Presentation at Asean Meeting on Logistics, Cebu. Philippines
1. ASEAN-‐AUSTRALIA
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ECONOMIC
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G DURAIRAJ, Chairman
Focus Group Institutional Issues &
Regulatory Framework,
MALAYSIAN LOGISTICS & SUPPLY
CHAIN COUNCIL
Government Role in
Removing Logistics
Performance Barriers
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SCOPE OF PRESENTATION
q Inventory Of Malaysian Logistics: A Snapshot
q Logistics Performance: Generic Barriers & Enablers
q Initiatives By Malaysian Government In Removal Of Performance
Barriers/Inhibitors
q Outcomes/Impact
q Other Issues That Need To Be Looked Into
q Policy Initiatives And Future Direction
q Conclusion
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The Economy
• Total trade (value):RM1,368,883m
• Total trade (volumetric): 600 mt
• World rank in trade (export): 24
• World rank in trade (import): 26
• GDP: USD 312 billion
• Per Capita Income: USD10,500
Components of Exports: 2013
Inventory of Malaysian Logistics
4. ASEAN-‐AUSTRALIA
NEW
ZEALAND
FREE
TRADE
AREA
(AANZFTA)
ECONOMIC
COOPERATION
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PROGRAMME
(ECWP)
• Total trade (value):RM1,368,883m
• Total trade (volumetric): 600 mt
• World rank in trade (export): 24
• World rank in trade (import): 26
• GDP: USD 312 billion
• Per Capita Income: USD10,500
Inventory of Malaysian Logistics
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Malaysia’s Global Trade Map
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Inventory of Malaysian Logistics
Container Port Throughput: 20.87 million TEU
Container throughout Ranking by Country: No 6
No of Gateway ports: 10 International ports
International Supply Chain Connectivity Index: No 5
No of Federal/state ports: 22
Gateway International airports: 6
Liner Shipping Connectivity Index, 2013: Rank 5
Logistics Performance Index: No 25
Doing Business ranking: No 6
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Malaysian Airports
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Expressways Railway Lines
Surface Transportation Network
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Inventory of Malaysian Logistics
Total ship calls 62,669 ship calls
Transshipment Traffic : 13.75 million TEUs
World Merchant fleet ranking: 19th
Rail line (total route/km): 1,665km
Federal Roads (length): 49,935km
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Barriers
• Poor physical infrastructure
• Last mile connectivity
• Out-dated institutional
practices
• Time-consuming and
burdensome inspections
• Rules/regulations which are:
• Arbitrary
• Discriminatory
• Obsolete
• Low-level skills
Enablers
Logistics Performance: Generic Barriers & Enablers
• Good physical Infrastructure
• Swift Cargo Clearance
• Swift Customs Clearance
• Business-friendly Regulatory
environment
• Capacity development:
Training & certification
• Rules which are:
• Simplified
• Harmonised
• Standardised
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ECONOMIC
COOPERATION
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(ECWP)
Initiatives by Malaysian Government in Removal of
Performance Barriers/Inhibitors
• Barriers/Inhibitors and Issues Addressed:
• Physical Infrastructure
– Ports
» Reforms/privatisation
» National Load Centre
– Shipping
» Main Lines/direct services
– Road
» Privatisation
– Rail
» Double-Tracking
– Air
» KLIA/Penang Cargo Centres
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Initiatives by Malaysian Government in Removal of
Performance Barriers/Inhibitors
• Barriers/Inhibitors and Issues Addressed:
• Trade Facilitation
– Standardisation/Simplification Documents
» EDI/DagangNet Technologies
» OGAs/PIAs
– Customs
» Harmonisation
– U-Customs
» NSW and ASW 2015
– B2B
» Port community system
» PKANet; Port Klang
» E-Ports at leading gateway ports
14. ASEAN-‐AUSTRALIA
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ECONOMIC
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(ECWP)
Initiatives by Malaysian Government in Removal of
Performance Barriers/Inhibitors
• Barriers/Inhibitors and Issues Addressed:
• Regulatory developments
– Liberalisation/Market access
» Container haulage
» Industrial Policy: Relaxed equity requirements
» Shipping agencies
» Freight Forwarding
» Cabotage liberalisation
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Initiatives by Malaysian Government in Removal of
Performance Barriers/Inhibitors
• Barriers/Inhibitors and Issues Addressed:
• Regulatory developments
– Administrative
» Process flow simplification
» Licensing of Commercial Vehicles
– Legislative
» Land Public Transport Commission, 2010
» Competition Commission, 2010
• Institutional Issues
– Capacity enhancement measures, 2010
– Malaysian Logistics & Supply Chain Council,
2008/2013
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The Outcomes/Impact
• Removing logistics performance barriers Increase GDP
Growth and Expand National Trade
• Improved outcomes have been felt in:
• Improved Performance
– Faster vessel turnaround time
– Higher crane performance
– Improved capacity/better connectivity
• Enhanced Productivity
– Ports with optimal utilisation
• Time savings
– Customs clearance
• Transparency
– EDI
• Cost savings
– Cargo clearance
• Service levels improvements
– Container haulage
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Issues Which Need To Be Looked Into
• Compliance & Commitments Under Asean Framework Agreements
on Transport:
– Multimodal Transport
– Goods in Transit
– Inter –State Transport
• Obsolete rules/regulations
• Merchant Shipping Ordinance, 1950
• Hague Rules, 1939
• Road Transport Act 1987
• Port Authorities Act 1967
• New rules/regimes needed
• Multimodal liability regime
• IMO conventions & agreements
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Recent Policy Initiatives & Future Direction
• Malaysian Freight Logistics Agenda
• 2010
• Developing An Empirical And Diagnostic Base To Support
Strategic Planning For The Freight Logistics Industry
• 2013
• Development Of Logistics & Trade Facilitation Masterplan
• 2014/June
• National Transport Strategy: The World Bank
• 2014/November
19. ASEAN-‐AUSTRALIA
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CONCLUSION
Ø Although much progress has been made by way of public policy
initiatives in removing logistics performance barriers and
inhibitors, further initiatives still needed to address specific gaps.
Ø The gaps are largely in attending to “soft issues” rather than
meeting requirements of physical infrastructure
Ø Addressing these issues would be helped with the prevailing
strong awareness among public policy planners on logistics
agenda
Ø National Logistics agenda views improvements to logistics “eco-
system” as strong enabling platform for overall national
development
20. ASEAN-‐AUSTRALIA
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ECONOMIC
COOPERATION
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(ECWP)
CONCLUSION
Ø Initiatives of Economic Planning Unit in the Prime Minister’s
Dept., Ministry of Transport and Ministry of International Trade and
Industry (jointly chairing the Malaysian Logistics Council) and the
Malaysian Productivity Corporation reflect growing importance
attached to logistics agenda.
Ø A major task seen in taking logistics agenda to higher level is
also need for private sector engagement (providers & users of
logistics services), capacity enhancement and greater
professionalism & skill development.
Ø Need also to be cognizant of closing deadlines and “logistics
readiness” in the light of AEC 2015.
