Still too early to determine impact of Malacca port on Singapore’s economy: Josephine Teo

Still too early to determine impact of Malacca port on Singapore’s economy: Josephine Teo

Singapore must, however, not be complacent and ensure that its port remains competitive, says Senior Minister of State for Transport Josephine Teo.

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SINGAPORE: As the expansion of the Kuala Linggi International Port (KLIP) in Malacca will only be completed within the next decade, it is “still too early” to determine its exact impact on Singapore’s economy, said Senior Minister of State for Transport Josephine Teo on Monday (Jan 9).

Speaking in Parliament in response to a question from Member of Parliament for Bishan-Toa Payoh GRC Saktiandi Supaat, she said the Government will closely monitor KLIP and other regional developments, and take further measures as necessary to retain a competitive edge.

The port, built at a cost of RM12.5 billion (S$4 billion), will offer storage, repair and refuelling services. Using 620 acres of reclaimed land, KLIP launched the construction of a port with 1.5 million cubic metres of oil storage capacity and dry docks to handle the biggest of oil tankers, hoping for completion within a decade.

Mrs Teo said the Government’s preliminary assessment is that KLIP’s planned oil storage capacity of 1.5 million cubic metres is small relative to Singapore’s current capacity of 20.5 million cubic metres. “In addition, our position as a regional bunkering and oil storage hub is anchored by a strong ecosystem of oil refineries and oil traders, and by the high volume of ships calling at Singapore for various services,” said Mrs Teo.

Furthermore, as KLIP’s expansion does not appear to include facilities for the container handling business, the expansion should have “minimal impact” on Singapore’s container transhipment port.

Nonetheless, she said Mr Saktiandi’s question is a “timely reminder” that Singapore must not be complacent, and ensure that its port remains competitive.

Outlining some of the Government’s efforts in doing so, she said it has been and will continue to invest in technology at the port to better meet the needs of the shipping industry. The Maritime and Port Authority of Singapore also regularly surveys shipping companies in order to identify and address any shortcomings.

Significant investments are also being made in manpower and a next-generation port is being developed at Tuas.

Mrs Teo added that all the Government’s activities and “significant investments”’ it is making are geared towards ensuring that commercially, the calculations of shipping companies will be tilted in favour of Singapore.

She said: “The shipping companies are always driven firstly by commercial considerations. They are not going to call on our port because of altruism or because they like us.

“So the first thing we must do is to ensure that the product we offer to them meets their requirements and allows them to make a better goal of the commercial considerations than if they were to call at other ports.”

Source: CNA/lc