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Malaysia’s Economic Development with emphasis on Public-Private Collaboration
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Dato’ Abd. Rahman Husin, Deputy Director General (Sectoral),Economic Planning Unit,MALAYSIA
May 2006
World Bank PSD Conference
2BR
IEFI
NG
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Privatization3
2Public-Private
Sector Collaboration –An
Overview
Sectoral Perspective -
Industrial Clusters
4
Malaysia, EPU & Development Planning
1
Conclusion5
MALAYSIA AND ETHIOPIA
Independence : 31 August 1957 Form of State : Federated constitutional monarch Administrative Division : 13 states and 3 Federal Territories Total area : 330,242 sq km
Land : 329,042 sq km Water : 1,200 sq km (Ethiopia : 1.1 million sq km – land area)
Climate : Tropical; annual southeast (April-Oct) and northeast (Oct-Feb) monsoons
Land Use : Arable land : 3 % Permanent crops : 12 % Forests : 68 % Others : 17 %
Language : Bahasa Malaysia (Official), English, Chinese, Tamil Religions : Islam, Buddhism, Hinduism, Christianity & Others
Country ProfileM
AL
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SIA
: G
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LIT
ICA
L
ST
RU
CT
UR
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Map
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MAIN FUNCTIONS OF EPU• Formulate policies and strategies in development planning
• Prepare long and medium term plans
• Prepare development programmes & project budget
• Monitor & evaluate the achievement of development programmes & projects
• Advise government on economic issues
• Initiate & undertake necessary economic research
• Plan & coordinate the privatization programme & evaluate its achievement
• Coordinate Malaysia’s involvement in the development of the Growth Triangle Initiatives
• Initiate & coordinate bilateral & multilateral assistance
• Manage the Malaysian Technical Cooperation ProgrammeEPU
MA
LAYSIA
ORGANIZATIONAL STRUCTURE OF THE EPU
Director General
Deputy Director General(Macro Planning Division)
Deputy Director General(Sectoral Planning Division)
Industry & E. Services
Privatization
Infrastructure & Utilities
Social Services
Development Budget
Technical Services
Agriculture
Energy
Macroeconomics
Distribution
Human Resources
Regional Economics
External Assistance
Secretariat to the National Economic
Action Council
Secretariat to the Foreign Investment
Committee
General Services
Legal Adviser
Sections directly under the Director General
No. of officers : 250
No. of staff : 150
Total : 400
Environment
Knowledge Economy
7
Planning Horizon . . . LONG TERM PLANNING
– Vision 2020, 1991-2020– First Outline Perspective Plan (OPP1), 1971-1990– Second Outline Perspective Plan (OPP2), 1991-2000– Third Outline Perspective Plan (OPP3), 2001-2010
MEDIUM TERM PLANNING– Five-year development plans, such as the Ninth
Malaysia Plan (2006-2010)– Mid-term review (MTR) of the five-year Plans
SHORT TERM PLANNING– Annual Budget
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Major Economic Policies
• Laissez-faire / export-oriented• Economic and rural development
Growth with Equity, 1971-90
TOTAL DEVELOPMENT
BalancedDevelopment,1991-2000
Performance & Impact Oriented Development to achieve the goals of Vision 2020
Post-independenc
e1957-70
New Economic Policy (NEP)
National Development Policy (NDP)
National Mission
2006 - 2020
Vision 2020
Transformation From an Agro-based to an Industrial-based Economy . . .
