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Ai pioneer Sam altman’s firm in four-party tech tie-up in Malaysia

Malaysia’s digital economy is expected to be strengthened with a four-party tie-up that includes a company started by artificial intelligence (AI) pioneer Sam Altman.

The four are MYEG Services Bhd, a provider of digital government services in Malaysia; Mimos Bhd, the national applied research and development (R&D) centre; the Worldcoin Foundation; as well as Tools for Humanity (TFH), a technology company co-founded in 2019 by Altman, Alex Blania and Max Novendstern.

TFH has a stated commitment to equitable economic systems and social inclusiveness, while the Worldcoin Foundation’s vision is to realise more inclusive and just institutions of governance and of the global digital economy.

MYEG said this strategic alliance is expected to revolutionise Malaysia’s blockchain infrastructure and digital ecosystem by fast-tracking the adoption of blockchain technology on a national scale following the signing of a memorandum of understanding in October 2022 between MYEG and Mimos.

“The partnership synergises Mimos’ prowess in research and development of information and communications technology (ICT) with MYEG’S advanced Zetrix blockchain platform, heralding a new era of digital transaction and service delivery.

“Through this joint effort, the blockchain infrastructure is anticipated to evolve with state-of-theart credential verification technology.

“This move stands to democratise the digital economy by infusing Mimos’ R&D ingenuity and the Worldcoin Foundation’s extensive blockchain acumen into Malaysia’s socioeconomic fabric,” it said yesterday.

According to MYEG, TFH will help ensure a more just economic system and will bring its wealth of experience in developing digital solutions for marginalised populations.

“It will work closely with Mimos and the Worldcoin Foundation to create innovative tools and platforms that address critical societal issues such as education, healthcare, and environmental sustainability,” it added.

MYEG also said it will work to incorporate the solutions developed by Mimos, Worldcoin, and TFH into existing government service delivery systems to ensure that citizens can access these services conveniently and securely.

“This collaboration is set to significantly impact Malaysia’s digital economy. It will enhance the security and efficiency of digital transactions, building trust in online platforms and motivating businesses to embrace digital transformation.

“This, in turn, will drive innovation, create jobs, and fuel economic growth.

“Furthermore, the collaboration will support the development of a skilled workforce in digital technology. Through training programmes and educational initiatives, the partners in this alliance will equip Malaysians with the knowledge and skills needed to thrive in the digital age,” it added.

Source: The Star

Digital economy to get a boost

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DATA centres are critical infrastructure in the development of an ecosystem for the digital economy and their spinoff effects are huge, says Minister of Digital Gobind Singh Deo.

In an interview with The Edge, he says many of the solutions needed today — whether by governments or companies — are based on artificial intelligence (AI), which requires a lot of data centre capacity.

“For example, if you want AI, it runs on data. GenAI runs on data, right? We’ve got new technology that will be created in years to come. So, at the end of the day, it’s a question of making sure you have that infrastructure within your jurisdiction that you can use, and it will support the economy around you,” Gobind explains.

On the investments that have flowed into Malaysia recently, Gobind says the huge jump was fuelled by the country’s focus on getting digital investments, including in data centres and cloud computing.

Malaysia recorded a 23% year-on-year jump in approved investments to RM329.5 billion in 2023. Prime Minister Datuk Seri Anwar Ibrahim said the surge in investments was in line with the rapid growth of the digital economy.

The digital economy contributed about 23% to the country’s gross domestic product (GDP) from 2021 to 2023. The target now is to increase the contribution to 25.5% by 2025.

Malaysia’s focus on data centres has received some criticism as the investments do not seem to be adding much value to the economy despite the amount that has flowed in. That is because data centres are essentially conduits of the flow of data, rather than an economic activity that provides high-income jobs or generates a lot of revenue for the country.

“You’ve got to think about the bigger picture … you’ve got ministries that are looking at problems that they have today and solutions that they want to put in place. The solutions are AI-based,” says Gobind.

“You’ve got industries that have problems which they can overcome using AI. That again is a solution that’s AI-based. You’ve got new companies that will build up, they will start, new economies will emerge, new industries will emerge.

“The income that they are making will be a lot higher because they are now industries that are tech-based. So, the spinoff effect of this will be extra jobs because there will be new companies that will emerge using the technology.”

In Google’s Data Centre Impact Report 2023 on Loudon County, Virginia, the digital giant said it added about US$1.1 billion to the US’ GDP annually between 2017 and 2022, through direct, indirect and induced contributions. The California-based company also said that its data centre operation in Loudon County contributed about US$330 million in direct, indirect and induced contributions to labour income.

During the same time period, Google’s operations supported about 3,500 direct, indirect and induced jobs in Loudoun County, it said. The company invested US$1.8 billion in Loudon County for its data centre there in 2018 and 2019 and expanded that with an investment of US$1.2 billion in 2021.

In Malaysia, Google is investing US$2 billion in City of Elmina in Shah Alam, Selangor, for its first data centre and cloud region in Malaysia. The investment is expected to support 26,500 jobs and bring in an economic impact of RM15.04 billion.

Data centre investments have also been criticised for using up a lot of resources such as electricity and water, not to mention the land that they occupy.

On this, Gobind says the government has taken the challenges the country faces in respect of water and energy into account when it comes to promoting industries, including data centres. “The government is looking at ways and means by which we can ensure that we are able to sustain as we go ahead and there are sufficient reserves as well.”

Having said that, he believes that Malaysia does not have much of a choice when it comes to opening up for data centre investments.

“You either say yes, we can do this, and prepare the country with the right infrastructure and get it done — take the lead. Or you say no, we’re going to take a step back and let others move ahead and then perhaps when it’s a bit too late, look back and say, look, this is what we should have done,” he says.

“We have made a decision. We are going to make sure that we prepare our country for the future. And I think the prime minister is very clear on his vision for this and it is a work in progress.”

For Gobind, embracing data centre investments, apart from being an enabler for the development of the digital economy, is also about creating a “buzz” in attracting global investments.

“Now, if you don’t have that, for example, the rest, as I said, is not just about us. It’s about how we perform in Asean, how we attract global investments. If you don’t have all these, then you are not going to be able to create that buzz. That to me is crucial at this point for us to build the country economically,” he says.

Source: The Edge Malaysia

Data centres crucial to draw investments

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Malaysia’s rapid economic growth in the second quarter, at 5.9 per cent and above expectations, reflected the confidence of foreign investors in the country’s potential, said Economy Minister Rafizi Ramli.

He said this also shows that the government’s policies and economic growth narratives have been well received. Therefore, Rafizi said the government needs to continue the growth momentum by intensifying its efforts to attract investors to maintain the international confidence and positive views of Malaysia.

“So what the government is focusing on now is to ensure that not only the narrative and policy are attractive for investment and growth but also to translate that into (investment) immediately and to provide everything necessary. That needs to be done quickly and in an orderly manner.

“(Then) the (growth) momentum can continue and if this happens, we will continue to be seen as a good investment destination in the region and the world,“ he told reporters after the ‘Ask Minister Anything with the Minister of Economy’ session in conjunction with the MADANI Rakyat South Zone 2024 programme at Dataran UTM here today.

He said this when commenting on the announcement yesterday of Malaysia’s economic growth rate in the second quarter which exceeded the initial forecast of 5.8 per cent.

