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A MIDA Publication for Global Investors No. 10/2014 y October 2014

In this issue ... zx MOGSEC 2014 zx Doing Business zx Safety First with in Malaysia Kayaku Safety Systems

budget 2015

he theme of 2015 Budget, “Accelerating Growth, Ensuring Fiscal Sustainability and Prospering the BUDGET 2015: Rakyat” reflects this aspiration. The Ministry of International Trade Tand Industry (MITI) is optimistic of maintaining the foreign direct investment (FDI) inflows of RM38 billion registered MITI Hopes last year. Its Minister, Dato’ Sri Mustapa Mohamed said besides matching the volume of FDI this year, MITI would To Maintain focus of high quality investments that would create high-income employment opportunities. A multimillion ringgit fund has been FDI Inflows created from the 2015 Budget for start-up loans, business accelerator programmes and various other incentives.

Page 1 y investByte October 2014 2015 Budget 2015

In line with the objective of achieving a high income nation status by 2020, the budget provides for various enhanced special incentive packages which will be offered to quality investment projects that provide highly qualified and knowledgeable employees with high salaries. Commenting on the 2015 Budget tabled by Prime Minister Datuk Seri Najib Tun Razak, Mustapa said the small and medium enterprise (SME) sector would contribute 40% to the gross domestic product (GDP) by 2020. Services Sector Guarantee Scheme, amounting to RM5 billion for SMEs in the services sector, with a maximum financing of RM5 million together with 70% government guarantee. The scheme is expected to benefit 4,000 SMEs: RM10 milllion for companies in knowledge sector to Datuk Seri Najib Tun Razak establish research centres, reintroduce the Services Export Fund with fund RM300 million and RM20 million for RM125 million from private investors. Franchise Scheme under KPDNKK and In addition, RM10 million will be PNS. allocated for the Business Accelerator Budget 2015 focuses on capital Programme under SME Corp. economy (macro policies, GDP To enhance use of new technology, growth, private sector investment, automation and innovation in the financial markets, etc.) as well as development of SMEs, RM80 million people economy (wage growth, SMEs, is allocated for a soft loan scheme household expenditure, cost of living, for automation and modernisation of jobs and family well-being). SMEs under the Malaysian Industrial In line with the focus, the 2015 Development Finance Bhd. Budget has been very encouraging “The two financing platforms with continued support on SMEs and introduced are the syariah-based entrepreneurship development. Investment Account Platform (IAP) and A total of 18 specific programmes Dato’ Sri Mustapa Mohamed SME Investment Partner (SIP). Both with financial allocation amounting programmes, with a total allocation of to RM14.3 billion (vs RM2.8 billion RM525 million, will provide financing in 2014) were announced for SME terms of economic and employment for early stage SMEs,” he said, adding development covering services sector, opportunities and for more than 90% of that the SIP is a programme introduced Bumiputera entrepreneurs, youth, all businesses in the manufacturing, under the SME Masterplan. graduates, microenterprises, petty services and the agricultural In addition, the High Impact traders, women, smallholders, sector and providing for 65% Programme 2 under the SME cooperatives and associations. of total employment. Masterplan, the Technology “The SME sector is the “Hence, the 2015 Commercialisation Platform, has backbone of the country in Budget places greater received an additional allocation of emphasis on SMEs, RM50 million, Mustapa said. particularly funds to be The government has also taken channelled to Tekun, necessary measures to ensure that Mara, SME Bank and SME SMEs are not adversely affected by Corp to enhance the SME the ongoing policy reforms such as the sector contribution to the goods and services tax (GST), which economy,” he said. will come into effect next April. An initial fund totalling In the first half of 2014, Malaysia’s RM375 million will be economic performance registered provided for a period of impressive growth of 6.3%. It is five years, of which RM250 estimated that national growth will million is from SME Bank and expand by 5.5% to 6% in 2014. iB

