The government has not set any timeframe for the implementation of the Cabotage Policy exemption for Sabah and Sarawak, the Transport Ministry announced on Wednesday, May 31.
"These findings will be used as the basis for our assessment of the effectiveness of the exemption. The assessment exercise is expected to take at least a year" the Transport Ministry said in a statement.
For the record, the ministry said the Cabotage Policy does not preclude or prescribe any vessel to make port calls in any port in Malaysia. Foreign ships are free to make port calls to all ports in Sabah and Sarawak directly from foreign ports.
They are also allowed to sail from any ports in Sabah and Sarawak to foreign ports without calling at ports in Peninsular Malaysia given the route of these vessels are fixed by the shipping company and not by the government, it clarified.
The ministry made the clarification after Sarawak Infrastructure Development and Transportation Minister Tan Sri Dr James Jemut Masing said that the cabotage policy is to be exempted for six months before a decision is made on whether it should be abolished or maintained.
"Within the six months, Sarawak will gauge the situation without cabotage policy to see if it works. If it does, then the cabotage policy will be abolished. Otherwise, the policy might be here to stay" Masing said.
He said this latest decision was made due to two main reasons. Firstly, the abolishment would deprive local shipping companies of business and secondly, for security reason.
"Without cabotage policy, it means international vessels may call at our local ports. The entry of these international vessels may pose a threat to our security. This is something we must take into consideration" said Masing who is also a Deputy Chief Minister.
Prime Minister Datuk Seri Najib Tun Razak announced the abolishment of the cabotage policy for Sabah, Sarawak and Labuan starting from June 1, 2017, as leaders from Sabah and Sarawak have been continuously requesting for the policy to be reviewed as it is said to be the cause of high prices in both states.
However, the policy would still be applicable to cargo shipping operations within Sabah, Sarawak and Labuan.