As one of the strategies to maintain the positive economic growth momentum, he said Prime Minister Datuk Seri Anwar Ibrahim will launch the Business Facilitation Framework, which also touches on the efficiency of government services in facilitating business. Rafizi said his ministry took a year and is now in the final stage to complete the framework.

Anwar is expected to launch the framework on Oct 4.

Meanwhile, at the “Ask Minister Anything” session, Rafizi said Malaysia would be recognised as a global middle economic power if its wish to join the intergovernmental organisation BRICS (Brazil, Russia, India, China and South Africa) was accepted.

BRICS consists of a group of countries that include prominent middle economic powers.

“I believe that if Malaysia is admitted to BRICS, it will not affect our international relations with other countries. This is because Malaysia is known as a country that practices neutral principles when dealing with global issues. When accepted, God willing, it is a recognition and their confidence in Malaysia as a middle economic power in the world. This will increase our economic capacity.

“Don’t be confused, we want to join not because of politics but because we want to establish good relations with all countries, including middle economic power countries like Russia, Brazil, India, and others,“ he added.

Source: Bernama

Robust second quarter growth reflects investor confidence in Malaysia’s economic potential – Rafizi

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The Selangor Aerospace Action Plan 2020-2030 is driving the state to become one of the region’s industrial hubs while creating quality job opportunities.

Menteri Besar Dato’ Seri Amirudin Shari said the 10-year strategy has increased investment in the manufacturing sector to RM19.3 billion in 2023 compared to RM12.2 billion the previous year, with part of this growth attributed to the aerospace industry.

“Globally, this industry is expected to grow to RM2.6 trillion by 2030. Passenger traffic is forecasted to increase by 6.1 per cent, and the assets of airline companies are expected to grow by 3.5 per cent.

“Several projects are being carried out in collaboration with leading companies including Dassault Aviation, Collins Aerospace, Smartlink Engineering, Singapore Airlines Engineering, and Malaysia Airlines Engineering,” he said in a Facebook post today.

These efforts have paid off as Malaysia has become a favourite among foreign investors in Southeast Asia.

“In fact, to further strengthen this effort, the Selangor Aerospace Apprentice Programme (SAAP) has been implemented to provide youths with the opportunity to enhance their skills and reap the plan’s benefits,” Amirudin said.

In September 2022, Menteri Besar Selangor (Incorporated) or MBI launched SAAP to empower youths to join the industry by building a sustainable talent or workforce pipeline.

The learn-and-work training programme, which involves more than 50 apprentices, includes engine maintenance training and technical engineering in mechanical and electrical systems.

The state government is also developing the Selangor Aerospace Park (SAP) on a 2,000-acre site in Sepang, which is equipped with various aerospace engineering industry facilities.

On September 7 last year, Amirudin said that SAP would include aircraft maintenance, repair, and overhaul (MRO) centres, aircraft modification facilities, an innovation centre, as well as smart and advanced hangars.

Source: Selangor Journal

Aerospace plan to draw renowned companies to make Selangor regional hub — MB

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Japan continues to show deep interest in investing in Malaysia’s energy sector, especially in the green hydrogen sector, said Deputy Prime Minister Datuk Seri Fadillah Yusof.

Fadillah, who is also the Minister of Energy Transition and Water Transformation, said Japan has already invested in Sarawak in the same industry and that it would continue to support Malaysia in terms of investment.

In December last year, it was reported that Sarawak would be producing green hydrogen on a large scale mainly for the Japanese market under a tripartite agreement inked between the Sarawak Economic Development Corp (SEDC) and two Japanese firms. “They are asking for our support and cooperation for what they have to offer. We can’t give a final decision (at this meeting). I have to bring it back to get a decision at the government level,“ he said.

Fadillah said this to the media after attending a courtesy visit session with four countries, namely Singapore, Vietnam, Brunei and Japan, in conjunction with his visit to Peru to attend the Energy Ministers Meeting, under the Asia Pacific Economic Cooperation (APEC), from Aug 15-16, 2024.

He said the four countries were ready to support Malaysia’s plans.

“What’s more, next year we will be ASEAN chair. (So) the bilateral meeting we held on Thursday morning and afternoon was in that context. While at the round table session, each of the APEC countries gave their views on the topic that had been prepared, which was related to how we want to mobilise the strategies of the respective countries in relation to the energy transition, which is the supply of clean and renewable energy.

“And at the same time (in switching) to this renewable and clean energy, how we want to ensure the security of energy supply. Second, in terms of safety and third, also to ensure that no party is left behind”.

The meeting also discussed cooperation opportunities in the development of halal certification by Vietnam, the SME capacity development and investment by Singapore and the organisation of the 3rd Asia Zero Emission Community (AZEC) Ministerial Meeting by Malaysia in 2025.

Meanwhile, Fadillah also said the issue of implementing third party access (TPA) was also discussed at the meeting of energy ministers. “We will announce everything in September, in terms of the mechanism, in terms of the rules, including the costing. Many are interested in the TPA of the electricity supply industry. So we will have an industrial dialogue on Aug 22. From there we get feedback from industry players,“ he added.

The 14th APEC Energy Ministers’ Meeting (EMM14) at the Lima Convention Center, hosted by Peru, brings together energy ministers from across the Asia-Pacific region to discuss strategies to drive the energy transition.

Source: Bernama

Japan remains committed to invest in Malaysia’s green energy, focus on hydrogen

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PENANG is set to unveil its STEM (science, technology, engineering and mathematics) Talent Blueprint by the end of this quarter.

Penang Chief Minister Chow Kon Yeow said its aim was to build a highly skilled workforce to underpin long-term growth in the state’s industrial and technological sectors.

This is in tandem with the recently announced National Semiconductor Strategy (NSS) that seeks to move the country up the value chain into higher-end manufacturing, design, packaging and equipment, as well as having 60,000 engineers by 2030.

“The working parties have presented the blueprint to the Investment, Trade and Industry Ministry (Miti) recently.

“Details will be revealed during the launch,” he said while addressing members of the Malaysia Semiconductor Industry Association (MSIA) in a dialogue session held at a hotel in George Town.

A key component in the blueprint will be the Penang Chip Design Academy, located at the Penang Skills Development Centre (PSDC) building in Bayan Lepas.

This is part of the state’s ongoing work in setting up a 42.49ha integrated circuit (IC) design and digital park in the area.

This will offer over 1,000,000sq ft of space catered to end-to-end design development, as well as cultivating talent through upskilling, reskilling, academic training and hands-on experience.

“Malaysia has emerged as a significant player in the chip manufacturing industry over the past five decades, accounting for 13% of global chip assembly, testing and packaging.

“The majority of that is done in Penang, which recorded RM341bil in E&E (electrical and electronic) exports last year.

“Overall, Penang also maintained its primacy as the top exporting state with RM435bil in 2023, representing 31% of the country’s total,” Chow said.

He added that the last five years also saw the best growth of approved manufacturing investments.

A total of RM184.3bil was recorded from 2019 to 2023, compared to RM76bil from 2008 to 2018.

“With rapid technological advancements and shifting global dynamics, the state recognises the importance of fostering resilience in our ecosystem to not only weather storms, but also transform them into opportunities for growth,” he said.

MSIA president Datuk Seri Wong Siew Hai said the figures underscored Penang’s critical role in the national economy.

“The semiconductor industry is powering the future.

“The global semiconductor market is set to rise from US$574bil (RM2.56 trillion) in 2022 to a forecast of US$1 trillion (RM4.46 trillion) by 2030.

