Malaysia’s Transformation Story:From Message to Passage

YB Senator Dato’ Sri Idris Jala

Minister in the Prime Minister’s Department &

Chief Executive Officer, PEMANDU

Invest Malaysia 2011

12 April 2011

PM introduced 4 strategic thrusts towards developed nation status

10th & 11th Malaysia Plan10th & 11th Malaysia Plan

People First Performance Now

1

• 6 NKRAs • 29 MKRAs

2

4

• 12 NKEAs• 131 EPPs• 60 Biz Opps

3

The Connection

• Grow the economy• Increase revenue• Increase job / income

• Spend the revenue based on rakyat needs

• Distribute the revenue (RBI & LIH)

We must do both

We introduced 6 NKRAs

under theGTP based on

what the rakyat wants

FightingCorruption

Reducing Poverty

ReducingCrime

Enhancing Education

ImprovingRural Basic

Infrastructure

Urban Public

Transport

1 2 3

4 5 6

Big Results Fast in 12 months

250 pages of results…

Note : GTP Annual report 2010 can be downloaded at www.pemandu.gov.my

Crime rose for 3 years prior to GTP

CrimeCrime

Types of crime

Violent

crimes

Property

theft

2008

211,645

2007

209,582

2006

196,780

20091

209,825

▪ Robberies without firearms

▪ Gang robberies without firearms

▪ Robberies with firearms

▪ Gang robberies with firearms

▪ Assault

▪ Rape

▪ Murder

▪ Theft

▪ Snatch theft

▪ Motorcycle theft

▪ Car theft

▪ Van/lorry/heavy machinery theft

▪ Break-in (night)

▪ Break-in (day)

15% drop inIndex Crime

2009 2010

209,817

177,520

-15.4%

-32,297

2009 2010

38,030

24,837

-34.6%

-13,193

35% drop inStreet Crime

CrimeCrime

Hotspot-based deployment

Pre-NKRA

• 1 Contingent, 5 Districts

• 22 Balai’s (Stations)

• 501 Sectors

• 2,892 police officers deployed for street patrolling

• 1 Contingent, 5 Districts

• 22 Balai’s (Stations)

• 11 hotspots, eg Pudu, Bukit Bintang

• 2,892 police officers deployed to patrol at hotspots

NKRA Approach

The Kuala Lumpur Story ILLUSTRATIVE

5.8 police officers assigned to patrol Bukit

Bintang every day

263 police

officers assigned to patrol Bukit Bintang

every day

CrimeCrime

192%improvement in

BET ridership

2.43 millionincrease in

LRT ridership

U.P.T.U.P.T.

BET reduces travel times,

increases ridership

Current route

▪ Over 30 stops

▪ Passing through Federal

Highway

KL Sentral /

Pasar Seni

Sri Muda

Shah Alam

Federal Highway

Bus Expressway Transit

▪ Limited to 4 stops

▪ Using underutilised KESAS

KESAS Highway

Current

BET

~75~75~65

~29~35~33

KESAS

Sri Muda – KL

Sentral

NPE

Subang mewah -

Sentral

Grand Saga

Kota Dsra - SentralPenchala

Sg Long -

Sentral

~ 75

Potential reduction in journey times

mins

~ 29

U.P.T.U.P.T.

The new Integrated

Transport Terminalat Bandar Tasik Selatan

completed…

500 southern buses will

terminate there

U.P.TU.P.T

634 bus stops

completed and

refurbished

54,569 more children benefited

from 1,500 pre-school classes

(more than 700,000 in total)

9,814 schools (primary & secondary) ranked

EducationEducation

Best UPSR exam results in 4 years.

R.B.IR.B.I

775km of rural roads

have been completed

35,291rural houses

with clean / water supply

16,926houses for rural poor build

& restored

27,209rural houses with

electricity supply

Touching the lives of more than

2 million peopleliving in the rural area

L.I.HL.I.H

Hardcore Poor reduction by Month

# of Ketua Isi Rumah (KIR)

99.76%Reduction in

hardcore poor

Dec

18,127

Nov

108

As of

31/12/2010

▪ Whistleblower Protection Act

came in to force on 15 December 2010

▪ Competitive tender as default

process

▪ 4,500 government contract

awards published on line (as of 24th March)

▪ Compliance units established

in key law enforcement agencies; joint training conducted

▪ “Name-and-Shame” – 328

corruption offenders (including

picture, IC No) published in MACC website to date (www.sprm.gov.my)

▪ Implementation of Integrity Pacts via Treasury directive, for Government contracting

▪ Corporate Integrity Pledge

launched

▪ 18 new corruption courts for speedy trials.

