KOTA KINABALU (July 5): The sudden imposition of port congestion surcharge by shipping companies for containers imported into Kota Kinabalu has incurred the displeasure of the business community.
A shipping company has announced an increase of the Kota Kinabalu Port congestion surcharge from RM500 for a 20-foot container and RM1,000 for a 40-foot container, effective from July 15, 2024.
The reason given is that the continuous congestion at the Kota Kinabalu Port has caused serious delays in ship turnaround time, affecting the shipping schedule, and thus causing a significant increase in operating costs.
Criticising the move, president of the Kota Kinabalu Chinese Chamber of Commerce and Industry (KKCCCI), Datuk Michael Lui, described it as incredible and unreasonable.
He said these new surcharges are expected to have a significant impact on shipping costs for businesses operating in and around Kota Kinabalu. Lui questioned the shipping company on what standards it based on to implement the surcharge, and it was absolutely unfair to the importers to directly borne the costs!
“We believe that the government should intervene immediately to see whether the shipping company has obtained the government’s approval to implement the port congestion surcharge to clear up everyone’s confusion. What is even more infuriating is that the port congestion is clearly an efficiency issue of the Sabah Port Authority, so why do shipping companies insist on asking us, the industry players to pay for it?”
Lui met up with the relevant business players at a dialogue to discuss the port congestion surcharge at KKCCCI premises in the morning today.
He said that the relevant authorities including the Sabah Port Authority did not take prompt measures to solve the container congestion problem that has been dragging on for some time.
“The issue has been unresolved until now, which has severely hit and affected the daily operations of business community, importers and exporters, resulting in the shipping company now daring to privately announce the implementation of the port congestion surcharge, which will be borne by importers and causing heavier operating losses! If the port management does not improve the problem, the situation will definitely be even more unimaginable,” he said in a statement today.
Lui further stated that attention must be given to the chain effect of the port congestion surcharge, and the final victim will be the consumers.
“The Sabah Port Authority must recognize that the current poor port conditions have brought quite serious efficiency problems and directly caused huge losses to business community. If we continue to take no active action, it will be useless,” he said.
KKCCCI calls on the Sabah Port Authority to arrange for all parties to sit down face to face to find the root cause of the problem and the solution as soon as possible.
“We hope that the relevant authorities will seriously explore improving the port efficiency, solving the problems of the industry and reducing the operation cost, so as to strengthen our international competitiveness.”
The Association of Frozen Meat and Food Importers of Sabah also expressed deep concern over the new surcharge.
Its chairman, Lim Young Peing, said as stakeholders in the frozen food industry, they find these surcharges costly to their operational expenses and adds undue burden to all whose livelihoods also depend on this business.
“Furthermore, this will eventually trickle down to the consumers and will exacerbate the inflationary pressures which the government is trying very hard to contain.
“Rather than passing on the cost we hope that the shipping lines will find ways to reduce cost and improve efficiencies,” he said in a statement today.
Lim said they were also surprised by the simultaneous announcements by the various shipping lines and cannot help but feel that there may be an indication of anti-competitive behaviour.
“These heavy handed imposition of surcharges raises serious concerns about fair trade practices within the shipping industry serving Sabah. We urge the relevant authorities, including the Sabah Ports Authority, the Malaysian Competition Commission and the Sabah State Government to intervene and investigate this matter thoroughly,” he said.
He added it is imperative to the benefit of all Sabahans that shipping companies operate in a fair and competitive environment, where costs are justified and transparent to all stakeholders. The Association of Frozen Meat and Food Importers Sabah remains committed to working constructively with all parties to resolve these issues and ensure that the industry can continue to serve the people of Sabah effectively and affordably.
Reference : https://www.theborneopost.com/2024/07/05/kk-port-congestion-surcharge-increased/