Port Klang Expansion to Double Capacity, Pursue Singapore's Logistics Hub

Port Klang Expansion to Double Capacity, Pursue Singapore's Logistics Hub
Credit: Westports

 Port Klang, Malaysia's largest port southwest of Kuala Lumpur, plans to double its capacity in the coming decades. The goal is to rival Singapore as a regional logistics hub amid global supply chain shifts that are intensifying competition in Southeast Asia's logistics sector.

As the 12th largest port in the world and the second largest in Southeast Asia after Singapore by 2021, the port, located on the main shipping lane of the Strait of Malacca, plans to increase its annual capacity from the current 14 million TEUs to 27 million TEUs with this expansion plan.

Westports Holdings, a leading port operator in Malaysia, is exploring the possibility of attracting external strategic investors to support its RM39.6 billion (US$8.34 billion) expansion over the coming decades.

Datuk Seri Kong Leek Teng, CEO of Westports, revealed this in an interview, while also looking at dividend reinvestment and borrowing options to support the development of its facilities in Klang.

Westports itself is undergoing a major expansion in Port Klang. This was triggered by an 11% increase in its net profit to RM 779.43 million by 2023.

To support the plan, Westports has extended its Port Klang concession by 58 years to 2082. The expansion is expected to take more than 40 years and is scheduled to commence in 2024.

The Malaysian federal government approved the massive Port Klang expansion plan in August last year. The project involves land reclamation along the coast to increase the number of container terminals from 9 to 17.

This expansion is part of the fierce competition among countries in the region. Gnanalingam noted that there is increasing competition from neighboring countries along the strait, such as Singapore and Thailand. For example, Singapore's Tuas Port is scheduled to officially open in 2022 and be completed in 2040 with a capacity of 65 million TEUs per year.

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