“We need to prepare for this once-in-a-generation opportunity and be ready to seize these opportunities as they arise,” Wong said.

He believes the state’s latest efforts will help the ecosystem move up the IC design value chain.

There are currently 25 active IC design companies in Malaysia, of which 21 are in Penang.

“Penang has a strong base for IC design with a headcount of over 7,000 engineers and these initiatives will allow it to continue to grow.

“The semiconductor industry here has experienced significant growth over the last few years, driven by substantial investments.

“This reinforces Penang as the Silicon Valley of the East,” Wong said.

On related matters, Chow said Penang had adequate land and infrastructural capabilities to accommodate industrial growth for the next 10 years at least.

He pointed to the Bandar Cassia Technology Park, Batu Kawan Industrial Park 3 and Penang Science Park South with over 323ha combined, as sufficient for projected demand.

There are other private-sector initiatives such as one in Bertam that will provide 323ha of space.

For the longer term, there is also the state’s Silicon Island project with 283ha.

“Unless we see a triple or quadruple surge in investment within the next few years, the state does not foresee any shortage of industrial land.

“We’re in a much better position now,” he said.

Chow also highlighted that Tenaga Nasional Bhd’s (TNB) cross-channel monopole transmission project would boost the energy grid by a further 2,000MW.

“At present, Penang’s domestic consumers and industry are consuming just below half of TNB’s overall capacity,” he said.

Chow also gave updates on the water situation and expansion of the Penang International Airport’s terminal and cargo facilities.

Source: The Star

New blueprint to boost Penang’s E&E future

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Malaysia is expected to attract new investments in the energy sector from Singapore and Vietnam, said Deputy Prime Minister Datuk Seri Fadillah Yusof.

Fadillah, who is also the Energy Transition and Water Transformation Minister, said the potential investments will be discussed in detail during courtesy calls with Singapore Senior Minister of State for the Ministry of Trade and Industry (MTI) and Ministry of Culture, Community and Youth Low Yen Ling, dan Vietnam Deputy Minister of Industry and Trade Nguyen Hoang Long later on Thursday.

“I think the minister from Singapore intends to discuss extending the (renewable energy import from Malaysia) agreement, as the expiry date is near,” he said.

The deputy minister said that Malaysia is prepared to export an additional 100 megawatts (MW) of power, in the event Singapore’s energy supply deal with Laos falls through.

“I will also discuss focusing on the Asean Power Grid initiative next year with the ministers (from Singapore and Vietnam),” he told the media on Thursday, during his visit to Peru for the two-day Energy Ministers’ Meeting (EMM) under the Asia-Pacific Economic Cooperation (Apec) from Aug 15-16.

The Asean Power Grid is a regional initiative to improve energy connectivity among Asean member countries.

The grid focuses on integrating the electricity grids of various Asean nations to enhance energy security, promote efficient energy use, and support the development of a regional electricity market.

The goal is to facilitate cross-border electricity trade and ensure a more reliable and sustainable energy supply within the region.

Fadillah said the association’s countries can assist each other with power needs, in the spirit of the Asean community, .

“This is one of the issues I intend to discuss with our Asean partners,” he said.

Meanwhile, Fadillah also discussed possible investments in Vietnam, which has abundant wind power resources.

He said that national oil company Petroliam Nasional Bhd (Petronas) and utility company Tenaga Nasional Bhd (KL:TENAGA) are keen to invest in Vietnam’s energy sector.

“I will discuss the possibility of an undersea (power) cable from Vietnam to Kota Bahru, Kelantan. This is not only for Malaysia, but the cable can be used to supply power to Singapore and other Asean countries,” he added.

Fadillah is scheduled for courtesy calls with the Brunei’s Minister at the Prime Minister’s Office and Minister of Defence II, Pehin Halbi; and Japan’s Parliamentary Vice-Minister of Economy, Trade and Industry Nobuhiro Yoshida.

He will also attend the minister’s lunch hosted by the Ministry of Energy and Mines of Peru.

Source: Bernama

Malaysia expects to attract energy sector investments from Singapore, Vietnam — Fadillah

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New York-based hybrid cloud and artificial intelligence (AI) solutions provider International Business Machines Corporation (IBM) sees strong growth potential in Malaysia, pointing to a recent surge in technology investors and new data centres.

IBM Asean general manager Catherine Lian said the company is focused on strengthening its private partnership ecosystem while developing strategies to enhance the technology value chain in the country.

“It is interesting to see how the Malaysian government is prioritising the enhancement of the value chain in this country. We believe Malaysia is a hub of economic growth, and with the political stability, we are excited about what lies ahead in the coming year,“ Lian told Bernama following a media briefing on the sidelines of the IBM Think 2024 conference, here.

The conference explored how the future of AI is unlocking Asean’s economic potential.

Lian said IBM is particularly encouraged by the increasing number of data centres in Malaysia, which she described as evidence of “explosive growth” in the country’s technology sector.

“This really shows that the value chain of economic growth is evident. While we see a lot of investment across these technology portfolios, IBM is excited to be part of the journey to drive technology and the adoption of generative AI in these data centres.”

Lian highlighted the Malaysian government’s role in fostering economic growth and attracting foreign direct investment, noting that IBM is committed to aligning its technology solutions with these national initiatives.

Looking ahead, she said IBM will continue to advance hybrid cloud and AI solutions in partnership with its Malaysian clients.

“When we consider Malaysia’s outlook, the adoption of AI has already started across all industries. It is important that technology providers like IBM continue to drive hybrid cloud AI solutions to build the digital transformation journey with our customers and clients in Malaysia,” she added.

IBM offers global expertise in hybrid cloud, AI, and consulting, helping clients leverage data insights, streamline business processes, reduce costs and gain a competitive edge. Hybrid cloud combines public cloud, private cloud and on-premises infrastructure to create a unified, flexible and cost-efficient information technology environment.

Source: Bernama

Malaysia’s growing tech sector spurs IBM’s expansion plans

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The Digital Ministry is confident of securing more digital investments in the second half of this year after the impressive performance recorded in the first half (1H).

Minister Gobind Singh Deo said Malaysia’s total digital investment hit RM66.22 billion in 1H, surpassing the RM46.2 billion achieved for the whole of 2023, supported by the MADANI government’s business-friendly policies.

These investments came with the creation of 25,498 jobs in 1H 2024, surpassing the tally of 22,258 in 2023.

“Digital is an area that is growing significantly and is attracting a lot of attention. Moving forward, we are going to see a lot more emphasis being placed in this sector,” he told reporters after the signing of a memorandum of understanding between 42 Malaysia, a peer-to-peer computer science school established by Khazanah Nasional Bhd in a joint venture with Sunway Education Group, and MyDIGITAL Corporation.

Gobind said that to spur the sector and investment in digital, the Budget 2025 wishlist to be presented to the Finance Ministry will include tax exemptions.

“The question that was raised was how can the government develop policies around incentives that will actually motivate businesses to invest, so there are certain suggestions to be put forward focused on taxation.

“I think ultimately, it comes back to how fast we can get everyone on board because if you look at the numbers, the small and medium enterprises form 97 per cent of the industries of the country. If we are able to get them on board adopting technology in their businesses, you’re going to see tremendous growth in the country’s digital economy,” he noted.

He also emphasised the need for further government and industry partnerships to hasten the national digital agenda, among others on talent creation, to support the fast-growing industry.

Gobind said tech giants such as Google, AWS, Byte Dance, Nvidia and Microsoft have committed billions of ringgit into Malaysia’s digital sector and will need a lot of skilled workers to support their operations.

