'Business-friendly transport policies needed for competitive edge'

 

SHIPPERS need good transport policies to optimise the logistics supply chain to gain competitive edge in a globalised marketplace.

"Business and trade-friendly transport policies are a primer to business and trade competitiveness," said the Maritime Institute of Malaysia Senior Fellow at the Maritime Institute of Malaysia's centre for maritime economics and industries Nazery Khalid.

Speaking on the issues, challenges and opportunities for shippers at a conference last week, Nazery said one of the benefits of such policies is that it provides attractive areas to set up manufacturing with cheap production costs and good connectivity.

He said trade transport policies must keep abreast of changes in transportation, ICT, industries, businesses, production and supply chain management. They must also be made in consultation with the stakeholders and must balance business needs as well as society's demands and expectations.

Globalisation and liberalisation of trade and changing production trends like "just in time", zero inventory requires good transport policies which will serve to protect the environment and public interests. It enhances efficiency and competitiveness of businesses and nations. These policies can also address various issues in the shipping industry.

Carriers impose various charges to shippers ranging from terminal handling charges, bunker surcharge, peak season fee to currency adjustment fee on grounds of rising costs and dwindling margins.

Several trends in trade transport policies are already being seen through rules against cartels, market controls and restriction of competition by way of price fixing or capacity reduction.

But policies are slow to adopt to the changing world and social values while there is a lack of regional or multilateral agreement on transport services liberalisation.

The Malaysian government liberalised the haulage sector in 1997, leading to the entrance of new players.

International Trade and Industry Ministry senior director from the services sector development division Mohamed Shahabar Abdul Kareem said the logistics industry needs to improve efficiency, effectiveness and competitiveness.

"There is also a need for integration within the overall global logistics supply chain. The industry is fragmented with too many players. The lack of coordination between ministries for the services sector is also another challenge for the industry,"he said.

Haulage comes under the motor vehicle licensing board, public warehousing under local councils, custom agents and freight forwarders under the customs and the ports under the Transport Ministry.

"As the integrated logistics sector is diversified, there are still sub-sectors which are unregulated and not under the custody of any ministries," Mohamed Shahabar said.

The transport sector remains in deficit (of RM14.7 billion) for trade in services due to dependence on foreign vessels, particularly in the transport of goods.

He said the Third Industrial Master Plan aims to create an efficient and competitive logistics industry.