KUALA LUMPUR: The government needs to focus on building a few quality companies instead of a mass of sluggish companies that can compete at the regional level and achieve its aspiration of becoming an Asean hub for various industries.
Consulting Board Asia founding partner Datuk Badlisham Ghazali said in order for Malaysia to become an Asean hub, as envisioned in the Shared Prosperity Vision 2030 (WKB2030), the government needs to start looking at things differently, in terms of developing quality companies at the regional level.
“This (Asean hub) is not a new thing for Malaysia. We have been trying to get into a lot of these things such as in maritime, digital economy, fintech.
“Whether we are able to do it, yes, because we have been trying to do it since Tun Dr Mahathir Mohamad was the fourth prime minister, through the Vision 2020 and multimedia super corridor,” he told Bernama recently.
Badlisham said Malaysia does not have to know about becoming an Asean hub anymore as the country is already clear about the target through various attempts in the past.
“What we need to see is that if we want to become an Asean hub we have to change our mindset. We cannot target to build end products, Malaysia is too small to say that we want to build the best driverless car in the world.
“We have to focus on what we can contribute to that kind of project for the regional or even world market. We should not be too broad (in planning to build a product). We should look at where we could build competencies to add value to the value chain,” he said.
In doing so, Badlisham said Malaysian companies could then claim to be good or even the best in building some of the components for a particular project among Asean countries.
“In the past, we always think that to be the best, we must be the only one and the number one in that particular subject. We don’t have to go that far, we can be the second, the third or among the top 10 in that particular subject, and that is already a great aspiration,” he added.
Badlisham, who was the former Malaysia Digital Economy Corporation chief executive officer, said to get there, the government must first improve its human capital, and after that, link up the value-chain.
“The Malaysian market is too small to be a sole producer of any kind of product for a bigger market. Even China doesn’t have its own animation studio to produce its own animation just for the Chinese market,” he said.
He said Malaysia has been building capabilities of companies that could take on any animation projects whether from China, France or the US.
“We don’t have to be the company that produces that project, but we can be the one who supplies important parts for that project. We don’t have a long timeline (under the WKB2030).
“Sometime, our aspiration doesn’t meet our ambition because we don’t know what the angle should be. We have the capabilities, we have to remember that it is about where we can place the ecosystem. We can achieve that target because Malaysians can accept that kind of knowledge and help translate it,” he added.
He said at the finish line, it does not matter how many companies that the country created, but what is more important is whether these companies eventually evolve and take on the value chain.
The WKB2030 has identified 15 proposed Key Economic Growth Activities (KEGAs) with potential to be developed to drive the country’s future economic development.
According to the WKB2030 Book authored by the Ministry of Economic Affairs, the proposed KEGAs will not ignore the development of existing economic activities such as oil and gas, manufacturing, electrical and electronic goods, and other services.
All the 15 KEGAs selected as the initial proposals are Islamic financial hub 2.0 (second wave/fintech); digital economy; fourth industrial revolution (4IR); content industry (animation, programming, entertainment, culture and digitalisation); Asean hub; halal and food hub; Commodity Malaysia 2.0; and sustainable transportation, logistics and mobility.
The book said Malaysia needs to develop its full economic potential in a holistic and sustainable manner, as well as maintain political stability to emerge as the Asean economic hub and Asian Tiger.
It inferred that qualitative forecasts indicated that by 2050, the world’s economic growth will shift from Europe to Asia but Malaysia has yet to capitalise on the opportunities resulting from this transition.
“Asean is seen as a hub of production and global trade with the fastest growing global consumer market,” it said. — Bernama