The following are the main activities undertaken by SERC:

Press Conference on Quarterly Economy Tracker for Apr-Jun 2018

Socio-Economic Research Centre (SERC Sdn Bhd) held a media briefing on current economic challenges and domestic economic conditions, including issues and challenges confronting the country and industry.

The highlights of the quarterly report and commentaries were given wide media coverage as below: -

1. 加码耗42亿．派发一马援金达100亿
   [SinChew]


2. 李兴裕政策不明朗-经济增长下调至5.2%
   [eNanYang]


3. 国阵竞选宣言助化解生活压力 但也存有隱忧
   [OrientalDaily]


4. 私人消費強勁SERC上調GDP至5.5%
   [OrientalDaily]


5. SERC raises Malaysia’s 2018 growth forecast
   [Edge]


6. ‘Fiscal discipline cannot be compromised in run up to GE’
   [Star]


7. Keep a close eye on deficit, says economist of manifestos
   [Star]


8. SERC raises 2018 GDP growth forecast to 5.5%
   [TheSunDaily]

Press Conference on Quarterly Economy Tracker on Jul-Sep 2018

Related news:

1. SERC cuts 2018 growth forecast again
   The Edge


2. Higher budget deficit seen
   The Star


3. 中總：大馬難逃貿易戰一劫 今年經濟料僅成長5.2%
   中国报


4. 李兴裕：政策不明朗 经济增长下调至5.2%
   南洋商报


5. 中總經研中心 經濟成長下修至5.2%
   东方日报


6. 建议简化程序利商招商
   东方日报


7. 中總社會經濟研究中心 將向財政部呈明年財案建議
   东方日报


8. 18年ＧＤＰ5.2％増に下方修正　米中摩擦と内政不安視＝ＳＥＲＣ
   Nikkei Newsrise Asia (NNA)

Statement of objectives

• The idea of developing Carey Island’s port was conceptualised following the remarks that existing ports in the Port Klang area will hit maximum capacity. In early 2017, Port Klang Authority (PKA) had announced existing ports in the area will reach maximum capacity by 2025.
• In April 2017, MMC Corporation Bhd has signed two agreements: (1) The first one with Adani Ports and Special Economic Zone Ltd (APSEZ) to conduct a feasibility study of Carey Island as an extension of Port Klang; and (2) Second MoU with Sime Darby Property Bhd and APSEZ to study the feasibility of developing an integrated maritime city in Carey Island.
• In July 2018, another feasibility study under new administration will be independently conducted and commissioned by Port Klang Authority (PKA). As of now, previous government had not issued approval for the Carey Port. Transport Minister Anthony Loke indicated that the project will be private initiative-driven if the Parliament approved.  
• The objectives of this working paper are to provide an overview of the port development in Carey Island and also to assess the potential of the Carey Island project that can enhance the surrounding development.

Summary: Carey Island’s port

• Seaborne trade is hardly can be substituted with either air or land transport. Strait of Malacca (SOM) will has enormous traffic over next few decades as world trade and intra-ASEAN trade are expected to grow at rapid rate annually.  
• Most of Carey Island’s lands are owned by Sime Darby Plantation. Carey port development would require about 700 hectare land, which makes up about 6% of 11,615.65 hectare Carey land from Sime Darby Plantation. For Port Industrial City (include port), Sime Darby Plantation ought to sacrifice entire palm oil plantation in Carey Island. Sime Darby Plantation’s total landbank area will reduce by 3-3.3%.
• The development of Carey Port is to cater for future needs as West Port and North Port have almost reached the maximum port expansion.
• Since the formation of a new shipping alliance, Port Klang’s container volume has declined by 9.8% from 13.2 million TEUs in 2016 to 11.9 million TEUs in 2017. Overall, Peninsular Malaysia’s port utilization rate was 66.8% in 2017.
• From maritime perspective, it is not economical viable for the construction of Carey Island’s port to be ready by 2025 or 2028 on account of the following reasons: (a) A number of existing ports expansion will be completed by 2030. Peninsular Malaysia’s ports capacity will expand to roughly 56.6 million TEUs in 2030 (34.3 million TEUs in 2017); (b) Melaka deep seaport and Tanjung Bruas Port would be participating in transhipment industry between 2018 and 2030; and (c) Ports’ capacity will be underutilized in Peninsular Malaysia, triggering a stiff domestic competition.
• In contrast, it cannot be denied that Carey Island’s port would create positive spillovers and multiplier effects to businesses and people. Most importantly, it can reduce the traffic congestion in Port Klang. With its strategic location geographically, Carey Island’s port can be realized faster than our expectations if the port integrates with innovation, latest technology, efficient services and competitive pricing.
• Alternatively, it will be interesting to see how developments projects such as Singapore’s Tuas, Myanmar’s Dawei, Thailand’s Laem Chabang, and other smaller ports development plans will complement or pose a threat to the Carey Island in the process of transforming South-East Asia into a massive regional hub (Please refer to previous research paper on  “Strait of Malacca”).
• Lastly, new mega ports or hubs being developed along Strait of Malacca are likely to benefit the shipping lines, and to some extent the importers/exporters in the future.

