Thai land bridge would benefit Penang, says port chief

 

Penang Port, which expects to move 1.5 million TEUs in 2024, will benefit from a proposed land bridge connecting the Gulf of Thailand with the Andaman Sea, according to its CEO. (Bernama pic)

GEORGE TOWN: Thailand’s ambitious plan to build a land bridge across the Kra Isthmus would bring economic benefits to ports in the north of Peninsular Malaysia, a port operator says.

Penang Port Sdn Bhd CEO V Sasedharan said the project could have an impact similar to that of the Suez Canal, which brought immense benefits to outlier ports located near the Egyptian waterway.

Thailand recently proposed a 90km land bridge across the Kra Isthmus which it said was intended to connect the Gulf of Thailand and the Andaman Sea via rail and road.

It said the route promised to reduce shipment time for vessels which presently sail around Peninsular Malaysia by between two and three days, giving rise to cost savings.

The Thais are looking for partners to kick off the project which bears an estimated price tag of US$28.5 billion (RM131 billion).

Sasedharan said Penang stood to become a key trans-shipment hub in the north of the Melaka Strait if the plan materialised, handling goods moving between the Pacific and Indian Oceans.

Trans-shipment refers to the transfer of cargo from one vessel to another.

“The spillover from Kra would do Penang good. This would be much like ports near the Suez Canal which facilitate trans-shipment between the Mediterranean and Red Seas,” he told FMT.

Sasedharan said 30% of Penang Port’s business presently originates from southern Thailand, mostly comprising exports of rubberwood, furniture and tyres.

He said most businesses located in the south of Thailand prefer to ship their goods via Penang, as the port in Songkhla has a more limited capacity.

“The depth of the water in Songkhla is around six to seven metres,” he said, adding that this limited the port’s ability to accommodate ships.

Sasedharan said the Malaysian government had long been aware of the potential of southern Thailand, home to many manufacturing industries, and in 2017 mooted a land bridge to connect Songkhla with Penang.

The proposal, made by then second finance minister Johari Ghani, involved the construction of a 260km bridge that would have saved ships a five-day voyage around Peninsular Malaysia.

Sasedharan said Penang Port was expected to remain the top port in the vicinity of the peninsula’s northern region, with 1.5 million TEUs targeted this year. He said the port put in a sterling performance last year with 1.44 million TEUs moved, an 11% year-on-year increase.

He also said the port was actively wooing more players in South Asia to encourage more trans-shipment activities for containers travelling between the Bay of Bengal and the Far East. - FMT