Discounting the short-term impact of major customer CMA CGM moving to Singapore as part of the container industry realignment, Malaysian Transport Minister Liow Tiong Lai believed that with two out of the three major alliances operating in Singapore, shipping lines would find it more challenging to operate there, especially on the transhipment trade, local media reported.
He added that Malaysian ports are also among the most efficient in the world with the capability to meet their requirements of shipping lines at very competitive rates.
Liow suggested that this might be an opportunity draw the lines back to Port Klang. "It makes more sense for each of the alliance to locate its hub in different ports so that it can compete leveraging on the strength of its supply chain," he said.
“But now, they are competing within a single hub in the same port without deriving any strategic advantage. Instead of having a pool each for themselves, they are now competing within a single pool.
"It is not far-fetched to say that with shipping lines intensifying competition against one another in Singapore, Port Klang will potentially become an attractive alternative hub in the future. It is a golden opportunity for shipping lines," Liow added.
Malaysian ports' competitiveness, particularly Port Klang, remains unaffected despite the move by Ocean Alliance to relocate their operations to the Port of Singapore.
"It is only a short-term ripple effect due to the move by Ocean Alliance, and mergers and acquisitions of CMA CGM,” he said.