GEORGE TOWN, March 10 — Penang industries are closely watching potential disruptions to logistics, supply chains and energy prices as global tensions begin to affect shipping routes and operating costs, Penang Chief Minister Chow Kon Yeow said.

He said currently, concerns are on possible disruptions to logistics and supply chains, as well as rising energy prices, particularly oil, which could push up production costs.

“At this stage, I think everyone is concerned about disruption to logistics, supply chain and energy prices, oil, which will bring effects to the cost of production and so on. This is the first stage,” he said in a press conference after launching the AI for Manufacturing Program and AI Sandbox at PSDC here today.

He said the extent of the impact will depend on how long the situation persists.

“We can expect these effects if it continues for a prolonged period. If it can be stopped and resolved in the near term, then the impact can be reduced,” he said.

Chow said industries should begin planning for the short and medium term to anticipate potential operational disruptions.

“For industries, they may need to plan for the short term, medium term — hopefully we do not need the long term — to anticipate how far their operations will be affected because of disruption to logistics, transport, energy cost and so on,” he said.

He added that companies may also need to reorganise delivery schedules and timelines as shipping routes are affected.

“For example, for those in logistics, ships cannot pass through certain routes, and I hear some ships travelling to the Middle East from Port Klang had to turn back and so on,” he said.

Chow said such disruptions could affect manufacturers exporting goods to certain destinations.

He stressed that it is still too early to determine whether Penang’s manufacturing sector has already been affected, noting that the situation has only developed over the past week.

“This is still the early stage, just over a week. It is too early,” he said.

“What I mentioned are projections of what could happen. I am not saying it has already affected us, but these are effects that can be anticipated and planned for,” he added.

He said the state will continue monitoring the situation to assess whether it could lead to a prolonged economic impact.