The minister said MyDIGITAL and 42 Malaysia will leverage skill sets from each other to develop digital talent in Malaysia.

The planned initiatives include joint research and development, cross-border training exchange programmes, collaborative workshops and training programmes, and executive digital leadership programmes.

Source: Bernama

Digital Ministry confident of securing more digital investments in 2H 2024

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Penang Chief Minister Chow Kon Yeow and delegates from InvestPenang have concluded a 10-day investment and trade mission to the US, strengthening ties with American investors, and offering insights into the future of artificial intelligence (AI) and new technologies.

According to a statement issued by the chief minister’s office, the mission, which was held from Aug 4 to 14, involved a total of 22 official strategic meetings and site visits aimed at encouraging the expansion of the US companies’ Penang operations, and to attract new investments into the state.

“During the meetings, key discussions revolved around the transformative impact of AI across critical sectors, with previews of its potential applications and innovations.

“The dialogues highlighted Penang’s strategic importance in the global supply chain, particularly in light of current geopolitical tensions,” the office said.

In addition, the discussions also underscored the exceptional capabilities of Penang’s talent pool in sustaining and enhancing the local ecosystem.

Notably, the office said there was a strong emphasis on the urgent need for renewable energy adoption and Penang’s strategic direction towards environmental, social, and governance principles.

According to the statement, the first four days were spent in San Jose, where the delegation visited companies such as MKS Instruments, Brooks Instrument, Lattice Semiconductor, AMD, Synopsys, Efinix, Agilent, Coherent, SambaNova and Western Digital.

The delegation then travelled to Seattle, San Diego and Los Angeles for the remaining six days, where they met with Centific, Monolithic Power Systems, Dexcom, Cohu, UST, TTM Technologies, Mattel and potential investors.

“This mission to the US not only offered better insights into the future of AI and new technologies engaged by existing and potential investors, but also served as a significant step towards reinforcing our existing partnerships and laying the groundwork for future growth.

“The collaborative efforts and feedback gathered during this trip will undoubtedly strengthen economic ties, and ensure continued prosperity for both Penang and our international partners,” the office added.

Source: Bernama

Stronger investor ties, expansion opportunities following delegation’s 10-day trip to US, says Penang CM’s office

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Johor’s status as Malaysia’s leading data centre (DC) hub is expected to strengthen further, bolstered by substantial foreign direct investment (FDI) in the services sector.

CIMB Securities Sdn Bhd (CIMB Securities) said Johor has cemented its position as an investment magnate as it topped the FDI charts and the state’s FDI flows are expected to re-accelerate in 2024, as a stable political climate ensures policy continuity following the conclusion of the six state elections in August 2023.

According to the research firm, the services sector accounted for about 70 per cent of the total FDI received by Johor last year, while the remaining 30 per cent came from the manufacturing sector.

By sub-sectors, the Information Communication Technology (ICT) segment was a major contributor towards the services sector, involving DC’s, cloud sharing services, software and design systems, as well as creative and digital content.

As for the manufacturing sector, it was mainly made up of electrical and electronics products (E&E) manufacturing, chemicals, and machinery and equipment.

“Due to its close proximity, Singapore is unsurprisingly one of the main sources of FDI for Johor.

“Given Johor’s transformative landscape, this would accentuate the demand for specialist builders of advanced technology facilities (ATF)’s, including high-tech industrial buildings, integrated logistics centres, and DC’s,” CIMB Securities said in a research note.

The firm added that a step-up in infrastructure-building is needed to augment Johor’s huge investment drive, and the state’s constructive outlook has also been galvanised by closer bilateral ties between Malaysia and Singapore.

Furthermore, the twin completion of the Gemas-JB Electrified Double Tracking (2025) and RTS Link (December 2026) could herald the start of more infrastructure spending to improve connectivity within Johor, it said.

It also noted that a firmer ringgit provides more fiscal leeway for the government to carry out large-scale infrastructure projects, especially for those that require machinery or inputs that are imported in US dollars.

“Therefore, to promote greater mobility, we firmly believe that the Madani administration may accelerate the rollout of large-scale public transportation projects to complement Johor’s robust growth prospects.

“As such, the Johor ART (autonomous rail transit) and KL-Singapore HSR (high speed rail) are the next two standout projects that could come to the fore,” CIMB Securities added.

Given that Johor’s rapid industrial drive could put a strain on the state’s natural resources, the research firm expects a greater push towards an upgrade of its utility network and related infrastructure in the months to come.

Source: NST

Johor’s data centre hub to get a boost from rising FDIs, says CIMB Research

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UEM LESTRA Bhd, a wholly owned subsidiary and the green arm of UEM Group Bhd, has allocated RM1.5bil, which it aims to deploy in the next 24 months, to invest in decarbonising Malaysia’s industrial parks.

UEM Group managing director and UEM Lestra chairman Datuk Amran Hafiz Affifudin said that the move is part of UEM Group’s agenda to spur domestic direct investment (DDI), which will lead to job creation and attract foreign direct investment (FDI) to Malaysia.

“Operating in a sustainable industrial park is one of the top priorities for foreign investors, especially manufacturers.

“We need to ramp up our efforts to explore setting up new sustainable industrial parks and at the same time decarbonise existing ones by upgrading current infrastructure via innovative technologies and methodologies that can be integrated into existing operations.

“This could potentially involve the integration of renewable energy sources, such as solar and the implementation of other advanced energy management systems and technology to optimise consumption patterns.

“Investors are hungry for zero-emission operations. As Malaysia continues to attract significant FDI, initiatives such as the decarbonisation of industrial parks are expected to boost the local economy, drive sustainable growth and position Malaysia as a key global player,” he said.

UEM Lestra aims to be at the forefront of these efforts, driving the transition towards a sustainable economy and leading the response to climate change, in line with the country’s aspiration of achieving net zero carbon emissions by 2050.

Plans for a renewable energy (RE) industrial park are already in the works.

In July 2023, UEM Lestra, in collaboration with local and international partners, announced that it is pioneering the development of a one-gigawatt hybrid solar photovoltaic power plant integrated with the RE industrial park in Malaysia.

This project is part of a flagship initiative under the National Energy Transition Roadmap.

UEM Lestra chief executive officer Harman Faiz Habib Muhamad shares that the organisation is looking at expanding its green assets and operations through strategic partnerships, as well as via direct and active ownership.

It plans to nurture domestic green champions such as Cenergi SEA Berhad, which it acquired last year.

“Over the long term, we plan to establish a competitive green platform in key energy sectors and emerging growth areas, such as renewables and storage infrastructure, integrated energy solutions, green and electric mobility, as well as waste management and recycling,” says Harman.

“These initiatives will be funded through our overall RM7bil sustainable and responsible investment sukuk programme.

“We are committed to reducing environmental impacts through strategic clean energy efforts. Our focus on sustainability extends beyond reducing emissions to fostering a new way of thinking that prioritises circular economy models and resource efficiency for the benefit of both the economy and the environment.”

Source: The Star

UEM Lestra Invests in Industrial Decarbonisation

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US-based Insulet Corp, a medical device company, has officially opened a 400,000 sq ft manufacturing facility on a 13-acre site in Johor Bahru to produce its Omnipod brand of products primarily for diabetes.

According to a press statement issued on Wednesday, the newly opened facility, which was completed in 2023, is twice the size of Insulet’s highly automated manufacturing facility in Acton, Massachusetts, which is where the company is headquartered.

