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29 August 2017
Joint Training Program on Economic
Corridor Development for
Competitive and Inclusive Asia
Close the urban-rural skills gap
NCER Is One Of The
Five Economic Corridors Established In
Malaysia
Stemming from RMK-9, 5 Regional Corridors were
established across Malaysia between 2006 – 2008 to
address uneven development across the nation
Northern Corridor Economic Region
2 3
Why Corridors?
1
Boost economic potential Address uneven development
and regional imbalances 2
Population 2015
6.5 mil1
Total employment
(at 2015)
2.8 mil
1
GDP as at 2015 (at
2010 constant price)
RM 169 bil
1
Total investment into
NCER (at 2016)
RM 79.9 bil
1
Jobs created (at 2016)
103,597 jobs1
Capitalising The Unique Strengths Of
NCER
3
2Key To The
Nation’s Food
Security Agenda
• Modern Agriculture
• Usage of Technology
3Top Tourists
Destinations
• Langkawi
• Pulau Pinang
• Belum Rainforest
1Strategically
Located
• IMT-GT & ASEAN
• Good infrastructure
and connectivity
4Strong
Manufacturing
Ecosystem
• Strong Cluster and
ecosystem
• Existing Talent & Skill
Targets Set For All
Corridor Authorities by
2020Realised Investment
RM236 bil1 Job Creation
470,0002
RMK-11 Has Positioned Corridors
Strategically To Enhance Inclusiveness
4
11th Malaysia Plan
Focus Area C
Strategy C2
Focus Area D
Encouraging more private investment in rural
areas
Accelerating regional growth for better
geographic balance
Chapter 3: Enhancing inclusiveness towards an equitable society
Corridor Authorities continue to play significant role to ensure investments are
realised and attract investment in rural / less developed areas
Blueprint 2.0’s Targets
For NCER by 2025 Realised Investment
RM146.5 bil1 Job Creation
161,1972
3rd Wave:Concentration and
Specialisation
Blueprint 2.0 (80 Projects)
2nd Wave : Capacity Development
(RM79.9b investment,
103,597 job creation)
1st Wave: Catalytic
Infrastructure Development
(RM17.25b)5
NCER Is One Of The
Five Economic Corridors Established In
Malaysia
6
Legend:
Airport
Bridge
Railway
1
Upgrading of Penang
International Airport
RM250 mil2 Penang Second Bridge
RM4.5 bil
3 Electrified Double Track
Project
RM12.5 bil
RM17.25 bilInvestment By Federal Government
2009 2016
RM79.9 bil Total Cumulative Investment
103,597 Total Cumulative Jobs Creation
Private Investment
Jobs Creation
1st Wave: Catalytic Infrastructure Development
2nd Wave: Capacity Development
NCER Is One Of The
Five Economic Corridors Established In
Malaysia
2nd Wave: Capacity Development
Economic Impact up to 2014
7
“Setakat 2016, Wilayah Ekonomi Koridor
Utara (NCER) mencatatkan tarikan
pelaburan paling tinggi sejumlah RM6.6
billion”…
1st Wave: Catalytic Infrastructure Development
NCER Is One Of The
Five Economic Corridors Established In
Malaysia
8
Economic Impact (Up To 2014)
87,59395,159
101,464106,268100,584
127,720135,972
143,776151,000
159,924
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
NCER GDP 2005 - 2009 and 2010 - 2014 At Constant Prices (In RM 'mil)
1,8101,927
2,1112,315
3,023
3,797
2002 2004 2007 2009 2012 2014
Median Monthly Household Income Of NCER (In RM)
NCER experienced higher annual GDP growth
rate of 5.8% compared to Malaysia’s 5.4% duringthe period of 2010 – 2014 (Dept of Statistics)
Median household income in NCER has grown by
10% (CAGR) from 2009 – 2014 compared to 3%from 2002 to 2007 (Dept of Statistics)
1 2
2nd Wave: Capacity Development
1st Wave: Catalytic Infrastructure Development
NCER Is One Of The
Five Economic Corridors Established In
Malaysia
NCER Has Attracted World Class
Foreign And Local Companies
99
1.47.48
17.3929.67
40.34
59.1471.62
79.92
2009 2010 2011 2012 2013 2014 2015 2016
Cumulative Private Investments 2009 - 2016
2,608
56,619
15,4753,818
Cumulative Private Investments By Sector (In RM mil)
Agriculture Manufacturing Tourism Logistics
1,050
1,777
3,751
11,532
13,350
0 5,000 10,000 15,000
China
Taiwan
Japan
Germany
USA
Top 5 Origin Of Investments By Country (In RM mil)
Share Of Private Investments
Local Participation Foreign Participation
45%
55%
RM 44.1 bilRM 35.8 bil
Local Investments Foreign Investments
10
Blueprint 2.0 To Propel Further Growth
Of NCER
3rd Wave: Concentration and Specialisation
Growth Nodes
7 Projects
Transcending Borders
28 Projects
Localised High Impact
45 Projects
80 Projects Identified In Blueprint 2.0
The Northern Corridor Economic Region
Development Blueprint (2016 -2025)
(Blueprint 2.0)
Blueprint 2.0 (BP2.0) was developed in consultation
with 409 stakeholders from the federal and state
governments, the private sector as well as from
learning institutions. BP2.0 is driven by the purpose of
Growth with Social Equity.
