Trends and News for SMBs | March

Trends and News for SMBs | March
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Keep your business up to speed with the latest news.

Thailand seeks funds for “land bridge” alternative to Malacca Strait 

Thailand appears to be betting big on its new mega project, a land bridge that would cross the kingdom’s narrow Kra Isthmus with highways and railways and potentially give China quicker access to the Indian Ocean.

Bangkok hopes Beijing will help build the $2.8 billion project linking the Andaman Sea and the Gulf of Thailand, Asia Times reports. If the project comes to fruition, it will be a shortcut for cargo from Southern China, saving the need for it to sail south around Singapore and the Malacca Strait.

Thailand believes the land bridge plan could offer a faster, shorter, and cheaper route for international shipping. The project would grant Inland Southern China access to two deep sea ports planned for Southern Thailand in the Andaman and Gulf coasts.

Congestion at the Malacca Strait, a vital international waterway, is expected to worsen in the coming decades, especially as Singapore and Malaysia plan massive expansions to increase capacity at the ports of Tuas and Klang.

Previous attempts by Thailand to create a route across the Kra Isthmus were thwarted by a legal challenge based on the country’s constitution, which prohibits the division of the kingdom.

A major advantage of the new plan is that it sidesteps this potential legal challenge.

According to Asia Times reports, China is understood to be favoring the project, which could give it a potential alternative route to the Indian and Pacific Oceans if the US blocks the Malacca Strait in the event of hostilities.

Bangkok’s next step is to host its “land bridge megaproject roadshow.” Its transportation ministry will attempt to attract Chinese government and private investment to fund the 100-kilometre project.

Along with roads and railways, the project will also include gas and oil pipelines, warehouses, and other logistics infrastructure. However, critics point to the potential extra cost and delays associated with loading and unloading freight from vessels to alternative modes of transport at ports.


Tuas – Singapore plans the world’s largest fully automated port 

Singapore’s Tuas Port is on course to become the world’s largest automated terminal, Maritime Logistics Professional reports. This transformation will allow it to double its capacity and ultimately enable shippers to track freight in real-time.

The first phase of the development opened in 2022 and already has eight berths. However, Tuas Port’s wider development is not expected to reach full capacity until the 2040s. By then, it will have doubled its annual handling capacity to 65 million TEUs. 

Ho Vee Leung, Southeast Asia’s Head IT at PSA Singapore, said, according to the Maritime Logistics Professional, “Amidst the rapid expansion of global trade, ports today face mounting pressure to enhance their capabilities and streamline operations. 

“Long-standing manual processes, while once sufficient, are now inadequate in meeting the escalating demands of the supply chain industry, such as real-time tracking, customer expectations, and the search for efficiency, productivity, and profit growth.”

At the heart of the new development is a command center that can oversee operations and maintenance. In the future, the port will also implement artificial intelligence, data analytics, and robotics to help streamline performance and boost productivity. 

It will be able to service vessels more than 400m in length and work with the airport to enhance connections between air and seaports. Currently, the facility relies on more than 200 automated guided vehicles (AGVs) that transport containers around the facility 24/7. PSA expects to more than double the AGV fleet as the development progresses, according to the publication.

Technical challenges in accomplishing the automation included designing AGVs to handle faults during various process parts.

The new system’s heart is an event-driven architecture (EDA) platform that allows interconnected systems, devices, and processes to exchange real-time event-based information. This includes vessel arrivals, container movements, and equipment status changes.

“Such a transformative opportunity doesn’t happen without some challenges,” said Ho to the publication, adding that “during Phase One of the development at Tuas Port, several complexities emerged, including designing AGVs with an always-on communications design that can handle faults at various layers of the technology stack.”


US economic growth boosts Malaysia’s timber exports

Improving growth predictions for the US economy are set to boost the Malaysian timber and timber products industry this year, Free Malaysia Today reports.

Malaysia’s Plantation and Commodities Minister Johari Ghani predicted an uptick in furniture exports due to positive macroeconomic figures in the US, the main market for Malaysia’s furniture exports.

Last year, a weakening in housing demand in the US – which accounts for more than half of Malaysia’s furniture exports – led to the exports of timber and timber products falling by 13.2% and furniture exports dropping by 18.1%. Exports account for around 44% of Malaysian timber production. The country has exported to over 180 countries over the last five years.

To ease global concerns about deforestation, the Malaysian government has funded an extensive forest plantation development program and has provided soft loans to 88 companies for replanting projects.

The replanting would ensure that the Malaysian timber industry can adhere to international standards – particularly regarding deforestation.

“This is for reforestation efforts involving 142,000ha, including 75,000ha in the peninsula, 37,000ha in Sabah, and 35,000ha in Sarawak. This ongoing development is expected to yield results in the next seven to 15 years,” Ghani told Free Malaysia Today.

“This collaboration aims to streamline the industry’s environmental, social, and governance (ESG) framework, harmonizing conservation and industrialization.”


Taiwan sees demand for high-tech exports soar

Worldwide demand for Taiwan’s high-tech exports has seen a resurgence, spurred on by demand for AI, South China Morning Post reports. 

Taiwan, a central global production hub, has seen a monthly export increase due to the rising demand for AI devices. Rising interest rates appear to have failed to dampen demand.

Positive indicators led Taiwan to revise forecasts for upward growth. Its trade-based economy is expected to grow at 3.43% in 2024, up from the previous GDP growth figure of 3.35%. Taipei expects 2024 exports to be up by 6.14%.

In 2023, they were down 9.8% year-on-year. Since 2020, Taiwan’s trade reliance on mainland China has been falling. In January 2024, Taiwan’s exports to mainland China and Hong Kong accounted for 32.9% of all exports. This was the third lowest percentage figure in a single month since August 2002. The Taiwanese government has been attempting to diversify its trade away from China, not only because of potential conflict with Beijing but also because of market uncertainty.

Despite muted economic conditions worldwide in 2023, Taiwan’s trade surplus rose 56.9% to a record high of $5 billion.

Leading the increase were exports of audiovisual communication products, which rose 28.9% year-on-year. Exports to the US accounted for $76 billion of Taiwan’s total exports in 2023, which were $432 billion.

Although Taiwan’s exports fell by nearly 10% year-on-year in 2023, Taiwan’s Ministry of Economic Affairs was relatively relaxed about the figure – pointing out that 2022 saw an unusually high export total.


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