MALAYSIA

SHIPPING 2017to
MASTER PLAN 2022
Revitalizing Shipping for a Stronger Economy
 MALAYSIA
SHIPPING 2017to
MASTER PLAN 2022
Revitalizing Shipping for a Stronger Economy
 This Malaysia Shipping
Master Plan covers all
the various ingredients
that make for a
successful shipping
industry from the actual
vessels that carry the
trade, the employment
and development of
Malaysian seafarers
and maritime human
capital, ship financing,
business and regulatory
environment, and the
provision of ancillary
services.

YB. Dato’ Sri Liow Tiong Lai

iv
Message from Minister of Transport
It is a special privilege to me to provide this Much has been invested in developing this plan and I am
message to mark the launching of the Malaysia confident that stakeholders in the Malaysian shipping sector
Shipping Master Plan. As part of our mandate at will benefit much by adhering to the initiatives and timelines
the Ministry of Transport, it is important that major contained in it. This is important as shipping contributes much
sectors of the transport industry, of which shipping is to the development of the nation and is a critical component
one, are addressed in a manner that will enhance of its economic and commercial make-up. Malaysia’s future as
their operations for the betterment of the people a maritime nation will depend much on following the guidelines
and the interests of the nation. This shipping master in this master plan and implementing them in a timely and
plan is a major initiative of the ministry aimed at consistent manner.
ensuring that the industry is focused on developing
itself as well as has a road map that will guide it for Together with Malaysia’s involvement in national, regional,
the next five years and beyond. and international maritime initiatives and organizations such as
the International Maritime Organization, this MSMP is a major
Malaysia’s shipping industry is well-rooted in history component in keeping Malaysia’s shipping industry at the
and can be traced to the early days when it forefront in contributing to the nation’s interests and promoting
facilitated much of the regional and international our engagement with the international community. The shipping
trade. Since then the industry has grown and industry must thus continue to operate in a way that is viable
contributed significantly to the development of the and efficient to ensure that its cornerstone role in promoting
nation. However, such growth has been sporadic Malaysia’s trade and economic fundamentals remain strong,
and incidental and a strong master plan for the competitive, and dynamic.
industry is what is needed to ensure consistent and
robust development that encapsulates all aspects I welcome the publication of this Malaysia Shipping Master
of the industry. This Malaysia Shipping Master Plan and am confident that it will serve as a valuable tool and
Plan covers all the various ingredients that make guidance for those involved in this industry which is of such
for a successful shipping industry from the actual importance to the nation.
vessels that carry the trade, the employment
and development of Malaysian seafarers and
maritime human capital, ship financing, business
and regulatory environment, and the provision of
ancillary services. Dato’ Sri Liow Tiong Lai

v
 The Malaysian
government is committed
to strengthen Malaysia’s
position in the maritime
domain with its shipping
and integrated logistics
sector playing a critical
role in the overall
development of the
nation.

YBhg. Datuk Seri Hj. Saripuddin

B Hj. Kasim

vi
Foreword | Secretary General Ministry of Transport
The Malaysia Shipping Master Plan is another effort financing issues, ease the business and regulatory environment,
by the Ministry of Transport to strengthen and and strengthen ancillary services. The programme also includes
revitalise the Malaysian shipping industry to meet an implementation plan for activities and measurable targets
the challenges of the future. I am pleased that to be achieved by working groups to be led by the Marine
all the relevant stakeholders have contributed to Department Malaysia with MIMA as the secretariat.
this initiative as it will make it all the more relevant
to their needs as well as facilitate its effective The MSMP will facilitate the Ministry of Transport in particular
implementation. and the government in general in keeping track of progress in
developing the industry as well as flag key issues that may hinder
The Malaysian government is committed to its success and sustainability. This will also aid in effecting timely
strengthen Malaysia’s position in the maritime interventions by the government and industry players to ensure
domain with its shipping and integrated logistics that our investments in this important endeavour will not just
sector playing a critical role in the overall enable us to weather the vagaries of the industry but instead
development of the nation. This MSMP will go provide maximum returns for the nation.
a long way in assisting the co-ordinated and
integrated development of the industry which is The Ministry of Transport and its related agencies will continue
especially important given the open nature of the to proactively manage this important sector and facilitate its
Malaysian economy and its heavy dependence long-term viability and sustainability. I am pleased that major
on foreign trade. timelines, benchmarks, and targets have been included in this
plan as it will facilitate its implementation and effectiveness.
The thrust of this policy is to provide the framework
and targets that would aid the shipping industry in I would like to thank the Maritime Institute of Malaysia, the
supporting and complementing the trading sectors Malaysia Shipowners’ Association, Marine Department Malaysia
of the Malaysian economy. Much thought and and all individuals and organizations that have contributed
inputs have gone into this master plan beginning towards the realization of this shipping master plan. I am sure
with the organisation of the National Shipping many will benefit from this work as we seek to promote and
Conference in March 2015 by the Maritime strengthen this sector that is such a critical component of the
Institute of Malaysia. Since then, various meetings nation’s infrastructure.
and workshops were held to formulate strategies
to revitalize the shipping sector. The 5-year work
programme in this plan seeks to enhance the
utilisation and employment of Malaysian vessels,
promote the employment and development of
Datuk Seri Hj. Saripuddin B Hj. Kasim
Malaysian maritime human capital, address ship

