Invest Malaysia - 30 June 2015

THE STAR, TUESDAY 30 JUNE 2015

special

INVEST MALAYSIA

On the map to success

line with national growth strategies.

The Government aims to promote higher domestic investments to spearhead economic growth, as the ETP targets 73% domestic investments by 2020, he says.

For years now, natural gas and chemicals industries have dominated the local manufacturing scene. This trend can still be seen well into this year as of last month, these activities have raked in RM13.3bil worth of investments. Accordingly, oil and gas services lead services sector investments so far with RM3.7bil.

The manufacturing sector will move towards more high value, diverse and complex products,

2 invest malaysiaTHE STAR, TUESDAY 30 JUNE 2015

International support

FOREIGN investments into the manufacturing sector accounted for 27.4% (RM64.6bil) of total investments into Malaysia last year.

Seventy percent of these investments came from Asian countries, several of which continue to support the countrys growing economic ecosystem in various sectors this year, while 24.5% were from the United States and European Union nations.

These were some of the major investors last year that continue to make their mark in Malaysia this year:

Japan

Singapore

China

Republicof Korea

United States

European Union countries

IN his meeting with 34 industry captains in Tokyo last month, Prime Minister Datuk Seri Najib Razak reported that 2014 was a record-breaking year for investments in Malaysia.

The total of RM181.5bil marked a 13.1% increase from 2013s RM160.5bil, surpassing the projected RM148bil target, which is an average annual growth target of 10.9% set under the 10th Malaysia Plan.

This year, Malaysia is projected to sustain a growth of 4.5% to 5.5% in view of a forecasted 3.5% global economic growth.

The 11th Malaysia Plan, which outlines national strategies for economic growth from 2016 till 2020, projects an increased gross national income by 7.9% per annum driven by private consumption and investment.

This plan, along with the New Economic Model, supports the Economic Transformation Programme (ETP), which is the Malaysian Governments initiative to develop the country into a high-income economy by 2020.

Twelve National Key Economic Areas (NKEAs) with high-income potential have been identified for further development.

The Malaysian Investment Development Agency (MIDA) was entrusted to ensure these sectors including oil, gas and energy, education, electrical and electronics, financial services, palm oil and related products, and tourism experience significant growth.

Accordingly, MIDA has initiated four new tax incentives under the Malaysian 2015 Budget to promote balanced growth while exploring new fields and upgrading manufacturing methods and facilities.

MIDA works closely with the Federal Government in promoting the manufacturing and services sectors in the country, assisting potential investing companies and facilitating their project implementations.

Promising prospects

In the first quarter of last year, a total of 42,906 jobs were created from the numerous projects approved througout the country. MIDA statistics on the same quarter this year displayed a 12% increase in employment opportunities through the creation of 48,120 jobs.

The investments received in the months of January to March this year were channelled into manufacturing, services and primary sectors. Manufacturing investments totalled RM33.6bil, followed by RM22.3bil in the services sector and RM1.5bil in the primary sector.

Bank Negara has indicated that

With steady investments into key industries, Malaysia is well on track to meeting its goals of developing a knowledge-based economy.

Prepare for change

Real estate29.98%

Global operations hubs

11.71%

Utility21.72%

IndustryTotal investments

from January to March 2015 (RM billion)

Others

Utility Real estate

Global operations hubs

Hotel and tourismHealth services

MSC statusSupport services

Regional establishments

6.5

4.8

2.6

1.61.61.2

0.7

1

2.2

Services gaining tractionThe countrys services sector recorded

RM22.3bil worth of investments in the first quarter of this year, in line with the Malaysian Investment Development Authoritys goal of expanding this sector. Under the Economic Transformation

Programme, the services sector is targeted to contribute 67% to the countrys GDP by 2020.

The chart shows the various subsectors driving growth of the service industry in Malaysia:

> SEE PAGE 6

Hotel and tourism9.91%

Health services

7.21%

MSC status 7.21%

Support services

5.41%

Regional establishments

3.15%Others4.50%

By THERESA BELLE

investment activities in manufacturing and services sectors are expected to remain robust. Investment in manufacturing will be supported by export-oriented industries and new growth areas such as renewable energy, semiconductors and medical devices, while expenditure in the services sector will be chanelled into higher value-added activities, such as IT services, education and medical tourism.

Out of the RM57.4bil investments made in the first quarter of this year, 73% came from domestic sources. The percentage of foreign direct investments are decreasing year after year, but MIDA chief executive officer Datuk Azman Mahmud explains that this is in

driven by three catalytic subsectors: chemicals, electrical and electronics, machinery as well as industries with high potential of growth such as medical devices and aerospace, says Azman.


invest malaysia 3

On June 4, the worlds first integrated bio-methionine and thiochemicals facility owned by South Koreas CJ CheilJedang and Frances Arkema in Kertih Biopolymer Park was officially launched by the Sultan of Terengganu, HRH Sultan Mizan Zainal Abidin Ibni Almarhum Sultan Mahmud Al-Muktafi Billah Shah.

Chief executive officer of ECERDC Datuk Seri Jebasingam Issace John.

Rise of the eastTHE East Coast Economic Region (ECER) of Malaysia consists of several areas rich in culture and natural resources the states of Kelantan, Terengganu and Pahang, and the Mersing district of Johor.

The responsibility of executing and implementing the East Coast Economic Region (ECER) Master Plan for developing this region has been entrusted by the Federal Government to the East Coast Economic Region Development Corridor (ECERDC), and the statutory body reports positive results.

The ECER attracted RM73.04bil in investments from 2007 up till March this year this figure represents 66% of the development corridors target of RM110bil total investment by 2020. This encouraging progress facilitated the creation of 73,708 new job opportunities in the region.

A great, unique advantage is that investments into ECER are not restricted to urban areas, says Datuk Seri Jebasingam Issace John, chief executive officer of ECERDC.

Rural areas such as Gua Musang, Besut, Jengka and Rompin have also attracted their fair share of investments, providing jobs and entrepreneurial opportunities for local communities.

The resource-based activities in this region are largely supported by the abundance of natural assets such as pristine beaches and coral-ringed islands, centuries-old rainforest, sizeable land areas, oil and gas as well as mineral reserves.

ECERDC has identified five economic clusters to spearhead economic growth:l Tourisml Oil and gas and petrochemicalsl Manufacturingl Agribusinessl Human capital and entrepreneurship development

Increasing focused efforts

Enhancing the regions competitive advantage is the ECER Special Economic Zone (ECER SEZ), a concentration of high-impact projects within the 25km by 140km strip extending to Pekan, Pahang from Kertih, Terengganu.

This gem within the nucleus of the ECER is expected to generate 80% of the regions economic output and aims to achieve a total investment figure of RM90bil by 2020.

Its attractive location in the centre of South-East Asia makes it a prime investment gateway to Asean and Asia Pacific markets.

Comprising new townships, international tourism sites, three ports, two airports and a knowledge innovation zone, ECER SEZ is set to accelerate growth with the support of good infrastructure development as well as knowledge-based and capacity-building programmes.

