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 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 northern Melaka Straits, providing for 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 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, with a depth of six to seven metres”.
Sasedharan said the Malaysian government had long been aware of the potential of southern Thailand, home to many manufacturing industries. In 2017, then second finance minister Johari Ghani mooted a 260km land bridge from Penang to Songkhla that would save ships a five-day voyage around Peninsular Malaysia.
Sasedharan said Penang Port was expected to remain the top port in the northern region, with 1.5 million 20ft containers (TEU) targeted this year. He said the port put in a sterling performance in 2023 with 1.44 million containers moved, an 11% increase on 2022.
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.