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Penang - The destination of choice for investments,
A great place to live, work, learn and play…
Dec 8, 2014
“Grow Your Business with International Partnership” Supplier Day
InvestPenang – Investor’s point of contact
• The Principal Investment Promotion Agency of the Penang State Government for the promotion of the manufacturing & services sectors
• Point of contact for investors.
• Collaborates with Federal/ State agencies
Promotion
• Assist State in Planning
• Policy advocacy
Planning & Evaluation
• Provides information on the business opportunities in Penang Opportunities for Investment
• Facilitates implementation of the investment projects in Penang
Facilitation
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Federal & State Government Relationships
Prime Minister (PM)
Federal Government
Chief Minister
State Government
+ Investment
Promotion Arm + Investment Arm
+ Penang Office
+ Ministry of Health
+ Institute of Medical
Research
+ Malaysian Biotech
Corp.
+ Ministry of
Education
+ Ministry of
International
Trade and
Industry
+ Malaysian
Investment
Development
Authority,
+ Malaysian
External
Trade
Development
Corp.
+ Ministry of
Science,
Technology
and Innovation
+ Universiti Sains Malaysia, Penang
+ Multimedia Development Corporation
+ MPPP
Local Authority Island
+ MPSP
Local Authority
Mainland
Penang Key Facts Where business goes to grow
Penang 2nd Bridge
• 2nd smallest state
in Malaysia
1031sq.km (MY
330,000 sq.km)
• 2nd most
urbanized state
population 1.6m
(MY29.3m)
• 4 decades of
industrialization
• >770, 500 workers
supporting Penang’s
economy
• >240,400 (31%) in
manufacturing
• Languages Spoken
Bahasa Malaysia,
English, Chinese
(Mandarin,
Hokkien), Tamil,
others
• Temperature: 21°~
32°C Source: DOS, Labour Force Survey Report 2012
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Penang in the news:
An industrial base state, heritage city and campus for
technology
Top 10 dynamic industrial cluster locations in the world to have demonstrated a successful manufacturing experience among developing economies (UNIDO Industrial Development Report 2009)
Top 31 Business Process Outsourcing (BPO) - locations of the future (KPMG’s “Exploring Global Frontiers” Report 2009)
Produces 8% of global back-end support for semiconductor industry (SEMI, 2013)
Georgetown – UNESCO World Heritage Site in 2008
The 8th most livable cities in Asia (ECA Intl. 2012)
Top in Green initiatives in Malaysia
C.A.T. Governance praised for anti-corruption efforts (Transparency International, AG Report 2010)
Top culinary spot (Lonely Planet 2014)
Penang Economic Profile
• GDP : RM 54.97 B
• GDP growth in 2013: 4.6 % (5.0% :2012)
• Contributes 7.0% of national economy (2013)
• Penang’s Share of Economic Activity:-
• Malaysia Inflation rate : 2.1% (2013) Source: Department Of Statistic Malaysia
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70s
80s
90s
00s
MNC’s
60s
• Quality branding
• Operational excellence
• Mfg – order fulfillment
• Disk drives
•Process automation • Consumer electronics assembly •Piece-parts & sub-assemblies •Localization – backend automation & tooling •Die fabrication
• Labor intensive semiconductor mfg
•Semiconductor assembly •Local machine shop upgrades •Logistics •Technical services
•Machine shops •Mech. R&M •Cottage industries
•Local precision tooling •Local back end automation
•Quality revolution •Local CM’s •Local high tech traders •Test automation
•Trading •Sub-Assembly CM’s •Technical services •Software/firmware • Internationalization • Outsourcing services
• Global supply chains
• Non-core outsourcing
• Global procurement
• R&D • Sales/marketing • Global ICT
integration • Equipment mfg
Local industry value add
Local SME’s
SME value add line
10s
• Biotech mfg. • Solar panels • Business units • Technology eco-
systems • LED fab/packaging • IC design
Low Vol/High Mix CM •Technical services • Tech startups • ODM’s • Design services. • Branding • Partnerships with MNC’s
• Penang has experienced 2 growth transformations to become a successful industrialized economy
• Penang’s economy targeted to move up the value-chain by driving the 3rd growth wave of knowledge intensive and innovation-led growth
• Promoting economic diversification e.g advanced technology, creative multimedia content, BPO-ITO, engineering design, R&D, ICT
1970s 1980s – 1990s
Jobs & GDP
Growth
2000 and beyond
Knowledge intensive, innovation-led
manufacturing and services Special Economic
Zone (“SEZ”)
1st Growth Wave: Malaysia’s First Free Trade Zone in Bayan
Lepas, Penang Industrialization
2nd Growth Wave: Expansion of SEZs into
Industry Clusters
3rd Growth Wave: Development of ICT Project
Move the PENANG ECONOMY up the value chain
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• Shared Services & Outsourcing (SSO) • IC Design & Development • ICT / Software development & Creative Multimedia • Operational Headquarters, International Procurement
