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Transhipment bungle jeopardises rice imports by Sabah, says trade group

Transhipment bungle jeopardises rice imports by Sabah, says trade group

KOTA KINABALU: A trade group has warned that Sabah is at the risk of losing RM2 billion in cross-border trade due to the mismanagement of a rice transhipment from Vietnam.

The state has been warned of getting blacklisted for future rice imports after the Customs Department accused the parties of smuggling, says Sabah Cross Border Trade Association chairman Nordin Ening.

As many as 351 containers of white rice worth RM16 million from Ho Chi Minh, en route to Labuan, were unloaded at Sepangar Port in early September last year due to heavy congestion in Labuan Port.

The Customs seized all 351 containers for not having an import permit and later changed the charge to smuggling, prompting the Vietnam Food Association to threaten a boycott in future.

“Despite showing a letter from the agriculture ministry that transhipment of rice is allowed until March 31, the Customs officer in charge refused to listen and proceeded with the charge in court.

“I reported the matter to the Malaysian Anti-Corruption Committee (MACC) on April 4. After it was proven that an import permit is not needed for the consignment, the charge was suddenly changed to smuggling.

“This is unreasonable because the cargo is currently under Customs’ custody. We cannot even touch our cargo without Customs’ approval,” said Nordin.

The Customs Department has said that the consignment was detained as the declaration documents were suspect.

The department stated that the case will be prosecuted under the Customs Act, 1967 for making a false declaration and other offences.

Nordin, however, said a wrong document should not be blamed on the consignee as documentation is done by shipping agents licensed by the Customs Department.

Therefore, he said, any problem with the documents should be the responsibility of the department.

He pointed out that another consignment, which unloaded in Port Klang, managed to reach Labuan Port without any problem.

“If the government proceeds with the case, the Vietnam Food Association will blacklist us from doing rice trade in the future.

“I hope the relevant authorities will take the necessary steps to see that this does not happen.

“There is already a protest held by the Vietnam Food Association at the Malaysian embassy in Ho Chi Minh. I hope the government will do something to save face,” he said.

Trade between Sabah and the southern Philippines brings in more than RM2 billion a year.

Sabah traders buy rice from Vietnam and ship it to the southern Philippines.

The entire business chain may be interrupted if Vietnam decides to stop bilateral trade with Sabah.

When contacted, a spokesman for the Vietnamese firms told FMT that their association will blacklist Sabah from future imports if the court case proceeded.

“Not only are the Vietnam shippers concerned. The Thais are also affected. They all know about this case and they won’t dare supply rice to Sabah any more.

“Other rice exporters in Myanmar, India and Pakistan know about this too.

“Because of this issue, we are all having second thoughts as it is too risky to supply rice to Sabah. The Customs can seize our cargo any time they want,” said Peter Doan, a spokesperson representing the seven companies.