Page 2 y investByte October 2014 update

MOGSEC 2014

he 2nd Malaysian Oil & Gas In fact, there is no other event (O&G) Services Exhibition and organised in Malaysia which champions Conference (MOGSEC 2014), was Malaysia as an O&G hub for the region, T held on 23-25 September 2014 at so much so that MOGSEC has created KL Convention Centre. its own niche. MOGSEC 2014 showcases The event featured four exhibition Malaysia’s O&G service providers halls covering 14, 000 sqm of space capabilities and expertise and highlight with an expansion to Hall 4 due to the Malaysia as the region’s O&G Hub. overwhelming response. More than two years ago, the 500 participating companies from Malaysian O&G Services Council all over Malaysia and the seminars was (MOGSEC) embarked on an exciting conducted by MOGSC Working Groups. new project – to bring together the The three-day exhibition and country’s O&G service providers and conference saw the participation of in the process, effectively elevate more than 6,000 professionals, trade Malaysia’s profile towards becoming a and business visitors from 38 nations regional and international hub for O&G engage with Malaysian O&G players. services, in line with the government’s The complementing two-day Economic Transformation Programme conference also saw the participation of (ETP). some 128 delegates. iB Hence MOGSEC was born, an inaugural trade event that was intended to act as the platform to showcase click here for more information Malaysia’s capabilities in O&G services. on the mogsec 2014.

Page 3 y investByte October 2014 CEO QUOTE

Doing Business in Malaysia

alaysia has been a rising force for manufacturing industry players that meets international standards in terms M of capabilities, experience and expertise. CEO Greg Brown shares his thought of Motorola’s existing business in Malaysia and milestones throughout the journey. “With its strategic location along key transportation routes, a welcoming government and flourishing business community, Malaysia has been a key market for Motorola Solutions in the Asia-Pacific region since 1974, when our company established a presence in the country. During the last four decades, we have invested a total of RM4 billion in Malaysia, and our team there has grown from 10 employees to more than 4,000. Motorola recently opened a research and development center at our existing manufacturing, network operations and customer support facilities in . This new R&D center one of the largest in Malaysia, features state-of-the-art laboratories for developing the next generation of mission critical communications devices and systems. The engineers and support teams at the new site will join an elite group of innovators and inventors across Motorola who ensure we continue to meet and exceed the expectations of our customers throughout the world. This center will not only help advance Motorola’s technology capabilities, but it also will support the Malaysian government’s goal of becoming a knowledge-based economy by 2020.” iB

Greg Brown Chairman and Chief Executive Officer Motorola Solutions for the US-ASEAN Business Council

Page 4 yy investinvestByte October 2014 UPDATE TIM to Singapore

alaysia’s Minister of International Trade and Industry Dato’ Sri Mustapa Mohamed M has lead a trade and investment mission (TIM) to Singapore on September 4th. The mission is jointly organised by the Malaysian Investment Development Authority (MIDA), Malaysia External Trade Development Corporation (MATRADE), Malaysia’s Ministry of International Trade and Industry (MITI), the Singapore Business Federation (SBF) and International Enterprise (IE) Singapore. It is aimed at attracting Singaporean companies to invest and do business in Malaysia as well as enhancing bilateral economic relations between both countries. In conjunction with the mission, Dato’ Sri Mustapa Mohamed, together with Singapore’s Minister for Trade and Industry, Lim Hng Kiang, a Malaysia Bilateral trade and investment under the New Economic Model and business forum was held on the same between Malaysia and Singapore the liberalised services sectors such as day at the Raffles City Convention has always been strong due to the oil & gas (O&G), electrical & electronics Centre. historical and cultural ties between the (E&E), information & communications The half-day business forum is two nations. Inbound investment from technology (ICT), private healthcare, to brief businesses and investors on the city state has increased over the education, business services, palm oil the latest policy measures taken by years, with the island nation ranking & related products, wholesale & retail, Malaysia mainly in the investment among the top investing countries into tourism and financial services. and economic fronts, according to Malaysia. Other sectors involved for a statement from the Malaysian The investors attended the dialogue investment from Singaporean Investment Development Authority session are from the high value and companies include infrastructure and (MIDA) in Singapore. high growth areas being promoted property development. iB

