Tawau will be turned into a free trade zone in view of its strategic position for international trade, said Finance Ministry Parliamentary Secretary Dr Hilmi Yahya.

He said that Tawau's location near Indonesia's border in Kalimantan and its proximity to southern Philippines made it an ideal gateway for international trade.

According to a Bernama report, Dr Hilmi said that as Sabah did not have a free trade zone as yet, it was hoped that the Tawau free trade zone would further boost business activities in the state.

The free trade zone in Tawau would be set up as soon as possible, he said, adding that this was important before other countries set up their own nearby.

On another matter, he said that the ban on Tawau Port from being used as a transit point for rice exports should be reviewed as it caused Malaysians to lose income and jobs. The ban is said to be enforced last July.