MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 2 MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 ISSN 0128-7524 June 2014 © Ministry of International Trade and Industry Malaysia, 2013 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission in writing of the Publisher. Content is correct at the time of printing. To purchase this publication or for other information, please contact: Strategic Planning Ministry of International Trade and Industry 15th Floor, Block 8 Government Offices Complex Jalan Duta, 50622 Kuala Lumpur Tel: +603-6200 0456 Fax: +603-6201 2573 www.miti.gov.my [email protected] Design, layout and printing by Visual Print Sdn. Bhd. (186281-A) No. 47, 47-1, Jalan Damai Raya 1 Alam Damai, Cheras 56000 Kuala Lumpur Tel: 03-9108 3966, 9108 2420 Faks: 03-9108 36969 www.visualprint com.my Price: RM60.00 MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 3 Contents 4 Foreword 6 At a Glance 11 A Sustained Growth Momentum 15 International Trade and Economic Relations 35 Megatrends and Opportunities for Manufacturing 53 Services: Empowering Growth, Energising the Economy 63 High Impact Programmes for Entrepreneurs 93 A Competitive Nation 103 MITI in 2013 and Beyond 109 Management Profile 115 Appendices DRIVING TRANSFORMATION, POWERING GROWTH 4 MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 Foreword YB Dato’ Sri Mustapa Mohamed Minister of International Trade and Industry, Malaysia MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 5 DRIVING TRANSFORMATION, POWERING GROWTH Malaysia’s sector. We also engaged with small and medium economy grew 4.7 entrepreneurs through our turun padang activities to gather feedback and to address problems on per cent in 2013 in the face the ground. of challenging economic conditions worldwide. The manufacturing sector Moving up the Global Value Chain grew by 3.4 per cent while the services sector grew by 5.9 per cent. Trade volume MITI will continue to spearhead efforts reached RM1.3 trillion, an increase of 4.6 to further integrate Malaysia’s products per cent compared with 2012. Despite the and services into the global value chain. modest pace of the world economy, Our initiatives will encourage greater exports increased to a new high of entrepreneurship, innovation and productivity at all levels of economic activities. To highlight RM719.8 billion while imports MITI’s role more effectively, we will increase reached RM649.1 billion. engagement with the public through media channels, including the social media. We will continue to further develop industries connected to the National Key Economic Areas (NKEAs). Overall, we maintained our attraction as a preferred destination for many investors, MITI will contribute towards the nation’s effort and our industrial base registered a shift in creating a high income economy that towards the production of higher value- is knowledge-driven and high technology added products and services, consistent industry-based. Focus will be on attracting with the strategic direction set by the quality investments and encouraging existing Economic Transformation Programme. industries to shift from lower value-added products and services to reinvesting in higher Transformation: A Strategic Perspective value-added and knowledge-intensive products and services. Emphasis will be on creating quality MITI’s core mission is to increase national jobs, establishing linkages with local suppliers and competitiveness. The Ministry’s initiatives have making significant contribution to export growth. focused on increasing productivity, promoting These efforts are in line with the objective of innovation and creating an environment that the New Economic Model (NEM) to transform is conducive to doing business. Our overriding Malaysia into a high income nation by 2020. objective in international trade has been to establish fair and beneficial trading relationships Going forward, improving the nation’s overall with our trading partners worldwide. In 2013, the economic competitiveness remains our highest Malaysia-Australia Free Trade Agreement came priority. Both the Government and the private into force. At home, we focused on promoting sector will have to continue to work together to investments in high technology and knowledge- ensure that we remain viable players in the global based industries, particularly in the services economic market place. DRIVING TRANSFORMATION, POWERING GROWTH MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 6 Jan 57.0 397.9 glance 2003 53.7 (RM billion) 2013 Trade Total 316.5 Trade Total Imports Exports 110.7 a At 714.4 Feb 52.5 44.3 2004 481.3 96.7 399.6 880.9 Mar 60.0 55.1 