MALAYSIAN INSTITUTE OF ACCOUNTANTS (MIA) REGIONAL CONFERENCE 2009
INVESTMENT OPPORTUNITIES IN SS CC OO RR EE Sarawak Corridor of Renewable Energy
YBHG. DATU ISMAWI BIN HAJI ISMUNI Director, State Planning Unit Chief Minister’s Department Sarawak
10th August, 2009 Table of Contents
• SCORE: Background;
• SCORE: Investment Opportunities; and
• SCORE: Incentives. New Economic Model and Institutional Frameworks
Development Plan & Development Area Implementing Agency
Launched on 11 February 2008 The 1-Stop Agency for SCORE
RECODA is created under the Regional Corridors Development Authorities Ordinance, 2006 which was passed by the Sarawak State Legislative Assembly on 20th November 2006. SCORE is Long-Term Development Plan to 2030 To lift the Sarawak economy With Corridor 2030 By increasing income per head GDP growth (%) 7.0 RGDP (RM billion) 118 Sarawak Economy by 2030 Jobs (million) 2.5 Sarawak GDP to expand 5-fold With Corridor 2020 Pop (million) 4.6 1.6 million more jobs GDP growth (%) 8.7 GDP Per Capita (Nominal) (RM) 97,400 RGDP (RM billion) 74 Population will double to 4.6 million Jobs (million) 1.9 7% Pop (million) 3.7 With Corridor 2015 GDP growth (%) 10.0 8.7% RGDP (RM billion) 55 Jobs (million) 1.5 Pop (million) 3.2
10% 5% Without Corridor 2030 GDP growth (%) 5.0 RGDP (RM billion) 75 Jobs (million) 1.7 Pop (million) 4.0 Current Situation 2008 GDP growth (%) 5.0 RGDP (RM billion) 26 Jobs (million) 0.9 Pop (million) 2.5 GDP Per Capita (Nominal) (RM) 28,801
2008 2015 2020 2030 SCORE Development Area 5 New Growth Nodes
Northern Region 34,567 sq km (27.8%) 437,100 persons
Samalaju Heavy Industries
Mukah Baram Services Hub Rural Growth Centre Central Region 70,708 sq km (56.8%) 862,000 persons Tanjung Manis Agro-Based Industries
Tunoh Rural Growth Centre Southern Region 19,174 sq km (15.4%) 1,105,000 persons SCORE Funding Strategy
RM334 billion – Total Planned Investments 20% 80% Government Funding Private Funding
Government RM % Private Sector RM % (Billion) (Billion) Physical Power Sector 67 20% 61 18% Infrastructure Industries 200 60% Human Capital 3 1%
Institutional 31% Infrastructure The Power Sector
Huge energy potential of 28,000 Mega Watts
Today (MW) Potential (MW) % Total Total 966 28,000 100% Hydropower 94 20,000 71% Coal 210 5,000 18% Other 662 3,000 11% Gas 481 481 2% Diesel 181 0 0% Other - 2,519 9% Sarawak has sufficient energy capacity for local industries, the rest of Malaysia and export Bakun HEP (2,400 MW), 2010-2012 Mukah Coal-Fired Plant (270 MW), April 2009 Murum HEP SCORE: Access Roads to Energy Sites
Solid line = existing road/upgrading Limbang access Dotted line = new road road Ongoing/Approved Priority 1 (2008-2010) 9MP MTR Priority 2 (2011-2015) 10MP Baram Priority 3 (2016-2020) 11MP Baram access road
Tatau Murum access Bakun road Belaga
Ng Merit access road Murum
Tanjung Nanga Merit Manis Coal Mine Tunoh access road Tunoh Sarikei Kapit
Balleh access road Baleh SCORE – 10 Priority Industries
Fishing & Aluminum 1 6 Aquaculture Industry Industry
Steel Livestock 2 Industries 7 Industry
Timber-based Oil-based 3 8 Industry Industry
Glass Marine 4 Industries 9 Engineering
Palm Oil Tourism 5 Industry 10 Industry Value Chains Examples of upstream and downstream industries
Opportunities for Opportunities for SMEs SMEs
Upstream Industry Priority Industry Downstream Industry
Hatching farms Fishing/aquaculture industry Fish exports, fish processing
Breeder farms Livestock industry Processed poultry for export
Palm oil plantations Palm oil industry Refining, oleo-chemicals
Timber plantations Timber-based industry Panels, mouldings, furniture
-- Oil-based industry Petrochemicals
Smelters Aluminum industry Aluminum end-products
Steel making (steel mill) Steel industry Steel products
Float glass plant Glass industry Modular windows
Ship-steel making Marine engineering Boats, marine structures
Enhanced marketing Tourism industry Creation of new attractions Spin-Off Service Industries Examples of Service Industries from Priority Industries Opportunities for SMEs
Upstream/Downstream Priority Industries Industries Service industries Fishing/ Aquaculture industry Farmer-producers Supplies, feed, distribution
Livestock industry Farmer-producers Construction, supplies, feed
Smaller plantations, cattle rearing Plant maintenance, transport, Palm oil industry in plantations supplies
Timber-based industry Downstream processing Plant maintenance
Plant maintenance and technical Oil-based industry -- services
Plant maintenance, technical Aluminum industry Fabrication and installation services, transport Plant maintenance, technical Steel industry -- services, transport Plant maintenance, technical Glass industry -- services, transport
Independent (small) companies, Maintenance and technical Marine engineering subcontractors to larger firms services, suppliers
Tourism industry Tour operators, agents, guides, hotels, restaurants, suppliers, transport Tanjung Manis Industrial Port City 2030 (Artist Impression)
Agriculture & resource-based industries – palm oil industrial cluster, deep-sea fishing, food industries (halal hub), timber-based industry & shipbuilding
