Malaysian Prime Minister Launches National Maritime Plan

The country’s first comprehensive plan for developing the shipbuilding and ship repair industry was among the announcements made by Malaysian Prime Minister Najib Razak on Tuesday in Langkawi.

Developed by the Malaysian Industry-Government Group for High Technology (MIGHT) and Association of Marine Industries of Malaysia (AMIM), the Malaysia Shipbuilding / Ship Repair Industry Strategic Plan 2020 aims to generate RM6.35 billion in Gross National Income (GNI) and create an additional 55,500 jobs for Malaysia by 2020. Growth is expected to be both sustainable and inclusive and could be a major boon for Sarawak, which has seen the maritime industry grow to become the third largest contributor to the state economy.

The plan targets the capture of 80 percent of the local new build market and 2 percent of the global new build market, up from 50 percent and 0.8 percent respectively in 2010.

According to figures provided by MIGHT, key contributions will come from the uptrend in build and repair of Offshore Support Vessels (OSV) for oil and gas exploration and replacement of the ageing vessels of Petronas Service Providers (PSC) contributing RM10 billion in industry revenue by 2020. Meanwhile, for the ship repair segment, the plan sets out to capture 3 percent of the Selat Melaka repair market worth about RM1 billion annually. The OSVs servicing the South China Sea offshore present repair work for shipyards in Kelantan, Terengganu and Pahang estimated to be worth more than RM200 million annually.

The recommendations of the plan are expected to boost Malaysian industrial competitiveness in shipbuilding and ship repair, industries which have come under increasing competitive pressure from regional players such as Singapore, Vietnam, Indonesia, India, China and the Philippines.

The plan targets specifically the small to medium-sized shipbuilding and ship repair segment and aims to upscale Malaysian capabilities in high-value, high technology products and processes. Key recommendations include the enforcement of build and repair quality, enhancement of local content levels and the introduction of new technologies and processes. The plan promotes local content in design and build and the alignment of state and local strategies with the needs of the shipbuilding and ship repair industry.

To achieve its goals of RM6.35 billion in GNI contribution and the creation of 55,500 new jobs, the plan recommends Government and regulatory intervention at several levels such as policy formation, regulatory framework, finance and incentive packages for investment and programs for human capital development.

The concluding recommendations of the plan include the strengthening of the institutional framework, in particular, the establishment of an inter-ministerial, national level steering body to oversee the industry’s development.

“The plan sets ambitious goals for the shipbuilding and ship repair industry,” said Mohd Yusoff Sulaiman, President and CEO of MIGHT, “but with the commitment of the industry and Government, and the right formula for cooperation, they are absolutely attainable,” he added.