▪ Chief Justice’s circular to complete all corruption cases

within 1 year

1

2

3

4

5

6

▪ Guidance issued on support

letters by KSN on 8 March 2010

7

CorruptionCorruptionBuilding blocks against corruption

CorruptionCorruption

No SurveyScore

(2009)

Score

(2010)

1 IMD World Competitiveness Report 5.2 6.3

2 Political Economic Risk Consultancy (PERC) Report 3.6 4.6

3 World Economic Forum (WEF) Report 4.5 4.6

4 Economic Intelligence Unit (EIU) Report n/a 3.3

5 Global Insights (GI) Report n/a 3.4

6 BF Report 4.5 n/a

Heading the right way…

����

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1. TI Corruption Perception Index (CPI) Survey:

Malaysia ranked 56th � 4.5 (2009) to 4.4 (2010)

1. TI CPI constituent surveys shows improvement in 2010 vs.

2009

1

2

CorruptionCorruption

Transparency

International

Global Corruption

Barometer surveyshowed significant improvement

28%(2009)

48%(2010)

Heading the right way…

International Panel Review

Committee

Endorsement on GTP Results 2010

1 2 Agreed Upon Procedure (AUP)

by independent auditor

Sir Michael Barber Partner, McKinsey UK; ex-Head of Prime

Minister’s Delivery Unit (PMDU) of Tony Blair Administration

Michael HershmanCo-founder of Transparency

International; Current CEO of the Fairfax Group

Stephen SedgwickAustralian Public Service

Commissioner

Ravi

BalakrishnanIMF Resident

Representative, Singapore

Sergei DodzinSenior Economist, Asia & Pacific

Department – International Monetary Fund

KwakSeung-Jun Chairman

Presidential Council for Future and Vision

• Full day workshop with NKRA Ministries and PEMANDU

• Full day workshop with PM & Cabinet Ministers

•Validation by Price Waterhouse Coopers (PWC) on the achievement / results of 6 NKRAs

GTP Performance 2010 for the 6

NKRAs showed positive results using

all the 3 methods….

Get it from the book

1 Urban Public Transport 100% 107% 107% 97% 97% 78% P

2 Crime 100% 168% 168% 100% 100% 90% P

3 Rural Basic Infrastructure 100% 91% 91% 88% 88% 75% P

4 Education 100% 156% 156% 99% 99% 90% P

5 Low Income Household 100% 79% 79% 79% 79% 63% P

6 Corruption 100% 121% 121% 90% 90% 78% P

120% 120% 92% 92% 79% P

Traffic

Lights 2

Score #3

(Yes, Partial, No)

Traffic

Lights 3

Overall composite scoring

No. NKPIs 2010

Target

Score #1 Traffic

Lights 1

Score #2

(max

100%)

Source : GTP Annual Report 2010

NKRA Overall Performance 2010

1 Urban Public Transport

2 Crime

3 Rural Basic Infrastructure

4 Education

5 Low Income Household

6 Corruption

No. NKPIs

Overall composite scoring

2010

Budget

Actual

Expenditure

(RM mil) (Nov 2010;

RM mil)

448 396 88%

338 258 76%

3,234 2,372 73%

245 118 48%

1,170 1,163 99%

8 4 52%

5,443 4,310 79%

% of

Expenditure

Saving to the Government = RM 1.133 billion

Source : GTP Annual Report 2010

GTP delivered 120% with 79%

expenditure

Lets now look at the Economic

Transformation Programme (ETP)

10th & 11th Malaysia Plan10th & 11th Malaysia Plan

People First Performance Now

• 12 NKEAs• 131 EPPs• 60 Biz Opps

• 6 NKRAs • 29 MKRAs

2 3

4

NEM - Making us a rich country,

for everyone & for a long time

High-Income

Inclusiveness Sustainability

Target USD 15,000

GNI per capita by 2020

Enables all

communities

to benefit

from the

wealth of the

country

Meets present

needs without

compromising

future

generations

Quality

of Life

Overview of ETP

Gross National

Income (GNI)

• US$15,000 (RM48,000) per capita GNI

• USD 523 billion (RM1.7 trillion) GNI

• 6% GDP growth per annum

Jobs• 31.6 million

population • 3.3 million

additional jobs

Investment

• USD 444 billion (RM1.4 trillion) investment• 92% private, 8% public investment• 73% domestic, 27% foreign direct investment