vii
viii
Acknowledgement

The Ministry of Transport Malaysia places on record its appreciation to

all those who contributed directly or indirectly to the production of
this Malaysia Shipping Master Plan. Among them are the Marine
Department Malaysia, Malaysia Shipowners’ Association, Ikhtisas
Kelautan Malaysia, the various Malaysian port authorities, and
all individuals and organizations whose active participation,
inputs, and suggestions were instrumental in this initiative
to revitalize and strengthen the Malaysian shipping
industry. The Ministry also acknowledges
the contribution of the Maritime
Institute of Malaysia in facilitating the
development of this shipping master
plan.

ix
WHAT’S INSIDE
MALAYSIA
SHIPPING 2017to
MASTER PLAN 2022
Revitalizing Shipping for a Stronger Economy

06 Chapter 1

02 Executive The Malaysian Shipping Industry

Summary
18 Chapter 2
Developing a Shipping Master Plan
24 Chapter 3
Opportunities Beyond 2020 44 Chapter 5
Creating Synergy

30 Chapter 4
Laying the Foundation for the Future 48 Chapter 6
Conclusion
Executive Summary

The Malaysian shipping industry is in decline with the steady At the conclusion of the workshops, it was agreed
reduction in Malaysian shipping tonnage and an increasing that the revival of the National Shipping Council
number of shipping businesses in distress. The Malaysia would be the first step towards ensuring that the
Shipowners’ Association (MASA) has attributed this to the weak Malaysia Shipping Master Plan and other action
global shipping market while the lack of emphasis on fiscal and plans and targets are implemented and their
legislative measures to mitigate domestic shipping vulnerabilities progress monitored.
has exacerbated the situation. This has contributed to a
continuation of the nation’s balance of payment deficit, as The industry workshops also concluded a strategy
Malaysian shippers increasingly depend on foreign ships while to put in place conditions necessary to enable
Malaysian ships reflag to other jurisdictions, and its seafarers the Malaysian shipping industry to become
and maritime human resources move elsewhere. This has major more resilient and competitive in the national,
strategic and security implications for Malaysia. regional, and global context, and thus continue to
contribute positively to national development. This
With the support of the Ministry of Transport Malaysia, Marine would be done by addressing outstanding policy
Department of Malaysia, and Malaysia Shipowners’ Association, issues on Cabotage, Seafarers, Financing, Taxation,
the Maritime Institute of Malaysia (MIMA) organized a national and Maritime Administration. The Malaysia
shipping conference themed “Revitalizing Malaysian Shipping Shipping Master Plan would secure commitment
for a Stronger Economy” on 26 March 2015. Recognizing the from both the government and industry to make
criticality of the shipping industry to the economy and security of necessary changes and adopt new practices to
Malaysia, the conference addressed the policies and strategies re-orient the Malaysian shipping sector towards a
needed to enable it to overcome its vulnerabilities and to thrive more synergistic partnership, aligned with overall
in a competitive environment. The conference concluded that a national transport aspirations.
shipping master plan was urgently needed to improve the state
of Malaysian shipping. The Malaysia Shipping Master Plan will realize the
aspirations of the Malaysian shipping sector to be
Following the conference, eight industry workshops were held to a business service sector that is a major player in
formulate strategies and action plans to address the decline in selected markets and contribute to the well-being
Malaysian shipping and Malaysia’s increasing dependence on of the nation and Malaysians. This will be achieved
foreign ships, seafarers, and services. through the introduction of sustainable measures
aimed at removing competitive disparities and
improving capabilities of Malaysian shipowners,
maritime human resources, and maritime ancillary
services to meet domestic and regional shipping
needs.

