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P I K O M C O N F I D E N T I A L
Future challenges and opportunities: further
expansion of trade in ICT products
GANESH KUMAR BANGAH Deputy Chairman, National ICT Association of Malaysia (PIKOM)
28 June 2017
Expanding ITA to Embrace the Digital Future –
A Malaysian Industry Perspective.
Voice of the Malaysia ICT
Industry
with members of close to 1,000 corporate companies representing
Retailers, Wholesalers, Software Developers, System Intergrators,
eCommerce companies, Multinationals and user community.
We are the bridge to regional & global ICT bodies as well:
P I K O M C O N F I D E N T I A L
• Population: 31.7 million • GDP: USD 400 billion • GDP per capita of USD 11,000 • GDP growth: 4.3% Note: Figures are for 2016 unless otherwise stated. Sourced from Ministry of Finance Malaysia
MALAYSIA AT A GLANCE
Malaysia is still very much a developing nation; Aspirations to be high income by 2020
P I K O M C O N F I D E N T I A L
MALAYSIAN ICT INDUSTRY
USD 40 billion industry Contributes 18% to GDP
Growing at 10% per annum
• ICT contribution to GDP at 18.2% • Mobile penetration at 141.6% • Broadband penetration at 77.9% of households
Note: Figures are for 2016 unless otherwise stated. Sourced from Malaysian Communications and Multimedia Commission
P I K O M C O N F I D E N T I A L
• ICT Products more affordable especially to the lower income groups.
• Catalytic effect on the ICT industry. ICT industry has quadrupled in the last 8 years.
• Exports of ICT products have increased 3 folds through ITA 1. Poised for further growth through ITA2.
BENEFITS OF ITA1 TO MALAYSIA
P I K O M C O N F I D E N T I A L
• Since implementation in mid 2016, immediate positive effects seen.
• Q3 and Q4 2016 recorded stronger economic growth of 4.3% and 4.5% from 4% in Q2.. Further growth of 5.6% in Q1 2017.
• ICT contribution to GDP in 2016 hit 18.2% from 17.8% in 2015.
HOW ABOUT ITA2?
P I K O M C O N F I D E N T I A L
• While ITA has been hugely successful, impediments abound. • Non-Tariff Barriers are the new road blocks to free trade. • Need for better and more effective elimination of NTBs. • MRAs need to be widely adopted across ITA countries.
CHALLENGES OF ITA
P I K O M C O N F I D E N T I A L
WHY ITA IS NEEDED?
P I K O M C O N F I D E N T I A L
THE TECHNOLOGY INDUSTRY HAS EVOLVED TO BECOME THE DIGITAL INDUSTRY
• Technology companies of today are Uber, Facebook Amazon, Google.
• Twenty years ago, with ITA 1, the list was very different. • From just Hardware and Software to Automate Processes; • Technology has now become an Enabler to Disrupt Entire
Industries.
EVOLUTION OF INDUSTRY
P I K O M C O N F I D E N T I A L
DATA IS THE NEW ENERGY
• The barriers to entry in the technology industry are very low. • Entrepreneurs arise not from wealthy backgrounds but from
all strata of society. • The Internet has Democratised Knowledge
EVOLUTION OF ECONOMY
P I K O M C O N F I D E N T I A L
BRIDGING THE DIGITAL GAP
• Rural and urban poor communities are connected and have access to technology.
• Education is available to all using the latest technology tools • Mobile is the most common access device
EVOLUTION OF SOCIETY
P I K O M C O N F I D E N T I A L
INCREASED INCOME LEVELS
• ICT has provided employment and business opportunities for all communities.
• Entrepreneurs can now earn a living selling online via social media.
EVOLUTION OF THE WORKFORCE
P I K O M C O N F I D E N T I A L
THE WORLD IS FLAT
• Trade barriers are the business model of the past century. • Today, products (and services) can be sourced from around the
globe. • Jack Ma’s eWTP : Deliveries done within 72 hours globally!
EVOLUTION OF TRADE
E-COMMERCE ALLIANCE MEMBERS Indonesia
Singapore
Thailand
Hong Kong
Malaysia
Vietnam
STRATEGIC INTERNATIONAL ALLIANCES
ASOCIO E-Commerce Alliance has signed up major e-commerce platforms across 6 countries within 3 months of initiation
P I K O M C O N F I D E N T I A L
WHAT’S NEXT FOR ITA?
• From Trading of Hardware and Software To Trading Of Data
• Tax & Security Implications
• From Business to Business (B2B) to Consumer to Consumer (Social
Trading)
• Empowering Trading For The Masses Enabled by Technology
• From Trade Of ICT Products and Services to Trade of Products and Services
Enabled by Technology
• Using ITA as a basis for eWTP
From ITA to DTA ? (Digital Trade Agreement)
P I K O M C O N F I D E N T I A L
WHAT CAN WE DO?
ITA3 or DTA negotiations should start now.
Why? Many products are not in the ITA list.
Multilateral negotiations take very long. Technology industry evolves very fast.
THE TIME TO ACT IS NOW
THANK YOU THE NATIONAL ICT ASSOCIATION OF MALAYSIA E1, Empire Damansara No 2, Jalan PJU 8/8A Damansara Perdana 47820 Petaling Jaya, Selangor, MALAYSIA E : [email protected] W : www.pikom.org.my
