Malaysia To Be Asia Pacific’s Preferred Air Cargo Hub With The Operationalisation Of Cainiao Aeropolis eWTP Hub

SEPANG/ HANGZHOU – Malaysia is poised to be Asia Pacific’s preferred air cargo hub with the operationalisation of the Cainiao Aeropolis eWTP (electronic World Trade Platform) Hub since November last year. The global e-fulfilment hub had arisen from the eWTP partnership between the Malaysian government and Alibaba Group, with the establishment of a joint venture company between Malaysia Airports and Alibaba Group. The hub will transform Malaysia into a regional distribution centre for e-commerce and is expected to generate a cumulative GDP of RM4.2 billion in the next ten years and support over 35,000 jobs. The eWTP Hub was launched earlier today by the Minister of Transport of Malaysia, YB Dato’ Seri Ir. Dr. Wee Ka Siong.

YB Dato’ Seri Ir. Dr. Wee said, “In 2020, the Malaysian freight and logistics market was valued at USD37.6 billion and is expected to reach more than USD55 billion by 2026, with the new economy being a strong contributing factor. The advent of e-commerce in recent years has proven to be a boon to air cargo growth as it is the single largest catalytic driver. The Cainiao Aeropolis eWTP Hub will be a game changer for Malaysia as the Asia Pacific hub for Regional Distribution Center (RDC) and e-commerce logistics with huge benefits such as its strategic location within the Free Commercial Zone with airside access where value-added activities such as break bulking and light assembly are also permitted. The hub is a growth engine for Malaysia, with projections to generate a cumulative GDP of RM4.2 billion in the next ten years and support over 35,000 jobs during this period.”

According to the chairman of Malaysia Airports, Dato’ Seri DiRaja Zambry Abd Kadir, “Our aim is to gain leadership in e-commerce logistics and establish KLIA as a preferred regional distribution hub within Asia Pacific. Air cargo has shown great resilience in the past two years, which is a silver lining for us in the aviation industry in mitigating the impact of the pandemic. Therefore, the establishment of the eWTP Hub was indeed timely and we believe that it will also serve the aspirations of the 12th Malaysia Plan by enhancing the competitiveness of our transport and logistics sectors through its efficiency, connectivity, and smart supply chain and logistics technology. This will further contribute towards improving air cargo handling processes, increasing air cargo volume and enhancing cross-border trade for the nation. All these efficiencies will allow cargo volume at KLIA to double to 1.3 million metric tonnes within the next ten years.”

Mr Wan Lin, CEO of Alibaba Group’s logistics arm Cainiao Network (“Cainiao”), said, “Our role is to support businesses, especially SMEs, by providing an efficient and comprehensive global logistics network that can serve a larger international customer base and reduce trade barriers. Together with our partners, we have created a global network of smart logistics hubs, starting here in Malaysia under the eWTP initiative. As a core component within the e-fulfilment ecosystem, the Cainiao Aeropolis eWTP Hub provides crucial logistics support for major events such as the upcoming 11.11 Global Shopping Festival, enabling Malaysian businesses and consumers to benefit from enhanced logistics efficiency and stability. We believe the hub will be a leading logistics and distribution centre in the region, and we are honoured to play a part in contributing to the economic development of Malaysia.”

Since the commencement of the hub last year, Cainiao has onboarded freighter airlines such as Kargo Express to operate directly from the hub. This has culminated in the launch of more international and domestic routes for charter and scheduled flight operations, thereby enhancing air connectivity and air freight stability to support growing demand for air cargo transportation. GTR and Pos Aviation are also operating directly in the hub, improving cargo handling efficiency for both shippers and consignees. Cargo clearance time has been reduced from 4 hours to within 2.5 hours upon delivery from aircraft.

Situated on a 60-acre (2.6 million sqft) plot of land within KLIA’s vast 10 km X 10 km landbank, the Cainiao Aeropolis eWTP Hub boasts 1.1 million sqft of warehouse space that houses a host of facilities for cargo terminal operation (CTO), warehousing, sorting, and a dedicated customs clearance that is backed by a first-of-its-kind innovative digital customs clearance system, capable of reducing clearance time from 24-48 hours to 1.5 hours. This has been made possible by the Royal Malaysian Customs Department (RMC) through the establishment of satellite operations and an administrative office away from their main base in KLIA, allowing for more rapid cargo clearance, while ensuring onsite supervision.

The hub targets vertical markets including automotive, sporting goods, fast-moving fashion and lifestyle, retail electronics and medical equipment sectors, among others. More importantly, the facility enables 24-hour and 72-hour deliveries within Malaysia and to the rest of the world respectively as part of its efforts towards supporting the country’s economic recovery and increasing trade flows in the broader region.