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Malaysia: Maritime industry sees silver lining in shipbuilding, repair

The domestic maritime industry is expected to see a boost in the shipbuilding and ship-repairing (SBSR) sector as Malaysia undertakes efforts to develop the industry in a systematic manner at the national level.
Some of the recommended systematic changes, tabled in the SBSR Plan 2020, included commitment by the local shipyards to improve their productivity, efficiency and upgrade of technological capability, according to the Maritime Institute of Malaysia (MIMA).
The plan, which will set the national agenda for the industry in the coming decade, targets to capture 80% of the local and 2% of the global new build market, up from 50% and 0.8%, respectively. For ships repair, the plan has set its sights on capturing 3% of the Straits of Malacca and 80% of the South China Sea offshore repair market.
“There has been a steady increase in the demand among international buyers for a variety of workboats built by Malaysian yards,” said MIMA, attributing the rise largely to quality and competitive pricing.
“Locally made offshore support vessels, passenger boats and marine crafts made of composite materials are especially in demand from foreign markets,” it added.
Recent examples include TAS Offshore Bhd which reportedly secured RM180 million in shipbuilding contracts, Boustead Heavy Industries Corp Bhd (BHIC) subsidiary that secured contracts involving the combat management system for the Malaysian government’s patrol vessels with a total ceiling contract sum of RM1.53 billion and SapuraKencana Petroleum Bhd joint-venture unit being awarded a US$45 million (RM138.01 million) contract for the charter of a vessel.
To further stimulate the SBSR industry, BHIC, for instance, has crafted a vendor development programme to work with the small and medium enterprises, attracting some 3,164 vendors to supply SBSR products and services.
MIMA said the industry has been targeted by the government to be promoted to generate value-adding high-income activities and to enhance its productivity through efficient management and optimal utilisation of human capital and resources.
Malaysia, which has come under increased competition from regional players like India, China, the Philippines, Vietnam and Indonesia, certainly has the right ingredients to become a globally competitive SBSR nation, it added.
According to the Third Industrial Master Plan 2006-2020, there are around 70 shipyards in Malaysia, with the bigger yards capable of building quality, durable and competitively priced vessels for the export market and offshore structures while the smaller ones tend to build small to mid-sized vessels for shallow water use.
“Labuan Shipyard is one of the largest and most well-equipped shipyards in South-East Asia, capable of building offshore structures and platforms providing repair services to the oil and gas industry and shipowners,” said MIMA.
“Malaysian yards can give other regional yards a good run for their money on account of competitive pricing and ability to deliver rugged, durable and easy-to-fix workboats.
“Malaysian-made vessels are now sought after by clients not only in the Asean region, but also as far away as the Arabian Gulf, West Africa, Australia, the Pacific Islands, South America and even North America. This can be attributed to the ability of several local yards to deliver quality products and servicing market niche,” it said.
Source: The Malaysian Reserve