Sabah trade reps laud RM150m to standardise prices, but still want cabotage to go

The industry leaders noted that cabotage was the main contributor to the decades-old price differentials between the country’s two regions. ― Picture by Julia Chan
The industry leaders noted that cabotage was the main contributor to the decades-old price differentials between the country’s two regions. ― Picture by Julia Chan

Subscribe to our Telegram channel for the latest updates on news you need to know.


KOTA KINABALU, Nov 3 — Industry leaders here welcomed the federal government’s RM150 million allocation to address price discrepancies between east and west Malaysia, but said this fell short of abolishing the cabotage policy they have long asked to be ended.

They noted that cabotage was the main contributor to the decades-old price differentials between the country’s two regions, which could sometimes be as much as 30 per cent higher in Sabah and neighbouring Sarawak.

“The announcement favours the B40 group, who bears the brunt of the high cost of living, by helping to stabilise certain necessary goods in Sabah.

“It is a good start, but we need better policies in the long run,” said Sabah Malaysian International Chamber of Commerce and Industry chairman Datuk Wong Khen Thau.

Finance Minister Lim Guan Eng announced the allocation when presenting Budget 2019 in Parliament yesterday.

The policy proposal is aimed at standardising the nationwide prices of goods such as wheat flour, refined sugar, 1kg cooking oil packs, local white rice (15 per cent broken) in the 10kg bags, RON95 petrol, diesel and liquefied petroleum gas (LPG).

Malaysian Consumer Protection Association (MCPA) Sabah Chapter president David Chan welcomed the news but said it does not adequately address overall higher prices in Sabah.

“The Budget is good from an administrative angle. It cuts unnecessary spending, but I hope it is not just a policy budget; it has to have realistic results that will actually lighten the people’s budget.

“Something like abolishing the cabotage policy will have a bigger impact as it means all our goods need not go through Port Klang. We also need something more concrete to solve our logistical issues, which is the root of the problem of high prices here,” said Chan.

Chan said without such a long-term solution, the ad hoc price stabilisation mechanism will not yield permanent benefits.

He said the state also needed more logistics and transport support for its industries, and more incentives to make it more attractive to investors.

Aside from the price stabilisation subsidy, Lim also announced a RM5 billion development allocation for the Pan Borneo Highway and other infrastructure.

“It’s heartening that the RM5 billion development allocation for Sabah covers the upgrading of infrastructure, such as roads, water and electricity supply, all of which are much needed in the rural areas to uplift the wellbeing and for the convenience of rural folks, such as in my Kiulu constituency,” said Kiulu state assemblyman Datuk Joniston Bangkuai.

Related Articles