On the opening of the new facility, Insulet president and CEO Jim Hollingshead said, “Insulet’s remarkable growth is driven by our market-leading Omnipod 5, the first and only tubeless automated insulin delivery system in the US. Our new state-of-the-art manufacturing facility in Malaysia positions us strategically to stay ahead of the huge demand for Omnipod, ensuring our customers have uninterrupted access to our products from this thriving region with great talent.”

The statement added that currently, there are more than 350 full-time Insulet employees working at the new facility with plans to grow to more than 1,000 in the coming years, which is part of a US$200 million (RM889.59 million) investment plan in the area.

In addition to that, the new manufacturing facility was designed with sustainable elements to achieve both Green Building Index certification and Leadership in Energy and Environmental Design (LEED) Silver certification, which is part of Insulet’s global efforts to minimise its environmental impact in the areas where it operates.

The statement added that the new facility has more than 5,700 solar panels that generate approximately 15% of the building’s power needs. To reduce the water consumption of local water sources, an underground rainwater harvesting system, comprising three rainwater capture units, was built with the capacity to satisfy 30% of the landscaping water needs. Additionally, energy-efficient equipment and construction materials were used as hardscape materials to reduce heat island effects.

Commenting on the new facility, Johor State investment, trade and consumer affairs committee chairman Lee Ting Han said, “The manufacturing facility is up and running with a local workforce that has been upskilled and trained. This investment by Insulet will have a profound impact on the local economy for many years to come as they grow globally.”

Source: The Edge Malaysia

US-based Insulet Corp officially opens medical device manufacturing facility in Johor Bahru

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The Ministry of Investment, Trade and Industry (MITI) will implement preventive measures to address potential supply chain disruptions, including the development of a platform to enhance traceability, ensuring the resilience of Malaysia’s industrial supply chain.

MITI also plans to establish initiatives that provide centralised access to guidelines, funding opportunities, and support programmes, while fostering knowledge sharing among industry players.

These measures were decided at the Sixth National Investment Council (MPN) Meeting, which focused on “Building Economic Security Through a Resilient Supply Chain,“ the ministry said in a statement.

Its minister, Tengku Datuk Seri Zafrul Abdul Aziz emphasised the need for responsive strategies to manage and recover from supply chain disruptions, citing findings from its engagement sessions with industry stakeholders and bilateral and multilateral cooperation.

He said the global supply chain is the lifeline of the world economy, with interconnected systems that complement one another.

“Supply chain security ensures the smooth flow of goods, services and inputs across borders and fosters economic growth and universal prosperity.

“The COVID-19 pandemic served as a wake-up call, exposing vulnerabilities and underscoring the importance of a resilient and efficient industrial supply chain,“ he said.

As an open economy, Malaysia is particularly sensitive to supply chain disruptions caused by global geopolitical events and natural disasters, MITI noted.

To maintain the competitiveness of the Malaysian economy, MITI is committed to ensuring that the national industrial supply chain remains resilient and secure against future disruptions, the minister added.

The ministry stressed the importance of a multi-pronged approach to bolster global supply chain resilience.

“Collaboration between governments, businesses, and international organisations is crucial for facilitating information sharing, coordinating responses, and developing uniform standards.

“This includes leveraging technology, diversifying sourcing options, fostering regional cooperation, and enhancing flexibility as key strategies to strengthen supply chains against disruptions,“ MITI said.

MITI also highlighted the need for digitisation to reinforce supply chain resilience and security, drive innovation, and provide a competitive edge in the increasingly complex global market.

“By embracing digital technology, Malaysia can improve its ability to prevent and respond to disruptions, implement robust security measures, and streamline operations for greater efficiency and agility through digitisation, including systems, applications, and virtual centres of excellence,“ the ministry explained.

Source: Bernama

MITI unveils initiatives for stronger industrial supply chain

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Malaysia needs to continue playing its role as a ‘neutral’ country with a strong ecosystem in the technology sector to ensure the country remains an investment destination.

Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz said Malaysia’s economy is open and has established cooperative relations with all countries.

“Southeast Asia is neutral, has good demographics, a growing, stable and peaceful economy.

“Malaysia and Singapore are two countries that have been involved in the semiconductor sector for a long time — Malaysia is over 50 years old and we have a good ecosystem, almost complete and mature.

“So, that’s one of the reasons we see investment also increasing in this sector,” he said on the Agenda Awani programme titled ‘Tech War’, Tesla and Investment Magnet broadcast by Astro Awani on Tuesday.

He said the increase in investment inflows was also supported by recent data which showed Malaysia recorded approved investments of RM83.7 billion in various fields in the first quarter, representing an increase of 13 per cent from RM74.1 billion in the same period last year.

“We expect the Gross Domestic Product (GDP) to grow 5.8 per cent in the second quarter of 2024 with the manufacturing sector growing by 4.7 per cent, boosted by the electrical and electronics (E&E) sector, especially semiconductors,” he said.

Tengku Zafrul said that in terms of trade, Malaysia has 16 Free Trade Agreements (FTAs) including multilateral and bilateral, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP).

“We have various FTAs with all groups, for example the BRICS (Brazil, Russia, India, China and South Africa) is not an economic block but a grouping that discusses global south issues.

“We are also together with the United States in the Indo-Pacific Economic Framework (IPEF). Recently we are looking to start discussions with the European Union on the Malaysia-EU Free Trade Agreement (MEUFTA).

“In my opinion, almost all of our blocs are together because our country is a country with an open economy and is also small compared to its main trading partners, the United States and China,” he said.

Source: Bernama

Malaysia needs to continue as ‘Neutral’ country to become primary investment destination – Tengku Zafrul

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Sarawak is advancing its green hydrogen initiatives with the aim of becoming a significant player in the global hydrogen market by 2030, said Datuk Dr Hazland Hipni.

To meet this aim, the Deputy Energy and Environmental Sustainability Minister said the Sarawak Hydrogen Hub in Bintulu will produce approximately 250,000 tons of green hydrogen annually, with 90 per cent for re-export and 10 per cent designated for local use.

“Key projects include H2ornbill, in partnership with Japanese firms Sumitomo and Eneos, as well as with South Korean companies Samsung and Lotte Chemicals.

“These projects are expected to generate substantial economic benefits and align with Malaysia’s clean energy goals, leveraging Sarawak’s abundant hydropower resources for hydrogen production,” he said at the ‘Hydrogen Economy Fuelling Tomorrow: The Impact of Hydrogen on Regional Economy’ discussion in Kuala Lumpur recently.

Dr Hazland was invited as a panellist for the discussion which was held in conjunction with the Malaysia Commercialisation Year (MCY) Summit 2024 at Kuala Lumpur Convention Centre (KLCC).

The event was officiated by Prime Minister Datuk Seri Anwar Ibrahim.

Dr Hazland during the discussion also shared that Sarawak had in June this year launched Malaysia’s first electrolyser assembly and distribution facility.

“The Sarawak Electrolyser Assembly and Distribution Facility (SEA-DF) brings Sarawak closer to achieving its aspiration of becoming a hydrogen hub in the region,” he said.

Also participating in the discussion were Science, Technology and Innovation Minister Chang Lih Kang, International Renewable Energy Agency deputy director-general Gauri Singh, and NanoMalaysia chief executive officer Dr Rezal Khairi Ahmad.