Transformational

Actions• 12 NKEAs• 131 EPPs• 60 BOs• Transformational

approach• Private sector-led

Target15,000+

OthersNKEA 5NKEA 4NKEA 3 NKEA 2 NKEA 1

Current7,000

GNI per capita

US$NKEAs (drivers)

Source: PEMANDU (with EPU)

SRIs (enablers)

Re-energising private sector

Competitive domestic economy

Strengthening public sector

Developing quality workforce

Transparent & Market Friendly Affirmative Action

Building knowledge base infrastructure

Enhancing sources of growth

Ensuring sustainability of growth

1

2

ETP = NKEA + SRI

FOCUS

FOCUS

FOCUS

FOCUS

COMPETITIVENESS

COMPETITIVENESS

COMPETITIVENESS

COMPETITIVENESS

Source: NEAC

Focus: 12 National Key Economic Areas

(NKEAs)

Competitiveness – Strategic Reform

Initiatives (SRIs)

51policy measures

51policy measures

14with natural homes within the NKEAs /

NKRAs

14with natural homes within the NKEAs /

NKRAs

37which are WIP and

require further detailing out

37which are WIP and

require further detailing out

Consolidate and monitor the implementation plans with the respective NKEAs / NKRAs

6 Labs covering the following:

Intl Standards & Liberalisation 9 policies

Human Capital Development 9 policies

Public Finance 5 policies

Narrowing Disparities (Bumiputera)2 policies

Government‘s Role in Business 5 policies

Public Service Delivery 7 policies

1

2

3

4

5

6

ETP Governance Structure to ensure delivery

ETP Forum

Economic Council

NKEA Steering

Committee

EPP / BO owners

Semi-Annual

Weekly

Monthly

Year-round

Secretariat

Respective Ministries /

EPP owners

Lead

Ministries

Investment Committee

Monthly

Round #1 (25 Oct 2010)

9 projects

Investment: RM5.3b GNI: RM100mJobs: 13,100

Round #2(30 Nov 2010)

9 projects

Investment: RM8.2bGNI: RM84.5bJobs: 70,500

Round #3(11 Jan 2011)

19 projects

Investment: RM66.8b GNI: RM32.5b Jobs: 52,400

Round #4(8 Mac 2011)

23 projects

Investment: RM14.75b GNI: RM20.1b Jobs: 88,354

ETP Updates by PM

60 Projects in 46 EPPs , RM95 billion investmentRM137.2 billion GNI , 224,354 jobs created

60 Projects in 46 EPPs , RM95 billion investmentRM137.2 billion GNI , 224,354 jobs created

35% of EPPs are already off the

ground…

9 18

37

60

RM5.3 b

RM13.5 b

RM80.3 b

RM95 b

60 Projects in 46 EPPs , RM95 billion investmentRM137.2 billion GNI , 224,354 jobs created

60 Projects in 46 EPPs , RM95 billion investmentRM137.2 billion GNI , 224,354 jobs created

Number of EPPs

4

2630

60 projects in 46 EPPs60 projects in 46 EPPs

RM 37.26 bRM 57.98 b

…worth RM 95 billion of

investment…

Shell Malaysia starts construction of new

RM800 million diesel processing unit, Port

Dickson

Part of RM5.1 billion commitment in 2011

including:

• Shell MDS wax plant expansion, Bintulu•Gumusut Kakap deepwater development, offshore Sabah

Tenaga Nasional signed agreement to build

coal-fired power plant in Manjung

• Part of RM4.0 billion commitment in 2011

•Engineering, procurement and construction agreement with Alstom

Power System SA-led consortium

•Expected completion and commission by March 2015

* Existing Shell MDS, Bintulu

* Existing 2,100MW Janamanjung power plant

Oil, Gas & Energy

OVERALL2km2km

Seri KembanganPutra Heights

Shah Alam

Klang

Shah AlamTown Center

SubangJaya

BatuCaves

KLJ

Sg. Buloh

Kota Damansara

PetalingJaya

Existing Rail Lines, Minconsult’s Option

and MMCG JV’s Proposal

Legend

Existing Rail Lines

KTM Komuter

Kelana Jaya Line

Ampang Line

KL Monorail

Kelana Jaya Line Extension

Ampang Line Extension

MMCG JV Schemes

RED Line

GREEN Line

CIRCLE Line

Minconsult’s Alternatives

BLUE Corridor

CIRCLE Corridor

AMG Kepong Extension Corridor

ORANGE Corridor

Legend

Existing Rail Lines

KTM Komuter

Kelana Jaya Line

Ampang Line

KL Monorail

Kelana Jaya Line Extension

Ampang Line Extension

MMCG JV Schemes

RED Line

GREEN Line

CIRCLE Line

Minconsult’s Alternatives

BLUE Corridor

CIRCLE Corridor

AMG Kepong Extension Corridor

ORANGE Corridor

Batu Caves

Putra Heights

Shah Alam

Klang

Shah Alam

Town Center

Subang Jaya

Sg. Buloh

Kota

Damansara

Petaling

Jaya

Seri Kembangan

Kajang

MRT

•PDP contractor appointed•Open Day completed•Alignment in progress•Pre-qualifying tender & bidding in progress