02
The Malaysia Shipping Master Plan has five The industry workshops further agreed that the implementation
focus areas each with its targets and a five-year of each focus area will be the responsibility of working groups
implementation plan. The focus areas are: led by the Marine Department Malaysia, and comprise relevant
• Promoting employment of Malaysian ships stakeholder representatives and experts from both government
• Promoting employment of Malaysian and industry. These would include representatives from the
seafarers and maritime human resources Ministry of Transport, Economic Planning Unit (Prime Minister’s
• Facilitating access to capital and financing Department), Ministry of Finance, Ministry of International Trade
• Enhancing Malaysia’s attractiveness to and Industry, Ministry of Human Resources, Ministry of Education,
shipping businesses Ministry of Science, Technology and Innovation, Malaysia
• Promoting innovation in and sustainable Maritime Enforcement Agency, Statistics Department Malaysia,
growth of maritime ancillary services and Bank Negara Malaysia. MIMA will facilitate the working
groups in formulating the action plans, targets, and measures for
The focus areas will be overseen by a governance implementation.
and monitoring mechanism under the Ministry of
Transport Malaysia and supported by the Maritime It is expected that the Malaysia Shipping Master Plan would help
Institute of Malaysia. This will aim to revive the provide the Malaysian shipping industry a level playing field to
National Shipping Council, formulate revised Terms compete successfully in domestic and regional markets. Positive
of Reference and a 5-year work programme for outcomes include the reduction of balance of payment deficit
it, develop a Maritime Transport Database, and attributed to shipping, enhanced creation of employment
introduce benchmarking and review systems. opportunities and revenue for Malaysia, improved transport
security for Malaysian trade, and maritime connectivity.
A governance and implementation monitoring
body is a key success factor to support the shipping The strength of the Malaysian shipping industry is dependent on
sector. Policy directions, monitoring, and reviews continuous support from shippers, a shipping-friendly business
will be undertaken by the National Shipping environment, and an effective coordinating body which is
Council chaired by the Minister of Transport, with supported by timely and accurate data for informed decision-
the Director-General of the Marine Department making to provide sound shipping policy and strategic direction
Malaysia, the Malaysia Shipowners’ Association, and to monitor implementation.
Ikhtisas Kelautan Malaysia (Association of
Malaysia’s Maritime Professionals), industry The Malaysia Shipping Master Plan is the result of extensive industry
members, and federal and state government consultation and is designed to restore conditions that will enable
representatives as council members. The Malaysia the Malaysian shipping industry to achieve full self-sustainability.
Shipping Master Plan, with its action plans and five-
year work programme (2017 – 2022) will provide The Malaysia Shipping Master Plan (2017 – 2022) report explains
the council with a clear direction and terms of in more detail the objectives and strategies for the Malaysian
reference. shipping industry. The following chapters are excerpts from the
report.

03
Chapter 1
The Malaysian Shipping Industry
Chapter 1 | The Malaysian Shipping Industry
What makes the Malaysian shipping industry?
Maritime transport is more than just ships and the provision of shipping services. The Malaysian shipping industry is
supported by and in turn supports other components of the maritime transport chain. Each component plays a role in
determining the efficiency and competitiveness of the Malaysian shipping industry.

Maritime Transport Supply Chain

SHIP 01 02 03 04 05
Building Owning Registration Operation Scrapping

06
07
Financing

Ship building,
ship repair,
marine industries
08 09
10
Classification
Insurance
services (P&I)
Seaferers,
MET Institutions

11
SUPPORT
Port/Terminal
operators

Source: Modified from Hoffman, UNCTAD

06
The Malaysian Fleet

BIGGEST COMPONENT SMALLEST COMPONENT

TOTAL OIL TANKERS CONTAINER VESSELS
MALAYSIAN 9,612,000
2016
FLEET deadweight 3,537,000 221,000
tonnage (DWT) deadweight deadweight
tonnage (DWT) tonnage (DWT)

MALAYSIAN
RANK (Fleet size) 3rd
ASEAN
24th
WORLD

ASEAN Tonnage 2016 (DWT '000)

Indonesia

Malaysia

Philippines

Singapore

Thailand

Vietnam

0 20000 40000 60000 80000 100000 120000 140000

Oil Tanker Bulk Carrier General Cargo Container Other Type

Source: UNCTAD

07
 AVERAGE
FLEET AGE

08
GLOBAL MALAYSIA

YEARS
YEARS

20
16

0
5
10
15
20
25
30
35
Bulk Carrier

Chemical tanker

Container

General cargo

Liquefied gas tanker

Oil tanker

Other liquid tanker

Ferry-pax

Ferry-RoPax

RORO
Chapter 1 | The Malaysian Shipping Industry

Service tug

Offshore vessel

Service vessels
Age distribution of Malaysia's national fleet

Miscellaneous

Source: Marine Department Malaysia

 Malaysian Ship Ownership
120,000,00 60
Deadweight Tonnage

100,000,00 50

80,000,00 40

%
60,000,00 30

40,000,00 20

20,000,00 10

0 0
2012 2013 2014 2015 2016

National flag Foreign flag Foreign flag as % of total ship ownership

Source: UNCTAD, Review of maritime transport reports years 2012 to 2016

United Kingdom 154

Singapore 5819
Panama 500

Large Marshall Islands 767

Vessels Liberia 10
are mostly Indonesia 108
flagged outside
China, Hong Kong SAR 17
Malaysia China 3
Bahamas 103

0 1000 2000 3000 4000 5000 6000 7000

Malaysia (’000 DWT)

SINGAPORE Source: UNCTAD 2015. Merchant fleet by country of beneficial ownership, annual, 2014-2015.
http://unctadstat.unctad.org/wds/TableViewer/tableView.aspx?ReportId=80100.