MCY Summit 2024 is the premier platform for showcasing Malaysia’s cutting-edge technology and innovation, driving socio-economic development, and fostering global collaboration.

Source: Borneo Post

Dr Hazland: S’wak boosting green hydrogen initiatives to become significant player in global market

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The standoff between the United States and China presents opportunities for Malaysia’s electrical and electronics (E&E) and renewable energy sectors, says Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz.

He said globally, investors in industries such as electric vehicles and solar power are focused on securing sensitive trade goods.

“At the heart of today’s tech Cold War lies a battle over the semiconductor supply chain and Malaysia’s 50-year-old sector places us in an excellent position to reap such opportunities.

“This is why we introduced the National Semiconductor Strategy (NSS) to move our semiconductor producers up the global value chain for us to export more higher-value products,” he said in his keynote address at PRAXIS 2024 here on Tuesday (Aug 13).

He said Malaysia has already welcomed global investors such as Infineon, Intel and Texas Instruments who have also increased their investments in Malaysia, citing Malaysia’s agile technology supply chains.

Aside from efforts on skilled talent development, Tengku Zafrul said Malaysia must also apply data-driven solutions.

He added that a proposal to establish an Integrated Digital Platform consisting of a Supply Chain Intelligent Management System, Business Continuity App and Virtual Centre of Excellence, was also presented to the National Investment Council on Tuesday.

“Together, these will map, gather and analyse real-time data from the supply chain of critical industries in Malaysia and show clearly how one sector’s supply chain supports another sector,” he said.

In terms of record investments, Tengku Zafrul also said Malaysia achieved a record high of RM330bil last year and RM83.7bil in the first quarter of this year.

He added that between 2021 and Q1 this year, the realisation rate of approved investments stood at about 80%.

He attributed this to diligent follow-ups by agency-led initiatives such as the Malaysian Investment Development Authority (Mida) Invest Malaysia Facilitation Centre, among others.

Trade-wise, he said Malaysia’s total exports last year surpassed RM1 trillion for the third year running, despite a cyclical downturn in the semiconductor industry and commodities.

“I am equally proud to share that for the first half of 2024, our total trade reached RM1.4 trillion, the highest ever for the period.

“The country has also recorded over two decades of uninterrupted quarterly trade surpluses, with E&E products and other manufactured goods massively contributing to exports,” he said.

Separately, Institute of Strategic and International Studies (Isis) Malaysia chairman Datuk Prof Dr Mohd Faiz Abdullah said the policy solutions put forward at the research sessions will be combined with cutting-edge research and analyses from the country’s researchers and knowledge partners.

“These policy papers will be made publicly available for all, and we will deliver them to the desks of all stakeholders to advance better policy solutions for the country,” he said in his welcoming remarks at PRAXIS 2024.

The Isis Malaysia website describes PRAXIS as its flagship public policy conference, designed to bridge ideas and translate theory into practice.

It has been held since 2011, bringing together policymakers, the private sector, civil society and academia to discuss topics of national interest.

Source: The Star

US-China tech impasse opens up opportunities for Malaysia, says Zafrul

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Some 80% of approved investments between 2021 and the first quarter of this year have been realised, says the Investment, Trade and Industry Minister.

Tengku Datuk Seri Zafrul Tengku Abdul Aziz (pic) attributed this to diligent follow-ups by agency-led initiatives such as the Malaysian Investment Development Authority’s Invest Malaysia Facilitation Centre.

He said the country achieved a record high RM330bil in terms of approved investments in 2023 and a 13% year-on-year increase in the first quarter of 2024.

On trade, he said Malaysia’s total exports surpassed RM1 trillion for the third-year-running last year, while total trade reached RM1.4 trillion for the first half of 2024, making it the highest ever for the period.

“Compared with many of our regional neighbours, Malaysia has shown its ability to punch well above its weight in the movement of goods across borders. This is also attributed to Malaysia’s commitment to the rules-based framework of global trade through its membership of an extensive ecosystem of free trade agreements,” he said at PRAXIS 2024 here yesterday.

PRAXIS is the Institute of Strategic and International Studies (ISIS) Malaysia’s flagship public policy conference, designed to bridge ideas and translate theory into practice.

Despite the achievements, Tengku Zafrul said there was considerable room for improvement.

This includes enhancing the utilisation rates of free trade agreements like the Regional Comprehensive Economic Partnership (RCEP), and the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP) among Malaysian firms.

He also highlighted the need to empower more small and medium enterprises to participate in international trade, and build resilience by economic diversification.

Separately, Tengku Zafrul said the standoff between the United States and China presents opportunities for Malaysia’s electrical and electronics (E&E) and renewable energy sector.

He said globally, investors in industries such as electric vehicles and solar power are focused on securing sensitive trade goods.

“At the heart of today’s tech Cold War lies a battle over the semiconductor supply chain and Malaysia’s 50-year-old semiconductor sector places us in an excellent position to reap such opportunities.

“This is why we introduced the National Semiconductor Strategy (NSS) to move our semiconductor producers up the global value chain for us to export more higher-value products,” he said.

He said Malaysia has already welcomed global investors such as Infineon, Intel and Texas Instruments who have also increased their investments in Malaysia, citing the country’s agile tech supply chains.

Aside from efforts on skilled talent development, Tengku Zafrul said Malaysia must also apply data-driven solutions.

Meanwhile, ISIS Malaysia chairman Datuk Prof Dr Mohd Faiz Abdullah said the policy solutions put forward at the PRAXIS 2024 sessions will be combined with cutting-edge research and analyses from researchers and knowledge partners.

“We commit that these policy papers will be made publicly available for all, and we will be delivering them to the desks of all stakeholders to advance better policy solutions for the country,” he said.

Source: The Star

‘Country achieved record high in approved investments’

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Malaysia needs to strategically acquire and develop its own technology to be counted among developed nations, said Deputy Investment, Trade and Industry Minister (Miti) Liew Chin Tong.

The deputy minister said that while foreign direct investment (FDI) is necessary, it is not an end in itself, and Malaysia needs to be strategic in its approach.

“Malaysia thinks that FDI is almost everything, and I think that mindset has to change,” he said.

He said in the Madani Economic Framework, Prime Minister Datuk Seri Anwar Ibrahim highlighted that for over 20 years, investment has constituted only about 20% of the gross domestic product (GDP).

“In contrast, during the early days of economic growth, it constituted around 40% of GDP. At one point in 1997, it rose to about 45%.

“While there were instances of overheating, the key takeaway is that investment is crucial and foreign investment is necessary, but we need to be strategic in our approach,” he said.

Liew said this in his keynote address at the National Consultation on Green Industrialisation in Malaysia: Integrated Policy Strategies for a Sustainable Future meeting organised by the United Nations Trade and Development (Unctad) intergovernmental organisation and Khazanah Research Institute (KRI) here on Tuesday.

He stressed that industrialisation cannot be just about exports; instead, it has to have some form of mission to solve societal problems.

“The New Industrial Master Plan 2030 [NIMP 2030] lists down four missions namely advance economic complexity; tech up for a digitally vibrant nation; push for Net Zero; safeguard economic security and inclusivity, which are all key to transforming Malaysia’s industry into one that is of high productivity, high skill, and most importantly, high wage,” he said.

Liew highlighted a comparison made by Seoul National University professor of economics, Prof Keun Lee, on the semiconductor sectors in Taiwan, Shenzhen and Penang, where the sector in Penang is still mainly driven by foreign firms.

