Dec 7, 2017 - building materials, food manufacturing, furniture, tourism and agriculture. Ladies and Gentlemen,. 14. Mov
WELCOMING ADDRESS BY ENCIK ZABIDI MAHBAR EXECUTIVE DIRECTOR, STRATEGIC PLANNING (MANUFACTURING) EAST MALAYSIA DOMESTIC INVESTMENT SEMINAR 7 DECEMBER 2017 (THURSDAY) BALLROOM, THE PACIFIC SUTERA, KOTA KINABALU, SABAH
Moderators and Speakers Distinguished Guests Members of the Media Ladies and Gentlemen, 1.
Good morning. It is a great pleasure for me to welcome all of you to the East Malaysia Domestic Investment Seminar.
2.
Just last month, MIDA’s Supply Chain Conference for East Malaysia held in Kuching, received an overwhelming response from the business community in Sarawak and Sabah. We are indeed delighted that the momentum continues today with the attendance of more than 200 participants in this hall.
3.
This seminar is part of MIDA’s continuous efforts to update the industry players especially in East Malaysia on the latest policies and facilities that are available. We have lined up two plenary sessions as well as business clinics throughout the day, featuring various agencies at both the federal and state levels.
4.
We would like to thank the moderators and speakers from Federation of Malaysian Manufacturers (FMM), Persatuan Usahawan Maju Malaysia (PUMM), Malaysia External Trade Development Corporation (MATRADE), SME Corporation Malaysia (SME Corp), Halal Industry Development Corporation (HDC), Small Medium Enterprise Development Bank Malaysia (SME Bank), Malaysian Industrial Development Finance (MIDF), and Credit Guarantee Corporation (CGC) for their support and contribution in making this seminar possible.
5.
Having gathered all these agencies in one platform, we would like to urge participants to take advantage of today’s programme to the fullest by 1
engaging these agencies in the venture to further develop and grow your business. Ladies and Gentlemen, 6.
As the principal investment promotion agency of Malaysia, MIDA, right from the beginning of its establishment 50 years ago, has played a pivotal role in the industrial development of the country. Throughout the years, we seek to attract quality investments that have many spillover effects towards generating greater prosperity for Malaysians.
7.
Sabah is certainly one of the recipients of such investments. As at December 2016, a total of 757 manufacturing projects with investments worth RM19.7 billion have been implemented in the state. More than 91,000 Sabahan have benefitted from these projects through employment.
8.
Among notable companies operating in Sabah include Petronas Chemicals Fertilizer (ammonia & granular urea), Sabah Forest Industries (pulp & paper), Sunlight Inno Seafood (frozen shrimp), Genting Biodiesel (biodiesel) and Mewah Datu (palm oil refinery).
9.
We are pleased that despite the challenging global environment, Sabah continues to attract additional approved investments this year worth more than RM400.0 million in the services sector particularly hotel & tourism, energy generation & conservation projects as well as in the manufacturing sector in the first half of 2017.
10.
We know that a comprehensive ecosystem will be a natural magnet for investments. With that in mind, the Government continues to undertake concerted efforts to put in place the required enablers to support investors in doing their business in this country.
11.
The commencement of the latest infrastructure development project, namely the Pan Borneo Highway, is certainly a game changer that will transform the future of the Borneo states. The highway will drive the economic development of the people along its 2,083 km alignment and accelerate the social and economic growth of the region.
12.
Upon completion, Pan Borneo Highway is slated to be the transportation backbone of Sabah and Sarawak and will play a major role in opening up economic corridors and opportunities in areas it transverses. With the greater mobility the highway provides, the cost of ‘point-to-point 2
connectivity’ will be reduced and more business opportunities will be created in Sabah and Sarawak. 13.
We are optimistic that the project will be an impetus to attract more quality investments into East Malaysia, particularly in the targeted sectors such as petroleum products, chemical and chemical products, oil & gas, building materials, food manufacturing, furniture, tourism and agriculture.
Ladies and Gentlemen, 14.
Moving forward, the Government is now aggressively undertaking various efforts to assist industry players in embracing Industry 4.0 through the adoption of automation and smart manufacturing.
15.
As the champion for Industry 4.0 and smart manufacturing, MITI and MIDA are heavily involved in formulating strategies and conducting related research in this space. This include the “Future of Manufacturing” Study on the 3+2 catalytic and high growth potential sectors identified under the 11th Malaysia Plan (chemicals, E&E, M&E and aerospace, medical device) as well as the National Plan for Industry 4.0. We are pleased to share that both documents are expected to be completed by the first quarter of 2018.
16.
Since 2015, the Government has provided a facility in the form of Automation Capital Allowance for automation expenditure to assist manufacturing companies in embracing this new concept. As at October 2017, MIDA has approved a total of 71 applications of which 2 applications approved were from Sabah.
17.
The impact of automation can be illustrated by this example of a garment factory where it invested RM1.24 million for automation systems consisting of 42 machines. The factory was able to increase the production volume by more than 300 percent, reduce defect rate by 8090 percent and reduce the number of foreign workers by 17 people. Instead of manual cutting, the design are done using computer and data is sent directly to the machine which cut the material with minimum human intervention. This allows the factory to cut more complex design faster with greater accuracy.
18.
Underscoring the Government’s commitment to accelerate the growth and adoption of smart manufacturing and Industry 4.0 in Malaysia, the Government has recently announced several new incentive packages under the Budget 2018 such as: 3
Additional matching grants of RM245 million under the Domestic Investment Strategic Fund (DISF) to upscale Smart Manufacturing facilities; Extend the incentive period for Automation Capital Allowance (ACA) for labour intensive industries in the category 1 (rubber, plastic, wood and textile products) on the automation equipment for the year of assessment (YA) 2018 to YA 2020; and Accelerated Capital Allowance (ACA) up to 200% on the first RM10 million qualifying capital expenditure incurred in the year of assessment 2018 to 2020 for manufacturing and manufacturing related services sectors. 19. Given the new wave of technological change that is sweeping across the globe and impacting the way people do business, it is timely for industries in Malaysia to strike quickly and steer towards this direction. 20. With these facilities in place, we would like to encourage more companies to adopt smart manufacturing technologies and processes that will in return serve them well by reducing dependency on foreign labour, improve productivity and enhance their long term competitiveness. Ladies and Gentlemen, 21. We believe there is much more room for expansion or diversification for existing companies in Malaysia to reinvest, particularly in new growth areas. As the principal investment promotion agency in Malaysia, MIDA will work closely with the Sabah State Government and other government agencies to ensure a conducive business environment for your investments to prosper. 22. Please leverage on all programmes and facilities provided by the government. Engagements such as these should not be a one way street. We encourage your feedback on issues or challenges you encountered for us to fine tune our policies. Our doors are always open and our staffs are ever willing to respond to your enquiries. 23.
On that note, it is my pleasure to officiate the East Malaysia Domestic Investment Seminar. Thank you. 4