Statement of objectives

• Southeast Asian ports’ strategic geographically positions for international shipping routes have greatly deepen the interconnected worldwide and become a crucial part of the global port system. A highly competitive and rapidly changing business environment requires the strategic planning and operation of ports to offer a unique position as seaports link.  
• Southeast Asia ports need to keep pace with increasing international trade in the future, driven by the advent technology and digitalisation . Bigger and stronger intra-Asia trade will demand better, smart and efficient port services.
• While ASEAN member states work together to strengthen maritime transport linking their economies, their ports and leading terminals will have to be enhanced and remained competitive in terms of cost and delivery service to attract more traffic and shipping lines and services.
• In general, the quality of some ASEAN ports were perceived to be far below the world average and have not keep pace with strong throughput growth within the region. The widening gaps between the ports in ASEAN require their port authorities to adopt appropriate strategies to improve and the competitiveness of their ports.
• Singapore and Malaysia are the leading pack of ASEAN ports. Both Indonesia and Philippines need to improve their national maritime strategies. Vietnam is progressing rapidly with the development of new ports. Indonesia focuses on the development in Sumatra and is eyeing to secure seaborne trade in Strait of Malacca.

Summary: Ports development in ASEAN and Malaysia

• Containerised cargos outlook remains positive. ASEAN constituted 13% share of container traffic in 2016. OECD estimates ASEAN’s container traffic will reach about 231 million TEUs by 2030 and 520 million TEUs by 2050.
• Presently, the combined annual capacity of major ASEAN ports is approximately 117 million TEUs. With current on-going and future development plans, the combined capacity can potentially be increased to 246 million TEUs.
• ASEAN becomes the most important manufacturing location and global supply chain worldwide. Each ASEAN country is developing its own Special Economic Zone (SEZ) or industrial zone to attract foreign direct investment (FDI). Some SEZ were designed to target specific foreign investors such as China and Japan.
• ASEAN member states are expanding their main ports capacity to cope with future demand and strengthen hinterland connectivity between the ports and SEZ. The port authorities need to have appropriate strartegies to improve the competitiveness of their ports.
• The gaps of ports development in ASEAN are widening. A majority of ASEAN member states are facing lack of shipping connectivity, poor quality of ports infrastructure and inefficient of logistics services as well as congestion problems due to lack of berth and depth. Ports in Myanmar and Cambodia are underdeveloped (handling less than one million TEUs), and hence may hinder free flows of goods. And, Singapore is pushing forward the digitalization and automation of its port to be in a well established good position. 
• three islands of Sumatra, Jawa and Sulawesi. Sumatra’s port development if runs efficiently can pose a threat to port operators in Malaysia and Singapore. The magnitude of impact will depend on the results and operation in Kuala Tanjung port in 2018. It also gives a precursor to whether Indonesia government is planning to build another mega ports in Batam Island or Malahayati.
• In terms of maritime perspective, Malaysia still has competitive advantages in ASEAN region --- a well-connected to global shipping networks (ASEAN ranking: 2nd), good quality of port infrastructure (ASEAN ranking: 2nd), and efficient trade logistics services (ASEAN ranking: 2nd).
• The container throughput in Malaysia registered positive growth of 10.2% pa from 2000 to 2016 and 57.5% of total trade generated from seaborne trade in 2016. Port Klang and Tanjung Pelepas are expanding their capacities up to 30 million TEUs and 22 million TEUs respectively. Going forward, the implementation of major infrastructure projects would strengthen hinterland connectivity in Malaysia.
• The enhanced and growing bilateral trade between China and Malaysia is expected to expand significantly in years ahead, driven by the formation of CMPA, Kuantan Port’s development and Melaka gateway project involving China investors.
• The general assessment of the development Carey Island port will be addressed in Part III of this research paper.

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