The expansion of Kuantan Port, which is located in ECER SEZ, will further enhance investment potential in ECER, offering the quickest and most direct route between Malaysia and ports in China.

The Federal Government is channeling RM1bil into building a new 4.7km breakwater and upgrading external infrastructure at the port.

On top of that, the new deep

water terminal (NDWT) will be developed in two phases fora total investment of RM3bil this involves construction and reclamation works as well as new equipment costs.

Upon completion of Kuantan Ports expansion in 2016, the port will be able to receive vessels of up to 200,000 dead weight tonnes, while doubling its operational capacity to 52 million freight weight tonnes annually.

Kuantan Port is recognised asa sister port to Chinas Qinzhou Port, which enhances logisticsand harbour-related industries between the countries. As a deepwater facility, this port will take on the role of a regional hub for cargo terminals and logistics.

In addition, ECERDC is upgrading road connectivity in the region while also looking at the possibility of implementing the East Coast Rail Link (ECRL) project in the future.

Water resources are also being well managed with treatment plants and storage tanks addressing any large resource-related issues while meeting industry requirements.

For example, the Panching Water Treatment Plant has enhanced the reliability, capacity and the quality of potable water supply to Kuantan and the surrounding areas.

With a capacity to provide 160 million litres of treated water daily, the Panching Water Treatment Plant will contribute significantly to the socio-economic growth and improve the quality of life of the local population, especially in Kuantan Port City.

Meanwhile, the Ganchong Water Treatment Plant, also in Pahang, will provide 160 million litres of treated water per day to the district of Pekan, including the Pekan Automotive Park.

Creating promising climate

ECERDC has made strides in addressing and building human capital over the years, which is crucial in creating a suitable business ecosystem for existing and emerging industries alike.

Human capital and entrepreneurship development programmes such as empower ECER, entrepreneur ECER, Agropolitan, ECER Talent Enhancement Programme, TERAJU@ECER and Suri@Home have greatly benefited the local communities.

These programmes have contributed to the creation of more than 9,000 entrepreneurs in the region, 61% of whom are women.

Under the ECER Talent Enhancement Programme, ECERDC provides on-the-job training to engineering graduates in collaboration with its investors.

Last year, 164 graduates completed the programme and went on to clinch positions in top companies. Given this track record for success, ECERDC is expecting more than 600 participants for this years programme.

Looking forward, ECERDC expects to continue working closely with federal and government agencies to attract more investments into the region, particularly into ECER SEZ.

The development authority will intensify promotions in Singapore, Japan, South Korea, China, the United States and countries in the European Union.

We aim to attract more investments into our key industrial parks such as Malaysia-China Kuantan Industrial Park (MCKIP), Kertih Biopolymer Park, Kuantan Integrated Biopark, Pekan Automotive Park, Gambang Halal Park, Pasir Mas Halal Park and Pahang Technology Park, says Issace.

For this purpose, we have been working very closely with the Ministry of International Trade and Industry as well as the Malaysian Investment Development Authority and the respective ECER state governments to attract more investments into ECER, he says.

The ECERDC will build on the existing relationship with China in leveraging on the Five-Year Programme for Economic and Trade Cooperations agreement between Malaysia and China to further attract investments from the global economic giant.

With all these in place to spur ECERs growth, this economic region is on the rise and its economy can only get bigger and better from this point on.

n For more information,visit www.ecerdc.com.my

Why invest in ECER?

Strong government support Advantageous geographical orientation Abundance of land and natural resources Good land, air and sea connectivity Competitive wage rates Large international business communities Skilled and multilingual workforce Market-oriented economy One-stop centre for investor management Human capital training tailored to the need and requirements of investors via the ECER Talent Enhancement Programme (ETEP)

Attractive and competitive incentives:> 100% income tax exemption for 10 years> 100% investment tax allowance on qualifying capital expenditure incurred for five years> Customised incentives based on specific industrial needs> Import duty and sales tax exemption for raw materials, parts and components, plants, machineries and equipment> Stamp duty exemption on transfer or lease of land or building used for development

Kuantan Port is now being expanded into a deepwater port upon completion, it is expected to propel ECERs positioning as the investment gateway to the Asean and Asia-Pacific markets, with a total population of four billion and a combined gross domestic product of US$17 trillion.


Talent gain to attract investors

SINCE its inception, many Malaysians are aware of the economic ambitions of Iskandar Malaysia. It is becoming one of the most exciting places to work in Malaysia, especially in nine economic sectors plus the oil and gas industry.

The Iskandar Regional Development Authority (IRDA) is the governments statutory body tasked to regulate and drive stakeholders in public and private sectors towards realising the vision of developing Iskandar Malaysia into a strong and sustainable metropolis of international standing.

It plans and facilitates the development of Iskandar Malaysias economic sectors.

These economic sectors are: l Electrical and electronicsl Petrochemicals and oleochemicalsl Food and agro processingl Logistics and related servicesl Tourism l Health servicesl Educational servicesl Financial services l ICT and creative industries

These economic sectors require a skilled workforce to support the industries at all levels.

To meet this need, IRDA is building the talent pool and cultivating the necessary skill sets and capabilities through close partnerships with government agencies, private businesses and educational institutions.

Starting with the creation of the Human Capital Blueprint in 2008, we have been following a focused plan to develop talent, says Ismail Ibrahim, IRDAs chief executive officer.

By studying the demand and supply of human capital for each of the key economic sectors, we have a good idea of the gaps that need to be closed to support the growth of industry.

Based on IRDAs strategic assessment of the regions human talent, Johor boasts a relatively young population, with about 50% of the states estimated three million people between 15 and 44 years old.

According to IRDA, this young population provides Iskandar Malaysia a strong and vibrant human capital base.

The government agencies that facilitate the funding process for human capital development in Iskandar Malaysia include the Johor Economic Planning Unit, the Economic Planning Unit (EPU), the Finance Ministry and the Performance Management and Delivery Unit (Pemandu).

The talent development programmes supported by government ministries and agencies include the National Talent Enhancement Programme (NTEP) for the electrical and electronics sector funded by Pemandu, the Graduate Enhancement and Training

Programme for the oil and gas sector funded by the Skills Development Fund under the Human Resources Ministry, and the Iskandar Malaysia Creative Industry Talent Development Programme funded by the Finance Ministry.

IRDAs dedication to address human resource issues such as the implementation of the minimum wage and Employment Act is unyielding.

The Iskandar Malaysia Human Capital Network (IMHCN) was set up in collaboration betweenIRDA and the Human Resource Ministrys Labour Department and Department of Skills Development.

The IMHCNs mission is to foster and sustain effective partnerships between the regions human resource practitioners.

Its meetings, conducted twice a year, provide human resource practitioners with a forum to discuss current industry issues, share good practices and network with one another.

While the state government plays an important role in closing the talent gap, IRDA also cooperates with the private sector to better understand the challenges of human capital development in Iskandar Malaysia.

IMHCN provides IRDA with the opportunity to communicate with the private sector and share the latest information on Iskandar Malaysias progress, particularly in the human capital development front.

Building up the human capital in Iskandar Malaysia needs to begin from education institutions, which is the reason IRDA is collaborating with the Education Ministry to initiate a tracking system forschool-leavers.

