Cabotage policy stays, investments not affected, says Wee

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A Malaysian vessel capable of carrying out undersea cable repairs.

PETALING JAYA: The Cabinet has decided to maintain the revocation of the cabotage exemption policy, says transport minister Wee Ka Siong.

In a parliamentary reply to Lim Guan Eng (PH-Bagan), Wee maintained that the government’s decision had not deterred the inflow of foreign investments in the digital industry, citing over RM40 billion in digital investments recorded in 2021.

This included RM3.4 billion in digital projects approved by the national committee on investment (NCI) and other projects worth RM39.6 billion which have been approved in principle but have yet to complete the formality of getting the NCI’s green light.

Wee said there were other potential digital investments being discussed with Putrajaya, comprising digital infrastructure and technology projects.

“This proves that the implementation of the cabotage policy in Malaysia did not hinder foreign investors in the digital industry.

“For your information, the Cabinet had in October 2021 agreed to maintain the cancellation of the cabotage exemption for foreign vessels performing undersea cable repair jobs,” he said in his written reply.

He said foreign vessels had still been allowed to perform undersea cable repairs, pointing out that applications for a domestic shipping licence (DSL) for these vessels were approved within three days.

The Pakatan Harapan government had approved the cabotage exemption which allowed foreign vessels to perform undersea repair jobs off the Malaysian coast.

However, in November 2020, the transport minister revoked this exemption for submarine cable repair and dismissed claims that it would affect investments.

In April last year, then Malaysia Digital Economy Corporation (MDEC) chairman Rais Hussin warned that the revocation of the cabotage exemption might scare off potential investors.

Wee and Lim had also held a debate on the issue on national television.

Lim, the newly appointed DAP national chairman, had previously urged Prime Minister Ismail Sabri Yaakob to reinstate the cabotage exemption to encourage high-tech digital companies like Facebook and Google to return to Malaysia.

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