•Ground breaking 8th July 2011

Talent Corporation

•Johan Mahmood Merican appointed CEO•New five-to-10 year Residence Pass launched on 4 April 2011

* Johan Mahmood Merican, CEO

Greater KL/KV

Oil palm replanting & new planting

Replanting:

• 264 applicants approved covering 921 ha• Commitment value: RM6.45 million (5 Apr)New planting:

• 1,205 applicants approved covering 2,410 ha• Commitment value: RM16.86 million (5 Apr)

Increasing FFB yield

4 cooperatives set up involving 11,492

smallholders and 59,039 ha

* Illustrative only

* Illustrative only

Palm Oil

Pulau Gaya Resort, Sabah:

• 14 of 31 rooms completed• Overall, 35% completed• Expected completion: 30 June 2012Majestic Hotel, KL:

•Sub-structure completed, super-structure construction in progress

• Overall, 23% completed•Expected completion: December 2012

Johor Premium Outlets

• 90% earth work completed•20% construction completed•Handover in September 2011•Official opening scheduled on 11 Nov 2011

* Pulau Gaya Resort & Majestic Hotel site pictures

* Johor Premium Outlets site picture

Tourism

TUKAR

•16 stores transformed as at 1 Apr 2011

•Four sponsors are Mydin, Tesco, Carrefour and SKM

Mydin

•Opened hypermarket in Bukit Jambul in Jan 2011

•In total, 14 hypermarkets to be opened in 2011-2014

•Land for all 14 sites purchased for RM165 million

* A TUKAR store in Merlimau, Melaka

* Mydin Hypermarket, Bukit Jambul

Wholesale & Retail

Healthcare

University Malaya

Health Metropolis• The health planning and architecture design selection process have been

completed. The formal appointment of architects is expected by the end of March.

• Traffic studies are expect to be completed by May 2011. Clinicalstakeholders will sign off on the schematic designs by June 2011.

• Submission to local authority for “Planning Permission" expected in end of June 2011.

• Earthworks are targeted to begin in Nov 2011• Tax incentive discussion started with MOF, expect to be gazetted as "Health

Metropolis" areas by Q3 2011.

Source : Bank Negara 2009 Figures

Malaysia’s GNI / GDP

GNIGNI

GDPGDP

Net Factor Income From

Abroad

CONSUMPTIONCONSUMPTION

INVESTMENTINVESTMENT

INVENTORYINVENTORY

TRADETRADE

RM 497 b

RM 521 b

- RM 24 b

RM 355 b

RM 111 b

- RM 14 b

RM 71 b

Consumer Confidence

on 4-year high…

Source : Neilsen Consumer Confidence Index

• Malaysia is at 9th place globally

• Ahead of Sweden and Vietnam (both at 103), Thailand (102), China (100), Hong Kong and New Zealand (both at 99)

…and reflected in private consumption

RM 97.7b605,156

536,905

12.7%

Retail Sales Car Sales Property Sales

RM 71.7b

35%

Source: MRG 2010 & 2009 Source: MAA 2010 & 2009 Source: Valuation & Property

Svc Dept (Nov 2010 / Nov 2009)

8.4%

RM 77b

RM 71b

2011 investment target (RM 83 b) is

achievable…

76

50.6

127

EPPs &

others

Base Load

Private Investment - RM (Billion)

Potential /

Planned

At 90% = RM 114 b

At 80%= RM 101 b

At 70 % = RM 89 b

Probability of

Success

Source : PEMANDU Analysis

RM1.169 t

Trade is up too..

2010/2009 Trade

RM 988.24 b

18.3%

Source: MITI

Bursa Malaysia closed at a

record high on 7 January 2011

Aug 2010

As at

7 Jan 2011 % Change

Market

capitalisation

(billion)

1,122.11 1,275.28

13.65%

(153.2

billion)

Daily average

volume

(billion)

1.03 2.14 107.7%

Daily average

value (billion) 1.69 3.01 78.1%

1,572.21 pts1,572.21 pts

It shows

Malaysia is ...

