Under a new breed of managers, Malaysian ports are going all out to win business. They have shown that not only are Malaysian ports able to match the world’s leading ports in efficiency, they also offer cheaper rates.

 

But that’s not all. Malaysian ports also compete fiercely among themselves for business.

 

Today’s CEO OUTLOOK 2003 features three of the new breed of Malaysian port operators – Tan Sri G. Gnanalingam of Westport, Mohd Sidik Shaik Osman of Port of Tanjong Pelepas (PTP), and Basheer Hassan Abdul Kader of Northport.

 

Gnanalingam spent many years heading the marketing division of Malaysian Tobacco Co (now part of BAT Malaysia) and used his expertise in this field as well as his extensive networking to build up Westport. Under him, Westport has grown by leaps and bounds.

 

Gnanalingam is very much into the ancient Indian ayurveda way to health, and started the Ayur centres in Petaling Jaya and Tambun, Ipoh. He is also the president of the Malaysian branch of The Indus Entrepreneurs (TiE) organisation, which seeks to promote networking between Malaysian and Indian businesses worldwide.

 

Mohd Sidik is a confidante of top entrepreneur, Syed Mokhtar Albukry, having known the low profile businessman since the 1970s when he (Sidik) was an official at the International Trade and Industry Ministry. Sidik later moved to the Transport Ministry, and was tapped by Mokhtar to head PTP.

 

How PTP got Maersk-Sealand and Evergreen lines to switch from Singapore to PTP is well documented, and justifiably celebrated.

 

For Basheer, the past year had been spent integrating the merger of Klang Container Bhd and Klang Port Management Sdn Bhd, which form Northport. So far the process has gone on smoothly.

 

Northport, although Malaysia’s biggest, is not as well known as PTP or Westport, and Basheer wants to change the image.

 

All three port CEOs are confident of a bright future ahead for their ports, given the importance of Malaysia as a trading nation.

 

At the same time, the terrorism threat means that Malaysian ports will have to pay more attention and spend more money to upgrade security to ensure ships entering and leaving our ports are safe.

 

Mohd Sidik Shaik Osman
Chief Executive Officer
Pelabuhan Tanjung Pelepas Sdn Bhd
Challenges and prospects for Malaysia’s economy.

 

Since the late 1990s, Malaysia’s economy has been going through difficult and challenging times. Despite this, we have made continued progress and this is largely due to the increasing Malaysian ethic of seeking “opportunities amid crisis”.

 

With the recent catastrophes and the prospects of war looming, 2003 does appear bleak for trade and hence the logistics and transport sector. Security measures and soaring insurance costs have seen freight rates increase on Europe and US routes. For Malaysia, foreign investors are now comparing Malaysia’s labour and land costs with China’s.

 

These challenges present us with the opportunity to seek greater efficiencies and provide value-added services. Our economy and skilled labour have long progressed and it is time we sought high-end manufacturing and technology-based industries to relocate to Malaysia.

 

Business must work hand-in-hand with the government to also ensure that regulations are investor-friendly and no longer complex and overtly bureaucratic.

 

Our performance in 2003 will solely depend on the efforts we put in.

 

Do you feel the government projected growth rate of between 6% and 6.5% for 2003 can be achieved?

 

The 6% growth rate is an optimistic rate and it reflects the government’s dynamism in promoting both large-scale manufacturing and the small- and medium-sized industries (SMI) emphasis.

 

We will be able to achieve this growth rate if we can seek new opportunities away from our traditional comfort zones.

 

Challenges and opportunities for your company in 2003.

 

The Port of Tanjung Pelepas has seen excellent growth over the past year primarily through seeking new businesses. The hubbing of Maersk Sealand and Evergreen Marine Corp, the world’s two largest lines, in PTP will see significant spin-off both through feeders and the distribution park at PTP.

 

To ensure continued growth and to stimulate demand, PTP has also embarked on phase two, which will be completed by early 2004. Phase two presents PTP with a continued ability to attract large main lines.

 

Do you see China’s emergence as an economic powerhouse providing opportunities for Malaysian companies or as a competitor?

 

PTP is primarily a transhipment port. China’s growth has presented opportunities for main lines to call at China directly for onward services to the US and Europe; some of which tranship via South-East Asia. China’s growth will, therefore, directly correlate with growth in PTP as a hub port.

 

The second area of growth, thanks to China, is the increased trade flow between South-East Asia and China, both exports and imports.

 

It will be prudent at this stage for key ports and Malaysian logistics companies to view China as an opportunity in this sector, not a threat.

 

How will your company be affected by the implementation next year of the Asean Free Trade Area (Afta)?

 

Ports are the drivers of trade and, hence, welcome most free trade arrangements. If the implementation of Afta is executed according to plan and adopted by member countries, we should see higher trade flow between Asean countries both in fast moving consumer goods and industrial goods. This should result in higher connectivity of feeder lines between key Asean ports and higher volumes.

 

Do you expect your company to do better of worse in 2003 compared with 2002?

 

PTP’s continued fast growth will see us handling over three million TEUs (20ft equivalent units) next year. For 2002, we expect to handle approximately 2.5 million TEUs.

 

We also hope to further increase terminal efficiency, which is already at a very high level of 30–31 gross moves an hour per crane, higher than most established terminals. This consistent productivity will be further increased at PTP with the introduction of new twin-lift cranes, the first in South-East Asia.