1970 1980 1990 2000 2003 2005
Agriculture Construction Manufacturing Mining Services
RM billion
0
50
100
150
200
250
53.9 %
31.9 %
8.9 %
46.8 %
24.6 %
16.3 %26.7 %
37.5 %
12.2 % 43.1 %
17.2 %
21.0 %
58.1%
31.4 %
8.2%
(GDP in RM billion at 1987 prices / Percentage to Total in italics)
300
8.7 %
57.6 %
30.8 %
Diversification Of Exports . . . (% to Total Exports)
Manufactures 11.9
Palm Oil5.1
Others9.8
Rubber33.4
Tin19.6
Forestry16.3
Oil & gas3.9
1970RM 5,163 million
(US$2,065 million)
2005RM 533,790 million
(US$141,588 million)
Manufactures 80.5
Palm Oil3.6Other
s4.2
Rubber
1.1
Tin0.2
Forestry1.2
Oil & gas9.2
11
Real GDP Growth . . .Average 1971- 80Average 1981- 90Average 1991- 2000Average 2001- 05
2000200120022003200420052006e
7.5 %5.8 %7.1 %4.5 %
8.5 %0.3 %4.4 %5.4 %7.1 %5.3 %6.0 %
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Open economy
Mixed system
Multi racial society
A federation
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The Guiding Parameters
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Partners In Development . . .through a MIXED ECONOMIC SYSTEM of free
enterprise but with active government support and direction
The GOVERNMENT provides the broad thrusts and sets direction for the whole economy, and ensures the achievements of socio-economic goals
The PRIVATE SECTOR is free to operate and given appropriate policy, institutional and infrastructural support.
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DEVELOPMENT PLANNING MACHINERY
Cabinet Ministers
National Planning Council
National DevelopmentPlanning Committee
Inter-Agency Planning Group (IAPG)
Federal Ministries & AgenciesState Governments Private Sector
National Economic Action Council
(NEAC), National Economic
Consultative Council (NECC)
Economic Planning Unit
PARLIAMENT
Draft
Policy
Draft
Proposal
Proposal
ProposalCirculars Circulars
General framework
Consultations
Secretariat
National Action Council
Implementation & Coordination
UnitPrivate Sector
Dialogue
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Malaysia Incorporated Policy . . .
Launched in 1983 ~ marked the introduction of structured public-private sector collaboration
Stresses the importance of cooperation between public and private sectors
Establishment of several consultative panels/ dialogues comprising members from the public and private sectorBudget & MITI dialoguesMalaysian Business Council
Government began instituting major policy initiatives
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MAJOR POLICY INITIATIVES Economic liberalisation & deregulation Improving investment policies & incentives Ensuring a business-friendly environment Administrative & institutional improvements
One-stop centres Systems & procedures for licensing Client’s Charter Productivity improvements – TQM, KPIs Public service delivery
Providing an integrated industrial infrastructureS
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Five Key Thrusts
To achieve the goals & objectives of Vision 2020
1. Moving the economy up the
value chain
2. Raising the capacity for
knowledge and innovation, and
nurturing “first class mentality”
3. Addressing persistent socio-
economic inequalities constructively and
productively
4. Improving the standard and
sustainability of the quality of life
5. Strengthening the country’s institutional
& implementation capacity ~ establish a
more effective implementing &
monitoring mechanism
Ninth Malaysia Plan, 2006 – 2010The National Mission, 2006 – 2020
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Thrust1
To move the economy up the value chain
Increasing productivity, competitiveness & value-add Generating new sources of wealth & job creation in
technology- and knowledge-intensive sectors
Giving a lead role to the private sector, & increasing private sector investment by providing an enabling environment for doing business, enhancing SMEs development, increasing public-private partnerships as well as attracting targeted high-quality FDI
Inculcating a culture of high performance & excellence in public & private sectors including GLCs
Expanding market for Malaysian products and services
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Thrust5 To strengthen the institutional &
implementation capacity
Improving public services delivery by strengthening governance, streamlining administrative processes and measuring performance
Improving usage and cost-efficiency of public sector funds by upholding financial prudence as well as improving the monitoring of implementation
Addressing actual and perceived corruption in both the public and private sectors
Enhancing corporate governance and delivery of private sector services by improving legal and regulatory frameworks
Strengthening the role of Parliament, media & civil society
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PRIVATIZATIONPRIVATIZATION
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• Privatization policy was launched in 1983
• It represented a policy shift from public sector-led to private sector-led growth
• The policy has been an integral part of the national development policy of Malaysia
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PRIVATIZATION POLICY
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Reduce financial & administrative burden of the Government
Reduce public sector size & direct participation in the market place
Promote competition, efficiency & productivity
Accelerate economic growth Meet the targets of NEP, NDP & NNM
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Objective of Privatization . . .