Key features of BP2.0:
Provides specific direction to transform NCER
Comprises revised targets and indicators
Enhances NCIA’s strategic direction, roadmap and
implementation plans
The NCER Blueprint 2.0 Was
Developed & Introduced Early This
Year
11
GROWTH WITH SOCIAL
EQUITY
To identify commercially-viable opportunities and
implement strategic initiatives to:
Spur economic growth to address inter and
intra-regional imbalances and increase
inclusivity
Achieve balanced growth in all sectors,
Manufacturing, Agriculture & Bio-industries
and Services
Enhance talent to meet the growing needs of
the region
Increase private-sector investments and private
finance initiatives
To be a world-class economic region by 2025
Mission
Vision
Blueprint 2.0 (BP2.0) was developed in consultation
with 409 stakeholders from the federal and state
governments, the private sector as well as from
learning institutions. BP2.0 is driven by the purpose of
Growth with Social Equity.
Key features of BP2.0:
Provides specific direction to transform NCER
Comprises revised targets and indicators
Enhances NCIA’s strategic direction, roadmap and
implementation plans
The NCER Blueprint 2.0 Was
Developed & Introduced Early This
Year
12
GROWTH WITH SOCIAL
EQUITY
Enhancing inclusiveness towards
an equitable society
Strengthening infrastructure to
support connectivity and growth
Addressing investors’ needs
Re-engineering growth and
productivity in priority sectors
Fostering talent development for an
advanced region
NCER Is Leveraging On The Strengths
Of Its Key Sectors
13
Pulau Pinang
Perlis
Kedah
Perak
NCER is a brownfield area that leverages on the strengths of its economic activities
NCER is strategically
located at the centre of
South East Asia
NCER Targets In Blueprint 2.0
14
2020
2025
2015
Note: Investment and job creation targets are NCIA targets as per the corridors’ expected outcomes
RM225
billion
RM300
billion
GDP
RM169
billion
RM
8,265
RM
12,964
Average household
income
RM
4,815
RM
3,852
RM
6,043
Average B40
income
RM
1,926
RM
109.5
billion
RM
146.5
billion
Cumulative
Investment
RM
71.6
billion
129,197
jobs
161,197
jobs
91,221
jobs
Cumulative
jobs created
7 Growth Node Projects
Perlis Inland Port
(PIP)
Pulau Pinang
Perlis
Chuping Valley
Industrial Area
(CVIA)
Pembangunan
Batu Kawan
Kedah Science &
Technology Park
(KSTP)
Kedah Rubber
City (KRC)
Kedah
Perak
15
Greater Kamunting
Conurbation (GKC)
Manjung-
Aman Jaya
Maritime City
12,674
Jumlah
pekerjaan
RM2.58b
PNK setahun
pada tahun
2025
14,471
Peluang
pekerjaan
RM14.7b
Jumlah KDNK
dalam 15 tahun
23,244
Peluang
pekerjaan
RM57.4b
Impak Ekonomi
Sehingga 2030
90,263
peluang
pekerjaan
RM12.96B
KDNK sehingga
tahun 2030
35,310 peluang
pekerjaan
RM22.5B
KDNK sehingga
tahun 2030
4,056
Jumlah
pekerjaan
RM0.94b
PNK setahun
pada tahun
2025
Examples Of Project Initiated By NCIA In
Perlis
Perlis Strategic Development
Plan 2012 - 2030
1
Perlis Strategic
Development Plan
2012 - 2030
3
Border Economic
Transformation Programme
2
Logistics & Trade
Facilitation
Masterplan
4
Chuping Valley
Development Plan
Typically Projects Are Initiated From The
Strategic Plans
Chuping Valley
Industrial Area (CVIA)1
Perlis Inland Port (PIP)2
Upgrading Of Padang
Besar Inland Container
Terminal3
4 Perlis Superfruits Cluster
5 MySuria Programme
Typically Projects Are Initiated From
Strategic Plans
Project Estimated Timeline
Project Facts
Chuping Valley Industrial Area (CVIA)
17
Brief Overview
Land Size
2,500 acres
Focus Clusters
District
Padang Besar
1 2
• Integrated Business Centre (IBC)
Mar 2017 – Sep 2017
• Phase 1 - CVIA
2016 – 2020
• Phase 2 - CVIA
2021 - 2025
1
2
Cluster 1:
Green
Industries
Cluster 2:
Halal
Industries
Cluster 3:
Renewable
Energy Generation
CVIA study was completed in 2015Potential Economic Impacts3
GNI Contribution
Per Year (By 2025)
Job Creation(By year 2025)
RM2.58 bil 12,674 jobs
Advantages• Rail connectivity to main ports in
Malaysia (Penang Port, Port
Klang)
• Located next to the upcoming
Perlis Inland Port
Lembah Chuping,Perlis
+
A Structured Game Plan To Attract
Investors
18
• NCER Development Blueprint 2.0 has identified key industrysegments we should focus on when we engage with potentialinvestors.
