Iskandar project to help boost growth of Senai and PTP

Senai airport and the Port of Tanjung Pelepas are expected to benefit from the massive development under the government's Iskandar project in Johor, bordering Singapore, reports Correspondent Ramadas Rao Malaysia is shrugging off the global recession in tandem with other Asian economies and is set for a GDP growth of at least six percent in the fiscal year 2010.

Maritime, logistics and aviation is set to ride this growth and also latch on to the massive development under the Iskandar project in the southern state of Johor, bordering Singapore.

The new development in Iskandar will provide a filip to the growth of Senai airport, which has ambitions of being a major air cargo and air logistics hub apart from providing passenger connections to more cities in Malaysia.

The Iskandar project, targeted for 2012, involves the construction of a huge metropolis that will include a cluster of factories, centres of learning, hospitals and entertainment. It is being promoted as a business hub within the Johor-Singapore-Indonesia triangle and as the southern gateway to Peninsular Malaysia.

The chief executive officer of Senai Airport Terminal Services, Mohd Sidik Shaik Osman, is optimistic about the growth of SATS, which he believes will be helped by the recent opening of a sprawling aero mall. Further investments in projects around the airport area marked for development, amount to US$808 million.

A high-tech park and a free zone to set up logistics facilities are also planned. Senai International Aviation Park has already succeeded in wooing investors that include C&A Aviation and Executive Jets Asia. A clutch of tax incentives and relatively cheaper land costs have added to the location's attraction. Sidik is also chairman of Port of Tanjung Pelepas in Johor, which is also being aggressively developed as a logistics hub within Iskandar Malaysia.

PTP, in which A P Moller Terminals has a 30 percent equity stake, competes with Singapore for transhipment containers and has seen volumes surge in double digits this year. First-half growth reached 13 percent and officials are optimistic of throughput for 2010 touching 6.5 million TEUs on the back of growth in East-West trade.

From January to June this year, PTP handled 3.2 million TEUs and 4.8 million TEUs up to September 30, compared with 4.4 million TEUs a year ago.

PTP has positioned itself for a rebound in global trade by expanding facilities and adding berths that has enhanced annual capacity to 8.5 million TEUs. Phase two expansion is well on track with two more berths to be added by 2013 that will mean a total of 11 berths together capable of handling up to 11 million TEUs annually. In tandem with physical expansion PTP has also been focusing on raising productivity and recorded its highest volume in 10 years of operations at 572, 444 TEUs in a single month in May this year.

Crane moves have shot up to 34 to 35 per hour on an average, well above what is said to be the industry average of 28 moves per hour.

The port handles about 80 vessel calls a week and officials claim that together with its berths and 44 quay cranes is capable of handling up to nine million TEUs a year. PTP draws most of its cargo from Denmark's Maersk Line, which is a vessel sharing partner with CMA CGM line of France. PTP has also inked a separate agreement with CMA CGM, which uses Westport in Port Klang as its regional hub to handle some of its regional transhipment cargo.

Taiwan's Evergreen also uses PTP as its hub in Asia. PTP was one of the few ports to achieve high growth in 2009. In a year when container volumes plunged elsewhere PTP volumes rose 7.4 percent for a total throughput of six million TEUs. PTP officials, however, downplay talk of competition with Port Klang near Kuala Lumpur, which remains a key gateway for Malaysia's export-import trade.

The rise of PTP notwithstanding, Port Klang continues to serve as a major conduit for Malaysia's international trade. The two port operators at Klang - Westport and Northport - together handled over seven million TEUs in 2009 and though the Klang free zone development is mired in controversy with allegations of irregularities, it continues to be a major cargo hub in Peninsular Malaysia.

Growth in the first half of this year was almost 30 percent at 4.31 million TEUs and the Port Klang Authority is estimating volumes to surpass eight million TEUs for 2010. Westport is confident of handling 5.5 million TEUs this year as it continues to be the Southeast Asian transhipment hub for China Shipping Container Line, which brings nearly a quarter million TEUs annually. The port operator has chalked out expansion plans that include a new 300m berth targeted to be completed in 2011 that will increase annual throughput capacity at Westport to 7.5 million TEUs.

Reefer volumes through Klang are also expected to rise following steps taken by the national carrier MISC to become a key player in the niche Halal market. MISC's logistics arm called MISC Integrated Logistics or MILS has invested in a logistics facility in Pulau Indah, Selangor, outside port limits to provide both dry and cold storage facilities including Halal products. MISC recently ordered 2,000 units of 40-foot high-cube reefer containers to meet growing demand.

The shipping line has strengthened its Halal Express Services and has introduced three new services aimed at fine-tuning its presence in the Asia and Oceania markets.