“Although there were no apparent security threats caused by Indonesian ships, they too were linked with smuggling activities in Sabah,” said Assistant Finance Minister Ramlee Marahaban. “Barter trade activities have opened up opportunities for smugglers and activities that can jeopardize the security of the state.”
However, he added, the government in fact decided to suspend barter trading because of the recent kidnapping incident in Ligitan waters, off Semporna, Sabah.
Sabah Chief Minister Musa Aman announced the suspension of the barter trade on April 6 after Filipino gunmen seized a tugboat with Malaysian seamen from Sarawak on April 1.
Elopura assemblyman Au Kam Wah, in begging to disagree, said the suspension of the barter trade would affect the Sabah economy and hit Sandakan in particular. However, he stressed that he would support the suspension if it was temporary and was for security reasons. “The economic outlook in Sandakan was already worrying with a drop in business by between 40 to 60 per cent this year in the wake of GST and the depreciation of the ringgit.”
“Many businesses had to downsize just to remain afloat.”
Apart from palm oil, he continued, the economy in Sandakan was very dependent on tourism but this sector has been affected by security issues.
Karamunting assemblyman Charles Pang, in supporting the suspension of the barter trade, thinks that such trade with the southern Philippines was no longer relevant. “Manila itself considered barter trade activities as a platform for smuggling between Sabah and the Philippines.”
“When these merchant vessels cross into Sabah waters, they are technically committing an offence. When the ships cross back into Philippine waters, laden with goods from Sabah, they can be considered as smuggling.”
The term barter trade may no longer be applicable, argued Pang, since ships come from the Philippines to Sabah with no goods. “They bring only cash to buy goods in Sabah and take them back.”
“It’s only appropriate that the barter trade term be revised and considered conventional export-import trade governed by international laws.”
One worrisome aspect, warned Pang, was that barter trade activities provide a perfect cover for foreigners to enter Sabah with no valid travel papers. “They continue to stay in the state illegally.”