Companies should localise foreign projects

Malaysia is the second largest palm oil producer in the world after Indonesia, contributing 29.4% of world production of oil palm, equivalent to 17.32 million tonnes in 2016. (Pic: Bloomberg)

By DASHVEENJIT KAUR

Malaysian construction companies with projects overseas are urged to increase utilisation of local products and services to accelerate the country’s export, said the National Export Council (NEC).

The council in its second meeting chaired by Prime Minister Datuk Seri Mohd Najib Razak, also discussed Malaysia’s participation in world’s iconic programmes in Asean, China, Japan and the Middle East and North Africa region.

To date, there are 54 projects owned by Malaysian companies or that involve Malaysian establishments taking shape in 16 countries with a value of RM109.71 billion, but only 10 are utilising Malaysian products and services.

“The total value of products and services sourced from Malaysia for the 10 projects is RM256.5 million or a mere 0.2% of the projects’ worth.

“The projects are spread across Europe, Asean, South Asia, Central Asia and the Middle East and range from mixed development, construction, structural steel works and fabrication, expressway to engineering services,” NEC said.

Apart from that, NEC also decided that investment incentives be reviewed to discourage employment of foreign workers.

“While ensuring incentives bring better returns to the Malaysian economy in terms of high-value added exports, creation of high-income jobs and support development of smaller Malaysian enterprises,” it added.

In addition, the council has deliberated on the efforts in strengthening the market share of Malaysian palm oil globally. Malaysia is the second largest palm oil producer in the world after Indonesia, contributing 29.4% of world production of oil palm, equivalent to 17.32 million tonnes in 2016.

Among the issues discussed on the palm oil sector were strengthening palm oil exports by focusing on specific initiatives based on markets in China, India, European Union and Asia Pacific.

To be spearheaded by Malaysia External Trade Development Corp, a number of incentives through various initiatives have been introduced to increase utilisation of more Malaysian services and goods for overseas projects.