These graduates represent an important part of the potential talent supply for Iskandar Malaysia, says Ismail.

To help them achieve their full potential, we share our database with the Human Resources Ministry to develop and execute talent intervention strategies. Depending on the situation, we try to match school-leavers with

employment opportunities or training providers for skills development.

The Place and Train conceptis used in the NTEP to find placements for new graduates to work with major participating employers in Iskandar Malaysia by subsidising part of their salaries for their first year of employment.

Following the term of employment, the companies may take these employees as long-term hires.

To support regional development, IRDA also examines the bigger picture through studies and reports.

For instance, IRDA has embarked on a salary and remuneration benchmarking study for Iskandar Malaysia.

Upon completion, the report will provide employers in Iskandar Malaysia a better idea of the current salary situation, which will enable them to offer the right remuneration package to attract more talent.

The talent strategy employed by IRDA is in line with the current investment trend and the vision to make Malaysia a high income nation by 2020.

IRDAs relentless work on human capital development will pay off handsomely as it is expected to boost local skills, support the key economic sectors, attract more investors and maintain the economic momentum.

IRDAs strategic role is clear: to plan, facilitate and promote human capital development programmes organised by industries and training providers, says Ismail.

IRDA is well suited to gauge the demand and supply of skilled workers and coordinate human capital development programmes.

With Iskandar Malaysias robust pool of potential talent, the needs of the industry will be met.

By 2025, Iskandar Malaysia is expected to achieve a gross domestic product of US$93.9bil (RM352.7bil) and support 1.43 million jobs for a population that is expected to reach three million.

> SEE PAGE 9

Tourism anengine of growthTOURISM has always been an important economic sector for Malaysia. Besides the typical sun and sea experience that the country is known for,todays travellers also demandmore exciting and authentic attractions with exceptional standard of amenities.

Johors traditional tourism attractions revolve around coastal tourism, eco-tourismand culture and heritage. The state is home to the worlds second largest uninhabitated mangrove island in Pulau Kukup while Tanjung Piai, at the southernmost tip of mainland Asia, is another tourist landmark.

Iskandar Malaysia will leverage on these assets and transform the sector with new tourism infrastructure to create a niche family fun destination.

Iskandar Malaysia has the right balance of new and old, indoor and outdoor activities thanks to Iskandar Regional Development Authoritys (IRDA) strategic tourism plan for the mega-region.

For now, the focus is on attracting tourists from Asean countries, China and India.

We want Iskandar Malaysia to be Asias gateway for tourist arrivals into Malaysia and Asean, says IRDA chief executive Ismail Ibrahim.

There has been more than RM1bil invested into the tourism sector in Iskandar Malaysia since 2006 and we believe that this has played a substantial role in boosting the tourism industry in Malaysia.

Iskandar Malaysia boasts impressively diverse tourism offerings, from Ramsar- designated wetlands (Ramsaris an international treaty for conservation and sustainable utilisation of wetlands) in the Western Gate Development to the colourful, modern theme parks at the new Nusajaya city.

Another tourist attraction is the Puteri Harbour Family Theme Park that houses the first Hello Kitty town outside Japan. It also has the Little Big Club and a Lat-themed restaurant.

The most obvious signof Iskandar Malaysias developmental intent is

Legoland Malaysia, the countrys first international theme park and the only Legoland in Asia. More than one million visitors have visited Legoland since its inception in September 2012.

Iskandar Malaysia is well-positioned to be a regional tourism player and we benefit from our proximity to Singapore and Changi Airport, which is one of the worlds busiest airports, says Ismail.

The Johor Premium Outlets retail centre is located just a 10-minute drive away from the Senai International Airport.

The introduction of the retail centre will become one of Iskandar Malaysias tourism draws as it offers shoppers access to many sought-after brands.

The two road links between Singapore and Malaysia are assets that help drive traffic into the region. IRDA also heavily invests in new highways to link existing attractions with new ones and allow travellers to explore the mega-region easily.

Visitors can expect enhancements of existing retail complexes and hotels to transform Johor Baru into a mini Venice.

The riverfront is clean, green and attractive, and will offer activities expected of any world-class city.

With IRDAs strategy of creating new attractions while improving existing ones, IRDA expects to attract major hospitality chains and encourage the growth of the hotel and tourism industry.

The hotel chains currently operating in Iskandar Malaysia includes Renaissance, Traders, Berjaya and Thistle, offering more than 17,000 rooms collectively.

The tourism sector in Iskandar Malaysia, thanks to the mix of private-public investment, has created a thriving scene and led to the creation of new jobs within the industry.

According to Ismail, tourism will play a key role in strengthening the local and national economy. By 2020, IRDA anticipates seven million visitors per year.

Iskandar Regional Development Authority (IRDA) is responsible for regulating and driving stakeholders towards realising the vision of developing Iskandar Malaysia into a strong and sustainable metropolis.

5THE STAR, TUESDAY 30 JUNE 2015


Nusajaya, the largest property development project in South-East Asia.

Corridors of advancementTODAY, the Malaysian economy has developed into an export-driven one based on advanced technology and knowledge-based and capital-intensive industries.

Malaysias five economic corridors are crucial mechanisms for each regions growth and for the country to achieve greater heights in economic and social development.

Iskandar Malaysia in the southern region is the nations largest single-development project.

Up north, the Northern Corridor Economic Region (NCER) encompasses Perlis, Kedah, Penang and four northern districts of Perak.

Situated on the east coast of Malaysia, the East Coast Economic Region (ECER) consists of Kelantan, Terengganu, Pahang and Johors Mersing district.

In East Malaysia are the Sarawak Corridor of Renewable Energy (SCORE) and Sabah Development Corridor (SDC).

Iskandar MalaysiaCovering 2,217sq km, Iskandar

Malaysia is approximately three times the size of neighbouring Singapore and twice the size of Hong Kong.

Six service-based sectors have been identified to sustain the regions economic growth

creative, education, financial advisory and consulting, healthcare, logistics and tourism.

Iskandar Malaysia has been further divided into five distinct flagship zones to focus on these sectors.

l Johor Baru CityThe city of Johor Baru is the

central business district and the state capital of Johor. It acts as the souths gateway and has the

potential to attract a large number of foreign tourists to Malaysia. Therefore, its focus is on financial, cultural and urban tourism.

Johor Baru is a shopping hub comparable to Singapore due to the analogously lower cost of purchasing various services and goods. It is also the main gateway for entering and exiting Singapore by road via the Causeway.

This flagship gives focus to financial services, commerce and

retail, arts and culture, hospitality, urban tourism, plastic manufacturing, electrical and electronics, and food processing.

l NusajayaAt 97.12sq km, Nusajaya is now

the largest property development project in South-East Asia and a key component of Iskandar Malaysia. By 2025, its projected population will reach 500,000.

Nusajaya operates as the state

administrative capital. The key economic activities of this flagship are mixed-property development and logistics.

