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Govt needs to provide incentives for more paper mills
Friday January 16, 2009
KUALA LUMPUR: Paper consumption is set to increase over the years but more than half of what is used now is being imported.
The Malaysia Paper Merchants’ Association (MaPMA) secretary Manmohan Singh Kwatra said about 380,000 tonnes of printing and writing paper is consumed annually, of which about 230,000 tonnes were imported yearly from overseas mills including the Asean region such as Indonesia and Thailand.
“The government should provide more attractive investment incentives to local industrialists to encourage and help them set up more paper mills here in collaboration with foreign investors,” he said Thursday night at MaPMA’s 20th anniversary dinner which was graced by Deputy Finance Minister Datuk Kong Cho Ha.
“About 150,000 tonnes is produced locally at the Malaysia’s first integrated pulp and paper mill, Sabah Forest Industries (SFI) in Sipitang, Sabah.
“With attractive incentives, our mill partners from neighbouring countries will be more attracted to add-on or shift their operations to Malaysia whilst SFI will certainly consider larger expansion plans to meet the present shortfall and the annual growing demand,” he added.
SFI’s production, he said, was set to increase to 180,000 tonnes per annum within the next two years.
The government, he added, should look at high import and other duties structure more pragmatically to ensure consumers and paper merchants enjoyed reasonable pricing.
“The consumption of paper is destined to increase over the years. Paper is very essential in our daily life. It’s availability at fair pricing is therefore very essential to the end user,” he added.
Meanwhile Kong said trade associations acted as a bridge not only to suppliers and users but also between the business community and the government.
“The government will always have a dialogue with the industry first before formulating a policy or law.”
Kong encouraged the setting up of more paper mills in the country given that the demand for paper would continue to increase.
“I encourage paper merchants to come together and invest in the paper mill industry so that we do not depend so much on imported paper as importation can affect pricing,” he added.
He said the fluctuating oil prices had affected all industries including the price of paper, making budgeting and purchasing difficult to do.
Meanwhile, MaPMA president Alvin Goh said prices had dropped sharply over the last two months causing the industry to suffer big losses, but added that the prices were now steadier.
Also present was MCA central committee member Loh Seng Kok.