THE newly-formed Labuan Economic Sector Coalition (LESC) has expressed grave concerns on the prospects facing Labuan due to the unfair application of new standard operating procedure (SOP) requirements to contain the COVID-19 pandemic.
This has led to shipping firms and related major economic sectors to slow down or completely halt their activities on the island, according to the coalition which is made up of various associations and business organisations.
This is despite the fact that Labuan is first among territories and states in Malaysia to have fully-vaccinated over 80% of its population and achieved herd immunity.
The coalition’s lead facilitator Daniel Doughty said import and export difficulties in Labuan started on July 16 when all visiting local and foreign ships were required to stay in quarantine for a minimum of 14 days to a maximum of 21 days.
As a result, parts and machinery supplies as well as oil and gas (O&G) production are affected, while ship yards are burdened with losses of contracts and delay penalties.
“Merchant ships have shown reluctance to visit Labuan to avoid paying substantial charges triggered by a prolonged stay at the port due to the quarantine rule,” Doughty pointed out.
“The new SOP has also disrupted the supply chain security for more than three weeks despite marine transportation being included in the essential services by the National Security Council (MKN).”
LESC’s members include the Labuan Freight Forwarder Association, Sabah Shipping Agent Association, Malaysia Offshore Support Vessels Owners Association (MOSVA), Malaysia Shipowners’ Association (MASA), Petronas, Labuan Shipyard & Engineering, Megah Port Management, Asian Supply Base, Sabah Flour & Feed Mills and Antara Steel.
Thus far, appeals to the District Disaster Management Committee (JPBD Labuan) and Federal Territory Ministry by various parties have been left unresolved with shipping SOP requirements that were updated not been favourable despite Labuan successfully moving on to Phase 3 of the National Recovery Plan due to its splendid record in managing COVID-19.
“All of this disappointment and frustration can be easily solved if JPBD Labuan is willing to have a dialogue with the stakeholders and formulate a winning SOP for all parties, and also recognise that we cannot expect to have an SOP to fit all types of business operations,” lamented Daniel.
Meanwhile, MASA representative James Ong questioned why Port Klang was not subject to similarly applied SOP requirements despite being located in Selangor which is still under Phase 1 of the National Recovery Plan.
“The stringent SOPs currently in place would have been necessary when Labuan was still deep in the pandemic two to three months ago. However, Labuan’s situation has greatly improved thus the introduction of these SOPs are outdated,” he added.
Megah Port Management managing director Tan Sri Mohd Bakri Mohd Zinin echoed MASA’s dismay on the discrimination against Labuan by warning that if the Government did not take action quickly, Labuan’s O&G sector could come to a grinding halt.
“Vessels with Labuan-consigned containers have shown reluctance to make a stop at Labuan and have chosen instead to discharge their cargo at the nearest ports such as Sandakan and Kota Kinabalu,”
“There, they are able to get port health clearance to dock without quarantine as well. Some shipping firms have even decided to halt their activities here because of the unfair Labuan condition.” – Aug 12, 2021
