Businesses suffer as ships bypass Penang

Businesses suffer as ships bypass Penang

GEORGE TOWN - Businesses in the northern region are expected to suffer substantial losses if ships continue to bypass the Penang Port, which has a shallow draught depth.

The Federation of Malaysian Manufacturers (FMM) Penang branch is urging the Federal Government to take immediate steps to address the problems of siltation, which is the cause of the shallow draught depth, by dredging and upgrading the port.

An FMM spokesman said the larger ships were bypassing the Penang Port and would sail to other ports such as Port Klang and the Tanjung Pelepas port in Johor.

"The larger vessels are bypassing Penang as their port of call due to its shallow draught depth. This will have a serious impact on manufacturers and cross-border businesses in the northern states and the region.

"The cost of shipping and doing business will escalate, given the need to use feeder vessels or land transport to move their cargo through Port Klang, for example.

"It incurs an additional cost because of the transportation of the goods from other ports to the northern region. There is also the delay because of the longer time it takes for the transportation of goods," he said in a statement yesterday.

However, he could not estimate the losses should the situation continue.

The spokesman said the North Channel is subjected to heavy siltation and capital dredging is periodically required to maintain the required draught of 14m to enable bigger vessels to call at the Penang Port.

"The Federation views with concern the shallow draught depth at the North Channel, which the Penang Port Sdn Bhd (PPSB) has confirmed to be at 10.5m currently," he said.

PPSB managing director Datuk Ahmad Ibnihajar could not be reached for comment.

In November, he had said the delay in the port's privatisation had, in turn, put several projects on hold such as the RM350mil (S$134 million) seabed dredging and the abandonment of a RM60mil contract with Belgian Lhoist Group.

The privatisation of the port was announced in 2010 when Tan Sri Syed Mokhtar Al-Bukhari, the Tanjung Pelepas Port and the Johor Port owner, won the bid in a limited open ten- der.

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