Cabotage issue: Ministers instructed to deliberate impact on digital investments and shipping industry

The Cabinet raised the issue of the cabotage policy exemption for submarine cable repairs in its meeting earlier today, said Science, Technology and Innovation Minister Khairy Jamaluddin.

He said several ministers including himself have been instructed to deliberate on the impact that the cabotage policy exemption would have on digital investments and the local shipping industry

“We are to report back in two weeks with recommendations,” Khairy said in a tweet.

The others include the international trade and industry minister, finance minister, communications and multimedia minister, transport minister, minister in charge of the economic planning unit, and entrepreneur development and cooperatives minister.

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The repeal of the cabotage exemption, finalised on November 18 last year, has been blamed as the main reason why Malaysia was excluded from a joint megaproject by tech giants Facebook and Google to construct two underwater cables to increase Internet connectivity between Singapore, Indonesia and North America.

Transport Minister Datuk Seri Wee Ka Siong defended the repeal as necessary to reduce the outflow of foreign currency through freight charges, and to reduce dependencies on foreign vessels by promoting participation from local shipping industry, among others.

This was met with criticism by other MPs, most notably during a Dewan Rakyat session on November 25, 2020, when his predecessor Anthony Loke and former communications and multimedia minister Gobind Singh Deo argued against his rationale.

The heated debate saw Loke saying that the repeal of the exemption will have detrimental effects and result in a loss of confidence among investors, as the exemption would not have just benefited a handful of companies but the entire nation as well.

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Gobind reminded Wee that faulty cable highlight repairs take an average of 27 days to complete, indicating that Malaysia faces problems when it comes to conducting undersea cable repairs.

He added the cabotage exemption was decided upon by the former Pakatan Harapan administration after requests were made by tech giants to resolve the issue.  — Malay Mail

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