Investment Pace Enhances Prospects for Port

Kuantan Port looks set to play a bigger role as an important seaport to cater for the increasing number of investments in the state of Pahang.

Kuantan Port has come a long way from a port handling mainly timber related products to major multi-purpose deep-sea port and a gateway port for petrochemical products.

"Kuantan Port has emerged as the important gateway to handle growing volume of petrochemical products following the Federal Government's policy to develop, Eastern Corridor as Malaysia's petrochemical hub," said the Malaysian Industrial Development Authority Director for the Pahang State, Hasdi bin Mohamood.

"The investment drive initiated by the government has started to show positive results. The response from investors has been encouraging. So far we have managed to attract RM12.76 billion investments to the state of Pahang. Of this RM8.73 billion has been approved for the petrochemical industries," said Hasdi.

" We have opened up 1,902 hectares for the Gebeng Industrial Estate. As of last year we approved almost 50 per cent of the planned area. The remaining 754 ha in the Gebeng Industrial Estate - Phase I, II and III - are still available for capital incentive investments. The 99-year lease term with attractive lease rate makes Gebeng Industrial Estate the popular site for investors. In view of this the state government has allocated an additional 2,000 ha site under Phase IV," said Hasdi.

The Malaysian Industrial Development Authority has approved 31 projects worth of RM2.47 billion in 1999 in the state of Pahang. Pahang remained as the favorite site for gigantic petrochemical investors.

Among the attractions of the industrial site are:

i. Federal Government's Eastern Corridor incentives on Investment Tax Allowance. The income base ITA allowance will be 80 per cent of the qualifying capital expenditure incurre and it can be used to offset 85 per cent of the statutory income.

ii. Other non-income base incentives like pioneer status, reinvestment allowance, infrastructure allowance, exemption on import duty and monthly electricity bills discount are other special incentives under the Eastern Corridor packages.

iii. The clear vision of the Kuantan Port Consortium Sdn Bhd to develop Kuantan port as the petrochemical hub port. The port's handling capacity for liquid bulk traffic will be greatly enhanced from present 870 meters to 2.62 km. This has prompted some shippers to look into the possibility of developing and operating own berthing facilities.

iv. The completion of common user pipe-racks facilities and Central Utility facility by Petronas's subsidiary, Kuantan Terminal Sdn Bhd which is projected to reduce investor's initial cost of operation at least by 20 per cent.

v. The commissioning of the dedicated railway line between Kertih petrochemical Complex and Kuantan Port with a spur to Gebeng Industrial Estate.

vi. The upgrading activities of the present two-lane carriage way and the development of RM2.3 billion East Coast Expressway has prompted many investors to expand their existing facilities and acquire additional land for their production activities.