KUALA LUMPUR (Sept 30): A heated exchange transpired between Transport Minister Datuk Seri Dr Wee Ka Siong and Bagan Member of Parliament (MP) Lim Guan Eng, following a question from the latter about the previously reported forgone investment of RM12 billion to RM15 billion after the revocation of the cabotage exemption for high-technology companies.

Wee, who is also the Ayer Hitam MP, said the exemption is for repair works only as opposed to installation works, and therefore does not hinder the entry of foreign investors.

Although the exemption has been revoked, he said that foreign vessels involved in subsea cable repair works can still operate in Malaysian waters, adding that 10 domestic shipping licences (DSLs) had been granted to two foreign vessels for the period of December 2020 to August 2021.

“Project Apricot is a cable installation project since the time of the BN (Barisan Nasional) government to PH (Pakatan Harapan) to the current government, where the policy remains the same, which is still subject to the cabotage policy since 1980.

“The revocation of the policy only applies to subsea cable repairs and does not hinder the entry of foreign investors in the digital industry,” said Wee in Parliament, adding that new cable projects had been undertaken, such as the MIST Cable System, which connects Malaysia, Singapore, Myanmar, Thailand and India, as well as the India-Asia-Xpress Cable System (IAX).

Wee added that Apricot links Singapore, Japan, Guam, the Philippines and Indonesia via the Pacific Ocean, which does not go through Malaysia.

However, Guan Eng was not satisfied with the response, saying that the minister “is in a state of denial and does not want to admit that his cabotage policy has driven away investors”.

“Even MDEC (Malaysia Digital Economy Corp) chairman [Datuk] Datuk Dr Rais Hussin [Mohamed Ariff] said that the minister was at fault and caused Malaysia to lose out on opportunities of RM12 billion to RM15 billion in potential investments,” he said.

In response, Wee reiterated that the cabotage policy is only related to repair works and not installations.

He added that Malaysia was never in the plan for the Apricot project, and therefore the cable system bypassing the country was never an issue. Wee also said that the MIST Cable System will still connect Malaysia to the Apricot system.

He challenged Guan Eng to a one-hour public debate on the issue, with Guan Eng taking up the challenge.

“I accept your challenge. You can set a date and time. I will be there,” said Guan Eng.

In August, it was reported that tech giants Facebook and Google will be participating in Apricot, which will be bypassing Malaysia, with some quarters pointing to the cabotage issue as a factor behind Malaysia not being included in the plan.

Earlier this month, The Edge Malaysia reported that Facebook, Google, Microsoft and Amazon as well as national Internet exchange body Malaysia Internet Exchange (MyIX) had written to the Prime Minister’s Office (PMO) to seek a meeting with the premier.

A letter sighted by The Edge indicated that the purpose of the meeting was to discuss issues in relation to the cabotage policy.

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