09
Chapter 1 | The Malaysian Shipping Industry
Decline in national tonnage

Malaysian Fleet Tonnage (By DWT & Types of Ships)

6000
Deadweight Tonnage (’000)

5000

4000

3000

2000

1000

0
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

Oil tankers Bulk carriers General cargo Container ships Other types of ships

Source: UNCTAD

Growth in Malaysian Tonnage (1985 - 2015)

10%

8%

6%

4%

2%

0%

-2%

-4%
Bulk Container General Cargo Oil Tanker Other Vessel

Source: UNCTAD and MIMA Calculations

10
Reliance on foreign ships for specialised trades

LICENCE

4039
VALIDITY
Shipping Licence

MALAYSIAN SHIPS 1
Domestic

2007
2016
YEAR
to

6825
LICENCE
VALIDITY

FOREIGN-FLAGGED
SHIPS
3
MONTHS

Number of ships engaged in domestic shipping

4000

3500

3000

2500

2000

1500

1000

500

0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Malaysian Foreign Source: Source: DSL unit, Ministry of Transport

11
Chapter 1 | The Malaysian Shipping Industry
Specialised trades dominated by foreign ships
Chemical Tankers
25
Number of ships issued DSL

20

15

10

0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Malaysian Foreign

Dry Bulk
25
Number of ships issued DSL

20

15

10

0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Malaysian Foreign

12
 Gas Carriers
20
18
Number of ships issued DSL

16
14
12
10
8
6
4
2
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Malaysian Foreign

Others
250
Number of ships issued DSL

200

150

100

50

0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Malaysian Foreign

13
Chapter 1 | The Malaysian Shipping Industry
Reliance on Foreign Seafarers

Malaysian seafarers vs Foreign seafarers

Annually -

6,000
18000
16000
Foreign
14000 seafarer
12000 Malaysian Certificate of Recognition
seafarer
10000 are issued to foreign seafarers

8000
6000 loss of
4000
2000 RM30 million
outflow per month =
0 loss of opportunities for
Malaysian seafarers :
2010 2011 2012 2013 2014 2015
Jobs & Career advancement
Source: Marine Department Malaysia

Worsening Transport Balance of Payment

Malaysian Fleet 1980-2016

6000 0
5000 -5,000
4000 -10,000

RM’Million
3000 -15,000
2000 -20,000
1000 -25,000
0 -30,000
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

Oil tankers Bulk carriers General cargo Container ship Other types of ship Transport BOP

Sources: (1) UNCTAD; (2) Economic Planning Unit

14
Policy interventions in strategic areas will promote competitiveness and build
resilience in the Malaysian shipping industry.

Market
Governance Access

Manpower
Availability

Malaysian Shipping
Uncompetitive & lacks resilience Support
Services

Fiscal &
Regulatory
Regime
Maritime Access to
Administration Technology

15
Chapter 2
Developing a Shipping Master Plan
Chapter 2 | Developing a Shipping Master Plan
Malaysia Shipping Master Plan Development Process

Malaysia
Shipping
Master Plan
Development
Process

Industry Shipping Conceptual

Workshops Conference Framework
5/2015 3/2015 2012 - 2014

Stakeholder
Draft 0 Engagement Draft 1
6/2015 7 - 10/2015 8/2015

National Action Plan

Implementation Shipping
of MSMP / Roadmap
Council 9 - 10 / 2015
2017 - 2022 2015

18
The concept

VISION OBJECTIVE
To be a sustainable maritime Enhance Malaysia maritime
transport/shipping business service transport/shipping service sector’s market
sector that is a major player in selected share by participating in selected market
markets contributing to the well being of domestic regional and global maritime
of the nation and all Malaysians. transport/shipping services.

20% 30% 75% 90% 100%

Malaysian vessels Malaysian vessels Malaysian vessels Malaysian Vessels Malaysian Vessels
in in Intra-ASEAN in Domestic OSV in Domestic in Port Tugboat
Global Shipping Trade Shipping Services Shipping Operations

Business promoting and engaging

GOVERNMENT financial, legislative policies,
SUPPORT & incentives and governance
POLICY framework.

HUMAN Up-skilling and re-skilling the

CAPITAL / workforce and technology advance
TECHNOLOGY leverage for competitiveness.

ANCILLARY
/ SUPPORT Business attractive environment for
SERVICES ancillary / support services industry.
SECTOR

19
Chapter 2 | Developing a Shipping Master Plan
Industry Workshops

What measures must be put

1
What conditions must exist to in place, taking into account

3
allow Malaysian ships national transport aspirations
engaged in respective trades and the advent of the ASEAN
INDUSTRY to meet the Malaysian
Shipping Master Plan targets?
Single Shipping Market, to
re-focus efforts and priorities
WORKSHOP on domestic and regional
trade?
KEY QUESTIONS

2 4
What strategies should be in
place to create and What are the activities that
maintain the necessary each stakeholder needs to
conditions? undertake to implement the
agreed strategies?

