KUALA LUMPUR: The logistics sector in Malaysia needs to urgently move forward against the backdrop of greater competitive landscapes as Thailand and Vietnam have recently overtaken the country in key industry rankings.
This is necessary given that Malaysia had fallen behind in the World Bank’s Logistics Performance Index (LPI), where the country saw its position drop to 41 out of 160 countries – compared with its ranking of 25 in 2014 and 32 in 2016.
“The LPI is a key indicator for investors when they do their evaluation on whether Malaysia is capable of doing logistics for them or not. This data must be used (in their evaluations).
“The investors want their goods to be distributed in a cheap and efficient way. If the government knows this, then they would know what to do,” PKT Logistics Group Sdn Bhd managing director Datuk Seri Micheal Tio said.
He was speaking at the Malaysia Competition Commission panel discussion on Takeaways from The Market Review and the OECD Reports on Malaysia’s Transportation Sector.
The recent LPI 2018 report saw three Asean countries being ahead of Malaysia – Singapore (2), Thailand (32) and Vietnam (39) – while Indonesia (46) is fast catching up.
“There is a lot of inefficiencies, that’s why we are low in the rankings. For example, we were supposed to be fully computerised through electronic data interchange for customs brokerage without the need for face-to-face meeting with customs officers.
“This is already happening in other neighbouring countries such as Singapore – it is so easy. But we still have this inefficiency and because of this, we are ranked quite poorly,” Tio said.
He pointed out that while this is lacking, Malaysia still had an advantage in its infrastructure as it is among the best in the Asean region.
“We are ranked quite well in terms of infrastructure in Asean with amazing connectivity. Our ports reach all over the world and the airports, with companies like AirAsia for example, we already have the reach in the region.
“If the government can pay more attention by giving a ministry the (task) to restore our rankings, I’m sure we can achieve this. It is a matter of focus and implementation,” Tio said.
“At the moment, we have to deal with five ministries when we talk about customs. So how we can do this is, perhaps, by creating one-stop centres. Choose someone who is responsible to report directly to the Prime Minister,” he suggested.