Aren’t logistic services essential? Freight forwarders call for clearer guidelines

FMFF President Alvin Chua said the Port Klang Authority has said logistics services are essential services but enforcement agencies do not seem to think so. — Picture by Farhan Najib
FMFF President Alvin Chua said the Port Klang Authority has said logistics services are essential services but enforcement agencies do not seem to think so. — Picture by Farhan Najib

GEORGE TOWN, March 24 — The Federation of Malaysia Freight Forwarders (FMFF) has asked for clear directions and guidelines for the logistic services on whether transport and warehousing services under the sector are deemed as essential services.

FMFF President Alvin Chua said there have been so many contradicting statements, media statements and guidelines issued by different ministries that all 1,300 members under FMFF are at a lost on how to operate their businesses.

“We have written to the Ministry of Transport (MoT) and Ministry of Home Affairs to confirm whether we are essential services, as in item 12 of the essential services issued by NSC, we have yet to receive a reply from these ministries,” he said in a statement issued today, referring to the National Security Council.

He said the Port Klang Authority has said logistics services are essential services but enforcement agencies do not seem to think so.

He claimed police has stopped logistics trucks at roadblocks and told the drivers that they must have a work travel pass and must provide proof that they have undergone testing for novel coronavirus (Covid-19) with the necessary endorsement by a government hospital or clinic.

Additionally, drivers and logistic companies were told that they need approvals from NSC to transport goods and that only medicine and food can be transported.

“These confusing and contradictory actions and requirements are overwhelming and contrarian to the announcement by Miti on the approval for logistics services rendered to manufacturers of essential goods and non-essential goods recently approved by Miti,” he said, referring to the Ministry of International Trade and Industry.

He then referred to an announcement by the Defence Minister Datuk Seri Ismail Sabri Yaakob that work travel passes needs to be issued for workers to travel to work.

“FMFF has written to both MoT and (Ministry of Home Affairs) for approval to issue work travel passes to our members and staff to travel to work and we have yet to receive any reply from these two agencies,” he said.

Chua said goods that were imported before the movement control order (MCO) have arrived at the ports and goods not listed under the approved list were not allowed to be moved from the ports.

“Each container that cannot be delivered will incur demurrage charges from shipping lines and storage and removal charges from ports,” he said.

He said this will add to the final costs of the delivered goods to manufacturers and importers and the final consumer will have to bear the additional costs. 

He warned that manufacturers may also face disruptions in their production schedules and face losses in the market.

“Similarly, exports of non-approved goods cannot be sent to ports for shipment, resulting in cancelled contracts and loss of business,” he said.

He said the storage capacity in ports will also not be able to cope with a large number of undelivered containers and that this will lead to a huge backlog to clear after the MCO.

He said essential goods only make up about 20 to 30 per cent of the total cargo throughput in the port.

“With other non-essential goods making up 80 per cent of the cargo volume, the huge volume of undelivered cargo would start a huge backlog and be a potential time bomb that would affect port operations efficiency and capacity,” he said.

He reminded the government that the logistics is an essential service that underpins the national economy as it is a manufacturing related activity.

Due to the conflicting guidelines, harassment from enforcement agencies and slow response of related ministries, Chua said FMFF may be compelled to advise all its members to cease operations immediately until the government approves and facilitate the operations of the industry.

However, he said the FMFF members will still facilitate clearance and transport of medicine, medical products, food items and any other products deemed to be essential.

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