“In comparison, the sectors in Taiwan and Shenzhen have acquired much more technologies and innovations,” he said.

Meanwhile, Liew said he is glad to see government-linked investment companies (GLICs) paying more attention to the semiconductor industry in Malaysia.

“The semiconductor industry used to be treated as a private-driven investment. Now, the industry has been thrust into the spotlight amid the current geopolitical fight between China and the United States due to the growing necessity of having access to advanced chips to power everything from smartphones to electric vehicles.

“Clearly, the ability to think critically about the way to position and accelerate advancements in semiconductors will have significant implications for trade, investment and geopolitics in the years to come,” he said.

Liew said that it is also crucial to develop horizontal industrial linkages within Malaysia.

“For example, the mature semiconductor industry in Malaysia should form a basis for developing the automotive industry, including electric vehicles (EVs) and agritech,” he said.

Liew added that Malaysia is at the brink of a second economic takeoff built upon the development of a high productivity, high skills, and high wage model.

Recently, the Ministry of Finance announced that six GLICS, Khazanah being one of them, have pledged to invest RM120 billion in domestic direct investments (DDI) over the next five years in high-growth, high-value industries, including the energy transition sector and advanced manufacturing, particularly in semiconductors.

Source: Bernama

Malaysia must be strategic in acquiring and developing technology to be developed nations

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Any changes in Tesla Inc. factory plans in Thailand and expansion strategy in Southeast Asia will not impact Perak’s efforts to attract foreign investments, according to Perak Menteri Besar Datuk Seri Saarani Mohamad.

Saarani clarified that Perak was never part of Tesla’s proposed factory plans.

Instead, the state is focused on existing projects, such as Zhejiang Geely Holding Group Co Ltd’s (Geely) investment in the Automotive High-Tech Valley (AHTV) in Proton City, Tanjung Malim. These investments will proceed as planned.

“I understand that Tesla’s investment plans were supposed to be in Kedah. We in Perak are not involved in the plans for a Tesla factory.

“We only have investments from Geely in AHTV Tanjung Malim, so as far as Tesla is concerned, I think we (Perak) are not affected,” he told reporters after attending

Mesra Programme here, yesterday.

It was reported that Tesla had cancelled its plans to develop factories in Malaysia, Thailand, and Indonesia following a reassessment of its business expansion plans in Southeast Asia.

Prime Minister Datuk Seri Anwar Ibrahim was also reported to have said that the decision was due to Elon Musk’s company suffering significant losses and being unable to compete with EV industries from China.

In related developments, Saarani said a meeting will be held in September between the state government and Geely to approve the master plan from Geely, which will involve an investment of RM40 billion in AHTV to finalize it.

He added that other major investments, such as the Maritime Industrial City Lumut (LuMIC) project in Lumut, the production and processing of quartz and silica-based minerals at the Silver Valley Technology Park (SVTP) in Kanthan, and the downstream rare earth element (REE) production plant by a South Korean company are proceeding smoothly.

“Geely has submitted the master plan for their development in AHTV, and in September we will have a meeting to approve the layout.

“Other investments, such as RM72 billion for LuMIC, a silicon company from China at SVTP, and from Korea for the production of super magnets (REE downstream products), are also progressing well,” he said.

Source: NST

Perak unaffected by Tesla’s shelved plan for Southeast Asia plant

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Malaysia needs to start thinking about mandating companies, both local and foreign, to contribute a portion of their revenue to support research and development (R&D) in Malaysian universities, said Deputy Minister of Investment, Trade and Industry Liew Chin Tong.

He recalled that during a visit to Brazil, he learned from Petroliam Nasional Bhd (Petronas) that Brazilian regulations require companies to contribute 1% of their revenue – not profit – to R&D in the country’s universities.

“And they (Petronas) contribute a lot of revenue (to R&D). (Therefore) whether it comes from Malaysian companies or whoever makes money out of Malaysia we have to start thinking about mandating some contributions by companies that make money in this country,” he said at the Unctad-KRI national consultation meeting on Green Industrialisation today.

Liew argued that Malaysia does not have a talent problem but the perceived talent shortage is actually a pay problem.

“Most of the time, university VCs are preoccupied by the idea that they have to train students. The national debate now is there’s a talent problem. If you pay two-thirds of Singapore pay, everyone will come back. But we are still preoccupied by this thinking that we have to train as many engineering students as possible,” he said.

“Additionally, when thinking about potential investors, we often compare ourselves to Vietnam, and investors often encourage this comparison. We are often told that Vietnam is doing this, doing that. To the extent that we continue to see ourselves just as a manufacturing base, we do not see ourselves as a location for R&D,” Liew said.

He added that as long as Malaysia continues to see itself merely as a manufacturing base, it fails to recognise its potential as a hub for R&D and high-end production.

Source: The Sun

Liew: Time to consider mandating companies to contribute to R&D in universities

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The Selangor government welcomes Tesla Inc’s continued investment plans in the state in the future, particularly in relation to research and development and the opening of electric vehicle (EV) service centres.

Menteri Besar Datuk Seri Amirudin Shari said the invitation was in line with Tesla owner Elon Musk’s desire to expand the company’s market in the Asian region.

He said that so far the giant EV company has branched out several operations in Selangor, namely the opening of its headquarters in Cyberjaya in addition to opening a charging centre.

“The headquarters and charging centres are already there. It will probably open the service centres after this because it wants to expand its market in Asia,“ he said when asked to comment on a report saying Tesla cancelled plans to develop a factory in Thailand recently.

So far, Tesla has developed four experience centres in Malaysia and the multinational automotive company has also exceeded its target by installing 52 units of instant chargers with a capacity of over 180 kW in various places in the Klang Valley, Johor, Melaka, Penang and Pahang.

The Mentri Besar said at a press conference after launching the Program Tuisyen Rakyat Selangor 2024 that the influx of investors in the semiconductor sector is extraordinary and the state government is ready to develop a second integrated circuit (IC) design park after the quota at the first IC park is expected to be full soon.

Source: Bernama

Tesla expected to continue investments in Selangor – Amirudin

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Malaysia, as a middle power, can play its role in global supply chain security amid the United States-China tensions, particularly via its electrical and electronics and renewable energy (RE) sectors.

Investment, Trade and Industry Minister Datuk Seri Tengku Zafrul Abdul Aziz said globally, investors in industries such as electric vehicles (EV) and solar power are focused on securing sensitive trade goods.

“The emergence of competing supply chains, and both countries’ (the United States and China) efforts to decouple from each other’s economies, has reshaped the dynamics of both international trade and investments,” he said in his keynote address at the Isis Praxis 2024 Conference today.

On Malaysia navigating this turbulent terrain, Tengku Zafrul said understanding the clear division within the global tech ecosystem has been crucial in positioning Malaysia as a preferred investment destination, particularly for semiconductors.

“China’s ‘Made in China 2025’ initiative seeks to establish dominance in crucial technologies such as artificial intelligence (AI), robotics, RE, EV, aerospace and biotechnology. In response, the US has restricted critical exports and domestic innovation investments through initiatives such as the CHIPs Act.

“As a result, many investors are seeking diversification across regions and sectors, as a risk-mitigation measure. Security concerns and over-reliance have led both economies and their regional partners to invest more in separate, rival tech supply chains,” he said.

Tengku Zafrul said at the heart of today’s Tech Cold War lies a battle over the semiconductor supply chain, and Malaysia’s 50-year-old semiconductor sector places the country in an excellent position to reap such opportunities.