Page 5 y investByte October 2014 Industry

safety first WITH Kayaku Safety Systems

ayaku Safety Systems (Malaysia) Sdn Bhd, Malaysian Investment Development Authority which is wholly-owned by Japan’s Nippon (MIDA) deputy CEO Datuk Phang Ah Tong said the Kayaku Co Ltd, is the only producer of airbag company’s facility will be a key addition that will Kinflators, glass to metal sealed squib and strengthen Malaysia’s automotive industry cluster microgas generators for seatbelt pretensioner in and the ecosystem of supporting players. this country. “We are confident that Kayaku Safety Systems Kayaku Safety Systems’ Managing Director will operate successfully in the competitive Shinji Ichikawa said in a statement that the business environment prevailing in the country. automotive safety component company, plans MIDA will continue to work closely with other to invest about RM212.5 million under phase government agencies particularly the state one of its development plan to build a factory at government in providing our full support to ensure Sendayan TechValley, that will the success of this manufacturing facility,” he said. produce airbag inflators for commercial vehicles. “The Kayaku Safety Systems’ facility would Incorporated in December 2012, the company definitely be a key addition to strengthen is build with a paid-up capital of RM100 million. Malaysia’s automotive industry cluster and the “All the management and employees are ecosystem of supporting players,” he added. excited that our project is moving forward and Its operations in Malaysia is expected to meet we will continuously work hard to make sure the demand of its customers for automotive safety commencement of the commercial operation in components in this region. 2015. Kayaku expects to create approximately 300 “We are very excited that besides providing new job opportunities within five years.” the forward-and-backward linkages, transfer It signed a land purchase deal with Menteri of new technologies and local sourcing, this Besar Incorporation (MBI) and Matrix Concepts project will also create high income employment Holdings Bhd to buy 38 acres in Sendayan opportunities, particularly for skilled personnel TechValley in March 2013. such as engineers and technicians,” he concluded. iB

Page 6 y investByte October 2014 news

OPENING CEREMONY OF KAYAKU SAFETY SYSTEMS (MALAYSIA) SDN BHD

atuk Phang Ah Tong, Deputy inflators for commercial vehicles. CEO of the Malaysian Among other products that will also Investment Development be produced here are MGG, squib and DAuthority (MIDA) recently related pyrotechnic powders. officiated the opening ceremony of “We are proud that our team has Kayaku Safety Systems (Malaysia) worked very hard to establish this Sdn Bhd at the company’s premises in manufacturing facility as per targeted Sendayan TechValley, Negeri Sembilan. date & time line. At this opportunity, Among the distinguished guests we would like to express our sincere present at the launching ceremony gratitude to all the great support were Mr Akira Mandai, President and provided by the state government CEO of Nippon Kayaku and authorities, Malaysian Co Ltd; Mr Yoshinori government, local Kodama, Minister and community, our customers Deputy Head of Mission as well as our vendors/ of Japanese Embassy; suppliers. Datuk Mohammad Haslah, “All the management Chairman of Matrix and employees are excited Concept; and Mr Shinji that our project is moving Ichikawa, Managing forward and we will Director of KayakuSafety continuously work hard to Systems Malaysia. make sure commencement Kayaku Safety of the commercial operation Systems, which is wholly Datuk Phang Ah Tong in 2015. Kayaku expects to owned by Nippon Kayaku create approximately 300 C. Ltd, Japan was incorporated in new job opportunities within 5 years,” December 2012. The company then said Mr. Shinji Ichikawa, Managing signed a land purchase deal with the Director of Kayaku Safety Systems Menteri Besar Incorporation (MBI) and Malaysia Sdn Bhd. Matrix Concept to buy 38 acres of land Datuk Phang Ah Tong in his speech in Sendayan TechValley in March 2013. said that the company’s facility will Nippon Kayaku’s decision to invest be a key addition that will strengthen in Negeri Sembilan, Malaysia is timely Malaysia’s automotive industry cluster, due to the growing ASEAN automotive and the ecosystem of supporting market. The operation of Kayaku players. Safety Systems in Malaysia will be able “We are very excited that besides to meet the demand of its customers providing the forward-and-backward for automotive safety components in linkages, transfer of new technologies this region. and local sourcing, this project will With a paid-up capital of RM100 also create high income employment million as of today, Kayaku plans to opportunities, particularly for skilled invest about RM212.5 million under personnel such as engineers and phase one of its development plan technicians,” Datuk Phang further to build the factory at Sendayan added. iB TechValley that will produce airbag

