S'pore port needs to work hard amid Malaysian challenge

S'pore port needs to work hard amid Malaysian challenge

Singapore needs to battle hard to retain its status as one of the world's busiest container ports amid a spirited challenge from neighbouring Malaysia, a senior economic official said Tuesday. Teo Ming Kian, chairman of the Economic Development Board (EDB), said while costs could be higher at the Singapore port, the city- state offers other services that gives its clients an overall advantage.

He said port operator PSA Corp. Ltd. "will have to work very hard" to maintain its present customers and attract further clients.

Last week, Taiwan's Evergreen Marine Corp. said it has decided to move its Southeast Asian transit centre from Singapore to the Port of Tanjung Pelepas (PTP) in Malaysia's southern state of Johor -- one of the largest in the world.

The island-republic already lost Danish global container line Maersk Sealand to Malaysia last year.

Singapore is the world's second busiest container port after Hong Kong. PSA said Friday it handled 19 million 20-foot equivalent units (TEUs) in 2001, down 3.2 percent from the previous year, due to the global economic slump.

EDB, Singapore's lead agency for economic development, wants "PSA to continue to be a shipping hub with great connectivity to the rest of the world because that will help basically our industries," Teo said.

"So I think as far as the PSA is concerned, I'm sure they are not sitting down," he told a news conference. "In terms of cost, I think there is certainly general comment that Singapore cost is high... but as we have said, cost is one part of the equation. The other side of the equation is really value," he said.

However, Teo said he was not sure if Singapore "can reduce cost to such extent that we will compete with the lowest cost around the world."

More important is for the city-state to "look at what are the values that we can provide" to make investors here more competitive, he said.

Malaysian Prime Minister Mahathir Mohamad has said that his government planned to expand all its ports to make the country a regional trade and shipping hub.

"We want to expand all our ports, not just PTP. We are as strategic as Singapore ... There is no reason why we cannot be a hub for trade and shipping in the region," Mahathir said.