Dry Bulk & Container Other Heavy Township Marine Terminals industries Engineering Commercial centre Fishing terminal
General cargo terminal
Regional Timber Processing Centre
Palm Oil Processing, Oil Refinery, Other liquids
Source: ADL Industries at Tanjung Manis: Organic Chicken and Egg Production Feed-Milling & Fertilizer Fruit and Vegetable Farm Herbal Plantation Tanjung Manis: Zoning Marine Fish Farming Eel Farming Bio-tech Aquaculture Prawn Farming 16,000 hectares Aqua Processing Industries R&D Centre
STIDC & SEA PARTY, BELAWAI TAIWAN AQUACULTURE TOWN PROJECT
TANJUNG MANIS AIRPORT
T A N J U SHIPBUILDING N G INDUSTRY
LKIM FISHERY PORT Dubai World RPA PORT NEW TOWNSHIP MARITIME OFFICE CODT
TIMBER PROCESSING ZONE POIC Mukah Smart City 2030 – Artist Impression Services hub – administration, ICT, education, training, R&D With a small port terminal and food processing industries
Tertiary Research education science park campus Airport
Government centre
Food processing industries
Residential area
Commercial Fish & General centre Terminal Coast guard base Mukah Industrial Estate 2030 – Artist Impression
Food processing industries
Steel industries
Residential Area
Aluminium industries Similajau Industrial Park 2030 — Artist Impression New Industrial Park for new industries – aluminium, polysilicon, steel, oil refinery With a deep-sea port
Other Oil Refinery, other Aluminum industries & Steel liquids, tank farms Smelter & commercial industries and processing Downstream
Silica based industries
Marine Engineering
Dry bulk and Liquid bulk general cargo port port area area Samalaju Industrial Park & New Township
Samalaju New Township
Area 2,266.24ha Northern Samalaju Location Industrial Park
Projected Population 20,000 people by 2013
To support industries sited Purpose at Samalaju Industrial Park Shipbuilding
Solar Glass
Port Samalaju Industrial Park
Aluminium Area 6,000 ha Smelter Start Construction/Completion Date: Polysilicon Phase 1 July 2008 – Aug. 2010 Phase 2 Aug. 2009 – Sept. 2012 Phase 3 July 2010 – Apr. 2013 Investment Proposal RM80,305.0 million Type of Industries SCORE 10 Priority Industries Developer Bintulu Development Authority SCORE / RECODA ORGANISATION STRUCTURE
SCORE Advisory Council RECODA Board To advise on direction for policy, strategy and - Chief Minister (Chairman) implementation to RECODA - Federal Government - State Government -Corporate Sector Co-Chairman Prime Minister, Chief Minister, Malaysia Sarawak Chief Executive Officer Federal State Corporate 1-Stop Govt Govt Sector Management Team Agency
RECODA is created under the Regional Corridors Development Authorities Ordinance, 2006 which was passed by the Sarawak State Legislative Assembly on 20th November 2006. SCORE: Incentives
State: Discount on industrial land
Federal: Special MIDA incentives for East Coast and East Malaysia: pioneer status, investment tax allowance, reinvestment tax allowance SCORE: Federal Investment Incentives
Incentives for Manufacturing Sector offered by Federal Government
Pioneer Status (PS) 100% tax exemption on statutory income for 5 years Investment Tax Allowance (ITA) 100% allowance on the qualifying capital expenditure incurred within a period of 5 years The allowance could be utilised to offset against 100% of statutory income for each year of assessment Reinvestment Allowance (RA) Free to offset RA against 100% of statutory income
Incentives for Strategic Projects offered by Federal Government
Pioneer Status (PS) 100% tax exemption on statutory income for a period of 10 years Investment Tax Allowance (ITA) 100% allowance on the qualifying capital expenditure incurred within a period of 5 years from the date the first qualifying capital expenditure is incurred SCORE: Land Price – Samalaju Industrial Park
Undeveloped Land Developed Land Samalaju Industrial Park Price per Square Metre
Original Price RM29.49 RM54.12
After Discount 25% for Preferred Industries RM22.12 RM40.59
Further Discount 50% For projects operating within 5 years from date of RM11.06 RM20.29 land alienation Price after Discount RM11.06 RM20.29 CONCLUSION
I hope my presentation has provided you with all the relevant information on investment opportunities in SCORE.
I would like to reiterate that Sarawak has a lot to offer, particularly our huge energy potential which is an essential to power our heavy capital intensive industries or better known as trigger industries.
In this respect, we welcome the participation of the investors in the trigger industries as they will provide spin offs to develop the whole value and supply chains in both the upstream & downstream industries that will also benefit our SMEs.
With our conducive investment environment, stable government and good quality of life here should provide the investors with the additional incentives to make Sarawak your Preferred Investment Destination.
I would like to extend my special thanks for your kind indulgence and patience.
With this, I wish you all a very successful and fruitful conference. Invest in Sarawak!
www.sarawakscore.com.my