• We have been able to narrow down on:
- areas to focus on
- rationale behind a participation
- and how these entities will operate
Investor nurturingLead nurturing
Pre investment
InvestmentPost
investment
The investor attraction funnelInvestors:
• Will take action when they are
ready, not when we are ready
• Will not only look for geographic,
demographic and cost of doing
business information – also on
opportunities and risks
• Will try to find customers, suppliers
and distributors:
• Will not just look at incentives, but
also how a community are aligned
• Will look for paths which can
provide soft landing for their
investments
The Quality Of Our Handholding Will
Be A Key Differentiator
19
Common Agenda
Shared Measurement
Mutually Reinforcing
Activities
Continuous
Communication
Backbone Support
Shared vision
Shared results & accountability
Delivery of co-ordinated plan of action
via differentiated approaches
Consistent & open communication
Escalation feature, with ability to
convene participating organisations
Collective Impact
Quality of
handholding
will strengthen
our position as
a competitive &
differentiated
investment
destination.
Pre investment
InvestmentPost
investment
• A key differentiator will be our ability to respond to client
needs efficiently, effectively and ahead of competitors. We
need to act as a partner to existing and prospective client
companies in the implementation of their strategic
objectives.
• This spans the entire investment process, from initial
awareness of our value proposition, through the full
decision-making process, to the start of the investors’
operations and beyond.
1 2 3
Preparing An Investment Soft Landing
Programme
20
Investors look for ways to maximise certainty and minimise risk in
considering new locations.
Game changer
Delivering the next generation of incentives
Tax incentives
Other forms of
facilitation
Support
facilities
Knowledge-
based support
Fiscal incentives: the base plus customised
structure via MoF
Other tools via NCIA or collaborative partners
as per RMK-11 positioning & NBOS Game Plan
Physical infrastructure used as “carrot” to
attract investors
Involvement of IPTs in providing the right kind
of inputs to the private sector
Community
supportInvolvement the local community via symbiotic
relationship with the private sector
NCER Incentive Packages
Broad based incentives for companies carrying out
promoted activities or products in the key sectors
To encourage and attract companies to establish or
expand its business / operations into NCER in the
key sectors
To promote and encourage the growth of human
capital and talent in NCER
• Tax incentives for knowledge workers
• Financial assistance and subsidies to promote relocation to NCER
• Incentives for companies (including grants) to train and relocate employees to
NCER
Incentives to attract individuals/talent into NCER
Broad Based Incentives1 Special Incentives For CVIA & KSTP2
KSTP CVIA
As part of Blueprint 2.0 focus areas, NCIA has submitted the NCER Incentive Packages in Mar
2017 to MOF and is currently pending approval
Improvements In Logistics &
Connectivity To Boost
NCER’s Economic Growth
22
Legend:
Airport
Bridge
Railway
7
Upgrading of Penang
International Airport
6 Penang Second Bridge
3 Electrified Double
Track Project
Rapid Kamunting8
Rapid Manjung
Perlis Inland Port2
Upgrading Of Pdg Besar Terminal1
Penang Sentral5
Rapid Sg. Petani4
9
• Note: Northern Integrated Transportation
And Logistics Hub
1 To ensure seamless
connectivity & mobility
of people and goods
2 Ultimately, this will
boost the economic
growth of NCER as a
whole
Infra connectivity has the power to
integrate economies by deepening
trade, investment and business
links. It can expand and strengthen
regional production networks and
supply chains of goods and
services. It improves inclusivity,
productivity and competitiveness;
and stimulates economic activity,
trade and investment.
NCIA As A Strategic Partner In IMTGT
23
Koridor Utara has an advantageous
position in SEA with close proximity
to China and India
… and can be a true logistics corridor in IMTGT
What do we need?
