Malaysia Needs a Comprehensive Policy for Airports and Seaports Development

The recent statement by the Transport Minister that the federal government has no immediate plans for a national policy on airport and seaport development raises significant concerns. It highlights the lack of direction and urgency in addressing Malaysia’s long-term infrastructure needs. This gap has far-reaching implications, not only for the transport and logistics sectors but also for the nation’s economic resilience and competitiveness.

The Case for a National Airports Strategic Plan (NASP)

The National Airports Strategic Plan (NASP) was envisioned to provide a structured framework for the development of Malaysia’s airport infrastructure, taking into account factors such as economic growth, population trends, trade, tourism, safety, and environmental sustainability. However, the study on NASP seems stalled, with no clear progress or outcomes nearly a year past its expected completion.

Without a cohesive policy, the industry faces policy gaps, overlapping roles, and conflicting objectives, especially when the government acts as both policymaker and shareholder, as seen in Malaysia Airports Holdings Berhad (MAHB). If MAHB is privatised , these governance and institutional issues could worsen without proper regulatory frameworks.

A robust NASP is crucial to developing an economically sustainable civil aviation sector. It would support Malaysia’s ambitions to become a top destination for global economic activity and foster a competitive environment for airlines and airport operators.

Linking Airports and Seaports to Trade

Airports and seaports are critical gateways for Malaysia’s trade and economic activity. Unfortunately, more than 15% of Malaysia’s total exports, amounting to USD 48.09 billion in 2023, are routed through Singapore, highlighting inefficiencies in our logistics and trade systems.

The Kedah Aerotropolis project and the proposed port in Sanglang, Kubang Pasu, present opportunities to enhance Malaysia’s logistics capabilities. Similarly, the RM2 billion container port in Port Dickson is a positive step. However, such projects require careful coordination and alignment with national objectives to maximise their economic impact.

Addressing Bottlenecks and Improving Connectivity

While Malaysia has a reasonably comprehensive logistics infrastructure, several challenges remain:

• Institutional and Regulatory Mismatches: Lack of clear policies and coordination among ministries creates inefficiencies.

• Hinterland Connectivity: Poor connectivity between industrial zones and ports hampers cargo movement.

• Low-Value Chain Activities: Malaysia must move up the value chain in logistics and trade-related services.

• Skilled Manpower: Addressing the shortage of skilled workers is essential for long-term sector growth.

Reducing border bottlenecks, enhancing connectivity to seaports and airports, and integrating hinterland logistics into a cohesive national strategy will significantly boost Malaysia’s trade competitiveness.

Balancing Priorities with Clarity

The Transport Ministry’s stance on public transport projects, citing difficulties in achieving swift returns on investment, reflects a short-term outlook. Projects like the East Coast Rail Link (ECRL) and Kedah Aerotropolis require long-term perspectives, focusing on their potential to stimulate economic growth and regional development.

The aspiration to be among the top 30 global economies under the MADANI Economy framework necessitates clarity and commitment. Politics must not interfere with the strategic development of airports and seaports. Instead, we must prioritize sustainable, economically viable projects that align with national objectives.

Moving Forward

To achieve this, Malaysia must:

1. Develop a Holistic National Policy: A comprehensive policy should integrate airport and seaport development with trade, logistics, and economic goals.

2. Ensure Regulatory Independence: Policymaking must be independent and focused on the sector’s long-term benefits, not short-term political gains.

3. Invest in Connectivity: Enhance hinterland logistics and reduce bottlenecks to streamline cargo movement.

4. Foster Collaboration: Encourage private sector involvement while ensuring projects align with national priorities.

5. Focus on Human Capital Development: Build a skilled workforce to support the logistics and aviation industries.

The urgency for a comprehensive policy cannot be overstated. Malaysia’s economic wellbeing depends on its ability to modernise and optimise its logistics and transportation infrastructure. With clear direction and strong commitment, we can position ourselves as a leader in regional trade and logistics, paving the way for sustainable growth.

What say you?