“This is why we introduced the National Semiconductor Strategy (NSS) to move our semiconductor producers up the global value chain to export more higher-value products.

“We have already welcomed global investors such as Infineon, Intel and Texas Instruments who have increased their investments in Malaysia, due to our agile tech supply chains. Indeed, as technology continues to evolve, investors are also considering the transformative potential of emerging technologies such as generative AI,” he said.

To that end, Tengku Zafrul said, Malaysia is courting investments in related assets such as robotics, AI-powered logistics suppliers and industrial real estate — in short, hardware, software and applications across the AI ecosystem — to help global investors mitigate risks.

“Indeed, the semiconductor industry is the backbone of today’s biggest technologies, including AI, electric vehicles and factory automation. It is also pivotal in securing economic prosperity and national security for tech superpowers such as China and the US, especially as Taiwan still dominates semiconductor manufacturing worldwide,” he said.

According to the minister, analysts have estimated that government initiatives, such as the CHIPS Act, may inject roughly US$100 billion (RM444.9 billion) into the semiconductor industry across the US, Europe and Asia, of which Malaysia has the industrial capacity, the track record and the rule of law to successfully reap that opportunity.

“Malaysia can truly become a ‘middle-power broker’ to support the security of the global tech supply chain. This is why the NSS has earmarked over RM25 billion over the next decade to strengthen and upscale Malaysia’s semiconductor sector through talent development, targeted initiatives for local companies, and incentives to promote investment in high value-added front-end activities.

“Aside from our efforts on skilled talent development, Malaysia must also apply data-driven solutions. Hence, the continued need for strategic, deliberate and conscious action by policymakers like the Investment, Trade and Industry Ministry,” he said.

Source: Bernama

‘Malaysia can be middle power in global supply chain amid US-China tensions’

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Johor is poised to be the country’s growth engine with the Johor-Singapore Special Economic Zone (JS-SEZ) and the Special Financial Zone (SFZ) in Forest City as key drivers.

RHB Research said JS-SEZ is designed to foster stronger business connections and improved connectivity between the two countries.

“We view all these positively, as it indicates that both the Malaysia and Singapore governments are working well together, and Johor may be able to capture a stronger inflow of investments from Singapore going forward,” it said.

The country’s third largest state by gross domestic product contribution, economic growth for Johor is expected to continue to surpass the national gross domestic product (GDP) average, said RHB Research.

It said Johor stands out with its strategic location, advanced infrastructure, and a diverse economic landscape that includes robust manufacturing activities and a strong services sector.

“We believe the government-led catalytic developments as well as an influx of foreign and domestic direct investments will help to lift the construction, data centre, energy, petrochemicals, industrial, tourism sectors, in addition to a positive spill over to the property market,” it said in note.

The firm said the work progress on the RTS Link project has significantly boosted buyers’ confidence, given the visibility of growth prospects for Johor.

The RTS Link is a game changer, as increased cross-border traffic and the powerful “SGD factor” should benefit the local real estate sector, including housing, retail, and hospitality.

It said demand for rental and housing in the central region of Johor is likely to grow more significantly in the coming years, while the influx of new investments will translate into higher affordability in the long run.

“Major developers remain confident in the long- term outlook with Johor continuing to be an important market.

“We like UEM Sunrise Bhd and Sunway Bhd in the Johor property space. For construction, we highlight Sunway Construction Bhd, Kerjaya Prospek Group Bhd, and Malaysian Resources Corp Bhd. “Other beneficiaries of the Johor growth story include Tenaga Nasional Bhd, YTL Power International Bhd, AME Real Estate Investment Trust and VS Industry Bhd,” it added.

Source: NST

Johor will be Malaysia’s next growth engine thanks to Johor-Singapore SEZ and Forest City SFZ

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Johor is set to be the next growth engine for Malaysia, driven by two high-impact projects, namely the Johor-Singapore Special Economic Zone (JS-SEZ) and the Special Financial Zone (SFZ) in Forest City, according to RHB Research.

The research house pointed that government-led catalytic developments as well as an influx of foreign and domestic direct investments will help to lift the construction, data centre, energy, petrochemicals, industrial and tourism sectors, in addition to a positive spillover to the property market.

“We believe that Johor’s economic growth will continue to surpass the national average, fuelled by its robust manufacturing sector, sustained strength in its services industry, advantageous location and well-developed infrastructure, as well as supportive policies from both state and federal governments. Johor has a well-developed infrastructure that includes ports, airports, road network and utilities, complemented by competitive business operation costs,” RHB said in its Johor Market outlook report on Monday.

Currently, Johor ranks as the third-largest economic contributor in Malaysia — behind Selangor and Kuala Lumpur — and second largest contributor to Malaysia’s trade.

The state accounts for 9.5% of the country’s gross domestic product (GDP). About 29% or RM753.1 billion of national total trade in 2023 came from Johor.

In recent years, RHB said Johor’s GDP growth has outpaced the national average, expanding by 4.1% year-on-year (y-o-y) in 2023, compared to Malaysia’s 3.6% y-o-y growth, driven by the services and manufacturing sectors, which contribute 84% of Johor’s GDP.

“Johor’s services sector has experienced the fastest growth among Malaysian states over the past five years. Several economic and demographic factors fuel the services sector there — consumer spending and retail trade are buoyed by a rising middle class and increasing per capita income,” it added.

Favourable FDI destination

Meanwhile, major ports like the Port of Tanjung Pelepas (PTP) and Johor Port provide excellent connectivity for export and import activities, with PTP standing out as one of Malaysia’s busiest ports and largest trans-shipment hubs, handling a significant portion of the nation’s container traffic and serving as a key gateway for regional and global trade.

“Johor continues to be a leading investment destination in Malaysia for 2023, attracting significant interest from domestic and international investors.

The state’s appeal is driven by its robust infrastructure such as ports and road networks while being well-equipped with utilities services as well as abundant labour.

“In 2023, the Malaysian Investment Development Authority (Mida) approved 751 projects in Johor totalling RM43.1 billion — accounting for 13% of the national figure. These projects are expected to create 19,053 new jobs,” the research house added.

On the other hand, Johor’s manufacturing output in 2023 grew by 2.8% y-o-y, surpassing the national average of 0.7%, driven by a diverse sector portfolio including electrical and electronics, automotive, and petrochemicals, with significant foreign direct investment in the Iskandar Malaysia region bolstering its industrial parks and multinational presence.

“This flagship economic zone is designed to attract high value industries and global investors, offering tax incentives, specialised business parks, and a business-friendly regulatory environment,” it said.

Besides, the ongoing RTS Link project in Johor, with an estimated investment of RM3.7 billion, was 77.6% completed as of May 2024 and is on schedule to begin operations by early 2027. This cross-border rail service, spanning some four kilometres, will connect Bukit Chagar (Malaysia) to Woodlands (Singapore), accommodating up to 10,000 passengers.

Increasing appetite for property in Johor

Additionally, the RTS Link is poised to be a game changer, boosting cross-border traffic and leveraging the “SGD factor” to benefit Johor’s local real estate sector, including housing, retail and hospitality.

Demand for rental properties and housing in Johor’s central region is expected to rise significantly, with new investments likely to enhance long-term affordability.

“Major developers remain confident on the long term outlook with Johor continuing to be an important market.” it said.

Source: The Edge Malaysia

RHB bullish on Johor as Malaysia’s next economic powerhouse

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