SCOPE OF PRIVATIZATIONSCOPE OF PRIVATIZATIONAirports RM10.0 bn /USS2.9 bn
Urban Transportation RM12 bn/US$3.2bn
Ports RM7.8 bn /US$2.1bn
Telecommunications/ multimedia RM6.6 bn /US$1.7bn
Power RM42.3 bn / US$11.1bn
Roads/highways RM31.6 bn/US$8.3bn
Water treatment
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Existing Projects/Activities : Outright sale (assets or shares) Lease Management-Buy-Out Management Contract
New Projects : Build-Operate-Transfer (BOT) Build-Operate (BO) Build-Lease-Transfer (BLT)/Build-Transfer (BT)
Guiding Principle : Choose a feasible method which maximize private sector investment
Administrative machinery : Centralized planning and processing at the EPU Decentralized implementation by the ministries and State
Governments Standardization of terms and conditions of privatization
PRIVATIZATION METHODSPR
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PRIVATIZATION ACHIEVEMENTS SINCE 1983
• Total privatized projects–Existing projects–New projects
• Workers transferred to the private sector
• Savings (RM billion)–Operating expenditure–Development expenditure–Proceeds from sale of Government equity
• KLSE market capitalization (Oct 2005)–RM billion (for 40 privatized entities)–% to total market capitalization
485346139
113,200
7.8154.0
28.9
174.123.0
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PRIVATIZATION POLICY - LESSONS LEARNT
• Need strong commitment by the Government• Strong policy statements on private sector as the
engine of growth• Private sector must possess a certain level of
expertise and readiness to undertake project & investment risks
• Require a well-developed financial market to support large scale investment
• Need proper planning, monitoring & coordination to ensure success in implementation
• Necessary to undertaken rigorous evaluation on project viabilityP
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INDUSTRIAL INDUSTRIAL CLUSTERS –CLUSTERS –PUBLIC-PRIVATE PUBLIC-PRIVATE PARTNERSHIPPARTNERSHIP
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E&E Industrial Cluster• Major driver in transforming Malaysia from an
agricultural to industrial exporter• Took off in the early 1970s with export-oriented
industrialization strategy• Attractive investment climate:
Investment Incentives Act 1968 & Industrial Coordination Act 1975 provided better incentives to attract FDI in E&E sector
Key support institutions, infrastructure & services
Industrial Infrastructure Utilities & Telecommunications Air Cargo & Port Facilities HRD – PSDC, Industrial Training Institutes,
Universities and educated low-wage labour• Leading industrial subsector
28% of manufacturing value added (2005) 65.8% of exports of manufactured goods 26.8% of total manufacturing sector
employment
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Incentives FDI
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Enhancing E&E Industrial Cluster – Development Strategies
• Moving the value chain up by encouraging MNCs to shift more sophisticated/high tech operations to Malaysia
• Deepening supply chain by developing capabilities in domestic firms
• Increasing value added through the technology acquisition & development
• Generating synergy with the development of ICT & multimedia industry
• Nurturing global Malaysian-owned companies e.g. Globetronics, ENG Technology
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CONCLUSIONCONCLUSION
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ROLE OF THE PUBLIC SECTOR
Strategic integrator & facilitator of development efforts in addition to its traditional role of administrator & provider of basic socio-economic infrastructure
Develop long, medium and short term plans in pursuit of national socio-economic development goals
Responsible for macro and socio-economic management towards socio-political, macroeconomic and financial stability
Enhance liberalization and deregulation towards creation of a conducive environment for private investment
Charting new directions and strategies for growth Custodian of public goods and spearheading social
programmes Governance by networks – collaborate with private firms,
industry associations and NGOs & engaging citizens