Page 7 y investByte October 2014 events MOFA- JICA - MIDA

he Malaysian Investment Development Authority (MIDA), Japan International Cooperation Agency (JICA) and the T Malaysian Technical Cooperation Programme under the Ministry of Foreign Affairs (MOFA) has conducted a course on ‘Investment Promotion for African Countries’ on September 29. MOFA in its course on ‘Investment Promotion for African Countries’ with objectives within an overarching strategy for improving the investment environment, investment promotion and facilitation which can help to increase both domestic and countries (Cote d’Ivoire, Ghana, Kenya, Nigeria, foreign investment and also to enhance their South Africa and Zambia) attended this course. contribution to national economic development. As part of the course, the participants were The success in promoting investment requires exposed to the history of investment in Malaysia, a careful calculation of how to employ resources the strategy used by MIDA and the streamlining most effectively and how to organise investment of the government department that has promotion activities within the government so tremendously helped in investment promotion. that the overriding goal of economic development Other than lecture and workshops, the through improvements in the investment climate participants will also have various study visits remains at the forefront of policymaking. to related sites such as which has a A total of 13 participants from 6 African comprehensive investment plan for its state. iB

Page 8 y investByte October 2014 Worldwide Network The Malaysian Investment Development Authority (MIDA) is the government’s principal agency for the promotion of the manufacturing and services sectors in Malaysia. MIDA assists companies intending to invest in the manufacturing and services sectors, as well as facilitates the implementation of their projects. The wide range of services provided by MIDA include providing information on the opportunities for investments, as well as facilitating companies which are looking for joint venture partners.

