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By Himanshu Bhatt. CONCERNED about the state of the economy, many Penangites may well say they have been waiting for this. In June, an "Outlook Forum" to look into the restructuring and reshaping of Penang was held in the state, in an initiative by the Socio-Economic & Environmental Research Institute (SE) and the Institute of Southeast Asian Studies (Iseas) Singapore.
What was significant about the forum was the particular juncture at which it was held – a bit more than a year after the political upheaval in the state that had seen a new government and just as the state was emerging from the throes of a global financial crisis. Those who attended were made to hear complex assessments of Penang’s past achievements, present capabilities and future growth potential. But there was one particular outcome of the event that has not been given its due publicity – an initiative to formulate a Penang Blueprint, a comprehensive policy for the development of Penang’s economy and society for the period 2011 to 2020. Mind you, there have been strategies prepared by the previous government before this. While the current government has naturally inherited some of the programmes left behind by its predecessor, the economic climate and political situation today have changed somewhat and perhaps warrant the drafting of a fresh blueprint. For example, there is a need to attract talent back to the state, even as the whole country faces a shortage of much-needed human capital. Penang needs to be made attractive to both individuals and companies. For this, there must be affordable housing, good infrastructure, efficient public transportation and good public services. It was therefore deemed necessary to revamp existing strategies for new growth directions and create a more equitable society as the state re-adapts to find its niche in an intensified globalised environment. And one particular area that people are feeling expectant – even impatient – about is the economy. Without a concrete plan or vision being publicised, the business community and the public may fall under the impression that the administration is guided by patchwork decisions and economic fire-fighting. The state has already set up the guiding framework for the blueprint, which is expected to be prepared by the fourth quarter of next year. So for the benefit of the public, here is the preliminary framework for the economic aspects of the blueprint as outlined by Chief Minister Lim Guan Eng: - Diversification of the economy. In the 70s and 80s, Penang was known as a low-cost manufacturing location. For the government, now is the time to hasten the conversion of the economy from a "sweat-shop" to a "smart-shop". In particular, the state wants to chart new areas where there could be a new era of "sunrise industries". There is a need especially to foster a more balanced composition between the electrical and electronics (E&E) and non-E&E sectors. The state now wants to attract foreign direct and domestic investment in non-E&E and resilient industries like avionics, oil and gas-related manufacturing, and medical devices. It is also set to explore the halal products industry.
- Institutions to spearhead competitiveness. Three new ins-titutions are geared to boost Penang’s competitive edge. They are the Centre of Excellence in Microelectronics, Innovation Centre for Bio-tech and Medical Devices, and an Allied Healthcare Practitioners Centre of Excellence.
- Rejuvenating tourism. Penang already attracts almost 10% of the total number of foreign tourists visiting Malaysia annually and two-thirds of the country’s medical tourism revenue. It wants to intensify its promotion by leveraging on George Town’s World Heritage Site status given by Unesco. There is also a plan to develop more MICE (meetings, incentives, conferences and exhibitions) facilities with the development of a new convention centre already on the drawing board.
- Promote Penang as an outsourcing centre. Penang has developed a reputation in this area in three key activities – information technology outsourcing, business process outsourcing and knowledge process outsourcing. It is now looking at providing business matching and outsourcing facilitation to boost this business.
- Assistance to small and med-ium scale enterprises (SMEs). Penang is looking at forming an SME market Advisory Resource and Training Centre to help local companies get market access, resources and information, business advisory and training and development. InvestPenang will provide a website to disseminate information helpful to Penang SMEs, and conduct supply chain research to enable promoted industries to identify opportunities and gaps that exist.
- Upgrade of logistical infrastructure. Penang has been awarded RM250 million by the federal government to upgrade the Penang International Airport and RM1.1 billion by the Northern Corridor Implementation Agency to improve the seaport. Once the projects are completed, the two facilities will be strong drivers of the state’s economy.
A policy is important to set the guiding path for a government, industries and communities. And as the state treads on the arduous task of preparing its Penang Blueprint, it is just as important that it heighten publicity for its economic framework, for the people to understand the new strategy that they are all going to be part of. *Reproduced with permission. This article first appeared in the November 26, 2009 issue of theSun. Himanshu is newspaper's Penang bureau chief.
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