Logistics

The logistics strategy is designed to address the current high cost of doing business in Sabah vis-à-vis other states in Malaysia. The strategies for reducing cost are three-fold:

• Lower freight and logistical costs by progressive review of the Cabotage Policy for shipping, while enhancing the cost competitiveness of ports in Sabah via alliances with other global port operators and shipping liners
• Establish Sapangar Free Zone (SFZ) annexed to Sapangar Bay Container Port (SBCP) by providing attractive incentives to potential investors to set up their manufacturing facilities and distribution centres in SFZ
• Position Sandakan as the regional trading hub in Borneo by expanding the role of Sandakan Integrated Trade Exchange Terminal (SITExT) to leverage the impending AFTA

The target for the logistics sector is to increase TEUs handled at Sabah Ports from 226,721 in 2006 to 551,100 in 2012 and 1.5 million by 2025.