To provide a wider range of investment opportunities, this flagship is also a hub for creative arts and entertainment, medical facilities, educational institutions, tourism, biotechnology and hi-tech manufacturing.

l Western Gate DevelopmentAcknowledged as one of the

worlds dominant container ports, Tanjung Pelepas is a free-zone industrial area with oil storage terminals. The port is a base for logistics, regional distribution and international procurement.

Most of the land banks situated in this flagship zone consist of agricultural lands and mangrove forests.

l Eastern Gate DevelopmentPasir Gudang is the renowned

hub for manufacturing purposes in the south.

Its key economic activities are closely related to manufacturing for heavy industries and logistics, which include the electrical and electronics, chemical, oleochemical, food and engineering-based industries. It also contains ports, logistics and warehousing.

> SEE PAGE 10

> FROM PAGE 2

Putting our best foot forwardThis is in line with the 11th

Malaysia Plan, which seeks to increase productivity, especially in higher value-added and knowledge intensive activities.

Speaking on behalf of the state and its development authority Invest Selangor, Mentri Besar of Selangor Azmin Ali concurs by affirming the focus shift from labour-intensive to knowledge-intensive industries.

Invest Selangor has introduced the life sciences cluster to achieve respective goals, but we also accelerate our efforts to attract foreign direct investments in niche sectors relevant to all five core clusters, he says.

These five clusters Azmin speaks of are central to Selangors development plan, and they include industries that have shown great growth on the national stage in recent years, including electrical and electronics and food and beverages.

The country is gaining international attention for its halal food industry, a high-growth subsector of its food and beverages industry. Selangor, as the halal centre of the country, is home to 34% of the countrys halal-certified products and 28% halal-certified companies.

Selangor representatives who went on investment mission trips to Japan and South Korea found interest in the halal food industry within the East itself, which promises to transform Malaysia into a regional and, eventually,

global halal hub. Malaysia is the first country in

the world to introduce halal parks and dedicated halal industrial estates, which has been a factor in attracting RM8.8bil worth of investments from the United States, Italy, Taiwan and Singapore since 2010.

The changing dynamics of investment focus can be witnessed nationwide, even up north in Perak.

It has always been our focus to

target industries that use new and efficient technologies as well as employ more skilled and semi-skilled workforce.

This is important as it is becoming much more challenging for manufacturers to source cheap labour not only in Perak but also in the country as a whole, says InvestPeraks chief executive officer Datuk Ir Muhammad Hafni Ibrahim.

Therefore, together with agencies such as MIDA, we

encourage both local and foreign investors to increase automation in their production.

Incidentally, one of the new MIDA incentives is capital allowance to increase automation in labour-intensive industries.

With all these plans in place and steady investment growth in targeted sectors, Malaysia has the potential to achieve greater economic success over the next few years.

IN April, the International Trade and Industry Ministry, along with the Malaysian Investment Development Authority, released detailed guidelines for four new tax incentives that aim to promote balanced, inclusive development and accelerate the shift of manufacturing and services sectors from labour-intensive to high value-added, knowledge-intensive and innovation-based industries.

They are:l Incentive for less developed

areas Malaysias economic corridors aim to encourage investment in manufacturing or services activities in less developed areas as this provides opportunities for employment and rural development.l Incentive for industrial

area management This incentive is offered to upgrade industrial estate management in the country.

Park managers will undertake the marketing and maintenance of industrial parks, which will reduce dependence on

government funding.l Capital allowance to

increase automation in labour-intensive industries To further encourage the move towards automation in manufacturing industries, a one-off incentive is being offered to companies that adopt it.

High labour-intensive industries will be entitled to a 200% capital allowance for undertaking automation on the first RM4mil expenditure incurred from this year till 2017. l Incentive for the

establishing of principal hub The Principal Hub Incentive Scheme is available to all international companies registered in Malaysia with significant headquarters-related business services or activities here.

The incentive is in the form of tiered rates of tax reductions based on the level of value created, and will also spur local employment as Malaysian-owned businesses are able to provide services to these companies.

Incentives for investors

With 2020 a mere five years away, the collective efforts of state and federal governments on the countrys development are putting Malaysia on track to realising Vision 2020.

The shift in the direction of the countrys economic focus signals an exciting new phase for local industries, which also matches the education and expectations of the younger generation as well as the resources currently available.

The booming halal industry is set to

transform the food and beverage sector

in the country.

7THE STAR, TUESDAY 30 JUNE 2015


Strengthening regional growthSEVERAL industrial parks have been set up by East Coast Economic Region Development Council (ECERDC) in the East Coast Economic Region (ECER) in hopes of further driving investments into the region.

Malaysia-China Kuantan Industrial Park (MCKIP)

This sister park of China-Malaysia Qinzhou Industrial Park (CMQIP) is the first joint industrial park development between Malaysia and China, an industrial giant in the east.

It was accorded the National Industrial Park status and is identified along with CMQIP as an Iconic Project for Bilateral Investment Cooperation between both governments.

A primary investor is Alliance Steel (M) Sdn Bhd, a subsidiary of China conglomerate Guangxi Beibu Iron & Steel Investment Co Ltd (China).

The firm is investing RM4.2bil into building a modern integrated steel plant in MCKIP. The plant is scheduled for completion in 2017 and is projected to produce 3.5 million tonnes of high carbon steel and H-shaped steel annually.

Although primary infrastructure construction works are still ongoing, MCKIP has already attracted RM9.7bil in investments. Investments in MCKIP are expected to create more than 12,000 new job opportunities by 2020, a majority

of which will be in the following target industries:l Energy-saving and environmentally friendly technologiesl Alternative and renewable energiesl High-end equipment manufacturingl Advanced materials manufacturing

Kertih Biopolymer Park (KBP)

Developed by ECERDC, KBP is one of the key projects in the ECER

Special Economic Zone (ECER SEZ), which offers vast investment opportunities and synergies to biotech industry players.

KBP recently witnessed the official opening of the worlds first integrated bio-methionine and thiochemicals facility worth RM2.1bil that is owned by South Koreas CheilJedang (CJ) and Frances Arkema.

The integrated facility will bethe first in the world to use fermentation process in producing bio-methionine, an amino acid commonly used in the manufacturing of animal feed.

With the operation of the CJ-Arkema manufacturing facility, Malaysia is now the worlds first producer of green bio-methionine. The plant exported its first batch of EAA to Indonesia in January.

The CJ-Arkema RM2.1bil facility is the largest investment in Malaysias biotechnology sectorto date with a potential total investment of RM3bil over a period of 10 years.

