LABUAN: The revival of barter trade and rice transshipment activities will help speed up Labuan’s slowing economy, says a coalition of the island’s business chambers.
It said the island’s economy is feeling the pinch after the barter trade was halted in 2016 after more than three decades in operation.
“Labuan had been enjoying economic glory prior to the stop order for the barter trade, but has been drowning since.
“Labuan, which is also an oil-dependent economy, has had to cope with plummeting global energy prices over the last four years, so the island does not only need urgent reforms but it also must embrace an alternative economic model,” its chairman Datuk Rozman Isli told Bernama Tuesday.
He said the economic situation in Labuan is not as dire as many investors think, as the island merely needs sectors with good economic growth and potential.
Rozman, who is also Labuan Member of Parliament, said the rice transshipment ban by the Ministry of Agriculture and Agro-Based Industry (MOA) has cut cargo handling activities at the Labuan Liberty Wharf by over 30 per cent, leaving hundreds jobless.
“The crash in energy prices is putting Labuan under economic pressure with more than 10, 000 people jobless, hundreds of shops closing down and foreign expatriates moving back to their home country,” he said.
On April 29, the coalition submitted a memorandum to the Federal Territories Ministry with a list of 15 economic issues for immediate attention.
These issues include the slowdown of Labuan port business activities due to the rice transshipment ban, the need to revive the barter trade business system, and the lack of Indah Water Consortium (IWK) facilities.
The chambers comprise the Malaysian Malay Chamber of Commerce (DPMM), Labuan Chamber of Malay Entrepreneurs (DUML]), Labuan Tionghua Chamber of Commerce, Indian Chamber of Commerce and Industry, Kadazan Dusun Chamber of Commerce and Industry, Malaysian Islamic Chamber of Commerce and Malay Traders and Industrialists Association of Malaysia (Perdasama).
The memorandum noted that Labuan had not received the 50 per cent of the tourism tax revenue scheduled for March.
Rozman said the tourism tax revenue could be used to promote the island more aggressively via the holding of more tourism activities, developing human capital as well.
He said the chambers also suggested the operators of the four roll on-roll off (Ro-Ro) ferries introduce an online ticketing system to avoid congestion and ensure more efficient service.
He said other related issues include the need for an additional ramp for the ferry, as well as the shortage of parking lots downtown and at the Urban Transformation Centre (UTC) building and compound.
Rozman, who is also DPMM Labuan president, said the business leaders also questioned the requirement for SIRIM certification for products imported into the island, the need for for importers to possess an approved permit (AP), and CIDB’s procedure for the importation of construction products into the island, which should in fact enjoy duty-free status.
“Another issue was the lack of enforcement by the enforcement agencies to monitor the inflow and outflow of foreign expatriates through Labuan wharf. We suggested a new wharf purposely to cater for transshipment and barter trade activities,” he added.
Other issues include the lack of projects for Labuan Shipyard Engineering Sdn Bhd and Preston Shipyard, housing assessment fees, the lack of local Labuan executives at the Petronas Labuan methanol plant, and the chairmanship of the Labuan Port Authority.