The agency is ready to provide its views on foreign and local investments in relation to the tariff spat
By SHAHEERA AZNAM SHAH / Pic By AFIF ABD HALIM
The Malaysian Investment Development Authority (Mida) is monitoring the impact of the US-China trade dispute.
Mida deputy CEO Arham Abdul Rahman said the agency is ready to provide its views on foreign and local investments in relation to the tariff spat.
“The ministry has formed a dedicated task force to look into the direct and indirect impact the trade war will have on Malaysian investments overseas and vice versa, as well as to foreign companies operating here,” he said at the signing of the memorandum of understanding (MoU) between Siemens Malaysia Sdn Bhd and Mida in Kuala Lumpur yesterday.
Arham noted that, a few days ago, India proposed a safeguard measure by imposing a 25% duty on solar cells from China and Malaysia and the protectionism move is something to consider.
The Ministry of International Trade and Industry (MITI) on Tuesday announced it has set up a task force to monitor and assess the impact of the tariff spat between the two countries, along with the protectionist cycle that ensued.
MITI in a statement said the task force is responsible for formulating strategies in mitigating the impact of trade protectionism, as well as a focal point for stakeholders to present their views.
Arham said in order to secure Malaysia’s investment overseas, Mida will be closely monitoring the countries that are affected, as well as the local companies who have investments in those countries.
“As an investment house, we have to monitor some of the possible impacts to the countries that our companies have investments in to make sure those investments remain secured,” he said.
According to Arham, the investment agency will also be assessing new companies opting to invest in Malaysia and to look out for indirect and direct impact that might arise later.
“It is important to determine the root of investment coming into Malaysia, as well as going out, because there are many foreign manufacturing companies that make Malaysia their manufacturing and production hub.
“Not all impact are negative, as some of the tariffs hike will benefit Malaysia,” he said.
He could not clarify if any Mida members were elected on the task force. On a separate note, local manufacturing companies are advised to seize the opportunities in the food and beverages (F&B) sector, particularly through the adoption of the digitalisation and the Industry 4.0.
Siemens Malaysia president and CEO Indranil Lahiri said Malaysia’s manufacturing sector lacks the digitalisation which enables “smart manufacturing” that can produce a high volume quantity at lower cost.
“Digitalisation needs new insights, technical know-how and consistent training. On top of that, we need an ecosystem to be built around it.
“The potential in Malaysia is good and the manufacturing competitiveness is quite high, probably higher than Thailand, which is well-known to have succeeded in the F&B business. But in order to launch technology able to operate efficiently and is flexible, it needs an ecosystem,” he said.
In March 2018, Mida approved 2,513 F&B manufacturing projects with investments amounted to RM51.2 billion.
According to the Department of Statistics Malaysia, there are more than 8,000 food manufacturing establishments in Malaysia, of which 80% comprise small and medium enterprises.
Mida CEO Datuk Azman Mahmud said in a speech read by Arham, the future of the F&B industry will remain resilient to external adversities as the industry is regarded “recession-proof”.
“The industry will grow in tandem with the world population, which continues to rise and is predicted to reach 9.7 billion by 2050 from 7.6 billion in 2016.
“Having said that, by 2050, the demand for food will increase between 59% and 98%,” he noted.