State is all set to carry out Economic Transformation Programme
KOTA KINABALU: Sabah is all set to implement the government’s latest programme to drive the country towards becoming a high-income nation by 2020.
Chief Minister Datuk Seri Musa Aman, in assuring Sabah’s readiness, explained that the Economic Transformation Programme (ETP) is also in line with the state’s existing Halatuju (development direction) and the holistic Sabah Development Corridor (SDC) programmes.
“The SDC is gearing Sabah’s rich natural resources and strategic location in the South China Sea Region to propel the state’s economy forward. There is a clear alignment between the ETP and SDC initiatives.
“ETP is also in line with the SDC initiatives, namely agriculture, palm oil, tourism, as well as oil and gas. ETP aims at transforming agriculture into agribusiness, moving towards an inclusive model anchored on market-centred, economies of scale and value chain integration,” said Musa when launching the ETP Open Day Programme here yesterday.
He said the SDC, launched two years ago, is an initiative to fully utilise the state’s natural resources that offer some 900,000 job opportunities and increase four-fold the Gross Domestic Product to RM63.2 billion by 2025.
Musa said the response to the SDC was overwhelming where between Jan 2008 and May 2010, the total investments were recorded at RM32 billion, 30.5 per cent from the RM18 billion target for the next 18 years.
He said Malaysia is currently facing the middle-income trap due to the current economic downturn and it needs a strategic approach to help materialise its target of becoming high-income nation in the future.
“Business as usual is no longer enough today. Malaysia needs a more radical and fast move to stay competitive internationally. It was with this in mind that the government has worked closely with the private sector to create and launch the ETP,” he said.
In Sabah, under the ETP, one of its agribusinesses is the commercial grade seaweed farming, leveraging the state’s strategic location in the Coral Triangle together with the Philippines and Indonesia.
“This triangle supplies nearly 80 per cent of Kappaphycus seaweed, which is highly sought after in the processed food and pharmaceutical industries.
“The seaweed mini-estate initiative aims to increase yield from 1.5 metric tonnes to five metric tonnes of dried seaweed per-hectare per-year in a framed totaling 28,000 hectares. The state government has designated 7,500 hectares of new areas for seaweed cultivation under the Industrial Aquaculture Zone (ZIA) and an additional 20,500ha will be designated by 2020,” he said.
In fact, Sabah is also one of the states identified for replicating the Integrated Aquaculture Model to tap the market for premium shrimps.
The larger market for fully certified and traceable seafood has increased from 20,000 MT to 600,000 MT over the last five years, an indication of its potential.
Apart from agriculture, the tourism industry in Sabah also stands to benefit from the development of a unique, green showpiece Econature Integrated Resort that is four to 10 times the size of other regional integrated resorts featuring components such as water theme park, mangrove centre, waterfront living and iconic architecture.
Minister in the Prime Minister’s Department Senator Datuk Seri Idris Jala, when briefing on ETP, said a total of 71 entry point projects (EPPs) within the 10 National Key Economic Areas (NKEAs) are expected to kick-start the implementation of ETP in Sabah.
“ETP is not a plan, it is a programme. There is something for everyone,” he said, adding: “ETP will kick-start Malaysia’s drive towards high-income nation status with 131 EPPs and 60 Business Opportunities (BOs). It aims to almost triple the country’s Gross National Income (GNI) from RM660 billion in 2009 to close to RM1.7 trillion in 2020.”
This, added Idris, who is also the Performance Management and Delivery Unit (Pemandu) chief executive officer, translates into an increase of GNI per-capita from RM23,700 to at least RM48,000, meeting World Bank’s high-income nation benchmark.
The country is expected to grow its GNI at six per cent between 2011 and 2020 to hit the target.
The ETP is the culmination of a substantial body of work to develop the government’s economic agenda, building on the 10th Malaysia Plan, the New Economic Model, and the principles of the 1Malaysia, People First, Performance Now.
“In order for this to succeed, we need to increase revenue and reduce costs. It has to be done together. We are heading towards strong economic recovery and growth. The Budget 2010 slashing has reduced expenditures and as a result, we have a surplus fiscal deficit, which has not happened since 1997. And for the first time in 13 years, our Ringgit is strongest. More investors are coming in, including foreign investments.
“There is a saying that when one door opens, the other closes. We spent too much time feeling sorry over the closed door that we forget to notice the open doors. Malaysia needs a complete economic transformation and there is no time to lose,” he said.
Under the ETP, 12 NKEAs were laid down in the 10MP, namely oil and gas; palm oil; financial services; tourism; business services; electrical and electronics; wholesale and retail; education; health care; communications content and infrastructure; agriculture; and greater Kuala Lumpur/Klang Valley.
The initiatives under the 12 NKEAs are forecast to create an incremental 3.3 million jobs, of which 63 per cent will be in the middle and high income segment compared to the current 43 per cent.
A total of over RM1.4 trillion funding is required for the duration of the economic transformation and in consistent with the strategy to make the private sector the primary driver of economic growth, 92 per cent of the NKEA funding will be private investment with public funding taking up the remainder.
In addition, the domestic direct investment will account for 73 per cent of total private investment with the remaining 27 per cent coming from foreign direct investment.
“The ETP is beyond a plan, it is something that you and I can contribute. It will create job opportunities that will pay you more and those in the rural areas will have a fair share of the development,” said Idris.