Sunday, September 20

Digital economy to make up 20 per cent of GDP before 2020

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PETALING JAYA: The contributions of Malaysia’s digital economy to the gross domestic product (GDP) are expected to exceed the 20 per cent target by 2020 from the current 17 per cent.

Communications and Multimedia Deputy Minister, Datuk Jailani Johari, said he was confident the target could be achieved earlier than 2020, as Malaysia had started making waves in the digital economy.

“This is especially with the Digital Free Trade Zone (DTFZ) launched in March this year and lately, the Malaysia Digital Hub.

“Malaysia can also leverage on the Regional Comprehensive Economic Partnership and the DFTZ, where our small and medium enterprises can benefit from partnerships with big players like Alibaba,” he said.

He said this in his keynote speech at the Asian Strategy and Leadership Institute’s Digital Economy and e-Commerce Conference yesterday.

Jailani said the global digital economy has been growing at an impressive rate of 10 per cent a year, more than triple the rate of overall global economic growth.

“At the rate at which the Malaysia Digital Economy Corp Sdn Bhd is bringing in the investments, we can achieve the 20 per cent target earlier than 2020,” he said.

He said the Malaysian ecosystem for start-ups was conducive and due to regulations, policies and facilities that had been put in place, the country was now the second top hotspot to launch start-ups in the world.

“We are starting to see many new start-ups being launched in Malaysia. Those that began elsewhere, such as in Singapore, are coming back to build their base here,” Jailani said.

The Malaysia Digital Hub offered start-ups an opportunity for global expansion, access to high-speed broadband and fibre optic connectivity, funding and facilitation opportunities, a workforce-ready ecosystem, technologically-focused and a holistic convenience and lifestyle experience, he said.

“It focuses on four categories, namely, growing start-ups, global technology companies, accelerators and talent builders and investors,” he said.

Jailani said incentives for the Malaysia Digital Hub included corporate tax exemptions for the tech start-ups, the Malaysia Tech Entrepreneurs Programme that issued passes for individuals who wanted to set up or expand their businesses into Malaysia, and access to funding.

“The special tax incentive would be leveraging on the existing tax regime and any further incentives would be announced later,” said Jailani.

The three digital hubs approved by the government at present are APW, The Co and Common Ground, all located in the Klang Valley, he said.

Meanwhile, Jailani urged the ASLI think-tank to highlight the need for regulators in all sectors to heighten collaborations to fortify the digital agenda.

“ASLI can consider conducting a specialised forum to discuss the role of regulators in the future,” he said.

ASLI is an independent, private, non-profit think tank group committed toward creating a better society and help organisations enhance competitiveness, leadership and strategic capabilities. — Bernama