ASEAN Ports Association Malaysia (MAPA)

THE Port Klang Authority (PKA), the regulator of Northport and Westports, plans to review the tariff structure at both terminals to bring their rates on a par with their neighbours’.

“People perceive that cheap tariff is the main reason why a shipping line calls at a port. I think that is the least of the reasons, but rather it’s about the efficiency and cost-effectiveness,” PKA general manager Lim Thean Shiang told Business Times in an interview.

He said Port Klang’s tariffs on most of the services it provides have remained unchanged since 1965.

It was reported that current handling charges for a 20-foot and a 40-foot container are RM230 and RM345 respectively. For transhipment, it costs RM140 for a 20-foot box and RM210 for a 40-footer.

“It is not about making more profit, but about helping port operators improve their infrastructure and facilities.

“If they don’t get higher tariffs, it is difficult for them to reinvest (in new equipment and facilities); and, if they don’t reinvest, we will never catch up with other (international) ports,” Lim said.

Citing Hamburg as an example, he said that 70 per cent of its operations is automated. Its port charges are about five to six times higher than those at Port Klang.

He has asked that the PKA’s research and development team collect tariff rates of ports in the region, which has several world-class ports, as a benchmark.

Once a review is done, a proposal will be sent to the Minister of Transport for approval.

On another matter, Lim said the port authority had put the dredging of the north channel on hold. It will study the viability of expanding the south channel instead.

The initial plan was to dredge the north channel in two stages to a depth of 15 metres, from 11.3m.

Work to deepen the channel to 13.3m has been completed, but further dredging to 15 metres is pending approval.

Expansion of the south channel waterway from 365m to 500m will allow for two-way traffic.

Lim said the final decision on which project to proceed with will consider the economic and safety benefits to be derived.

While both projects will need about the same amount of capital outlay, further dredging of the north channel would be more costly owing to the maintenance dredging needed to upkeep the depth at 15m.

“I am from the private sector, and it’s all about dollars and cents. All decisions should be based on commercial gain,” Lim said.

By : Presenna Nambiar

This 30 years ago, when Johor Port Authority was established, many were skeptical about its ability to manage and operate a port in Johor, the southern most state in Malaysia. Far less was expected of its abilities to develop the port industry in Johor to the magnitude it is now. Astoundingly, within a short period of time Johor Port Authority baffled all skeptics when it successfully launched Johor Port into the international maritime trading scene. The ships many though would never come began to queue up, sometimes for days.

Beginning modestly, JPA embarked courageously into the port industry on 1 January 1976 when it was established. The odds then, were against JPA’s success. On one hand there was a realization that a port in Johor was needed to service the local industries and to create better terms of trades for local traders who were suffering from the tariffs and costs of exporting via Singapore. However, despite this recognition there was great skepticism in Johor Port’s ability to return enough revenue to justify its establishment. The biggest worry at the time stemmed from the fact that Johor Port was barely an hour’s steaming time from Singapore, at the time, the region’s biggest and most efficient port. However, JPA illustrated its mark of distinction when it boldly decided to let commercial forces shape the future of Johor Port. As a forward looking organization, JPA embarked on an effort to promote industrial development within the Pasir Gudang area where Johor Port was located. This move proved to be rewarding when it created ready revenue for the port when trade was executed thru Johor Port.

JPA also began an aggressive international marketing campaign which was handsomely rewarded. When in 1979 it launched itself into the container business, again, many were surprised and skeptical. Comments ranged from the fact that Johor Port was only a small party to the fact that container industry was still new to the region and the country did not require Johor to service container lines. All was proved wrong when international liners like Titan and Evergreen began landing in Johor.

It was not merely campaigning and marketing that was required to launch Johor Port Into the international maritime scene, in 1984, JPA succeeded in gazetting  Johor Port as a free trade zone hence becoming the first and only port in Malaysia situated within a free trade zone. All these efforts and commitment to top-class service soon led to Johor Port being the biggest fertilizer handling point in Southeast Asia and the largest in the world in handling palm oil exports in the 80s.

Despite the success it displayed within a short period of time, the tremendous challenges faced by JPA never dissipated.

In 1993 and 1995 respectively, the Government had decided to corporatise and subsequently privatize port services operation in Johor Port. This period marked a turning point for JPA’s role. JPA was restructured in accordance with its main functions as a regulatory body while maintaining watch over all port operations and port development ensuring the smooth running of port operations.

Now, JPA’s wings not only spread over Johor Port, situated at the southern tip of Peninsular Malaysia. Since 1999 it also overseas port operations at the Port of Tanjung Pelepas, in the western part of Johor’ and since 1993, it has been responsible for the Tanjong Belungkor and Changi Ferry Terminals. These changes note a considerable increase in responsibility compared to when JPA was solely responsible for the development in Johor Port.

JPA’s responsibility over the Port of Tanjung Pelepas essentially means it is now responsible for regulating port operations located at the confluence of the region’s busiest shipping routes/ The Port of Tanjung Pelepas is expected to be the region’s main container ports in the region and is expected by many to be the ASEAN’s main trading hub. With the Tanjung Belungkor Ferry Terminal JPA has already prepared an extensive strategic plan to further enhance Tanjung Belungkor’s role as the third southern international gateway to the country.

JPA’s commitment and level of quality was given due recognition when it was accredited ISO 9002:1994 by the Llyods Register Quality Assurance on Provision of supervision of handling of dangerous goods/hot work, pilot certification, port security, licensing of support services contractors and licensing of private jetties. The accreditation was successfully upgraded to ISO 9001:2000 in 2003.

On it’s 30^th Anniversary, JPA has established its indispensable role to ensure the development of maritime trade and port industry in the country and the region. It now plays an important role in the establishment of Johor as Malaysia’s Southern Gateway and in the establishment as Johor as the main logistics and trading hub for the last 30 years, Johor Port Authority will continue to forge a remarkable and distinctive history!

By: Johor Port Authority