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ROLE OF THE PRIVATE SECTOR
Provide dynamism in spearheading the economy and be the engine of growth
Improve efficiency & productivity towards the creation of a competitive private sector
Engage foreign investors in mutually beneficial partnership and joint ventures
Embark on R&D and innovation activities for wealth creation
Develop long, medium and short term plans in pursuit of national goalsC
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CRUCIAL ELEMENTS FOR SUCCESS
• Strong political and public sector support
• Sufficient level of empowerment• Close collaboration among central
agencies Ministries and implementing agencies
• Strong partnership between public and private sectors
• Effective communication strategy
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THANKTHANK YOUYOUYOUYOUwww.epu.jpm.mywww.epu.jpm.my
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HYPERLINKED HYPERLINKED SLIDESSLIDES
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Thrust2
To raise the country’s capacity for knowledge and innovation and nurture ’first class mentality’
Promoting Islam Hadhari as a comprehensive & universal development framework for the nation
Undertaking comprehensive improvement of the education system, from pre-school to tertiary level, from the aspects of curriculum and teaching to school facilities, with a special focus on raising the standard of schools in rural areas
Enhancing national schools to become the people’s “school of choice”
Producing universities of international standing and ensuring that tertiary institutions meet the needs of employers
creating more avenues for skills development, training and lifelong learning for the labour force at all levels and for all ages, including in ICT
Providing an environment and innovation system which encourages top-quality R&D and its commercialisation
Refining and implementing programs which encourage the development of a strong moral and ethical culture as encapsulated in the National Integrity Plan
Empowering youth & women to participate in national growth and development
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Thrust3 To address persistent socioeconomic
inequalities constructively & productively
Eradicating hardcore poverty by 2010 as well as reducing overall poverty
Reducing disparities between rural and urban population & among states & regions via sustainable income-generating avenues & by improving access to basic needs such as housing, education, healthcare, utilities & transportation
Developing less developed regions through regional growth centres
Bridging the digital divide Addressing inter- and intra-ethnic disparities,
particularly by raising incomes through the enhancement of skills & capabilities
Promoting equal opportunities in employment towards reducing disparities in occupation & income as well as enhancing integration among the ethnic groups
Creating a new generation of competitive Bumiputera entrepreneurs & enterprises
Reviewing past restructuring policies and programmes to evaluate their effectiveness and impact, and to focus future policies and programmes on merit and need
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Thrust4 To improve the standards and sustainability
of the quality of life
Ensuring better protection of the environment and more efficient usage of natural resources
Enhancing energy sufficiency and efficiency, including diversifying sources of energy
Increasing the efficiency of water services delivery
Providing better public transportation to relieve congestion and reduce fuel usage
Improving access to and quality of healthcare and affordable housing
Ensuring public safety and securityEnhancing the development and
promotion of Malaysian culture, arts and heritage
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Investment Incentives . . .
Pioneer status or Investment tax allowance for manufacturing companies
Incentives for small- & medium-scale enterprise
Training and R&D Grant Incentives for high technology
companies Incentives for strategic projects Incentives for R&D
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Other Incentives
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Investment Incentives . . .
