Mida to advise on forward manufacturing policy

KUALA LUMPUR: The Malaysian Investment Development Authority (Mida) expects to announce its policy recommendations to the government for the manufacturing sector in the third quarter of this year.
The recommendations will be based on findings of a joint study conducted by Mida, University of Malaya and Universiti Teknikal Malaysia Melaka covering five catalytic and high-potential growth industries sub-sectors; namely electrical and electronics, machinery and equipment, chemicals, aerospace and medical device.
“We will be talking to our colleagues. Probably in the third quarter of this year, we will come up with a document on the way forward in as far as the future of manufacturing in Malaysia is concerned, taking into account automation, smart manufacturing and the fourth industrial revolution,” International Trade and Industry Minister Datuk Seri Mustapa Mohamed told reporters at the signing of a memorandum of understanding (MoU) between Mida and Rockwell Automation yesterday.
The industrial study titled “Future of Manufacturing: Industry 3+2 Sectors” is an analysis of the future of manufacturing focusing on the five sub-sectors that have been identified to drive the growth of the manufacturing sector. The best practices of industrial standards of other countries will be benchmarked for this study.
“Those are the focus areas and new growth areas. We will identify certain areas and certain measures that can be recommended as a policy to the government, said Mida CEO Datuk Azman Mahmud.
In terms of government assistance to encourage adoption of smart manufacturing, Mustapa said grants totalling RM995.8 million have been approved as at September 2016, under the Domestic Investment Strategic Fund (DISF), for 235 projects valued at RM11.5 billion. The approvals include RM548.2 million capital grants and RM47.3 million for the licensing and purchase of new and high technology.
Mustapa said DISF, which was launched in 2012 with an initial allocation of RM1 billion, received an additional RM1 billion from the government under the 11th Malaysia Plan. Of the total RM2 billion funding, Mida has utilised close to RM1 billion.
“This is an important fund. The government recognises that there’s a need for more funding but we understand the financial situation. When the financial situation improves, I’m sure the government will be quite amenable to increase the amount,” he said.
According to Azman, the fund not only benefits companies and industries, it also attracts investments as it is disbursed via “matching grants”.
Azman said both the private sector and the government have to play a role in investment, with the government giving the initial boost to encourage the private sector to invest, and the latter should not only rely on government funds.
Meanwhile, Mustapa said it is important for Malaysia to embrace smart manufacturing and improve productivity in order to keep pace with global developments and remain competitive.
He also said that revamping the education system, adopting more automated practices and learning from best practices are vital in developing the smart manufacturing sector.
“Malaysia has got all the assets in terms of strategic location, talent/human capital and of course, we need to make sure that our trade system responds fast enough to current developments, otherwise we would not be able to provide jobs for the future,” he added.
He said the MoU with Rockwell will open doors for companies, especially small and medium enterprises to automate themselves.