KUALA LUMPUR (October 5, 2017) – Malaysia will become a major distribution centre for the ASEAN region, driven by investment projects and the growth of e-commerce, according to the Malaysian minister of transport.

According to Liow Tiong Lai, who was giving the keynote address at the FIATA World Congress 2017 held in Kuala Lumpur, the global economy is increasingly become digital, and it is estimated that a 20% increase in ICT investment will result in 1% of GDP growth of a country.

“For Malaysia, that figure is even higher, at around 1.4%, as we are more seeing more and more cross-border e-commerce trading taking place,” he said. “E-commerce in Malaysia is expected to grow to RM1.4 billion (US$330 million) by 2020 or 6.4% of GDP, with the implementation of a national e-commerce strategy roadmap. In addition, Malaysia has excellent logistics infrastructure, such as ports, airports, roads, container depots and free trade zones to facilitate trade.”

Malaysia’s central location in ASEAN as well as between the East and the West means that it can provide a strategic location for logistics and transportation.

“I wish to give you the government’s commitment to continuously enhancing and improving our infrastructure to support a growing industry like logistics,” said Liow. “This includes future expansion of airports, development of several ports including a third terminal at Port Klang on Carey Island, a new Malacca gateway port, the redevelopment of the Sepanggar port in Kota Kinabalu, Sabah, and the development of a new deepsea port in Kuantan, to name but a few.”

The country is also investing in a large-scale rail project that will connect ports to cities and include a high-speed rail link to Singapore.

“Once completed, I can guarantee we’ll have the best network of rail, road, sea and air transport to support the fast-growing logistics industry,” Liow said.

At Kuala Lumpur International Airport’s Aeropolis, a new Digital Free Trade Zone jointly established by the Malaysia Digital Economy Corporation and the Alibaba Group designed specifically to promote and facilitate cross-border e-commerce will provide efficient cargo-clearance facilities, with the aim of being a regional distribution hub.

“We are prepared for the transhipment of cargo within this region and we’re confident in the KLIA Aeropolis,” said Liow. “All four major integrators and 20 of the world’s top 25 freight forwarders have operations here. We’re going to get them to support and participate in this DFTZ, and it will be our gateway for Southeast Asia with over 1,250 weekly flights within the region. We promise people in ASEAN that goods purchased will be delivered from KLIA to their doorstep within 72 hours.”

When it is fully completed in 2025, Liow said that the DFTZ will create a holistic logistics ecosystem which is estimated to move up to US$65 million worth of goods around the ASEAN region.

“The potential is limitless,” he said. “All that is required is our willingness and readiness to explore all opportunities, and the government will act as a catalyst to make all these things happen.”