Challenges faced by Malaysian Shipping Industry

General Cargo Other Vessels
All Trades Bulk Container Oil Tanker
(Tugs, Barges) (OSV)
Malaysian shipping Inability of Container Loophole in ship Unattractive Loophole in ship
is affected by less Malaysian tonnage Overcapacity of registry regime and business registry regime,
favourable to meet domestic Malaysian tonnage higher operating environment for unrealistic
economic demand, due to cargo costs (crew, shipping business. prerequisites for
environment and particularly in imbalances finance and Oil tankers are financing,
poor market relation to the moving between taxation) due to choosing to refl�ag mismatch of
conditions. shipping of palm Peninsular fiscal and out of Malaysia. contract tenure,
Prolonged and oil. This supply gap Malaysia, Sabah regulatory regime. Singapore being financing terms
unsolved shortage is being met by and Sarawak. This sector is being the flag of choice. and useful life of
of qualified local foreign vessels. outcompeted by asset, higher
seafarers, coupled foreign ships on operating costs
with increasing price. due to fiscal and
costs of employing regulatory regime
foreign workers and technical
contributes to rising obsolescence.
manning costs. The Client-imposed
need to comply excessive
with international technical
maritime specification
conventions adds requirements also
to operating costs prevent Malaysian
(compliance OSV from trading.
costs). In addition, This sector is being
inadequate local outcompeted by
ancillary support foreign ships (MISR)
services (expertise, on both price and
parts, equipment technical
and yard facilities) specifications.
add to operating
costs and
non-productive
time

20
 Maritime services Ship Financing
Workshop 5 Workshop 6
Maritime welfare & MET
Workshop 4 Malaysia needs to develop local Malaysia needs to
Malaysian seafarers on experts and maritime services to review the shipping
Malaysian ships support Malaysian shipping fund and develop
local ship financing
Malaysian needs a to support Malaysian
Maritime Education & shipping
Training Blueprint

Meeting shippers’
needs INDUSTRY Ship Facilitation
Workshop 3 WORKSHOP Workshop 7

Reliable, efficient & Summary & Maritime administration

cost effective conclusions and port authorities
shipping service need to enhance
partnerships with industry

Strategic market-needs
assessment
Alignment with
Workshops 1 & 2
national transport
Malaysian cargo aspirations
on Malaysian ships Workshop 8
Policies need
to be rationalised.
No subsidies.

21
Chapter 3
Opportunities Beyond 2020
Chapter 3 | Opportunities Beyond 2020
Importance of shipping to Malaysia
Shipping is a significant contributor to the Malaysian economy. In 2016, total trade was RM1.48 trillion. 98.4% of Malaysian
trade is carried by sea.

Total Trade

RM 1.48
2016
Shipping is a trillion
Significant Contributor
to the Malaysian
Economy 98.4%
carried by sea

24
 Total Trade
1,600,000
1,400,000
1,200,000
RM Million

1,000,000
800,000 Total
Trade
600,000
400,000
200,000
0
1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016

Source: Economic Planning Unit

Total Freight Tonnes ('000) 568214

539205
506170
495775
494540
445211

Total (’000)
Freight Tonnes

2010 2011 2012 2013 2014 2015

Source: UNCTAD, Review of maritime transport reports years 2012 to 2016

25
Chapter 3 | Opportunities Beyond 2020
Malaysian shipping also supports a multitude of ancillary services and support industries. The ship building and ship
repair industry, maritime legal services, and ports rely on the well-being of the shipping industry to flourish.

Malaysian Shipping Industry

MARITIME TRANSPORT ANCILLARY & AUTHORITY &
IMPORTS / EXPORTS
SERVICE SECTOR SUPPORT INDUSTRY REGULATORY

Shipbuilding & Repair

Maritime Education
& Training
Charterer
Insurance Ministry of Transport
Malaysia Ship Broker Marine Department
Manufacturing Registered Communication Ministry of Finance
Oil & Gas Ship Owning, Maritime Association Ministry of International
Trade & Industry
Agriculture Managing & Ports
Ministry of Defence
Commodities Operating Maritime Legal
Malaysia Investment
Companies Information Technology
Development Authority
Survey & Mapping
Ministry of Home Affairs
Maritime Security
Ship Finance
Marine Salvage
Storage & Husbandry

Direct Indirect
Employment Employment Revenue

26
The Eleventh Malaysia Plan (11MP) covering economy, regionally and globally integrated post-2020” and that
the period 2016 to 2020 addressed the issue of “[a]s the People’s Republic of China and India prosper further,
Malaysia’s development beyond 2020. In its profile coupled with their large and growing affluent middle class, they
of Malaysia beyond 2020, it projected Malaysia’s will become major markets for Malaysian goods and services.”
gross domestic product (GDP) to increase to ASEAN is expected to be “the linchpin for Malaysian businesses
RM2.6 trillion by 2030 from RM1.4 trillion in 2020. to go global”. This is because “[i]mproved connectivity with
Malaysia’s GDP per capita is projected to double ASEAN members will boost investment, trade, and tourism as well
to RM117,260 in 2030 compared to RM54,890 in as cross-border movement of talent”.
2020.
These projections are in line with that of the Third IMO Greenhouse
With world exports expected to increase from Gas Study 2014 (GHG3) which forecasts that demand for
USD25 trillion in 2020 to USD44 trillion in 2030, the shipping is expected to double in 2030 from that of 2020 and
11MP states that Malaysia “will remain an open again in 2050.

