Sabah and Sarawak will be exempt from the cabotage policy, effective June 1, Najib Abdul Razak said.
The prime minister said with the exemption, Sabah, Sarawak and the Federal Territory of Labuan would no longer be bounded by the policy imposed on all cargo shipping services between peninsular Malaysia, Sabah, Sarawak and Labuan.
"Sabahans have sought the abolition of the cabotage policy in Sabah, Sarawak and the Federal Territory of Labuan. Let me tell you that upon recommendations from the Sabah state government and the Sabah Barisan Nasional, the government has decided to implement the exemption of the cabotage policy on cargo services (in Sabah, Sarawak and Labuan), starting June 1.
"This (the exemption) applies to shipments from any port in peninsular Malaysia to any port in Sabah, Sarawak and the Federal Territory of Labuan and vice-versa, as well as between ports in the states of Sabah and Sarawak.
"However, this does not apply to ships operating between Sabah, Sarawak and the Federal Territory of Labuan," he said at the launch of the 'Negaraku Expression' at the Sandakan Municipal Field today.
Under the cabotage policy, goods from Sabah, Sarawak and Labuan must go through Port Klang first before they are exported to other countries.
Present were Sabah Chief Minister Musa Aman, Communications and Multimedia Minister Salleh Said Keruak, several federal and state ministers, and community leaders.
Najib said with the exemption, the cabotage policy, which was widely blamed by many quarters for higher costs of goods in Sabah, Sarawak and Labuan, would no longer be an issue.
'More Sabahans in civil service'
Meanwhile, the prime minister said that the federal government was committed to keeping its promise to increase the number of Sabahans filling federal civil service posts in Sabah as announced before.
Najib said a the time when he announced the commitment a few years ago, Sabahans made up only 72 percent of teachers in the state, but the number now had increased to over 80 percent.
"We will increase the number to 90 percent within three years. Similarly for doctors. The number of Sabahan doctors (in the state) has reached 40 percent now. We will give more opportunities to the locals in the public service," he said.
In another development, Najib, who is also finance minister, said he would keep the promise he made to Sandakan residents during his visit on March 3 that he would upgrade the Sandakan Airport.
The prime minister said the ground-breaking ceremony for the upgrading of the airport would be done today and upon completion of the project, he hoped Sandakan would attract more foreign tourists, especially from China, Korea, Japan, and Asean countries.
He said RM80 million was allocated for the project, for which the contractor had been appointed.
Sarawak CM thanks PM
The federal government decision will help reduce cost of goods, said Sarawak Chief Minister Abang Johari Openg.
"We thanked the prime minister for abolishing the cabotage policy that will hopefully reduce cost implications because it avoids double handling.
"I know that certain sectors are not happy but we have to consider the needs of the consumers. Hopefully, it will help reduce the costs and weather the rising cost of living," he told reporter after chairing the BN assemblypersons meeting at the Parti Pesaka Bumiputera Bersatu (PBB) headquarters in Jalan Bako, Kuching today.
On a separate issue, Sarawak state assembly speaker Mohammad Asfia Awang Nassar said only the Supplementary Supply (2016) Bill 2017 will be tabled at the Sarawak state assembly which will sit for eight days starting May 11.
He said the bill will be tabled by Sarawak Second Finance Minister Wong Soon Koh.
"The first reading is on the May 12, while the second and third reading are on May 16," he said.
He said a total of 411 questions would be submitted and eight motions would be tabled during the sitting.