Sabah ties up with Shandong Port to become BIMP-EAGA logistics hub

KOTA KINABALU: The Palm Oil Industrial Cluster (POIC) Sabah Sdn Bhd has signed a strategic collaboration with China’s Shandong Port Overseas Development Group, the biggest port operator in the world.

The agreement was signed today between POIC Sabah chief executive officer Datuk Freddie Gan and Shandong Port deputy general manager Xu Wei.

Gan said the link-up with a major Chinese port operator will move them towards opening up the port to serving customers other than investors at POIC Lahad Datu.

It was also a huge step forward for Sabah to realising its vision as a hub for logistics, resource amalgamation and manufacturing for the Brunei-Indonesia-Malaysia-Philippines East Asean Growth Area (BIMP-EAGA) region.

With the agreement, POIC Lahad Datu in particular will now be linked to Shandong Port Group’s 313 shipping routes of which 173 are international, 113 regional comprehensive economic partnership (RCEP) national port routes and 84 Belt and Road member port routes.

Shandong Port Group has under its wings four sizable port groups along China’s eastern seaboard, namely Qingdao Port, Rizhao Port, Yantai Port and Bohai Bay Port.

The ports have a combined annual cargo throughput of 1.9 billion metric tonnes and 30 million twenty-foot equivalent units (TEUs) compared to Sabah’s annual cargo in 2021 of 31 million tonnes, and under four million TEUs.

POIC Sabah chairman Datuk Seri Yong Teck Lee, who witnessed the signing ceremony, said the relationship will be a major contribution to Sabah’s development and efforts to draw in foreign investments.

Yong said the business-to-business contact will help to enhance diplomatic relations between Malaysia and China, as well as establish people-to-people connections.

He added that the sheer size and business reach of the Shandong Port are invaluable assets for Sabah which can offer a good industrial park with a comprehensive port infrastructure.

POIC Lahad Datu is located in a region with extremely rich resources, promising markets and served by an increasingly important Lombok-Makassar shipping super highway, he said.

“We are looking to develop our port as a network port of the Shandong Port Group.

“Our POIC Lahad Datu industrial park can grow to serve as a cargo consolidation and break-bulking hub, creating access to markets and territories in our region of about 78 million people,” said Yong.

Shandong Port chairman Zhang Quan Cheng acknowledged POIC Lahad Datu as a major project helping to accelerate growth in East Asean.

He said the Shandong Port Group also has related logistics businesses in Southeast and South Asia, the Middle East, Europe and West Africa.

Last Friday, POIC Sabah signed a similar collaboration agreement in Kuala Lumpur with the China Construction Bank Corporation (Malaysia) Bhd to give priority attention to the state’s future investors.

Sources by: Click Here