27
Chapter 3 | Opportunities Beyond 2020

200,000

180,000
Transportwork (109 tonne miles yr1)

160,000
non-coal bulk dry SSP1
140,000
non-coal bulk dry SSP2
120,000 non-coal bulk dry SSP3
non-coal bulk dry SSP4
100,000 non-coal bulk dry SSP5
unitized cargo SSP1
80,000
unitized cargo SSP2
60,000 unitized cargo SSP3
unitized cargo SSP4
40,000 unitized cargo SSP5
20,000

0
1970

1975

1980

1985

1990

1995

2000

2005

2010

2015

2020

2025

2030

2035

2040

2045

2050
25,000

20,000
Transportwork (109 tonne miles yr1)

liquid bulk RCP4.5

15,000 liquid bulk RCP2.6
liquid bulk RCP6.0
liquid bulk RCP8.5
bulk coal RCP4.5
10,000
bulk coal RCP2.6
bulk coal RCP6.0
bulk coal RCP8.5
15,000

Source:
0 Third IMO
1970

1980

1990

2000

2010

2020

2030

2040

2050

Greenhouse
Gas Study 2014

28
Chapter 4
Laying the Foundation for the Future
Chapter 4 | Laying the Foundation for the Future

Malaysia aims to build a maritime transport sector that is a major player in selected markets, contributing to the well-
being of the nation and all Malaysians. The Malaysian Shipping Master Plan focuses on the manner in which the
government and industry should respond to the decline in the shipping industry and actions required to enhance its
resilience and competitiveness beyond 2020.

30
 MOVING FORWARD
Enhance creation of Reduce balance of
Our Improve transport security
for Malaysian Trade &
Employment payment deficit attributed
Goals Maritime Connectivity
Opportunities and
Revenue for Malaysia
to Shipping

Our A business sector that is a major player in selected markets,

Vision contributing to the well-being of the nation and all Malaysians.

Our 1
STREAMLINE SHIPPING
2
RATIONALISE STRATEGIES
3
A CUSTODIAN TO ENSURE
Action GOVERNANCE THE WELL-BEING OF THE
SHIPPING INDUSTRY

31
Chapter 4 | Laying the Foundation for the Future

Streamlining shipping governance

While shipping is a matter for which the Ministry of Transport is The streamlining of the system hinges on one
directly responsible, several other ministries and government of the most crucial component of the MSMP,
agencies govern various shipping-related matters. For i.e., the National Shipping Council (NSC). The
example, aspects of shipping incentive are under the NSC is expected to provide the platform for
purview of the Ministry of Finance and certain matters an effective governance regime to measure
relating to ballast water discharged from ships concerns the the effectiveness of strategies and act as a
Ministry of Science, Technology and Innovation. Together, monitoring and feedback mechanism.
the multiple ministries and agencies function as a complex
web of shipping governance in Malaysia.

Malaysia National
Shippers Council

National Shipping
Shipping MARDEP
Council
Maritime Division
MOT KETTHA
MOT
Sarawak River Board JPM MOF
MCMC

MARDEP
JPM MINDEF

RMC
Maritime
MMEA
Surveillance

RMN

32
Federal & MOT MOT
State Port MITI
Authorities
MOHR

MARDEP
Ports MOF

Maritime
Division SBSR MOT

JPM Seafarers

EPU
MARITIME
TRANSPORT
SECTOR MOT

MARDEP
MOT

Related
JPM
Maritime
Ministries Education

MNIT
R&D
MOSTI
ISIS

MOE
ALAM +
Universities
MIMA

33
Chapter 4 | Laying the Foundation for the Future
Rationalise strategies

Pe
rt
m B
po

M ba an
al n k
ns

ay gu
Tra

Ship sia na
of

Registry
n
ry

National
ist

National Shipping
in

Ministry of Human Resources

Logistic

Ministry of Higher Education

M

Fund
Plan

Maritime Department
Maritime HR &
Ship MARITIME Maritime
Facilitation
STRATEGY Education and
Training

National Ancillary
it

Port
n

Support
U

Strategy
Ship
g
in

Building
n

Ship Repair
n a

Plan
Pl
ic
m
no

MI
o

GH
Ec

34
National Shipping Council Organisation

National MOT Minister / KSU (Chair)

SUB Maritim
Shipping Director General of Marine Department Malaysia
Council MASA
IKMAL
Industry representatives
Federal Government representatives
Sabah & Sarawak State Government representatives

Maritime Division

MARDEP

Working Working Working Working Working

Group Group Group Group Group
1 2 3 4 5

Stakeholders

35
Chapter 4 | Laying the Foundation for the Future

Promote employment
of Malaysian ships

Promote employment
of Malaysian seafarers

Strategy
& Objectives
Introduce sustainable measures
to remove competition
disparities and to improve Facilitate access to
capabilities of Malaysian capital & financing
shipowners, Maritime HR
and Maritime Services to
meet domestic and
regional demands
for shipping

