- MITI carried out well in many factors to support industry, eliminate trade barriers
- Urge all to get in touch with Govt Ministries, understand what’s there to help
The Government associated with Malaysia had entrusted PwC to perform an assessment from the potential economic benefits and costs of Malaysia’s ratification of the CPTPP (The Comprehensive and Progressive Contract for Trans-Pacific Partnership) and to propose interventions and mitigation for your identified costs.
The review, including the CBA (Cost Benefit Analysis) analysed manufacturing activities within 12 key areas and the final statement was shared recently by MITI (Ministry of International Trade and Industry) using the Industry.
CPTPP is unlike traditional free business agreements (FTAs) since it goes beyond providing market access pertaining to goods, services plus investments. The CPTPP also aims in order to harmonise rules plus disciplines for new plus emerging trade and also cross-sectoral issues.
The CPTPP was signed in the 8 March 2018 by 11 nations and has been ratified by eight, along with Brunei Darussalam, Chile and Malaysia still pending. The United Kingdom (UK) has applied to sign up for the CPTPP and so has the People’s Republic of China (China), Chinese Taipei and Ecuador. As in 2019, the original 11 countries have a combined population of 508 million (6. 6% of world population), generated a total GROSS DOMESTIC PRODUCT of US$11. three or more trillion (RM50. 36 trillion) (13% of world GDP) and accounted for 15% associated with total world trade.
From our Malaysian perspective, the particular 11 countries solely accounted for 29% associated with Malaysia’s total exports and 24. 4% of total imports. With UK, Cina, Chinese Taipei and Ecuador, the ultimate combined population is going to be 2 billion (26% of world population), with a GDP associated with US$29 trillion (RM129. 23 trillion) (33% of world GDP) and will account for thirty-two. 8% of overall world trade.
[RM1 = US$0.224]
In the report, Malaysia stands to gain a total GDP increase associated with US$56. 5 billion dollars, investments reaching US$112. 3 billion and exports reaching US$354. 7 billion, with a strong trade balance surplus at eight. 5% of GROSS DOMESTIC PRODUCT in 2030.
So , what is next? With the opening of markets, arrive bigger challenges as well. Are we looking forward to the global marketplace? May our industry maintain and compete successfully and efficiently when we are still recovering from the pandemic? Broken provide chains, coupled with a good measure of unreasonable profiteering, have created large inflationary pressures over the key manufacturing elements such as raw materials, which have gone up by 45%, and labour, with wages up simply by at least 26% (and not to mention the huge mismatch in terms of necessary skills vs requirements).
We are still grappling with labour shortages in the plantation, construction, textile and manufacturing areas. Malaysia is a land of plenty. Our own MITI has done properly in many aspects to aid the industry, removing trade barriers, and still maintaining in place a measure of protectionism for our nearby industry. It is very a lot up to us since the Industry to capitalize on the opportunities given.
Industry needs a shift in focus. Stop sobbing “no migrant workers, production affected”. Think automation, digitization plus digitalization. Think methods to reduce reliance on manual input, reduce human errors, think how to increase efficiency and efficiency, think stability and how to assure consistent quality and provide. Upskill our nearby workforce to straighten up with the requirements of a progressive industry along with a highly competitive market. Invest in automation and upskilling our labor force. Focus on STEM (Science Technology Engineering plus Mathematics) subjects within education.
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If you haven’t currently started on your digital transformation journey, I would encourage you to make use of MITI’s Industry4wrd Readiness Assessment. Trained assessors will help you to understand your own company’s readiness intended for Industry 4. 0 and make suggestions about where to start your own transformation. They will furthermore advise you on how to apply for the financial incentives given by the Government.
I desire you all to obtain in touch with our Govt Ministries, join their own talks and understand what’s there to assist us. Get to know all of them and the initiatives they have launched.
Make friends with the SME Corp , and check out MyAssist MSME. They have advisory panels to help you out using their various programmes and initiatives. Check out the SME Revitalisation Financing (SMERF) where you can get funding up to RM250, 1000.
Did you also know that the SJPP (Syarikat Jaminan Pembiayaan Perniagaan), wholly owned from the Ministry of Financing Inc, can problem guarantees for up to 80% of your loans with the bank? The guarantees for the SME (Small and Medium Enterprises) and Mid-Tier Companies (MTCs) can be as much as RM20million, without guarantee.
Yes, there are fees so you would need to prepare an offer. There are no free of charge lunches. If you are devoted to grow, the SJPP has your back.
Check out MIDA (Malaysian Investment Advancement Authority) at www.mida.com.my .
Have you heard of PENJANA (Pelan Jana Semula Ekonomi Negara), otherwise known as the National Economic Recovery Plan? Launched by the Prime Minister’s Office to help battle the COVID-19 Outbreak in 2020, nearby Malaysian companies (manufacturing or agricultural) may claim Reinvestment Allocated (RA) for up to fifteen consecutive years (+ 3 additional for certain categories). Based on the Financial Act 2021 (gazetted on 31 December 2021), the Particular RA is extended for an additional two (2) years to YA 2024.
As of the last update, companies may claim up to 60% of their reinvestment expenditure. And have a look at Malaysia Digital ( www.mdec.my ), the national proper initiative by the Malaysian Government to motivate and attract companies, talents and purchase while enabling Malaysian businesses and the Rakyat to play a leading component in the global electronic revolution and digital economy.
Check out the MyWIT programme which offers 40% income subsidy for 6 months and training bonuses for in-house or external/ 3rd party teaching. This is scheduled to end on 31 August 2022, but hopefully they may extend it.
As I said, our Malaysia is really a land of plenty. We are blessed with valuable natural assets, blessed with geographical stability (no earthquakes & volcanoes) plus good peace-loving individuals. Whether the CPTPP is usually ratified or not, the particular playing field will be levelled and the buy-ins are going to get also higher. We need to prepare yourself not only to survive but to thrive in the global marketplace. Let’s all work to develop our economy plus prosper together.
Callum Chen is certainly President, MCMTC (Malaysian Consortium of Mid-Tier Companies) The MCMTC comprises of MTCs (Mid-Tier Companies) from every industries. The MTCs form 1 . 7% of total businesses in Malaysia, utilize 16% of the complete workforce but lead 39. 9% of Malaysia’s GDP.
Get in touch with us at www.mcmtc.my