| by Uwe Fischer |
Dr Mohd Shahreen Zainooreen B. Madros, MATRADE’s CEO, spearheads the Malaysian delegation at the world’s largest fair for industrial technology. The participation at Hannover Messe is part of an Export Acceleration Mission organised by MATRADE.
“This is my first time here at Hannover Messe, and I find it very impressive compared to many other events I have been to. I think, if you are in the area of technology, this is definitely a must-come place because it is not only about showing products but also a good platform for development work”, Dr Shahreen said.
The Malaysian delegation includes eight exhibiting companies in hall 5 and eight more in hall 16, representing their nation at the largest trade fair in the world for industrial technology. The companies showcase Malaysia’s capability in various areas such as engineering solutions, software services, precision engineering and machining.
From Agriculture to High Tech
To understand where Malaysia stands today you have to look back,” explains Dr Shareen. “Up to the 1970s, Malaysia had been predominantly an agriculture and mining economy. But in the early 70s, the government started its industrialisation initiative. The Government formed MIDA in 1974, an agency encouraging a lot of investments into the country in the 70s. That was the starting point for our electronic industry which soon made Malaysia a regional centre for electronics. Since then, Malaysia has evolved from being largely an agricultural economy into a leading manufacturing nation. This progress has enabled Malaysia to become a major export nation of mainly E&E, chemistry, machinery and petrochemicals. Today, this makes up about 70 % of our total trade.”
Malaysia’s technical progress is still in full bloom. MATRADE, the country’s agency for external trade promotion, encourages this development by providing opportunities where Malaysian companies can showcase their products and expertise. Hannover Messe 2018 is such a platform. The aim is to promote Malaysia as a hub for outsourcing and an opportunity for foreign investors to form joint ventures. “Malaysia fits the bill,” Dr Shareen is convinced. “Our labour costs are competitive compared to the West, therefore many global players have been setting up their plants in Malaysia. At the same time, we are also growing our own local activities to support the increasing demand in ASEAN. Apart from China and India, it is the ASEAN region which has huge potential to grow in the future.”
With a population of about 650 million, ASEAN (the Association of Southeast Asian Nations, made up of Malaysia, the Philippines, Singapore, Thailand Vietnam, Myanmar, Indonesia, Cambodia, Laos, and Brunei) is thriving to become a major economic force in Asia and a driver of global growth. While Singapore is fully developed and in many respects the leading force within ASEAN, Malaysia has formulated the goal to become a high-income nation by 2020.
This implies that its reputation as a low-cost labour country is no longer valid. “We are fully aware that our labour costs are a bit higher than those in the other ASEAN countries, except for Singapore. Therefore we are embracing technology and digitalisation in order for us to be more productive, efficient and competitive. If you look at Malaysia’s development during the last 5 years, you see that we have really taken on a lot of initiatives to progress in terms of science, technology and education”, according to Dr Shahreen.
Apart from that, Malaysia has extensively invested in logistics to ensure goods produced in Malaysia can easily be transported. Being a peninsula, the mainland of Malaysia has numerous first class ports connecting the country to all parts of the world; the Kuala Lumpur International Airport is not only a hub for passengers but also for air freight; the highway net is one of the best in South East Asia. Currently, Malaysia is concentrating on expanding its rail network. “In the last 5 to 10 years, we expanded our rail systems, we have MRT 1 and 2, soon we will have MRT 3, we connected the east coast railway from Port Klang all the way to Kelantan, and we are working on a high-speed rail connection to Singapore, so there is so much going on in terms of infrastructure.”
Malaysia is also pushing on the agenda of e-commerce. In 2017, it established the Digital Free Zone. “Our industrialisation has created 1 million registered companies in Malaysia”, says Dr Shahreen. “98,5 percent of them are SMIs and SMEs. We need to connect them to the world, and e-commerce is a low-cost enabler helping them to showcase their products to the world.”