AS the economy shifts to a lower gear, it may be the right time for the local port industry to focus on improving infrastructure and raising efficiency levels.
This will enable port operators to provide cost-effective services to customers in the near term while ensuring that when the world trade picks up, they are able to seize the opportunities in the longer term.
In recent years, major ports in Malaysia have utilised almost full capacity to cater to the booming business, which in turn has prompted them to embark on major expansions.
According to Malaysia’s Maritime Institute senior fellow Nazery Khalid, it is crucial for local ports to continually improve their infrastructure, efficiency, productivity and performance to offer customers value for money, especially in this climate that is proving to be extremely challenging for the shipping industry.
“Unlike Westports, Northport and Port of Tanjung Pelepas, which are on par with the world’s best container ports, there are some other local ports that can improve their services.
“The other local ports must benchmark themselves against regional heavyweights like the Singapore Port, Shanghai Port and Hong Kong Port which are among the world’s top five container ports in terms of volume.
“Malaysian ports can certainly improve on many fronts to enhance their competitiveness to attract more main-line operators (shipping companies) to call at their terminals,” he adds.
He suggests that port operators thoroughly assess their current positions and chart their next course of action to weather the global economic downturn.
“Amid the economic and seaborne trade slowdown, port operators must plan their resources meticulously and find ways to harness their strengths to place themselves on a stronger platform.
“Now is the time to identify areas of weaknesses which they may have overlooked during busier times,” Nazery says.
As the most cost-efficient mode of trade transport, where 90% of goods are transported via sea, the shipping industry is vulnerable to any slowdown in the world economies against a backdrop of declining trade volume.
On the flip side, it is also well positioned to benefit from the up-tick in economic activity.