Malaysia plans to invest millions of dollars into the transportation infrastructure supporting Port Klang in an effort to boost exports out of the country’s main maritime gateway.
About 300 million Malaysian ringgit ($81.45 million) will be spent to improve the “last-mile connectivity” to Port Klang under a “Logistics and Trade Facilitation Masterplan,” Prime Minister Najib Razak announced Monday. There was no explanation of how this would be accomplished.
The Malaysian government has said in the past, however, that projects to improve connectivity to the busy container port must include improvements to the port’s “access road, rail network and traffic management system.”
Industry sources gave the news a lukewarm welcome earlier this week when talking to IHS Maritime 360, a sister company of JOC.com. An official with Thailand’s Regional Container Lines told the publication he was wary, not of the details of the initiative, but the lack thereof.
"We see the initiative as a recognition by the government on the importance of the logistics industries' contribution to Malaysia's GDP and a critical component in the development of economy," the official said.
Pointing out that the initiative covers five important areas and has a clear three-phase timeframe, the RCL official added, "With this, we expect to see further improvements on the terminal-centric infrastructure development, improved transparency in the dealings with the regulatory institution and industry-specific demands of [a] skilled workforce."
Port Klang is the world’s 12th largest port by volume as well as the 17th busiest port in total cargo tonnage, according to 2012 statistics.
The Port Klang Authority has said it is confident the port will break into the Top 10 list by 2016, driven by the expansion of both its Northport and Westports terminals and the success of the Port Klang Free Zone.
The free zone, an ambitious regional industrial park near the port, opened operations in 2006 with an occupancy rate of less than 30 percent. As of last summer, almost the entire acreage at the site had been leased, Datuk David Padman, general manager at the Port Klang Authority, told the Star, an English-language newspaper in Malaysia.
“The prospects of PKFZ are slowly coming to fruition, as we have good multinationals with long-term leases that span from five to 30 years,” he is quoted. “We have no more land to offer and the remaining 5 percent is only light industrial units.”
Meanwhile, expansions at Northport and Westports terminals have increased their capacity to 5.6 million TEUs and 14 million TEUs, respectively. Market leader Westport handled 7.5 million TEUs in 2013. Northport handled 2.88 million TEUs that same year.