Puteri Umno chief Rosnah Abdul Rashid Shirlin has refuted the opposition’s claim that the government's cabotage policy was responsible in slowing down and curtailing Sabah's economic growth.      

Questioning the logic behind the claim, Rosnah, who is also deputy health minister, said on the other hand, Sabah gave priority to local shipping companies with the aim of protecting them and the welfare of local people in the long run.      

She said if the policy, which was implemented in 1980, was abolished as promised by the opposition, it could pose economic problems.      

"Without the cabotage policy, nothing can stop foreign shipping companies from controlling our waters or forming an oligopoly market or a cartel that will dictate prices of services to the detriment of the economy," she said in a statement today.      

Rosnah was commenting on the opposition's pledge to abolish the policy, which it claimed made no economic sense, should it come to power.      

The cabotage policy requires all domestic transhipment be done using Malaysian-flag bearing vessels, which was blamed by the industrial sector for having contributed to rising shipment costs and subsequently higher costs of goods in Sabah and Sarawak.      

Despite the relaxation of the policy in 2009, many quarters in Sabah and Sarawak are still demanding that the policy be done away with.      

Rosnah said the opposition was so confident that direct shipping would lower shipping cost and the prices of goods as there would be no transhipment cost from Port Klang, but they were not very sure whether that would really happen.      

She said the government had never prevented foreign vessels from making deliveries to Sabah, Sarawak and Labuan as claimed by the opposition, instead foreign ships preferred to go to Port Klang for economic reasons or to avoid too many goods to be sent to different destinations.      

"The increase in the prices of consumer goods is due to many reasons. Among them, profiteering, geographical factor, the population of Sabah compared to the peninsula, inefficiency in stevedoring services, marine insurance cost, inland transportation, and bunker price in proportion to fuel prices," she added.      

- Bernama