Headquarters mida overseas offices GERMANY (FRANKFURT) Director/Consul Investment, MIDA Malaysian Investment Development Authority ASIA PACIFIC Tel: (4969) 7680 7080 (MIDA) Fax: (4969) 7680 708-20 MIDA Sentral, AUSTRALIA E-mail: [email protected] No. 5 Jalan Stesen Sentral 5, Consul-Investment/Director Sentral Consulate of Malaysia/MIDA Sydney GERMANY (MUNICH) 50470 Kuala Lumpur. Tel: 61 (02) 9251 1933 Director, MIDA Tel: (603) 2267 3633 Fax: 61 (02) 9251 4333 Tel: (4989) 2030 0430 Fax: (603) 2274 7970 E-mail: [email protected] Fax: (4989) 2030 0431-5 E-mail: [email protected] E-mail: [email protected] CHINA (GUANGZHOU) MIDA State Offices Director, MIDA ITALY (MILAN) Tel: (8620) 8752 0739 Consul (Investment) Fax: (8620) 8752 0753 Consulate of Malaysia (Investment Section), MIDA Director, MIDA E-mail: [email protected] Tel: (3902) 3046 521 Tel: (603) 5518 4260 Fax: (3902) 3046 5242 Fax: (603) 5513 5392 CHINA (SHANGHAI) E-mail: [email protected] E-mail: [email protected] Investment Consul/Director Consulate General of Malaysia (Investment Section), SWEDEN (STOCKHOLM) MIDA Economic Counsellor, MIDA Director, MIDA Tel: (8621) 6289 4547 / 5928 6335 c/o Embassy of Malaysia Tel: (605) 5269 962/ 961 Fax: (8621) 6279 4009 Tel: (468) 791 7942 Fax: (605) 5279 960 E-mail: [email protected] Fax: (468) 791 8761 E-mail: [email protected] E-mail: [email protected] INDIA Pulau Pinang Director/Consul Investment, MIDA UNITED KINGDOM (LONDON) Director, MIDA Tel: 00 91 22 26 59 1155 / 2659 1156 Director, MIDA Tel: (604) 228 0575 Fax: 00 91 22 2659 1154 Tel: (4420) 7493 0616 Fax: (604) 228 0327 E-mail: [email protected] Fax: (4420) 7493 8804 E-mail: [email protected] E-mail: [email protected] JAPAN (OSAKA) & Director, MIDA UNITED STATES Director, MIDA Tel: 81 (6) 6451-6661 Tel: (604) 731 3978 Fax: 81 (6) 6451-6626 BOSTON Fax: (604) 731 2439 E-mail: [email protected] Director, MIDA E-mail: [email protected] Tel: (1617) 338-1128 / 338-1129 JAPAN (TOKYO) Fax: (1617) 338-6667 Director, MIDA E-mail: [email protected] Director, MIDA Tel: 81 (3) 5777-8808 Tel: (609) 622 7200 Fax: 81 (3) 5777-8809 CHICAGO Fax: (609) 623 2260 E-mail: [email protected] Director, MIDA E-mail: [email protected] Tel: (1312) 787 4532 SINGAPORE Fax: (1312) 787 4769 Director/Consul Investment, MIDA E-mail: [email protected] Director, MIDA Tel: +65 6835 9326 / 6835 9580 / 6835 7069 Tel: (609) 748 3151 Fax: +65 6835 7926 HOUSTON Fax: (609) 744 7294 E-mail: [email protected] /[email protected] Director, MIDA E-mail: [email protected] Tel: (1713) 979-5170 SOUTH KOREA Fax: (1713) 979-5177/78 Counselor (Investment)/Director, MIDA E-mail: [email protected] Director, MIDA c/o Embassy of Malaysia (Malaysian Trade and Tel: (609) 513 7334 Investment Centre) LOS ANGELES Fax: (609) 513 7333 Tel: 82 (2) 733 6130 / 6131 Consul-Investment E-mail: [email protected] Fax: 82 (2) 733 6132 Consulate General of Malaysia (Investment E-mail: [email protected] Section) Tel: (1213) 955 9183, (1213) 955 9877 Director, MIDA TAIWAN Fax: (1213) 955 9878 Tel: (607) 224 5500/ 226 5057 Director (Investment), MIDA E-mail: [email protected] Fax: (607) 224 2360 Tel: 886 (2) 2718 6094 / 2713 5020 (GL) E-mail: [email protected] Fax: 886 (2) 2514 7581 NEW YORK E-mail: [email protected] Consul-Investment Melaka Consulate General of Malaysia (Investment Director, MIDA Section) Tel: (606) 232 2877 UNITED ARAB EMIRATES Tel: (1212) 687 2491 Fax: (606) 232 2875 Director/Consul Investment, MIDA Fax: (1212) 490 8450 E-mail: [email protected] Tel: 971 (4) 4343 696 / 4343 697 E-mail: [email protected] Fax: 971 (4) 4343 698 Negeri sembilan E-mail: [email protected] SAN JOSE Director, MIDA Director, MIDA Tel: (606) 762 7921 (GL) EUROPE Tel: (1408) 392 0617/8 Fax: (606) 762 7879 Fax: (1408) 392 0619 E-mail: [email protected] FRANCE (PARIS) E-mail: [email protected] Director, MIDA Tel: (331) 4727 6696/3689 Director, MIDA Fax: (331) 4755 6375 Tel: (6088) 211 411/230 411 E-mail: [email protected] Fax: (6088) 211 412 E-mail: [email protected]

Sarawak Director, MIDA Tel: (6082) 254 251 / 237 484 Fax: (6082) 252 375 E-mail: @mida.gov.my

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