Pekan Automotive Park (PAP)

This industrial park boasts

GambangKuantan

Pekan

Kertih

Spread of private investments in ECER (as at March 2015)

6.10bil

5.77bil

0.63bil

3,252

7,626

116

Special Economic Zone (ECER SEZ) 33.42bil 31,7141

5

6

7

4.86bil 5,0182 Cross-border development

5.06bil 8,6473 KTCC-Kenyir-Dungun growth triangle

2.72bil 2,3874 Mersing-Rompin KDA*

Gua Musang-Kuala Lipis KDA

Bentong-Raub KDA

DARA-Jengka KDA

14.48bil 14,948Others

Nodes Name Total private investments (RM) Total jobs created

*KDA key development area

54.54%

18.47%

0.10%

2.46%

3.08%0.77%

0.22%1.98% 4.11%

7.70%

6.57%

Pahang

KelantanTerengganu

Gua Musang

Bukit Bunga

Jeli

Rantau Panjang

Tumpat Kota Baru

BachokTok Bali

Besut

Kuala Lipis

Kuala Berang

Kuala Terengganu

Dungun

BandarMuadzam

Shah

Bandar Tun Abdul Razak

Pulau Tioman

Mersing

Rompin

Endau

Raub

Bentong

Mersing

2

35

6

1

4

7

The pie chart details the breakdown of investments in the ECER by industry in the past eight years. Manufacturing remains the top sector in this development corridor followed by tourism and bio-economy. The healthy mix of industries attracts various investments from around the world, creating a diverse pool of possibilities.

Manufacturing RM39,834,396,855Tourism RM13,489,500,728Bio-economy RM5,622,000,000Oil, gas and petrochemicals RM4,801,944,776Infrastructure RM3,000,000,000Property RM2,250,000,000Logistic RM1,800,000,000Education RM1,445,302,792Agriculture RM561,019,954Construction RM162,413,493Services RM75,814,841

established names such as Mercedes-Benz, Volkswagen, Suzuki and DRB-Hicom.

Last year, PAP saw the reinvestment by Mercedez-Benz through the construction of the firms completely knocked down warehouse.

PAP recorded investments worth RM1.2bil as of end-March this year.

Gambang Halal Park (GHP) and Pasir Mas Halal Park (PMHP)

The countrys booming halal industry is supported by these two ECER Halal Parks in Gambang, Pahang and Pasir Mas, Kelantan.

GHP will specialise in the production of both halal food and non-food products, which include pharmaceuticals, cosmetics and self-grooming products, additives and ingredients, and gelatine.

It is now ready to commence operations and discussions with potential investors are underway.

PMHPs Entrepreneurs Business Complex houses Kolej Universiti Islam Sains dan Teknologi (KUIST) and is expected to welcome five other tenants by the second half of this year.

This halal park will focus on the production of downstream and high-value halal food products such as nutraceuticals, herbs, sauces, and agro- and meat-based products.

SINCE 2007 up till March this year, the East Coast Development Region (ECER) has attracted a total of RM73.04bil private investments.

These investments are spread across the manufacturing, tourism, agrobusiness, bio-economy and oil, gas and petroleum sectors.

ECERs development can be understood by studying the key development areas highlighted in the map. Table A further explains the investments.

Areas of development

Focusindustries

Table A.

The Malaysia-China Kuantan Industrial Park (MCKIP) not

only welcomes investors from Malaysia and China, but

also from Asean countries and beyond.


invest malaysia 9

TRADITIONALLY the centre of Malaysias tin industry, Perak, the second largest state in peninsular Malaysia, played a big role in Malaysias early economic growth.

Today, while the tin mining industry does not have as much impact on Peraks economy, it has left a legacy of knowledge and skilled manpower that has created economic growth within the metal fabrication, machinery and equipment, foundry and engineering sectors that service the automotive, railway, and oil and gas industry worldwide.

These industries along with others such as natural resource-based industries, transport equipment, marine industries, food manufacturing, and electrical and electronics continue to provide jobs and business opportunities to the local people, says Datuk Ir Muhammad Hafni Ibrahim, chief executive of InvestPerak, the state governments investment promotion agency.

Peraks gross domestic product (GDP) growth over the past few years has been steady the state GDP has expanded between 5.3% and 7.1% annually since 2010 with the manufacturing and services sectors providing greatest growth.

According to Ir Muhammad Hafni, under the Perak Industrial Development Action Plan (Pidap), Perak aims to have its manufacturing sector contribute to 25% of its state GDP by 2020, up from the current 19%.

To achieve this target,

InvestPerak is encouraging the development of new industries such as iron and steel while supporting the continued growth of existing industries.

The presence of Vale SAs regional iron ore distribution hub in Teluk Rubiah, Manjung, presents Perak with a great opportunity to create an iron and steel hub in the state.

This aim is spurred by the presence of quality iron ore and limestone as well as the fact that

Incentives for investors into industrial parks

Fast-track status for qualified industrial park projectsNominal premium cost for application of State Government land for qualified industrial park projects Exemption from late payment penalty for unpaid quit rent and assessmenttax for a certain period for qualified industrial park projects Discounts on fee for the conversion of agricultural land to industrial land for the development of qualified industrial park projects

Perak has sufficient coastal land and geographical advantages for such projects.

The Perak state government is working closely with the Federal Government to ensure that this iron and steel hub becomes a reality in the near future.

We need to leverage on Vales iron ore hub so that our economy can benefit from its presence.

The iron and steel downstream industries have great potential to become the new economic growth sector for Perak, says Ir Muhammad Hafni.

With this hub, Malaysia can rely less on imports of quality steel slab, billets and blooms to produce quality and high value-added iron and steel products.

This will greatly benefit the countrys economy and support further national development, says Ir Muhammad Hafni.

There are also investment opportunities in infrastructure projects, and InvestPerak is calling for developers to explore the possibilities of establishing new and modern industrial parks to accommodate quality investments, including high value-adding activities, technology, capital, and skill- and knowledge-intensive industries with strong linkages to domestic industries.

Perak is currently experiencing depletion in the availability of fully developed and sellable industrial land. As a result, we have missed out on a few potential major investments.

The availability of new and modern industrial parks will make the state an attractive investment destination for years to come as investors can leverage on Peraks strategic location, competitive operational costs and diverse industrial base, explains Ir Muhammad Hafni.

The Perak state government has also initiated the Perak Southern Corridor Development plan to develop the southern region in the state. This plan will cover the Hilir Perak and Batang Padang districts.

The Perak State Development Corporation is taking the lead in implementing the plan.

> SEE PAGE 11

Kota Iskandar is an iconic filming location.

Stage for success> FROM PAGE 4

WHILE many Malaysians are aware of the economic ambitions of Iskandar Malaysia, not everyone knows about the lofty plans in store for the creative industry.

The Iskandar Regional Development Authority (IRDA) is on a mission to promote this key economic sector, which includes small and medium creative businesses.

We recognise that Malaysia needs to diversify its economy by including higher value-added activities, especially in the creative sector, which has been identified as one of the main economic pillars of Iskandar Malaysia, says Ismail Ibrahim, chief executive officer of IRDA.

The opening of Pinewood Iskandar Malaysia Studios (PIMS) is a key step in turning Iskandar Malaysia into Asias new creative destination.

The state-of-the-art facility built on 20ha of land is one of the largest and most advanced film facilities projects in the Asia-Pacific region, aptly established at a time when Asia is experiencing its fastest growth in film production.

IRDA partners with the Multimedia Development Corporation to cultivate creative multimedia talents through activities such as ICONApps, which is a bootcamp for mobile app developers.

There are also future plans to build capacity in other creative areas, including television, fashion and music. To get the ball rolling, however, IRDA is betting on the power of the film industry.

Pinewood partners with IRDA to train a new generation of world-

class creative talent. Pinewood Studios has hosted

several major film productions over its long history, including blockbuster movies such as the Harry Potter and James Bond series.