Incentives for software development Pre-packaged incentives Incentives for exports General incentives
Industrial building allowance Infrastructure allowance Import duty exemptions for:
o raw materials / components and o equipment & machinery
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Manufacturing Investment in Approved Projects, 2001- 2005
IndustryCapital Investment (RM million)
Number Domestic Foreign
Resource-Based
Food Manufacturing
Beverages and Tobacco
Wood & Wood Products
Furniture and Fixtures
Paper, Printing and Publishing
Chemical and Chemical Products
Petroleum Products
Natural Gas
Rubber Products
Plastic Products
Non-Metallic Mineral Products
Non-Resource-Based
Textiles and Textile Products
Leather and Leather Products
Basic Metal Industry
Fabricated Metal Products
Machinery Manufacturing
Electronics and Electrical Products
Transport Equipment
Scientific and Measuring Equipment
Others
1,948
369
26
193
233
123
288
61
2
144
358
151
2,771
178
12
163
487
443
1,051
353
84
93
25,612 (46.2)
3,469 ( 6.3)
142 ( 0.3)
2,267( 4.1)
1,363 ( 2.5)
6,418 (11.6)
5,004 ( 9.0)
1,787 ( 3.2)
50 ( 0.1)
1,442( 2.6)
2,050( 3.7)
1,620( 2.9)
29,303 (52.8)
1,171 ( 2.1)
57 ( 0.1)
9,308(16.8)
2,059( 3.7)
1,961 ( 3.5)
8,084(14.6)
6,157(11.1)
506( 0.9)
559( 1.0)
23,903 (31.0)
2,303 ( 3.0)
470 ( 0.6)
943 ( 1.2)
297 ( 0.4)
4,850 ( 6.3)
3,025 ( 3.9)
6,289 ( 8.2)
0 ( 0.0)
963 ( 1.2)
1,760 ( 2.3)
3,005 ( 3.9)
53,068 (68.8)
947 ( 1.2)
17 ( 0.0)
5,502( 7.1)
2,177 ( 2.8)
1,535 ( 2.0)
35,290 (45.7)
5,388( 7.0)
2,212( 2.9)
181 ( 0.2)
Total 4,812 55,474 77,152
Total
49,516 (37.3)
5,772 ( 4.4)
612 ( 0.5)
3,210 ( 2.4)
1,659 ( 1.3)
11,268 ( 8.5)
8,029( 6.1)
8,076( 6.1)
50 ( 0.0)
2,405( 1.8)
3,810( 2.9)
4,625( 3.5)
82,371(62.1)
2,117( 1.6)
74 ( 0.1)
14,810 (11.2)
4,236 ( 3.2) 3,496 ( 2.6)
43,374 (32.7)
11,545 ( 8.7)
2,718 ( 2.0)
740 ( 0.6)
132,626
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TYPES
Industrial Zones
Special Commercial Premises
SME Industrial Estates
Technology Parks
Industrial Corridors
Business PremisesSU
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Providing An Integrated Industrial Infrastructure
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IPe-ENABLE SUPPLY CHAIN e-ENABLE SUPPLY CHAIN MANAGEMENTMANAGEMENT
• RosettaNet Malaysia - launched in 2002
• Joint initiative by Fed agencies (MITI, SMIDEC), State agencies (PDC), Manufacturers Association (FMM), MIMOS MNCs, SMEs & Solution Providers
• Enables Malaysian suppliers to link to global E&E supply chain
• Reduce inventory costs, time to market & lower transaction costs
• No. of companies successfully implemented RosettaNet Standards increased from 33 in 2004 to 327 in Mac 2006
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ADDITIONAL SLIDESADDITIONAL SLIDES
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Solution Providers : Hewlett-Packard SalesMicrosoftOracle Penang Network Services Cardos Automation SystemKarenSoft Technology*JSP Consultinge-BusinessLK SolutionsTradenex.comB2B CommerceNDT Software ConsultingSCS Computer Systems SAP Malaysia* Formfill Australasia Dagang NetNECBGlobalMnEBayGridNodeAdvanced Professional (India)Rank AlphaSterling CommerceJ.D. EdwardsPeopleSoftNovellGlobal EXchange
Foreign MNCs : IntelDellInventecIBMInfineonFairchildEricssonKemetSeagateLSI Logic
Malaysian Companies : LKT Industrial GlobetronicsPublic PackagesBCM ElectronicsTFS Electronics (Unico)1st SiliconPolytool TechLeong Bee Soo BeeIre-Tex D’nonceSan Yong EnterpriseFederal PackagesGenting Sanyen
Associations & Clubs: FMMGovernment:MIMOS,MITI,SMIDEC,PDC, MECM, EPU
RosettaNet Malaysia Partners include …
Logistics Providers: Priority Cargo
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• 1 Corridor
• Bill of Guarantees
• 50 world-class companies
• Launch 7 flagship applications
• World-leading framework of cyberlaws
• Cyberjaya as world-leading intelligent city
• Web of corridors
• 4,000 MSC Status & 250 MSC Global companies.
