Logistics Improvement Strategies for Thailand-Malaysia Cross Border Trade

Abstract

The objectives of this research are to 1) study logistics costs in the Thai-Malaysia border tradeand 2) develop a conceptual framework to reduce the logistics costs. This research approach is qualitative research using Delphi technique with 17 participants. The results indicate an overwhelming number of aspects of reducing logistics costs in the Thai-Malaysia border trade.
Thai authorities should reduce the fee, and also eliminate the over-time cost in the border trade. The authorities should introduce a free tax of the first 30,000 tons of perishable goods that are transited to Singapore. Additionally, setting up official patrols and security desks are needed in the border-trade area in order to eliminate crimes caused by cultural differences. The consignment of illegal oils and the use of illegal vehicle license plates must be investigated by the patrols too.
To encourage Thais to understand Malaysia’s law is also important. With respect to mutual agreement, both countries should introduce transshipment regulations to balance their own advantages with expectation of a win-win outcome. Thai authorities should support contributions in form of finance and people to increase the efficiency of the border trade. As well as private sectors, they should cooperate with the authorities in order to reduce logistics costs in the border-trade area such as a collaboration of logistics-people development.
Inland Container Depot (ICD) should be established close to the border between Thailand-Malaysia. With regards to port of the entry, the development of infrastructure will be speed up of goods transit. Moreover, this should include new immigration mechanisms in the port of entry such as a single-window system. Additionally, more logistics infrastructure should be developed such as double track railway, high speed train, and terminal port. Furthermore, the martial law should be abolished in safety areas. On the other hand, a special law against corruptions should be seriously implemented in the border trade.