Centre and Regional Distribution Centers • Logistics & Transportation • Healthcare & Wellness Services • International Education • Meeting, Incentives, Conferences, and Exhibitions (MICE) • High value Tourism / Hospitality
Our promoted sectors
• Electrical & Electronics • Electronics Manufacturing Services (EMS) • Light Emitting Diodes (LED) • Life Sciences / Medical Devices • Aerospace / Avionics • Renewable Energy (RE) • Halal & Food Industry
Industry
Services
Over 300 multinational companies have chosen Penang as
their location of choice to do business
No. of companies Japan: > 85 Taiwan: >70 US : > 50 Singapore: >30 Germany: > 10 Others : >50
Others – EU co
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Investment Performance in Penang 2000-Jul 2014
0
2
4
6
8
10
12
14
Source: MIDA
Domestic Investment Foreign Investment Total Capital Investment
RM Billion
Recent Projects in Penang:
Penang E&E Clusters
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Machining Stamping & Fabrication
Automation
Plastic Moulding
Die Casting
PCB Assembly
Surface Treatment
Jigs & Fixtures
CNC
Precision Engineering in Penang
www.penangcatcentre.my
“resource centre and point of contact for employers and job seekers”
Matching job seekers with potential employers
Policy advocacy on how to address talent gap
Initiatives to attract and retain talent
Penang Future Foundation Scholarship Award – Scholars bond to serve organizations in Penang
Affordable housing scheme – Priority given to talent working in Penang
Penang CAT Centre Career Assistance and Talent Centre
“My Penang….. My Workplace”
Attract and retain talent in Penang
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2012 Graduate Output
Talents
Institutions of Higher Learning
2 Public Universities
3 Private Universities
27 Colleges
2 Polytechnics
6 Community Colleges
4 Industrial Training Institutes
1 Youth Skills Development Institutes 2 Teacher Training Institutes
Year 2010-2012, Malaysia produces
190,000 university graduates yearly
Engineering produces 35,358
graduates
Competitive cost of doing business
• RM0.66/m3 vs KL/ Selangor RM2.07/m3 Johor RM2.60/m3
Among cheapest water rates in
Malaysia
• Compared to Asian region
Among cheapest electricity rate in the region
• Lower annual turnover rates Staff attrition
• Kuala Lumpur – RM 1,900 /month
• Johor – RM 1,500 / month
• Penang RM 1,450 /month
Lower median salary
Source: Department of Statistics 2012
Country Electricity Tariff (per KWh)(USD)
MALAYSIA 0.11
THAILAND 0.11
INDIA 0.12
CHINA 0.13
SINGPORE 0.23
PHILIPPINES 0.27
JAPAN 0.22
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Cost of Doing Business in Penang
investPenang’s ‘Cost of Doing Business’ booklet
available for collection at investPenang booth or
download at www.investpenang.gov.my
• Comprehensive master plan
• Eco-friendly township – work, live & play
• World class technology and innovation led industries
• Supply chain at SME Village
• Education hub
• Affordable housing – 11,800 units
Strategic location in Batu Kawan Industrial Park
Innovation Led Manufacturing
Education Hub & Talent Pool
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Choice of manufacturing/operation space in Penang
• Vacant industrial land in Batu Kawan Industrial Park and Penang Science Park (0.5 acres to 5 acres)
• Ready built factory units at Batu Kawan SME Village: Semi-detached (7k sqft) Terrace (3k sqft)
• Flatted manufacturing space for light industries (6k -13k sqft) in Penang SME Centre
• Wide range of selections for existing buildings in industrial parks
8th most livable cities in Asia
• “habitat of choice” for local and global talents
• Quality of life is key to attract & retain talents
UNESCO world cultural heritage site
• Vibrant showcase for art and creativity
• Best street food and beach resorts in the region
10 international schools
•American, British, Japanese, Taiwanese curricula
7 private hospitals with international accreditation
• 55% medical tourism revenue contribution by Penang
Pioneering Green State
• Promotion of recycling community , Green Building Index compliance & Sustainable water supply
Safe City
• Largest drop in crime index in Malaysia - 15% drop in Q1 2014 • Installation of closed circuit televisions and police patrolling over
hotspot areas
Home to global citizens
• 2000 expatriates in enjoy quality lifestyle with lower cost of living • International associations (e.g.: International Women’s Association)
Stable Economy
GDP : RM 52.5 B (2012) GDP growth in 2012: 5 % (3.9% :2011) Contributes average of 7.0% of GDP in Malaysia
Why
Penang?
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Penang: where you want to be….
“My continuing adventures – living in PENANG, working in PENANG and making PENANG home”
Tranquil Island Resort in a Vibrant City
Thank you! www.investpenang.gov.my
Invest-in-Penang Berhad
PSDC Building, 1, Jalan Sultan Azlan Shah, Bayan Lepas, 11900 Penang, Malaysia Tel: 604-646 8833 Fax: 604-646 8811