Its new studio PIMS in Nusajaya has all the facilities necessary to drive the country as the film destination of choice in South-East Asia.

We chose to focus on film because it encompasses the most creative sub-sectors within it, explains Ismail.

Large film projects can provide employment for not just hundreds of local crew, but also thousands of local vendors in music, fashion design, performing arts, advertising, publishing and animation. A single successful blockbuster film can have huge knock-on effects for the local economy just look at how the Lord of the Rings films boosted tourism in New Zealand.

Among the facilities PIMS offers are:l Five film sound stages ranging

in size from 15,000sq ft to 30,000sq ftl Two 12,000sq ft high-definition

equipped television studios with a combined audience capacity of 1,360 peoplel 35,000sq ft of production office

space spread over six production office areasl 36,800sq ft of construction

workshop space, including a woodmill, plaster shop, fibreglass shop and paint shopl Post-production facilities,

including editing rooms with television sound and vision post-production facilitiesl Three serviced backlots with

30 acres (12.1ha) of natural forest

Pinewood Iskandar Malaysia Studios will draw investments, skills and technologies that will boost not just the film industrybut also other creative industries,

says Ismail. Pinewood Studios chose

Iskandar Malaysia because it has all the right elements to become the film hub of South-East Asia, including the countrys cultural ethnic diversity. With a skilled English-speaking workforce and creative talents, the country can provide Pinewood Studios with everything it needs to establish its presence in Asia.

Iskandar Malaysia also offers a strategic location with its proximity to both Singapore and Kuala Lumpur, together with major airports serving the Asia-Pacific region.

While Malaysia has hosted previous Hollywood films such as Entrapment and The King and I, the time is right for a string of international blockbusters to put the country back on Hollywoods map and keep it there.

More importantly, the success of Iskandar Malaysias creative hub could kick-start bigger and brighter

projects for local directors and stars.

IRDA intends to leverage itsclose relationship with government authorities to expedite approval permits for international film projects. Separate permitsare required for foreign film productions at the federal and state levels, but Ismail is confident that IRDA will be able to untangle the red tape at all levels for companies looking to film in Iskandar Malaysia.

Foreign film productions will also benefit from the 30% Filmin Malaysia Incentive from the National Film Development Corporation Malaysia.

This production rebate incentive is made available to foreign companies that use Malaysia for location filming or post production, and involves a 30% cash rebate on Qualifying Malaysian Production Expenditure.

If IRDAs vision of Asias new creative destination becomes a reality, every level of the creative value chain will benefit from job opportunities created by these film projects pre-production, production, post-production, distribution/marketing as well as SME support services (including hospitality, logistics, food and beverages, equipment rental and building materials).

The technology transfer from these projects, in the form of enhanced skills and experience for local creative professionals, will strengthen the local creative ecosystem. PIMS is expected to attract RM3.8bil in foreign film projects by 2020.

n For more information, visit www.iskandarmalaysia.com.my

Great northern opportunities

There are great opportunities for investment into modern industrial parks in Perak.

Datuk Ir Muhammad

Hafni Ibrahim.


Timber and timber products continue to be big contributors to Malaysias economy.

Malaysia is expanding its investments in oil palm plantations.

A brightfuture ahead

> FROM PAGE 6

l Senai-SkudaiThis flagship contains electrical

and electronics and engineering industries as well as logistics, such as airport services.

It is also the centre for agricultural and food processing, information and communication technology and retail tourism.

The establishing of Universiti Teknologi Malaysia (UTM) is associated with the education aspect that is enforced within this flagship.

The Senai International Airport has made this area a transit destination with a potential for creating large-scale commercial and airport-related businesses.

Northern Corridor Economic Region

The Northern Corridor Economic Region (NCER) is overseen by the Northern Corridor Implementation Authority (NCIA).

The NCER focuses on the acceleration of economic growth and the elevation of income level in hope of becoming a world-class economic region by 2025.

It has five areas of economic focus:l AgricultureThe agriculture sector will be

resuscitated to increase demands in both domestic and foreign exports.

The NCIA intends to heighten this sectors output to bring up the living standards of local farming communities.

An integrated support system has been enforced to modernise current farming techniquesand promote it to the younger generation.

l ManufacturingTechnology and engineering-

based activities in NCER have transformed over the past 40 years, enabling the region to have a large and educated workforce, a vast and sophisticated logistics network to support the key economic sectors, a thriving business culture and the presence of large multinational corporations.

As it moves towards Phase 2 of its development plan, the NCER aims to retain its lead in this sector through its various Centres of Excellence.

l TourismRecognised as one of the worlds

leading tourism hubs, Malaysias rich heritage of natural attractions, culture and cuisine as well as healthcare and wellness facilities are big draws.

The northern region contains abundant tourist attractions, not least its biodiversity and eco-tourism opportunities.

The NCIA encourages investors to explore the development of high-quality, innovative and sustainable tourism facilities in the region.

l LogisticsNCER is located strategically

within the Indonesia-Malaysia-Thailand Growth Triangle, providing it with a great opportunity to become a major processing centre and entrepot.

The vibrancy of NCER has been boosted through the well-established logistic ecosystem, which acts as a key for

development in the manufacturing, tourism and agriculture industries.

The main mediums of transportation and logistics infrastructure that support NCERs connectivity are the international airport, international ports and the extensive road network.

Due to its increasing momentum of growth, the NCIA foresees the Second Penang Bridge, the Ipoh-Padang Besar Electrified Double Tracking project and the expansion of the Bayan Lepas Airport Passenger Terminal as potential projects to enhance the regions infrastructure.

l Education and human capital

The NCIAs focus in this area is the development of soft infrastructure to strengthen the nations talent base.

The NCIAs aims in this respect are:> To support the key industries by enhancing and broadening the skill base of the regions human capital.> To enhance the skill set and employability of human capital to meet the needs of the private sector in agriculture, manufacturing, tourism and logistics.> To increase the number of research- and development-based activities among hi-tech companies.> To enable the rural communities

to participate in the agenda of development.

East Coast Economic Region

The East Coast Economic Region (ECER) covers more than 66,000sq km equivalent to more than half of peninsular Malaysia and is blessed with a plethora of natural resources.

Developed in 2008, the ECER Master Plan acts as the guideline for the development of this region until 2020.

It aims to transform the region into a major international and local tourism destination, an

exporter of resource-based and manufactured products, a vibrant trading centre and a logistics hub.

The Master Plan also intends to abolish poverty and improve income distribution in a sustainable manner for ECER.

The ECER has identified five economic clusters for development focus:l ManufacturingThe rich resources in the

ECER allow the region to be a competitive manufacturing destination that provides great opportunities for investors.

A number of industrial parks have been developed for the establishing of major industrial initiatives: > Pekan Automotive Park > Malaysia-China Kuantan Industrial Park > Gambang Halal Park> Pasir Mas Halal Park> Kemaman Heavy Industry Park

l Oil, gas and petrochemicalsThe oil, gas and petrochemical

cluster is centred in the Kertih Integrated Petrochemical Complex (KIPC) in Terengganu and Gebeng Integrated Petrochemical Complex (GIPC).

