— Francis Loh
The Malaysian Insider
Aug 03, 2012
AUG 3 — We are deeply distressed to learn that Penang Port has been privatised to Seaport Terminal (Johor) Sdn Bhd.
Penang Port, Malaysia’s first port, is a valuable cultural and economic heritage of Penangites, indeed of all Malaysians. It has been a part of our history since colonial times, providing ferry services that linked the island to the peninsula, and serving as an important free port and port-of-call for ships from the East and West.
In no small way, the port has contributed towards the economic dynamism and the cosmopolitanism of Penang and in turn towards our Unesco Heritage listing.
Not surprising, Penangites from all walks of life — the Penang Pakatan Rakyat government, business groups, port workers, port contractors and especially the rakyat have rejected the privatisation proposal. Even the Penang Barisan Nasional has urged the federal government to review its decision, not least because of popular sentiments against Seaport’s takeover on the eve of the 13th general election.
In fact, there are three other major concerns regarding the proposed takeover.
First, Seaport Terminal, owned by tycoon Tan Sri Syed Mokhtar Al-Bukhary, already controls Pelabuhan Tanjung Pelepas (PTP) and Johor Port. Opened in 1999, PTP handled about 6 million TEUs last year, five times more than Penang Port.
Consequently, concern has arisen that Seaport Terminal will not be interested in developing Penang Port to any considerable extent and that the takeover will relegate Penang to a feeder port for PTP. The cranes in Penang Port, a mainstay of our harbour view for more than a century, might even be dismantled and transferred to PTP, which is being geared for even greater growth.
Indeed, if such plans are in the offing, some have suggested that Seaport’s acquisition of Penang Port could be against the Competition Act 2010, potentially an anti-trust violation.
Seaport Terminal director Datuk Mohd Sidik Shaik Osman has denied the allegation that Penang Port’s status will be diminished following their takeover. Rather, he declared, Penang Port’s capacity will be increased and it will be turned into a regional port. He has also assured that the necessary dredging of Penang Port will be conducted.
Indeed, our second major concern about Seaport’s takeover is with regards to the dredging of the North Channel — but not about whether it will be conducted but who will be doing the dredging and how accountable they are.
Apparently, this work has been conducted by local dredging firm Inai Kiara Sdn Bhd, which together with Seaport Terminal had set up a joint venture called Integrated Marine Works (IMW). Subsequently IMW signed an agreement with Ballast Ham dredging (BHD) of Netherlands.
We understand that IMW-BHD, in 2004, acquired a 15-year concession agreement with the Malaysian government to carry out the dredging of all ports and harbours under federal jurisdiction.
In other words, the dredging of the North Channel might come under the control of IMW, just like all the major ports under federal jurisdiction in Malaysia. Who really owns IMW and its parent companies?
Our third concern arising from that Seaport’s acquisition of Penang Port is that it will further facilitate Syed Mokhtar’s tightening of his grip over logistics in the country.
Apart from a couple of ports and related activities, he already has interests, whether directly and indirectly in Pos Malaysia, Proton, and DRB Hicom and is reportedly working on a takeover of national railway KTM and stakes in a sewerage system and national water assets.
Such control can only lead to a monopoly which cannot be healthy for our country that, under the still-born New Economic Model, is striving to rise from a middle-income to a high-income nation. Where will there be the necessary competition and the competency?
Confused and annoyed like us?
We therefore demand to know all the terms and conditions for the takeover of Penang Port including the dredging (and the parties that stand to profit from it).
The facts and figures of Seaport Terminal’s future plans for Penang, the amounts of money that they will invest in Penang Port, when these are forthcoming, employment with regards to port workers, the charges they will be imposing, etc, must be available for public scrutiny.
Since news of the proposed privatisation reached the public, there have been two other parties that have declared that they are interested in taking over Penang Port, namely the Penang state government and the Penang Chinese Chambers of Commerce that intends to set up a consortium involving the other Chambers.
It is preferred that the Penang Port not be privatised, certainly not if it leads towards the monopoly by an individual with vested interests over the country’s logistics industry or control by those with vested interests over its land banks.
The advantage of transferring the Penang Port Commission which controls Penang Port to the Penang State government is that the latter, whether PR (or BN, as some hope after GE13), is that we can hold the port authorities accountable. After all, if they do not perform competently, we can always remove them in GE14.
We demand therefore that the Cabinet revoke its decision to privatise Penang Port to Seaport Terminal. The Penang state government, on behalf of the people of Penang, should then be allowed to put in a bid.
Save Penang Port! — aliran.com
* Dr Francis Loh is president of Aliran