KUANTAN: Kuantan Port on Malaysia’s east coast has grown from a minor berth into an increasingly important trading hub, connecting the country with East Asian markets, reported Xinhua.
Having been previously sidelined unlike the major ports along the country’s west coast facing the Malacca Straits, the port has grown into prominence as it is now being connected to the Malaysia-China Kuantan Industrial Park (MCKIP) and will be connected to the East Coast Rail Link (ECRL), Malaysia’s mega rail project being built by China Communications Construction Company (CCCC).
In a recent interview, Kuantan Port Chief Executive Officer Vino Kumar Selvabalakrishnan told Xinhua that greater interconnectivity with the MCKIP industrial hubs and the ECRL has allowed the port to tap into the booming East Asian markets, where Malaysian commodities and manufactured goods are in high demand.
Commenting on the expansion and modernisation of the port, Vino Kumar said the deepwater terminal being built for the port would greatly enhance commerce by allowing larger ships with a deeper draft to dock at the port.
Vino Kumar had been to Ningbo in east China’s Zhejiang province. He had seen the Chinese shipping industry firsthand and stressed the importance ports have on stimulating economic growth, citing China’s construction of massive ports that had opened up access to its markets and allowed Chinese manufactured products to be shipped to the global market.
He added that Malaysia would benefit greatly from such an approach.
The MCKIP is a key Belt and Road cooperation project and a demonstration base for cross-border industrial capacity cooperation. The MCKIP, together with the China-Malaysia Qinzhou Industrial Park situated in China’s southern Guangxi Zhuang Autonomous Region, has set an innovative example of bilateral economic cooperation under the model of “Two Countries, Twin Parks.” – Bernama
KUALA LUMPUR: The Malaysia China Kuantan Industrial Park (MCKIP) has celebrated its 10th year of establishment by introducing the Kuantan Port-Beibu Gulf Port-Sichuan-ChongQing multimodal transport route with IJM Corp Bhd’s Kuantan Port.
This year marks a decade of the industrial park’s establishment that mainly facilitated the collaboration between Malaysia and China through leading industrial hubs in the east coast region and attracting investments from various industries.
The event witnessed the gathering of Malaysian and Chinese government and business stakeholders with a series of activities at the “Year of Investing in China” or Embracing Asean programme in MCKIP and Kuantan Port.
The delegates were also brought on a site visit to Kuantan Port’s new deep water terminal and MCKIP show gallery.
The Kuantan new international land-sea trade channel was launched by Transport Minister Anthony Loke and the secretary of CPC Guangxi Zhuang Autonomous Regional Committee.
MCKIP chairman and IJM group chief executive officer Lee Chun Fai said MCKIP was established to revitalise the industrialisation of the east coast economic region.
“Fast forward to today, MCKIP has emerged as a leading industrial hub in the region – driving the development of new industries, attracting global investments and creating job opportunities for the local community.
“A Belt Road Initiative success story, MCKIP’s 10th anniversary milestone is not just a celebration of its growth and success, but also a testament to the successful cooperation between Malaysia and China, creating a pathway for future investments and economic development in the region,” he said.
Lee believes that MCKIP and Kuantan Port will be able to play its role in implementing the consensus reached by the leaders of both countries to enhance the relations by generating more economic opportunities, improve bilateral trade and investment relations.
MCKIP is a joint venture between a Malaysian consortium led by IJM and a Chinese consortium led by Guangxi Beibu, a state-owned logistics company.
Launched in 2013, MCKIP and China-Malaysia Qinzhou Industrial Park (CMQIP), are the first sister parks in different countries, creating a new model of “Two Countries, Twin Parks” bilateral investment cooperation.
An important component of the BRI, the sister parks are intended to drive the development of industrial clusters, enhance the regional supply chain management and optimise the flow of trade and investment which runs between Malaysia and China that is connected via the sister ports of Kuantan Port and Qinzhou Port.
Spanning over 3,500 acres, MCKIP 1 and 2 are fully taken up and has attracted heavy and medium industries such as steel and non-ferrous metals, high-end equipment and advanced materials manufacturing.
MCKIP has realised RM14.55 billion in investments and RM15.45 billion more has been committed.
