By Datuk Ts Dr. Hj Ramli Amir, former President of the Chartered Institute of Logistics and Transport (CILT) Malaysia and Vice-President of CILT International for Southeast Asia
(Incorporating Tan Sri Andrew Sheng’s perspectives and my own observations on Sabah’s current gaps)
KOTA KINABALU: Sabah stands at a turning point where logistics can shift from being a hidden cost in the background to becoming the visible engine that powers growth, competitiveness and marketability.
Tan Sri Andrew Sheng’s core message, in his capacity as Special Advisor to the Chief Minister, is that Sabah must use logistics not just to move goods, but to create value—by producing, designing, packaging, marketing and financing its own products as part of a coherent supplychain strategy.
From his vantage point as Special Advisor, he emphasises that Sabah’s geography and resource base are strategic assets only if they are embedded in efficient, transparent and wellgoverned logistics systems. Sabah’s position at the northern tip of Borneo, on major East–West maritime routes, together with its port, road and industrial infrastructure, gives it the skeleton of a regional hub.
The real challenge, in his view, is to turn that skeleton into a living organism: a connected ecosystem where rural producers, processors, logistics providers, designers, financiers and regulators all operate to common standards and shared objectives.
In line with his longstanding concerns about moving up the value chain, Tan Sri Andrew Sheng stresses that Sabah cannot afford to remain a pricetaker in commodities.
Logistics is the bridge that allows the state to convert raw materials into branded, differentiated products. At the production stage, this means using transport and coldchain networks to aggregate fragmented output from farmers and fishers into processing hubs that can guarantee quality, traceability and consistency. Instead of shipping bulk, undifferentiated fish, timber or agricultural goods, Sabah can supply processed, graded and certified products aimed at specific regional and global niches.
He also highlights the importance of designing both products and supply chains together. For him, design is not just about aesthetics; it is about engineering products to fit logistics realities—container dimensions, pallet configurations, route reliability, lead times and handling requirements.
By locating design and R&D capacities close to ports, airports and industrial parks, and by using real logistics data on costs and transit times, Sabah can encourage entrepreneurs to develop offerings that match the constraints and opportunities of actual trade flows.
This is how Sabah can become a “rulemaker” for its own niche markets rather than forever adapting to others’ terms.
Packaging, in this narrative, becomes a strategic industry in its own right. Tan Sri Andrew Sheng would see value in developing specialised packaging and certification clusters at key logistics nodes, so that final valueadding—labelling, halal assurance, ecolabelling, destinationspecific formats—takes place as close as possible to export gateways.
This allows for postponement and customisation: semiprocessed goods from the interior can be finished and packed at Sapangar Bay or KKIP according to demand from Tokyo, Dubai or Jakarta, reducing inventory risk and enabling rapid response to market signals.
On marketing, he is likely to argue that logistics performance is part of Sabah’s brand equity. A state that can demonstrate clean, transparent and reliable logistics—short dwell times, minimal leakage and informal costs, strong coldchain integrity, robust documentation—can command better prices and trusted relationships.
“Sabah origin” can be made synonymous with predictable delivery, traceability and compliance with halal, environmental and safety standards. Regional distribution and ecommerce fulfilment centres linked to ports and airports can then project Sabah’s producers into BIMPEAGA and wider ASEAN with service levels that rival established hubs.
Finance is a recurring theme in his thinking: deep, wellstructured financial intermediation is essential to turn productive capacity into sustainable growth. In a logisticscentred Sabah, trade finance and supplychain finance can be anchored on the physical and informational flows of goods.
Warehoused inventory, goods in transit and confirmed export orders can become bankable assets if supported by robust documentation and digital tracking. This opens the door for both conventional and Islamic instruments that monetise the strength of the supply chain, not just the collateral of land and buildings.
For SMEs, this is potentially transformative.
At the same time, my own view is that while these pointers are theoretically solid, Sabah is currently constrained by the simple fact that the “avenue for moving it” is in disarray.
Logistics on the ground is fragmented; all the key elements—ports, roads, air cargo, warehousing, standards, trade facilitation, human capital—tend to operate in silos. The root cause, in my opinion, is that the importance of logistics as a strategic pillar of the state economy has not been properly recognised or institutionally anchored. The core issue has never been fully addressed.
Foremost among these issues is that logistics has no real “home”.
There is no dedicated, empowered platform whose primary mandate is holistic, statewide logistics planning and integration. The Ministry of Industrial Development, Entrepreneurship and Transport (MINDET) exists and is an important step forward, but it is newly constituted in this expanded form and understandably does not yet have deep, specialised expertise in handling logistics as an integrated, multisectoral system.
In practice, responsibilities remain scattered: different agencies handle ports, roads, industrial parks, regulations and incentives, with no single entity tasked to knit them together around a coherent logistics vision. This is supposed to be the function to be undertaken by MINDET.
Given this landscape, my opinion is that the only credible institution that can immediately “house” logistics thinking and coordination—at least as an interim anchor—is the Institute for Development Studies (IDS) Sabah. IDS already has a mandate for research, policy analysis and strategic planning; these capabilities can be extended and focused to create a dedicated platform for holistic logistics management. From this starting point, IDS Sabah could serve as the convening and knowledge hub that brings together MINDET, other ministries and agencies, industry players and financiers to design Sabah’s logistics master narrative and roadmap.
An IDS-CILTM (The Chartered Institute of Logistics & Transport, Malaysia) Logistics and Trade Facilitation Centre of Excellence must be the starting point. Why is CILTM in the fray? It is because it is the only Professional Association under the auspices of the Ministry of Transport, Malaysia that can provide the professional outlook and structure needed for a holistic approach to logistics management.
Furthermore, IDS and CILTM had collaborated before in successfully establishing the Sabah Logistics Council, as a precursor to the holistic management of logistics. It is also with CILTM input through the Sabah Logistics Council that led to the establishment of the new ministry (MINDET). So, the establishment of this Centre of Excellence would just be a continuation of an ongoing collaborative efforts, this time into the nitty-gritties of logistics.
Under such an arrangement, logistics is no longer left as a residual technical matter dispersed across agencies. Instead, it is treated as the platform on which Sabah upgrades from a commodity exporter to a sophisticated player in regional and global value chains.
By combining Tan Sri Andrew Sheng’s emphasis on valuecreation, institutional strength and financial deepening with a clear recognition of today’s fragmentation—and by using IDS Sabah as the initial institutional home for integrated logistics thinking in close collaboration with MINDET—the state can begin to address the core governance gap.
Only then can Sabah fully leverage its geography, resources and infrastructure to shape its own economic destiny, rather than simply adapting to the plans and logistics systems of others.
