Dubai-Malaysian joint venture threatens S'pore shipping hub

Dubai-Malaysian joint venture threatens S'pore shipping hub

Agence France-Presse, Singapore

Malaysian and Dubai businessmen are planning to build a new logistics hub in Malaysia in a move that could challenge Singapore's position as the region's leading shipping and logistics center, a report said Tuesday.

The Business Times said Dubai's economic czar Mohamed Ali Alabbar and Malaysian port magnate Syed Mokhtar Al-Bukhary have tied up to establish an investment firm to invest in ports, logistics and real estate projects in Malaysia and the Middle East.

One of their plans is to build a new logistics base in Malaysia's southern state of Johor near Singapore.

The planned facility will be located next to Malaysia's Port of Tanjung Pelepas, the start-up which has snared two of Singapore's main shipping clients and is an emerging rival for the city-state's pre-eminence as a regional transhipment hub.

"It is likely to be a logistics hub with mixed-use development," the Business Times quoted Alabbar as saying.

Malaysia has been moving to strengthen Johor's capabilities as a logistics hub to rival its smaller neighbor.

Alabbar was described in the report as the leading economic adviser to Dubai's Crown Prince Sheikh Mohammad Al Maktoum and is the director-general of the Department of Economics in Dubai.

He said the joint venture intends to tap a massive pool of money pulled out of the U.S. by Middle East investors following the Sept. 11, 2001 terrorist attacks in New York and Washington.

"A lot of Arabs took their money out of the U.S. in the wake of the post 9-11 backlash. As a result, we now have a lot of liquidity sloshing around in the Middle East," he said.