Both the KIPC and GIPC are part of the Petronas Petrochemical complex.

KIPC focuses on ethylene-based petrochemicals and biopolymer products while GIPC concentrates on polypropylene-based petrochemicals, oil palm biomass

and palm oil-based feedstock products.

Other projects include the Kertih Biopolymer Park and Kuantan Integrated Biopark.

l TourismThe economic growth of ECER

depends greatly on tourism. This economic sector covers three segments heritage and culture, urban and coastal tourism, and environment and ecotourism.

l AgricultureThis sector is driven by private

sector investments, which are aimed at nurturing sustainable growth along the complete value chain for crops, livestock and fisheries.

NCIA aims to increase productivity and competitiveness in the region, deepen links with other industry sectors, venture into new areas as well as conserve and utilise natural resources in a sustainable way.

l Human capital developmentAs an effort to attain sustainable

socio-economic development, ECER has endorsed a multi-pronged approach in addressing the specific human capital needs of the region.

This effort is undertaken to prevent any of its citizens from being left out of the socio-economic development.

Sarawak Corridor of Renewable Energy

The Sarawak Corridor of Renewable Energy (SCORE) is the second largest corridor in Malaysia in terms of land area, covering more than 70,000sq km.

SCORE boasts an abundance of natural resources, including renewable resources such as hydropower.

Due to the rise of energy-intensive industries in SCORE, the Regional Corridor Development Authority (Recoda), the agency that manages the regions development, has established training centres and technical colleges to create skilled workers that can boost the development of growth nodes.

Ten priority sectors have been identified for development:l AluminiumFor the past few years, there has

been a steady increase in the international demand for aluminium.

With its massive availability of inexpensive energy and excellent position, SCORE has taken the opportunity to further develop its aluminium industry.

l Glass industriesSCORE aims to collaborate with

strategic partners to develop flat glass (also known as float glass) operations in Similajau.

This collaboration has the ability to jump-start a downstream industry for future demands in architectural glass and double-glazed insulating glass units.

l SteelDue to the low energy costs and

increasing developmental needs of developing South-East Asian countries, SCORE has remained an attractive location for steel investments. The development of this industry has also created more job opportunities for locals.

> SEE NEXT PAGE

Malaysias natural attractions draw large numbers of tourists, making it one of the worlds leading tourism hubs.


invest malaysia 11

Driving Peraks development forward

Banking on natural resources

> FROM PAGE 9

THE Perak Investment Management Centre, better known as InvestPerak, serves as the first point of contact for investors into Malaysias northern state of Perak.

Headed by its chief executive Datuk Ir Muhammad Hafni Ibrahim, InvestPerak reports directly to the chief minister of Perak, Datuk Sri Diraja Dr Zambry Abdul Kadir, who is also the agencys chairman.

Formed in 2006 as the state governments principal investment promotion agency, InvestPerak offers services to support the creation of new businesses and the expansion of existing ones, and promotes companies that offer high impact to broaden and strengthen the economic base of Perak.

Our role is to guide potential investors in taking their first steps in Perak and to assist them in executing their preliminary investment work, such as site selections, feasibility studies and sometimes facilitating them in identifying local partners. We also assist existing investors in the state in solving issues they face that are under our purview, says Ir Muhammad Hafni.

Supporting growthAs the Perak state governments

investment promotion agency, InvestPerak complements the role played by the Malaysian Investment Development Authority

(MIDA) at the Federal Government level.

It also works closely with other state and Federal Government departments and agencies, local authorities, utility providers, business chambers and industrial associations to ensure continuing growth of the manufacturing industry and an ecosystem conducive to growth for the industry in Perak.

To play our role, it is crucial that InvestPerak continuously engages and works closely with these various government departments and agencies. We all have a common objective to

ensure that investors in Perak are being taken care of and prosper.We are all committed to seeing the smooth implementation of our investors projects in Perak, says Ir

Muhammad Hafni.The commitment shown by

InvestPerak and their counterparts is paying off.

Based on the Malaysia

Investment Performance Report 2014 produced by MIDA for the period between 2010 and 2014, Perak is ranked fourth in terms of number of implemented manufacturing projects, only outranked by the traditional manufacturing powerhouses Selangor, Johor and Penang.

With InvestPerak at the helm, Peraks steady growth will soon see the state achieve its development potential while it continues to contribute to the nations overall advancement.

n For more information, visit www.investperak.gov.my

InvestPerak is focusing on developing several natural resource-based projects such as Vale SAs iron ore distribution hub (left) and limestone quarrying in Kinta.

The manufacturing industry plays an important role in Peraks economic development.

> FROM PREVIOUS PAGE

l Oil-based industriesThe Sarawak state government

views SCORE as an ideal location for producing renewable energy in the form of biodiesels.

This is due to the huge area of planted land that can sufficiently supply alternative oil-based energy.

l Palm oilWhile available oil palm

plantation land in peninsular Malaysia and Sabah are almost exhausted, Sarawak is still expanding its plantation investments.

Significant investment is still needed to meet food security goals and the global demand for oils.

l Fishing and agricultureTanjung Manis Halal Hub is

situated strategically for the development of large-scale aquaculture production in the region.

The state government has invested about RM1.5bil in infrastructure development in this sector.

l LivestockRecoda aims to boost the

development of modern smallholder livestock production systems to bring benefit to rural communities and meet customer requirements for quality.

l Timber-based industriesTimber and timber products are

the fourth biggest contributor to Sarawaks gross domestic product.

High-value processed timber products are still in high demand and the SEDC is encouraging more investments into this industry.

l MarineSituated off the South China Sea,

Sarawak has become the busiest international maritime trade route in the world.

The state aspires to develop a reputation for building, repairing and maintaining medium-sized

vessels via a particular focus on offshore support vessels.

l TourismSeveral areas have been

identified by the SarawakTourism Board for development purposes.

Due to Sarawaks biodiversity, more emphasis has been put on the conservation and preservation of its natural environment to boost ecotourism.

Sabah Development Corridor

The Sabah Development Corridor (SDC) will be the catalyst for Sabahs economic growth until 2025.

Overseen by the Sabah Economic Development and Investment Authority (Sedia), the corridors high-income service-based economic model aims to enhance the quality of life and boost the

states economy, making it a leading economic region and a favourable destination for investment, work and living.

Several focus areas have been identified:l TourismThis sectoral focus targets

visitors who may make this state their second home.

Sedia intends to make Sabah a premier eco-adventure destination and a high-end lifestyle destination with luxurious holiday villas and signature resorts.

In addition, it is encouraging investors to anchor new signature tourism products and activities into their businesses.

l AgricultureSedia is focusing on increasing

the overall food self-sufficiency level of the state, planting high-value crops for export and downstream processing, and providing assistance in poverty abolishment.

This focus area promotes the use of science and technology in science-industry linkages to ensure that agricultural products are sustainable and safe.

l ManufacturingThis sectoral focus aims to

enhance the infrastructure and human capital within the state to promote high-value jobs and high value-added downstream activities.

