POIC adopts new strategy to transform eastern Sabah
KOTA KINABALU: State-owned POIC Sabah Sdn Bhd has adopted a four-pronged business strategy to help the state achieve developed status by 2035.
The strategy will open up economic potentials in the region east of Sabah. This translates into enormous investment possibilities in logistics, shipping and manufacturing.
“The process will transform eastern Sabah, particularly the Lahad Datu Palm Oil Industrial Cluster (POIC Lahad Datu) into a new economic growth centre of Sabah,” Chief Executive Officer of POIC Sabah Sdn Bhd, Datuk Dr Pang Teck Wai, told the 16th Asean Ports and Shipping Conference in Johor on Wednesday.
The three-day international conference was hosted by Johor Port.
Pang, who briefed Chief Minister Datuk Seri Mohd Shafie Apdal last month on the plans and ambition of POIC Lahad Datu, was sharing the company’s latest business plan in public for the first time.
He said the four-pronged strategy comprised creating industries to generate cargo volume; leverage on geographical location to develop POIC Lahad Datu as logistics and bulkbreaking hub of Asean; capture logistics potentials of the LombokMakassar Straits, which is Asia’s second busiest shipping route after Straits of Malacca and promote the region east of Sabah as Asia’s last major resource frontier and the importance of POIC Lahad Datu in this scenario.
Pang pointed to the comprehensive port infrastructure available at POIC Lahad Datu, the natural deep harbour and Lahad Datu’s strategic geographical location as what qualifies Lahad Datu as the future logistics hub of the vast region.
The government began developing POIC Lahad Datu in 2005. It has to date, attracted a global presence of investors with a portfolio of more than RM2.4 billion. Along with the industrial park development, the cluster has also developed a dry bulk jetty, a liquid jetty, a barge berth and a container terminal.
ôAAnd they are located along a busy Lombok-Makassar Straits, a naturally deep harbour, one of the deepest in the world, that can accommodate vessels up to 200,000 deadweight tons, he told the conference in his presentation ‘Role and Opportunities of POIC Port in Asean Trade and Development’.
Pang, an economist, said POIC Sabah’s main thrust was in the promotion of industries, particularly oil palm-related value-adding manufacturing, and ‘because we believe that only through industrialisation can Sabah ever hope to get out of the middle-income trap’.
He asserted that oil palm is one of only a handful of sectors that has the size, volume and global demand that can be developed to transform Sabah’s economic landscape.
“We produce more than six million metric tonnes of crude palm oil a year. What we need is to retain about half of it for downstream value-adding, and combined with the large volume of oil palm biomass, we can be looking at adding some RM200 billion to our economy.”
Referring to recent statements from State ministers about the prospect of pushing manufacturing’s share of the state GDP to 35% (it is about 8% currently), Dr Pang said it would take a massive economic sector like oil palm to narrow the gap.
He said the territories of Kalimantan, Sulawesi, Irian Jaya, the Southern Philippines, Sabah and Sarawak, once known as BIMP-EAGA, combined to be the last frontier of many natural resources from oil & gas, coal, marine and agricultural resources.
“It will require a safe shipping lane, excellent port facilities to amalgamate and move these resources, and also industrial parks of the POIC standard to enable value-adding.
“The Lombok-Makassar Straits will do to POIC Lahad Datu what the Straits of Malacca has done to Singapore, opening up investment opportunities in the entire value chain of logistics,” Pang added.