GEORGE TOWN, April 23 — Penang has managed to keep its competitive edge in the electrical and electronics (E&E), and services sectors despite uncertainties in the first half of 2019, said Invest Penang executive director Datuk Seri Lee Kah Choon.
Debunking “misconceptions” about Penang’s economic situation, he said Penang is the powerhouse that drives the E&E sector in Malaysia.
The E&E sector contributed at least 300,000 jobs and more than RM1.5 billion in wages per month in Penang, he said.
“From the country’s perspective, in 2018, the E&E sector created a trade surplus of RM119 billion, the highest among all subsectors for manufacturing industry,” he said in a statement today.
He said the E&E sector represented 38 per cent of Malaysia’s total export in 2018 which amounted to RM380 billion.
“Without it, Malaysia will be in deep financial trouble,” he said.
Lee admitted that there could be a slowdown in the first half of 2019 due to uncertainties arising from trade war among others.
“Research shows that recovery is expected in 2020 as the world moves into the 5G stage and the proliferation of many new technologies such as autonomous driving, Internet of Things, Industry 4.0 and virtual reality,” he said.
He stressed that Penang is not only dependent on its E&E sector as the state has diversified into new segments of the economy, attracting investments from medical devices, aerospace, automation and equipment manufacturing.
An increasing number of multinational companies based in Penang had also chosen to set up their Global Business Centre (GBS) here, suggesting that Penang has the talents and ecosystem for this branch of the services sector, he said.
Lee listed several Penang-based and homegrown success stories in the E&E sector such as Vitrox Corporation, Inari, Globetronics, Pentamaster Corporation and SRM Integration as a testament of the state’s strengths and talent in this sector.
He said Penang is also home to successful tech start-ups such as Jobstreet and Exabytes.
“However, we must not be complacent and we need to continuously up-skill our labour force to ensure our competitive edge remains,” he said.
Lee admitted that Penang has been facing brain drain but attributed it to a national issue that is equally experienced by all other states.
“In actual fact, Penang is the state that registered the highest positive effectiveness ratio of migration at 58.4 per cent in 2015-2016, according to the Department of Statistics, Malaysia,” he said.
On the state’s GDP growth rate of 5 per cent for the past 10 years, he said it mirrored that of the whole country and that most of the time, Penang is doing better than that of the country.
He said Penang’s GDP growth was hampered as most licenses and development budgets were approved at the federal level.
“Just imagine, if Penang could have the necessary financial licenses and more money to expand the airport for example, Penang can do much better economically than what it is now,” he said.
As for the tourism sector in the state, Lee said Penang contributed close to 50 per cent share for medical tourism in the country.
Finally, Lee said Penang needs to invest more for better infrastructure to attract more investments into the state.
“It is illogical to expect Penang to attract the world’s top technologies and high spending tourists to its shore when at the same time, starve it of well thought out industrial incentives and development fund for better infrastructure,” he said.
Source: The Malay Mail Online