MITI wants incentives in Budget 2018 to step up Industry 4.0 adoption

Automation grants and assistance are among the proposed incentives to help manufacturers, especially SMES, adopt Industry 4.0


The Ministry of International Trade and Industry (MITI) has submitted a proposal requesting the government to provide incentives for industries that are adopting Industry 4.0.

Industry 4.0 is the new industry buzzword where industries digitalise and automate their processes to boost efficiency and productivity.

Minister II Datuk Seri Ong Ka Chuan said MITI had proposed some incentives to Finance Minister Datuk Seri Mohd Najib Razak and the Finance Ministry to help the manufacturing sector to implement Industry 4.0.

“As the government being enablers, we have to accommodate and provide the industry players some incentives and assistance because the hefty investments required to automate plants and factories,” he said at the Federation of Malaysian Manufacturers Industry 4.0 Conference in Petaling Jaya yesterday.

He said Industry 4.0 is high on the ministry’s agenda as it would impact production and competitiveness in the international market.

“To do this, we will need to digitalise our manufacturing processes where the government will need to help them (manufacturers), especially the small and medium enterprises (SMEs), be equipped with the appropriate technologies.

“Once they have established themselves, they will be able to compete on their own in the market.”

Among the incentives suggested are automation grants and assistance. But Ong said the industry would have to wait until the Budget 2018 announcement on Oct 27.

“If we do not take the steps forward into Industry 4.0, we will not move forward. By adopting Industry 4.0, it will make manufacturing production processes more accurate, reduce human errors, maintain quality consistency and increase production,” the minister said.

But Ong warned that having a big enough market is as critical as achieving the digitalisation and automation standards.

“We are concluding the Asean-Hong Kong Free Trade Agreement (FTA) next month at a summit in the Philippines. This will provide local manufacturers access to Asean’s combined population of 630 million.

“We are also discussing with the European Union an FTA to eliminate trade barriers,” he said, adding that Malaysia already has 13 trade agreements with other nations.