Enhance Malaysia’s
attractiveness to
shipping businesses

Promote innovation in &

sustainable growth of
maritime ancillary services

36
 National Shipping Council

Organization for

Implementation Monitoring Review

MSMP
Stakeholders MSMP
provide Working groups
information (facilitated by MIMA)
/ feedback formulates action
plan, targets and
measures
National
Shipping
Council
provides
policy direction
and performs MARDEP
monitoring and leads
review the
functions implementation
of the plan
MOT as
secretariat
for the
National Shipping
Council

37
Chapter 4 | Laying the Foundation for the Future

Action Plan
2017 - 2022

Ministry of Re-establish the National Shipping Council

Develop Maritime Transport Database
Transport Develop Industry Benchmarking

Group 1 Group 2 Group 3 Group 4 Group 5

Rationalise Review & Review & Commercial Review
ship strengthen strengthen orientation of strategies for
registration the CMMF the Malaysian maritime manpower
regime mechanism Shipping Fund administration development
Review Develop a mechanism services in the
Cabotage, DSL Maritime Introduce maritime
and DSLE Education & competitive industry
processes Training and stable tax Review
Increase user Blueprint and fiscal strategies for
participation package promoting
in shipping Introduce R&D culture
Develop programme and
domestic for the commercialization of
feeder harmonization emerging
services and regular technologies
update of for reducing
maritime laws costs and to
deliver
environmental
benefits

38
 Governance & Monitoring
Objective : To establish a governance & monitoring mechanism
Activity Expected outcome Responsibility

1.
Utilization of Ships
A governance and implementation
Re-establishment of the National monitoring body to support the
Ministry of Transport Malaysia
supported by the Maritime Institute
Shipping Council with revised Malaysian shipping sector. of Malaysia
Terms of Reference and a 5-year Success indicators Activity Period
work programme. • Frequency of meeting and
2. Develop a Maritime Transport completion of work programme.
Database.
3. Develop industry benchmarking
Governance Seafarers
Malaysia’s & Monitoring
• Shipping is included in
Development
2017

and review. Plans and is featured as a key

economic area.

UtilizationFinancing
Shipping of Ships
Objective : To promote employment of Malaysian ships
Activity Expected outcome Responsibility

Business Environment
Enhanced competitiveness in
Seafarers
domestic and regional markets
Working Group 1 (Lead : Marine
through removal of competitive
1. Rationalize Malaysian Ship Department Malaysia)
disparities and improvement in
Registration regime.
capabilities.
2. Review Cabotage, DSL and Success indicators Activity Period
DSLE processes. • Market share targets met in
3. Increase user participation in Shipping Financing
2020.
shipper through facilitation
of alliances for cooperative
Support
• 20% Services
in global energy shipping.
advantage. • 30% in intra-ASEAN shipping.
2018-2020
4. Decelop domestic feeder • 75% in Domestic OSV services.
services and short-sea shipping. • 90% in domestic shipping.
Business
• Environment
100% in local port tugboat
operations.

39
 Utilization of Ships
Chapter 4 | Laying the Foundation for the Future

Seafarers
Objective : To promote employment of Malaysia seafarers
Activity
Governance
Expected outcome
& Monitoring Responsibility
1. Review and strengthen the Shipping Financing
A ready and available maritime skills
Ministry of Transport Malaysia
Central Mercantile Marine Fund base which matches the needs of
supported by the Maritime Institute
mechanism to support : and supports the Malaysian shipping
of Malaysia
• Implementation of sector.
Malaysian First policy
• Funding for apprenticeship,
Utilization of ShipsActivity Period
Success indicators

specialization and seafarer

up-skilling
Business Environment
• Improvement of • Rate of compliance with DSL
seafarer employment manning conditions. 2018-2020
security, conditions and
• Reduction in issuance of CORs.
2.
opportunities
Development of a Maritime Seafarers
Education and Training
Blueprint.
Support Services

Shipping Financing
Objective : To facilitate access to capital and financing
Activity Expected outcome Responsibility

Business Environment
A robust Malaysian Shipping Fund
to support fleet modernization and
Working Group 3 (Lead : Marine
expansion projects and a catalyst for Department Malaysia)
Review and strengthen the
ship financing industry in Malaysia.
Malaysian Shipping Fund mechanism
to support : Success indicators Activity Period
• Long-term positive impact for
• Funding of fleet expansion and beneficiaries
modernization projects.
• Ship financing orientation
programmes
Support Services
• Number of beneficiaries
• Cost / resources efficiency of 2018-2020
projects
• Availability of affordable local
ship financing.

