by NUR HANANI AZMAN / pic by TMR FILE
THE Federation of Malaysian Manufacturers (FMM) asked for priority be given to Made-in-Malaysia products and services for all infrastructure and development projects outlined in the 12th Malaysia Plan (12MP).
Its president Tan Sri Soh Thian Lai (picture) said the implementation of several key infrastructure and development projects under the plan will have spill over effects on the manufacturing sector.
FMM believes as the main catalyst of growth with extensive upstream and downstream linkages throughout the value chain, the manufacturing sector can contribute significantly towards helping to achieve the strategies of productivity, investments, moving up the value-chain and strengthening exports.
“We call on the government to continue to support the manufacturing sector by ensuring a business-friendly operating and investment environment through the reduction of unnecessary regulatory burden and costs; and a more level playing field to facilitate fair and open competition and access to market opportunities.
“The priority should be to support and promote the expansion of the manufacturing and other elated services sectors, especially in this very critical period we are currently are in, to enable the reaping of higher returns to revive the economy, enhance business sustainability, ensure job security and more importantly for medium and long-term growth,” Soh penned in a statement yesterday.
FMM look forward to close and regular engagement with the government on relevant programmes and initiatives under the strategic priority areas, enablers and game changers. FMM and the 12MP targets and aspirations to be well executed and achieved through close collaboration and consultation between the government and businesses, particularly in the manufacturing sector.
“We welcome the establishment of the Research Management Unit which will be instrumental in ensuring research and development and innovation activities and funding will be aligned to national priorities.
“In addition, we note several major programmes and projects have been approved to support the growth of strategic sectors and industries in the form of investment loan funds for research and development in the fields of aerospace, electrical and electronics,” he added.
Soh added that the support for green growth drivers like embracing circular economy and adoption of integrated water resources management will support various industries’ move towards more sustainable manufacturing practices and the adoption of environmental, social and governance principles.
AmBank chief economist and head of research Dr Anthony Dass said although Malaysia is a business-friendly country that attracts large flows of foreign direct investment and is well-integrated in global value chains, there is an urgent need to reinvigorate business dynamism through regulatory reforms to achieve a robust post-Covid-19 recovery as the pandemic risks remain.
He said measures initiated under the 12MP are essential to drive growth in the post-pandemic world and to position Malaysia on a better footing as vibrant competition remains an essential component of business dynamism which will foster cost reductions, innovation and promote productivity growth.
“For business dynamism, the key focus is the ease of new firms entering the market or entrepreneurs starting up new businesses. As the country transitions to a high-income status, future growth sources will increasingly need to shift to innovation and productivity gains,” he said.
Dass added that there is an urgent call for further improvements in business dynamism while ensuring a regulatory environment that encourages effective competition for long-term growth and sustainability of the country.
On the 12MP’s impact on the construction sector, Anthony stated that development expenditure under the 12MP is projected at RM400 billion, compared to the 11MP’s RM248.5 billion, and is likely to be back loaded with higher allocation from 2023 when Covid-19-related spending begins to taper.
“The 12MP does not play out to be an immediate or near-term catalyst for mid-sized and large contractors (listed on Bursa Malaysia) given the key focus is on rural projects (in the spirit of balanced and inclusive development) that are typically small-scaled and likely to go to privately owned smallish contractors,” he noted.