Global maritime trade is expected to plunge 4.1 per cent in 2020, as the health pandemic has taken a toll not only on the supply chains but also shipping networks and ports, resulting in plummeting cargo volumes, of which Malaysia was not spared.
According to Shipping Association Malaysia , container throughput for 2020 is expected to reduce by 15 per cent from 25 million TEUs in 2019 due to lower transhipment activities and container volume caused by the disruption in the supply chain. Subsequently, opposition lawmakers and giant tech companies quizzed the government’s stance in welcoming investment from international companies as well as Malaysia’s aspirations as a data centre hub.
Citing other countries that are taking similar measures, he said the United States, Brazil and even Indonesia have a more stringent cabotage policy than Malaysia. MOSVA members own about 300 vessels. There is an addition of about 100 vessels in Malaysian waters that are owned by non-MOSVA members including those belonging to pseudo-Malaysian companies.
“Most of the contracts supporting the productions remain as usual and there is no major re-negotiation of contracts from oil majors, including Petronas. The number of projects, including drilling, has been postponed,” he said, adding, the disruptions had resulted in the laying up of about 30 per cent of MOSVA members’ fleets.
Meanwhile, he said certain types of OSVs including fast crew boats, accommodation workboats, and anchor handling and tug supply vessels needed to be built to restore depleting supply. “The full impact of Covid-19 remains to be seen, together with the knock-on effects on the SBSR sector, but certain countries tightened their cabotage policy,“ he said.
Soo added, “If the shipowners were to buy vessels/ships from overseas builders, then there is no contribution to the Malaysian economy, and it becomes a foreign exchange outflow”.