign investment and cause large tech companies to exclude Malaysia from cable projects aimed at boosting regional Internet connectivity.