1. Double Tracking
2. Fast Intercity Train
Service
3. Reliable Commuter
Train Service
4. Integrated
Transport Terminal
5. Inland Container
Terminal
Legend:
Container
Terminal
International
Airport
Domestic
Airport
Seaport
Integrated
Terminal
Penang Port
Padang
Besar / PIP
Lumut
24
Trade & Customs Facilitation
• Streamlined custom policies and
processes to facilitate trade
Transport & Logistics Effectiveness
• Assessible and connected logistics
location
Supply of Logistics Human Resource
• Steady supply of talent with Logistics
experience
Multi-modal transport structure
• Effective multi mode transportation
network
Koridor Utara has an advantageous
position in SEA with close proximity
to China and IndiaWhat do we need?
1
2
3
4
… and can be a true logistics corridor in IMTGT
NCIA As A Strategic Partner In IMTGT
Capitalising On Regional Trade
Networks
25
Grow international trade
and export activities.
Increase cross-border private
sector engagements.
• Build comprehensive regional service provider network that offers
effective support services for international trade.
• Enable selected industries to ride on Koridor Utara’s logistics
capabilities and network.
• Form strategic relationships with international business networks,
existing foreign companies.
• Leverage on the activity base and facilities of Padang Besar, Bukit
Kayu Hitam, Durian Burung and Pengkalan Hulu.
• Implement the BETP study.
Action plans
The agriculture sector remains an important sector in NCER,
contributing around 11% of the region’s Gross Domestic
Product (GDP).
In 2016, the agricultural sector accounted for 8.1% of the
national Gross Development Product (GDP), a decline from11.9% recorded in 2011.
Malaysia also continued to widen its trade deficit on
agriculture products to RM16.59 billion in 2016 from RM 11billion in 2011,
Agriculture Sector
Food Security
Malaysia’s population growing at 1.8% per annum and is
expected to reach 35 million by 2025.
Can we cope with the
increase pressure on food demands?
13.3 millions
are obese
5.6 million
are overweight
6.1 millions
have hypertension
3.5 million
have diabetes
9.6 millions
have > cholesterol
(Uni. Victoria, Australia)
National Health and Morbidity Survey (NHMS), 2015
GDP loss to Malaysia from NCD
is expected to be about US$
22.5 billion by 2025
70% - 80% of NCD was due to
improper diet resulting in
ailments such a diabetes and
obesity.
Recent statistics already show
that 60% of premature deaths
(below 60 years) in Malaysia
were caused by NCD
Nutritional Safety
The strategy refers to intensifying the use of productivityenhancing technologies by the farmers.
Commercialising The Agriculture
Sector
Farm Output
Farm Surpluses Market Participation
Farmers Income
Less number of labour
As a pre-requisite to implementing this strategy, the local
agriculture sector:
must increase its productivity to achieve lower per
unit costs of production
adopts the market-driven farming program.
These pre-requisite requirements however pose another
huge challenge to commercialising the local agriculture
sector.
Commercialising The Agriculture
Sector
There is also deficient of interest towards
the agriculture sector among the young andeducated workforce
60% of the workforce in this sector are
already over 60 years old while only 15%below 40 years old.
Challenges In Commercialising The
Agriculture Sector
64%
26%
7%3%
Paddy Yield: 2011 (Prior program)
<4 4 - 6 6 - 8 8 - 10
Nota :
64% of the farmers’ yield were below 4 MT/ha with monthly gross
income of RM465.00
Nota :
43% of the farmers produced average paddy yield of between 6 to 10
MT/ha with monthly gross income of between RM2,167.00 to
RM4,000.00 i.e. higher than the average income of B40
RM465.00 RM897.00 –
RM1,763.00
RM1,763.00 –
RM2,462.00
RM2,462.00 –
RM3,327.00
17%
40%
33%
10%
Paddy Yield: 2016 (Post Program)
<4 4 - 6 6 - 8 8 - 10
RM667.00 RM1,167.00 –
RM2,167.00
RM2,167.00 –
RM3,000.00
RM3,000.00 –
RM4,000.00
Introduction of Modern Farm
Management Concept
Shared Value In Commercialising
The Agriculture Sector
Shared value concept is a principle of integrating business
efforts with social and environmental values. It is a point of
connection between the activities and needs of a company
and the activities and needs of the society.
The Government will act as a catalyst for creating shared
value partnerships through which there is also the changing
role of business and government in solving the social
problems.
The introduction of the right kind of regulatory framework
can encourage companies to pursue shared value.
One example of a successful shared value project in the
Northern Corridor is the collaborative partnership between
NCIA, Nestle Paddy Club and Pertubuhan Peladang
Kebangsaan (PPK) C2-Kerpan on rice farming for baby
cereal products.
Shared Value In Commercialising
The Agriculture Sector
Agriculture 4.0
Knowledge-based farm production
system such as precision agriculture
(PA) could replace the current labour
intensive system with lowproductivity.
The IoT in agriculture market is
expected to grow at a cumulative
average growth rate (CAGR) of over
16% in terms of market value
through 2016 to 2022, to reach$20 billion
THANK YOU
36