“The government will be by your side,” Lim told business leaders at The Edge Malaysia-Centurion Club & Corporate Awards 2019 ceremony today.
“I trust that as business owners and entrepreneurs, all of you here knows best what works and what does not. And your company’s success and growth will in turn translate into more jobs, higher wages for the people, increased tax income for the government and a more resilient economy,” he said.
“I would like to encourage you to be brave in taking calculated risks and invest more, especially in high value areas that can help unlock productivity growth. We need you to be at the forefront in creating new growth drivers to propel the economy forward,” he added.
Lim said the trade war between China and the US provides Malaysia with a rare opportunity to reverse the premature deindustrialisation and readjust the country’s growth trajectory, in order to be a fully industrialised advanced economy.
As Malaysia’s biggest trade partner, Lim noted there is still room to grow for Chinese investment. Thus, the government has a special dedicated channel for Chinese firms interested in investing in Malaysia.
Citing the Malaysian Investment Development Authority (MIDA), Lim said the US is the top source of approved manufacturing foreign investment during the first half of 2019, with plans to invest as much as RM11.7 billion, followed by China at RM4.8 billion.
“Malaysia has been suffering from premature deindustrialisation since year 2000. Our high-tech share to the GDP has been declining and replaced by low-skill and low-cost industries.
“Indeed, from 1988 to 1997, Malaysia’s economy on average grew 9.3% yearly, but from 2000 until 2018, the average has come down to 5.1% only. We know this is not sustainable and we need to change our economic trajectory, in order to become a fully industrialised advanced economy.
“The trade tension is reorienting the global supply chain and this is a chance for Malaysia to attract new high-value, high-tech investments from companies adversely affected by the trade tension,” Lim said.
Additionally, the government will be providing RM50.2 billion at least over five years, to put Malaysia back to business and Malaysians back to work.
Among some of the incentives, grants, funds and loans to business, he said, are the RM21.6 billion investment through Public-Private Partnerships (PPP) over five years from 2019 to 2023 in the National Fiberisation and Connectivity Plan (NFCP) and to provide RM20.7 billion worth of cash and non-cash incentives over five years to raise Malaysia’s productivity.
“Next year, we are encouraging SMEs to adopt digitalisation,” said Lim, adding that the government will provide a 50% matching grant of up to RM5,000 per company for the subscription of electronics point of sale system, enterprise resource planning (ERP) and electronic payroll system,” Lim said.
This matching grant will be worth RM500 million, limited to the first 100,000 SMEs applying to upgrade their systems, he said.
Lim also reiterated that the government will be also allocating RM550 million to provide Smart Automation matching grants for 1,000 manufacturing and 1,000 services companies to automate their business processes, in which this grant will be given on a matching basis up to RM2 million per company.
Source: The Edge Markets