Sedia also encourages foreign investments into manufacturing to speed up the growth of the upcoming manufacturing activities in Sabah.


Various offerings to support development

These are the industrial parks that play a large part in the advancement of industries in Selangor: Pulau Indah Industrial Park Selangor Halal Hub Port Klang Free Zone Selangor Science Park 2 Mahkota Industrial Park Tanjung Industrial Park Sg Buaya Industrial Park BerjayaCity Industrial Park, Bukit Tagar i-Zone Bernam Jaya

Extensive infrastructure and facilities are also available, including: Telecommunications Water Energy Housing facilities Education Transportation Sea Rail Air Road

Datuk Teng Chang Khim, Selangor state senior executive councillor.

Hasan Azhari Idris, chief executive officer of Invest Selangor Berhad.

Golden state at the forefrontSELANGOR generated 23.5% of Malaysias gross domestic product (GDP) last year, proving its pivotal role in the development of the country.

Surrounding the federal territories of Kuala Lumpur and Putrajaya, this state is home to 5.79 million people who live and work in the thriving industrial heartland that is the Klang Valley.

Manufacturing has been a major economic focus for decades as evidenced by the numerous factories and plants located throughout the state, especially in Shah Alam and Klang.

Foreign and domestic investments into the states manufacturing projects totalled RM7.04bil last year and more than RM122bil over the past 16 years.

The role of attracting and managing investments coming into Selangor is filled by Invest Selangor, the pioneering investment promotion agency in the country.

Invest Selangor is entrusted by the state government to create a favourable climate for business and investment while providing support to investors as a one-stop agency.

Over the past 15 to 16 years, Invest Selangor has facilitated more than RM120bil of direct investments into the state, says Selangor Mentri Besar Azmin Ali. He calls this a great and promising achievement.

Invest Selangor was formed under the name Selangor State Investment Centre (SSIC) in 1999.

Earlier this year, the company underwent rebranding to formally become Invest Selangor a move aimed to create a stronger, clearer brand and avoid misinterpretations.

Hasan Azhari Idris, chief executive officer of Invest Selangor, expresses hope that this new, dynamic name can help create awareness of the company among potential local and foreign investors.

Playing on strengthsUnder the 11th Malaysia Plan,

the Federal Government strategises to increase productivity and foreign direct investments, especially in higher value-added and knowledge-intensive activities. Invest Selangor recognises this and has accordingly set its goals to match those of the nation.

Annually, Selangor produces approximately 10,000 knowledge workers who hold at least a diploma qualification, which comes as no surprise given that, the state is home to the largest number of local and international branch universities, colleges and other institutions of higher learning in Malaysia.

Better qualified graduates contribute to intellectual growth, which further drives a knowledge-based industry. This spells a shift from the focus on labour-intensive manufacturing to more capital-intensive high-end projects incorporating the latest technological advancements.

As Selangor is a major contributor to the countrys GDP,

the investments should be aligned with the developmental direction of the country, says Hasan.

Manufacturing remains a top priority as the service industry cannot grow without its support.

In view of this, Invest Selangor has zeroed in on five industry clusters that hold most development potential in the current economic climate. These are:l Electrical and electronics, including consumer and industrial electronics, electronic components and electrical products.l Life sciences, including biotechnology, pharmaceuticals, chemicals, and medical devices and services.l Food and beverages, including dairy and confectionary products, soft drinks, frozen food processing, raw materials and halal compliance.l Transport and equipment, including automotive, aerospace and maritime sectors.l Machinery and equipment for industrial use.

Selangor is also a major player in the countrys booming halal industry as more than one quarter of the halal-certified corporations in Malaysia are located in the state.

Within Asia itself, countries such as South Korea and Japan are already displaying great interest in Malaysias halal industry, says Datuk Teng Chang Khim, Selangor state executive councillor and

chairman of the Investment, Industry and Commerce, Small and Medium Enterprises (SME) and Transport Standing Committee, who recently visited these countries with Hasan in efforts to promote Selangor and examine the international climate for business and investment.

Building bridges Teng also recently launched the

Selangor International Expo (SIE) 2015, which will be held from November 26 to 28 at the Mines Exhibition Centre.

Having identified Selangor as one of the most advanced states in Malaysia, this expo will bridge the growth of Malaysias economy with the world, he said in his welcoming speech.

The expo will see local and international trade members set up booths to showcase their latest products and services, establish networks and link businesses, and attract potential buyers.

It will leverage on current innovative trade trends and Selangors strategic location in between two emerging Asian economies China and India to promote the state as a global trading hub.

Invest Selangor also recognises the role of SMEs in growing the national economy and engages them through the Selangor Information Technology and E-commerce Council (SITEC).

The councils latest initiative is to familiarise SMEs with e-commerce platforms by bringing together industry experts and entrepreneurs in a nine-month training programme.

By exposing SMEs to the virtual market, we provide them with opportunities to move with current trends and minimise marketing costs while tapping into a greater pool of potential customers, says Teng.

Training will begin on July 1 and will include classes, conferences and mentoring. The best of the best will be listed in the Selangor Online 100 within a year.

SITEC will also provide co-working spaces in its centre, where entrepreneurs can gather to exchange views and ideas in a dynamic work environment.

Opportunity for growth Selangor is a prime location for

investment in the country given the strong industrial base and rich host of facilities and infrastructure in place to support development.

The state boasts excellent connectivity via 17 highways and major air and sea ports. Urban centres such as Petaling Jaya and Shah Alam are well facilitated with top educational institutions and first-class living amenities.

Accessibility is continuously being upgraded through initiatives such as the ongoing Mass Rapid Transit and Kuala Lumpur-Singapore High Speed Rail projects.

On top of this, investors in various sectors will be provided tax incentives by the Malaysian Government direct tax incentives grant partial or total relief from income tax payment for a specified period, while indirect tax

Why invest in Selangor? Political stability Strategic location Economic strength Developed infrastructure Progressive leadership

and efficiency Investment opportunities

incentives are in the form of exemptions from import duty, sales tax and excise duty.

According to Hasan, attractive investment packages, an environment conducive to business and consistent policies and laws are the main factors of attraction for investors.

Speaking on Invest Selangors plans for the future, Azmin says, Our recent experience during investment missions to Japan and South Korea indicates further demands. We will also be in China, several European countries and Asean nations over the next few months.

He adds that the state is now working on a new transportation masterplan and an economic development agenda, which will enhance infrastructure in Selangor while supporting its growth and development.

Selangor is rife with investment opportunities and business owners should take advantage of the strong existing bases even in the relatively young but booming halal and aerospace industries to build businesses that will flourish in this majestic state.

n For more information, visit www.ssic.com.my

(From right) Datuk Jeffrey Ng, Madhu Sudan Nair, Jeffrey Tan, Michael Kang, Datuk Soh Thian Lai, Elizabeth Wong Keat Ping, Datuk Teng Chang Khim, Hasan Azhari Idris, Datuk Seri Stanley Thai Kim Sim, Abdul Latif Shaari and Datuk Andrew Goh at the launch of Selangor International Expo in May.

Azmin Ali, Selangor Mentri Besar.

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Invest Malaysia - 30 June 2015