Selangor Journal

The prospect of Malaysia's ports remain promising

KUALA LUMPUR, JUL 20: RAM Ratings Services Bhd (RAM Ratings) expects Malaysia’s ports handling container and cargo remains promising this year in line with the gradual global recovery.
In a statement, RAM Ratings said the overall growth was also expected to be one-digit compared to three per cent in 2016.
Co-leader of the Infrastructure and Utilities of the firm, Davinder Kaur Gill said the prospects for major ports including Westports Holdings Bhd, Northport (M) Bhd and Tanjung Pelepas Port Sdn Bhd also remained stable following the projection of local and regional economic growth.
“However, the facility is still vulnerable to the current trending effects that are likely to be towards (policy) protection as well as changes at the shipping pact level,” he said.
Davinder said Malaysia’s total cargo volume was also strong throughout 2016, including containers that recorded a 10 years annual growth rate of six per cent while five per cent cargo.
At the same time, he said Malaysia handled over 25 per cent of the container crossing the ASEAN-5 countries (Malaysia, Singapore, Thailand, Indonesia and Philippines) which contributed three per cent of global traffic.
“Although the prospects for regional trade are still encouraging, long-term growth of South-East Asia ports should be analyzed in the context of economic expansion, new port capacity of the region and the need for new shipping pacts,” he said.
He stated, the need for Malaysian and regional port financing are big if the expansion plan comes into being soon.
“However, we are targeting the effort to be implemented in stages,” he said.
For that reason, he said, domestic financing requirements over the next five years were estimated to be around RM5 billion due to the expansion of the Kuantan Port, Teluk Sepanggar Container Port and Tanjung Pelepas Port.
“The estimate is likely to hit over RM250 billion if large scale projects such as the third Port Klang on Carey Island and the Melaka Project are started,” he said.

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