40
 Governance & Monitoring
Shipping Financing

Utilization of Ships
Business Environment
Objective : To enhance Malaysia’s attractiveness to shipping businesses
Activity Seafarers
Expected outcome Responsibility
A maritime administration, regulatory

1. Review and strengthen the

Support ServicesWorking
and fiscal framework that is Group 4 (Lead : Marine
supportive of the Malaysian shipping
Department Malaysia)
sector.
Maritime Administration
Success indicators Activity Period
to support a commercial
orientation of maritime Shipping Financing
Tonnage targets met in 2020 :
administration services. • Additions to existing tonnage
2. Introduce a competitive and - 90% in bulk carrier tonnage
stable tax and fiscal package to (2,293,000 dwt)
attract and retain shipping. • 62% in Container ships tonnage
(506,000 dwt) 2018-2020
3. Introduce programme for the
harmonization and regular Business Environment
• 34% in general cargo tonnage
(199,000 dwt)
update of maritime laws.
• 31% in oil tanker tonnage
(1,606,000 dwt)
• 9% in other vessels (459,000 dwt)

Support Services
Objective : To promote innovation in and sustainable growth of maritime ancillary services
Activity Expected outcome Responsibility
1. Review strategies for manpower Improved access to and availability
Working Group 5 (Lead : Marine
development in the maritime of support and ancillary services for
Department Malaysia)
industry. the Malaysian shipping sector.
2. Review strategies for Success indicators Activity Period
promoting R&D culture and
commercialization of emerging • Number and diversity of
technologies for reducing costs maritime ancillary service 2018-2020
and to deliver environmental providers.
benefits.

41
Chapter 5
Creating Synergy
Chapter 5 | Creating Synergy
To effect the transformation necessary to rebuild and strengthen the industry to make it more resilient to operational
vulnerabilities, both government and industry need to re-orient their relationship towards a more synergistic partnership,
aligned with overall national transport aspirations.

CREATING SYNERGY

Government & Industry in Synergistic Partnership

Market Access

Shipowners Government Access to capital

Manpower availability
Employ Malaysian Encourage
seafarers 'Malaysians First" Shore support
availability
Employ Malaysian Incentivise
services Competitiveness Favourable tax regime

Support Malaysian Address Supportive maritime

Maritime competitive disparity administration
Administration initiatives
Access to Technology

Governance Regime
Measure of effectiveness of strategies
Monitoring and Feedback mechanism

44
 Malaysia Shipping Master Plan Targets

MARKET TONNAGE SEAFARERS SERVICES GOVERNANCE

20% global + 90% bulk carriers Seafarer Ship building National
energy shipping Management and ship repair Shipping Council
+ 62% container Centre
30% intra-ASEAN ships Malaysian Shipping Maritime
shipping 20,000 Malaysian Transport
Fund
+ 34% general seafarers Database
75% domestic cargo ships P&I Malaysia
OSV + 2000 training Shipping
+ 31% oil tankers berths Industry
Maritime legal
90% domestic services Benchmarking
shipping + 9% other vessels Malaysian ships
to be 90% manned Shipping-friendly
Programme for
100% local port by Malaysian fiscal, regulatory,
commercialisation
tugboat operations seafarers and
of technologies
for shipping administration
Reduction of regime
active COR to 10%
(1028) at any
given time

20 technical
publications by
seafarers

45
Chapter 6
Conclusion
Chapter 6 | Conclusion

The Malaysia Shipping Master Plan is the result of extensive industry consultation and is designed to
restore conditions that will enable the Malaysian shipping industry to achieve full self-sustainability.
The viability of the industry depends on the continuous support of shippers and users. However, this
would require the shipping industry to become more competitive, through policy interventions in
strategic areas. The revival of a coordinating body supported by timely and accurate data for
informed decision-making will foster more meaningful collaboration between industry and the
government and cross ministries and agencies. When implemented successfully, Malaysian shipping
tonnage is expected to increase, while the shipping industry will create additional jobs. More
importantly, the strategic value of shipping in terms of national defence, ensuring maritime security
and enhancing Malaysia’s influence in international shipping governance will be sustained.

Defined Goals
Clear and defined goals are established to ensure that
success is measurable and to promote team cohesion.

1
Investment in
human Long-Term Vision
resources and

7 2
A compelling long-term vision which
technology underpins and guides the development
Prioritise skills of meaningful plans, create strategies
development and inpire positive action.
and technology
advancement
as a key strategy
KEY Government

6 3
for economic
SUCCESS and industry in
competitiveness
and growth. FACTORS synergistic
partnership
National Secure commitment from both the

5 4
Shipping Government and industry to make
necessary changes and adopt new
Council
practices to re-orient the Malaysian
A coordinating shipping sector towards a more
body to provide synergistic partnership, aligned with
policy directions overall national transport aspirations.
and to monitor
the implementation
of the master plan. Data Depository Strategy Roadmap
A depository of A time-based plan to get the industry from
accurate data for informed where it is to where it wants to be and
decision-making. how to get there.

48
MALAYSIA SHIPPING WITH MSMP

Reputation and
influence in the Tonnage
IMO is sustained + >5,000,000 dwt

Improved
transport
security Revenue &
Employment
+ RM6.9B &
+ >158,000
jobs

RM30M Reduction
in Balance of
payment deficit

49
Ministry of Transport Malaysia
No. 26, Jalan Tun Hussein, Presint 4,
62100 W.P. Putrajaya

Telephone:
(603) 8000 8000

Facsimile:
(603) 8888 0158