IJM sealed a strategic partnership with China Harbour Engineering Company for the development of the Malaysia-China Kuantan International Logistics Park (MCKILP) in MCKIP 3 – an integrated mixed development and logistics hub on a 640-acre site in MCKIP in July 2022.
MCKILP aims to attract foreign direct investment of up to US$4 billion, create 20,000 jobs and churn out an annual production value of up to US$3 billion from investors.
“Kuantan provides an opportunity to shift investment from the more crowded and more expensive West Coast to the cheaper, more accommodating East Coast, which is perfectly positioned for doing business with the Far East.”
Kuantan Port is one of the largest ports on the east coast of Malaysia. Could you give us an overview of the Port?
Kuantan Port is a multi-purpose port facing the South China Sea, which is the fastest shipping route between Malaysia and China. As the port operator, Kuantan Port is 60% owned by publicly listed IJM Corporation, and 40% by Beibu Gulf Port Group, a China state-owned enterprise. The port is well connected not only by rail, road and air, but we also benefit from dedicated industrial areas: Covering more than 3,000 acres of land, the MCKIP (Malaysia-China Kuantan Industrial Park) is the first such park jointly developed by Malaysia and China. Malaysia Consortium holds majority equity of 51% in MCKIP, while China Consortium owns the remaining 49%. Five km away from Kuantan Port we also have access to the Gebeng Industrial Park, which hosts a cluster of chemical players.
In 2022, Kuantan Port received its deepest and heaviest vessel. Can you tell us about the expansions undergone by the Port?
Kuantan Port has two terminals, Kuantan Port 1 and the NDWT (New Deep-Water Terminal). Over the years, we have increased the berths and their draught, which has enabled us to receive supersize vessels of up to 16.5 m draught. In October 2022, we welcomed at NDWT the deepest and heaviest vessel ever to call at Kuantan Port, with a 16.4 m draught and a capacity of 180,000 tons.
Could you elaborate on the opportunities for increasing containerization at the Port?
Currently, 90% of our business is not containerized, of which about 40% is represented by dry bulk, and the remaining is liquid. The revenue stream for liquid bulk is slow and yields low margins. But Kuantan has great potential for containerization by leveraging our captive market here in Malaysia, where raw materials are imported and finished goods are exported. More than 50% of finished products are transported via containers.
A deeper, larger port, with larger cranes and higher productivity, will translate to lower freight rates and benefits for clients. As part of our Phase 2 development within the port, we want to build a new, deeper container terminal for finished goods. We are in touch with a Middle Eastern company that would like to do a feasibility on the role of Kuantan Port in connecting the subcontinent with the Middle East and East Africa, across the Indian Ocean. They are particularly looking at the food supply chain. Malaysia is blessed with a tropical climate propitious for agriculture, especially in Pahang. We joke that, if you leave a mango in the backyard, you will discover a fully-grown mango tree months later. Japanese, Chinese, and European investors are all exploring Southeast Asia as a spot for agriculture in a bid to create more security in the global food supply chain, in line with new regulations around GMOs.
Why is it important for Kuantan Port to diversify?
With close to 50% of our business linked to Chinese trade, the lockdown impacted our operations. “When China sneezes, we catch a cold.” Today, Kuantan Port offers liquid, dry bulk, and containers for different types of chemicals, minerals, and consumables. On the imports side, we mostly receive iron ore and coal from Australia. What we are missing is a gas platform. In the area of new fuels, we have been looking at opportunities for a bio-methanol platform together with Romanian investors.
What are the main advantages offered by Kuantan Port?
One of the main advantages of Kuantan Port is the availability of space together with lower labor costs. Whereas there are over 8 million people living in the Klang area where the country’s biggest port is found, there are only a few hundred thousand people in Kuantan. Therefore, Kuantan provides an opportunity to shift investment from the more crowded and more expensive West Coast to the cheaper, more accommodating East Coast, which is also perfectly positioned for doing business with the Far East. What our clients will find at Kuantan Port is a very capable team, ready to offer flexibility and tailored services, including on-dock depot and maintenance for containers, speed gates for the dry bulk, as well as enhanced security, both physical and IT, for all customers.