No. EPP2020 GNI

(millions)Jobs

Palm Oil

87 Accelerate the replanting of oil palm 4,612.0 NA

88 Improve fresh fruit bunch yield 10,172.7 1,600

89 Improving worker productivity in plantations and estates 1,692.4 (82,500)

90 Increasing the oil extraction rate 13,711.1 10,000

91 Developing biogas facilities at palm oil mills 2,934.0 2,000

92 Developing oleo derivatives 5,813.5 5,858

93 Commercialising second generation biofuels 3,261.5 1,044

94 Expediting growth of food and health-based downstream segments4,924.7 74,942

Communications Content and Infrastructure

95 Ensuring broadband for all 2,160.5 7,155

96 Extending reach 2,688.5 3,135

97 Offering a smart network 1,665.7 4,186

98 Extending the regional network 2,289.8 1,220

99 Connecting 1Malaysia 1,783.1 2,056

100 Deploying 1Malaysia payments 1,005.9 1,478

101 Nurturing ’s creative content 3,081.9 10,326

102 Launching e-Healthcare 1,402.5 250

103 Establishing e-Learning for students and workers 1,487.3 800

104 Deepening e-Government 1,100.1 1,000

Tourism

105 Developing the world’s first eco-nature integrated resort in 706.6 7,733

106 Designating KLCC-Bukit Bintang as a vibrant shopping precinct 1,159.2 14,546

107 Establishing three new premium outlets in 875.2 1,500

108 Declaring as a global biodiversity hub 1,486.9 2,919

109 Positioning as a duty free shopping destination for tourist goods 7,838.3 64,294

110 Creating a straits 1,758.2 9,713

111 Targeting more international events 426.7 8,036

112 Establishing dedicated entertainment zones 740.4 5,614

113 Developing local expertise and better regulating the spa industry666.2 5,644

114 Establishing as a leading business tourism destination 3,947.0 16,720

115 Improving rates, mix and quality of hotels 5,528.7 64,424

116 Enhancing connectivity to priority medium-haul markets 3,310.5 13,402

No. Business Opportunities2020 GNI

(millions)

Jobs

Palm Oil

48 Upstream developments (organic growth)13,986.0

0

49 Downstream investments (organic growth)3,496.0

26,489

50 Biodiesel expansion (organic growth)493.1

2,131

51 Organic growth (inflation effect)5,324.0

0

Communications Content and Infrastructure

52 Mobile services development1,128.5

5,788

53 Fixed services development541.3

3,250

54 Courier, post and broadcast services development500.9

7,563

55 Net regional transfer services development1,480.6

664

Tourism

56 Organised tours293.8

7,447

57 Food and beverage outlets1,114.7

9,608

58 Taxi industry222.9

44,994

59 Baseline growth7,297.7

220,610

131 EPPs & 60 BOs to ‘subscribe’…

Source : Economic Transformation Roadmap book

You can participate too…

Engage

Government early

with your project

proposal

Robust

investment

analysis &

business case

Proper

follow-up

meetings

1 2 3

A high-level pitch to Government should contain:� Clear analysis of how

the project addresses the issues and opportunities

� Clear high level estimate of potential GNI and employment impact

� Clear articulation of support you need from the Government.

3 steps

to become an ETP project

If Government expresses interest, a detailed analysis which provides a robust estimate on the project’s impact on

GNI, employment and

investment.

The appropriate

PEMANDU NKEA

director will assist to

facilitate the project.

These include meetings with various ministers and ministry officials

These project meetings are important:

� To secure the necessary support;

� To facilitate fast and successful implementation

� To resolve any issues or roadblocks

Message to Passage..

120% achievement Progress is on track

� �

Thank you

Secured contracts with:

•Best Western Premier Dua Sentral

•4 Bangkok Hospital Group hospitals

•Pullman Resort Bali•Vietnam Post & Telecom•KUBTel (for content partnership)* Client properties

Communications Content & Infra

Cisco has commenced manufacturing of a

wide range of routing and switching products

at its manufacturing partner’s facility in

Penang.

* A router component at the assembly station

AUU Sunpower

•Phase 1 of RM2.2 billion solar cell fabrication facility in Melaka was

officiated by Prime Minister on 15

December 2011 and operational.

•When fully completed in 2013, it is expected to produce cells capable of

generating 1,400 MW of energy per

year.

The Malaysia Education online portal will

be launched by Higher Education Minister

on 12 April 2011

•Six public higher education institutions have been engaged, three more pending

•One private higher education institution has been engaged

•Engagement with two government agencies in progress

* AUO Sunpower plant in Melaka

E&E & Education