Concern for finances of Sabah logging companies due to log export ban

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Sabah has imposed an interim ban on log exports and sacrificed a major source of income to ensure the domestic market enjoy adequate raw material supply. Mohd Shafie Apdal, Sabah Chief Minister, said the log export ban announced recently is temporary as a review will be undertaken to examine the logging and processing sectors.

Deputy Chief Minister and Industry and Trade Minister, Wilfred Madius Tangau, said the State Cabinet will examine how best to help local industries and create jobs for Sabahans while ensuring logging firms do not incur huge losses because of the ban.

The Sabah forest sector contributed around 7% of total State income in 2016 and earned just over RM2 billion from wood product exports. Analysts write “the woodbased industry in the State is dominated by primary processing mills many of which are operating well below capacity due to the shortage of logs”.

The number of mills in Sabah has been steadily falling from nearly 400 in 2015 to below 200 in 2016 when the latest review was conducted.

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