14/06/2020 10:32 AM
By Harizah Hanim Mohamed
MANCHESTER, June 14 -- The appointments of Tan Sri Noh Omar as the new chairman of MISC Bhd and Datuk Seri Mohamed Khaled Nordin as the new non-independent and non-executive chairman of Boustead Holdings Bhd bode well for the maritime industry.
The appointments of both highly experienced former ministers can be the conduit to channel some of the long-standing issues plaguing the industry.
Boustead Heavy Industries Corporation Bhd is mainly involved in shipbuilding and ship repairing industry, heavy engineering as well as an operating marine training academy.
Malaysian Shipowners Association (MASA) chairman Datuk Abdul Hak Md Amin welcomed their appointments and hoped under their leaderships, the maritime industry will overcome its current challenges and come out stronger as well as in revitalising the industry.
"We hope that pressing issues such as the Cabotage Policy, the tax regime, easy access to the maritime fund and human capital development can finally be addressed with their help and intervention, especially with their vast experiences in the government and their relationship with the authorities," he told Bernama.
Addressing analysts' concerns on political appointees, Abdul Hak said their presence will bring an added advantage to the industry as the industry needs stronger voices in order to be heard.
"I am aware that there are some concerns on political appointments raised by various parties, however, despite that, the corporate sector has to adhere to the rules like good governance, fiduciary responsibilities, among others. As far as it concerns, corporate changes are a continuous process in any organisation and for me, as long as the rules are being followed and guided by responsible members of the board, I don’t see any issue with these changes," he explained.
The appointments are timely as the progress of the Malaysia Shipping Master Plan seems lagging, especially the shipping fund, which is long overdue and needs to be looked into with urgency to help the local players survive and for the shipping industry to flourish in tandem with other industries in Malaysia.
Under the plan, RM3 billion in soft loans were allocated under the Maritime Development Fund through Bank Pembangunan Malaysia, to help the industry grow, however, industry players are still unable to access the fund.
"These issues have been going on far too long and unless the government address the issues soon, we will see a stalemate in our maritime industry, shipping companies need to plan for long term development and capital expenditures are huge and in order to expand like buying new ships or investment in human capital, we need to have industry-friendly policies and importantly must be consistent," Abdul Hak said.
The industry expected the corporate tax for shipping companies to continue to be waived beyond 2020 and coupled with the reinstatement of cabotage policy, it will allow shipping companies to plan for their future capital investment.
These incentives will also ensure shipowners keep their ships in the Malaysian flag and also bring back their tonnages into the country’s registry.
Emphasizing that the timing to solve the issues could not be more fitting, as all industries including maritime industry are suffering from double whammy, namely the COVID-19 pandemic as well as low oil prices.
"We have not seen this before and unprecedented and it was difficult to keep ourselves afloat, but I lauded the government as it has done tremendous effort with the stimulus packages and the moratoriums," he added.
Commenting on the outlook for the industry, the shipping industry he said, has been hit hard by the pandemic coupled by the low oil price with the freight has fallen quite a lot across the board.
National Oil Company, Petroliam Nasional Bhd (Petronas) has announced a 25 per cent cut in its capital expenditure and it will affect the upstream players.
"The first half of 2020 looked very challenging for most shipowners, however, anticipation for the full year performance, we are still collecting feedback from our members," he said, but with the easing of the lockdowns in most countries, there will be an improvement in the second half of 2020, although returning to normalcy is still far-fetched.
"We hope the upward trend of the crude oil price will continue to the level before the crisis and with the higher oil price, the offshore activities will be reactivated and the demand for the support services will improve," he said.
-- BERNAMA