2005 536.2 115.1 432.9 2003 -2013(RMbillion) Performance Trade Malaysia’s 969.1 55.8 Apr 54.8 2006 589.2 110.6 478.1 May 55.8 1,067.4 52.9 2007 604.3 108.7 502.0 June 56.7 1,106.3 52.4 2008 663.0 109.2 519.8 July 60.7 EXPORTS 1,182.8 57.9 719.8 118.6 2009 552.5 434.7 Aug 62.9 434.7 55.8 118.7 2010 638.8 Source: Department ofStatistics,Source: Malaysia 528.8 Source: Department ofStatistics,Source: Malaysia 63.3 Sep IMPORTS 1,167.7 54.6 649.1 117.9 2011 697.9 573.6 Oct 67.1 1,271.5 58.9 126.0 2012 702.6 606.7 Nov 62.2 1,368.9 1,309.3 52.5 TRADE TOTAL 114.8 2013 719.8 Dec 65.7 649.1 56.2 1,368.9 121.9 DRIVING TRANSFORMATION, POWERING GROWTH MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 7 236.8 Top10 Major Export Products 2013 TOTAL EXPORTS RM719.8 2.4% billion FROM 2012 65.4 59.2 47.7 45.9 31.6 28.2 27.2 20.8 18.9 RM billion 32.9% 9.1% 8.2% 6.6% 6.4% 4.4% 3.9% 3.8% 2.9% 2.6% E & E Refined LNG Chemical & Palm Crude Manufactures Machinery Optical & Rubber Products Petroleum Products Chemical Oil Petroleum of Metal appliances Scientific Products Products Products & parts Equipment Source: Department of Statistics, Malaysia Top10 Major Import Products 2013 179.6 TOTAL IMPORTS RM649.1 7.0% billion FROM 2012 71.8 55.9 54.6 42.4 40.7 26.1 21.9 17.7 15.6 RM billion 27.7% 11.1% 8.6% 8.4% 6.5% 6.3% 4.0% 3.4% 2.7% 2.4% E & E Refined Chemical & Machinery Transport Manufactures Iron Crude Optical & Processed Products Petroleum Chemical appliances Equipment of Metal & Steel Petroleum Scientific Food Products Products & parts Products Equipment Source: Department of Statistics, Malaysia Source: Department of Statistics, Malaysia DRIVING TRANSFORMATION, POWERING GROWTH 8 MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 Top Five Export Destinations 2013 (RM billion) SINGAPORE 100.4 CHINA 97.0 JAPAN 79.7 UNITED STATES 58.1 RM 719.8 billion TOTAL EXPORTS THAILAND 39.9 Source: Department of Statistics, Malaysia Malaysia’s Productivity Level and Growth 2011-2013 57,907 59,063 60,424 Productivity level (RM) Productivity Growth 1.8% 2.0% 2.3% 2011 2012 2013 Source: Malaysia Productivity Corporation DRIVING TRANSFORMATION POWERING GROWTH MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 9 Investments into Malaysia’s Services Sector 2013 (RM million) RM144,734.1 83,314.2 million Real Estate SERVICES 9,063.3 SECTOR Utility 7,947.4 Global Operations Hub 4,234.0 Regional 7,887.8 Establishments Transport 3,448.2 7,025.6 Support Services Hotel &Tourism 3,106.5 5,838.2 Financial RM 719.8 Telecommunications* Services billion 5,002.7 3,001.7 TOTAL Distributive Trade MSC Status EXPORTS 2,146.3 Education Services 1,940.5 Health Services Source: Department of Statistics, Malaysia 777.6 Other Services Note : * : Data up to January-September 2013 Source : Malaysian Investment Development Authority Domestic and Foreign Investments in Approved Projects 2012 & 2013 (RM billion) 2013 2012 Total Investments 216.5 167.8 Domestic Investments 157.0 133.0 Foreign Investments 59.5 34.9 Source : Malaysian Investment Development Authority Source: Malaysia Productivity Corporation DRIVING TRANSFORMATION POWERING GROWTH A Sustained Growth Momentum 12 MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY REPORT 2013 A Sustained Growth Momentum Year 2013 once again saw domestic demand sectors were the main drivers to this growth. taking the lead in driving Malaysia’s economy, In terms of total approved investments in as the external environment remained on 2013, Malaysia achieved a commendable a moderate recovery path. The amount of outcome with approved investments totalling private approved investments achieved in 2013 RM216.5 billion. These investments were also reached a new record high. Favourable channelled into 5,669 projects, with the majority of investments coming from the employment conditions and wage growth, services sector (66.8%). Domestic sources partly due to the effect of the Minimum Wage constituted 72.5 per cent with foreign Policy, were key factors in 2013 that propelled investments making up the remainder. The private consumption and domestic demand. labour market will benefit greatly from Exports are projected to grow by 5.8 per cent, the investments 192,000 employment and Malaysia’s economic outlook in 2014 opportunities created for the economy. is expected to be positive with a projected growth of 4.5 to 5.5 per cent. Growth in public investment moderated to 0.7 per cent. This was a result of the Federal Bolstered by the continued robust growth Government cutting back on development of domestic demand, Malaysia’s economy expenditure. However, increased capital recorded a 4.7 per cent growth in 2013.