• 100,000 new jobs & RM69 bil revenue & RM2.5 bil exports
• Enhance ICT industry cluster
• Enhance multimedia applications
• Leadership towards harmonized global framework of cyber laws
• Link to world leading intelligent cities
• All of Malaysia
• 500 world-class companies
• Global test-bed for new multimedia applications
• International CyberCourt of Justice in MSC
• Become net ICT exporter
• Cybercities/cybercentres linked to global information highway
ICT & Multimedia Hub: MSC ICT & Multimedia Hub: MSC MilestonesMilestones
Transform Malaysia into a knowledge society
Phase 3
Grow MSC into a global ICT hub
Phase 1
Create the MSC
Milestones1996 2003 2010 2020
The MSC: Next Leap
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MSC Phase 1
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MSC Next Leap (2004 – 2010)
Rollout MSC Cybercities/Cybercentres….
Bayan Lepas, Penang
Kulim Hi-Tech Park
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Flagship Applications
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TargetMarket Shared Services
Pooling of resources to render common services cost-effectively, leveraging on economies of scale
Global/Offshore
LOCAL
INSOURCE OUTSOURCE
Services delivered internally Partner with external provider
• Telekom Malaysia• Petronas
• User: BCB• Provider: EPIC-I (EDS)
Companies in MSC
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• Malaysia is ranked 3rd globally for global outsourcing location attractiveness
• Well developed, low-cost infrastructure and strong government support
• Created 8,000 high-value job opportunities in MSC• SSO MSC created 12,000 jobs by end of 2005
Source: A.T. Kearney’s2004 Offshore Location Attractiveness Index: Making Offshore Decisions
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Factor Conditions for Growth of MSC & Public-Private Sector Collaboration
Firm Government commitment Comprehensive package of incentives
Bill of Guarantees Infrastructure Cyberlaws Incentives
Competitive cost of doing business Emphasis on human capital development
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Factor Conditions for Growth of MSC & Public-Private Sector Collaboration
Effective Institutional Mechanisms for Policy Directions, Implementation, Monitoring & Coordination
International Advisory Panel Implementation Council Dedicated ‘one-stop’ agency – Multimedia
Development Corporation (MDeC) with investor-friendly mindset to facilitate private sector investment
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Bill of Guarantees
• Provide a world-class physical and information infrastructure
• Allow unrestricted employment of local and foreign knowledge workers
• Ensure freedom of ownership by exempting companies with MSC Status from local ownership requirements
• Give the freedom to source capital globally for MSC infrastructure, and the right to borrow funds globally
• Provide competitive financial incentives, including no income tax for up to 10 years or an investment tax allowance, and no duties on import of multimedia equipmentS
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Bill of Guarantees
• Become a regional leader in intellectual property protection and cyberlaws
• Ensure no Internet censorship
• Provide globally competitive telecommunications tariffs
• Tender key MSC infrastructure contracts to leading companies willing to use the MSC as their regional hub
• Provide an effective one-stop agency – Multimedia Development Corporation
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Biotechnology Industry ClusterPU
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• Position biotechnology as a new engine of growth & wealth creation
• Transform and enhance value creation of the agriculture sector through biotechnology
• Capitalise on strengths of biodiversity to commercialise discoveries in health-related products
• Ensure growth opportunities in industrial bio-processing and bio-manufacturing
• Establish R&D centres of excellence and accelerate technology development via strategic acquisitions
• Build human resource capability • Create an enabling financial, legislative and
institutional framework• Foster greater public-private sector
collaboration through Bio-Nexus network
PHASE I(2005-2010)
Capacity Building
PHASE II(2011-2015)Science to Business
PHASE III(2016-2020)
Global Business
HR DevelopmentEst. Advisory and Implementation Councils
Est. Biotechnology Corp.
Capacity Building in R&D
Develop Agricultural, Healthcare and Industrial Biotechnologies & Bioinformatics
Develop Legal and IP Framework
Regional Biotechnology Hubs
Develop BioNexus Malaysia as a brand
Promote FDI participation
Initial job and industry creation
Develop expertise in drug discovery & devt.
New Products Technology
Acquisition Intensify FDI
participation Intensify Spin-
off Companies Strengthen
Local and Global Brands
Develop Capability in Technology Licensing
Job Creation
Consolidate Strengths and Capabilities in Technology
Further Develop Expertise in Drug Discovery and Devt.
Leading Edge Technology Business
Create greater value through Global Malaysian Companies
Re-branding of BioMalaysia as Global Hub
Competitive &
LeadingBiotechIndustry
BIOTECHNOLOGY ACTION PLANBIOTECHNOLOGY ACTION PLAN
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Generating New Sources of Growth
Growth Areas Competitive Advantage
• Agro-biotechnology– Higher value added crops
and foods– Natural products
• Health-Biotechnology– Bio-Generics– Diagnostics– Vaccines
• Industrial Biotechnology– “Green” Chemistry– Biocatalysts– Biomaterials– Bio-Manufacturing
• Strong Government support• Well established agro and
medical research base• One of 12 mega diversity
countries• Create niche market • Built upon local capability
• Demand for green technology applications
• Potential/new markets e.g. EU
• Environmental concerns
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Bio-Nexus
IPNDengkil
Genome CentreUKM
IABUPM/MARDI
Food Cluster
Natural ProductsVaccines
Industrial-bio
Agro-bio
Bio-Nexus Network
Healthcare-bio
Interactions between institutions & industry
Industry NINPVBEnstek, Nilai
Platform Technology
61PU
BLI
C-P
RIV
ATE P
AR
TN
ER
SH
IP • 5,152 offshore companies from 93 countries
• LOFSA – a one-stop agency • Promoting Labuan as a unique
IOFC with specialization in Islamic financial products & services
• Strengthening legislation & guidelines
• Enhancing competitiveness to sustain attractiveness
• Incentives to attract strong foreign entities with global market linkages
Financial Services Cluster Labuan IOFC
62
Palm Oil Industrial Cluster (POIC)• Lahad Datu POIC - to add value to the
oil palm industry, create jobs & business opportunities
• Designated palm oil industrial cluster & logistic hub for east ASEAN
• Developed by POIC Sabah Sdn. Bhd. with support from Federal Government
• Equipped with adequate physical infrastructure to attract private investment in upstream & downstream industries
PU
BLI
C-P
RIV
ATE P
AR
TN
ER
SH
IP
63
Halal HubPU
BLI
C-P
RIV
ATE P
AR
TN
ER
SH
IP
• Development of halal product industry cluster to capture the growing share of the world halal market potential
• Credibility and worldwide recognition of JAKIM’s halal certification system and logo
• Availability of needed resources and strong government support
• Establish Halal Industry Corporation• Provision of various incentives as well
as programmes for improvement in product quality and standards, training, promotion, branding & market access
• International M’sia Halal Showcase (MIHAS)
TIGeR’s Supply Chain Model
Global Buyers
1st Tier Suppliers
2nd TierSuppliers
Vertical Integration of local suppliersHorizontal Integration with other businesses, services and government into the GSC
Government
Govt. AgenciesService Providers
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