Speech by Chief Minister of Penang,YAB Chow Kon Yeow
At The Grand Launching of ICCL Phase 5
'A One Stop Logistics Centre for Regional Distribution & Centre of Excellence for Halal Logistics'
ICCL, Bukit Minyak Industrial Park
7 July 2018
Yang Berhormat Tuan Lim Guan Eng
Minister of Finance, Malaysia
Yang Berusaha Logistician (Log) Kevin Lim
Group Managing Director of ICCL Group of Companies
Yang Berhormat Dato’ Hj Abdul Halim Bin Haji Hussian
Penang State Exco for Rural Development, Consumer Affairs and Entrepreneur Development & Chairman of Halal Penang
Yang Berhormat Tuan Gooi Hsiao-leong
Bukit Tengah Assemblyman
Yang Berusaha Tuan Lim Poo Koy
Chairman of ICCL Group of Companies
Yang Berbahagia Dato’ Dr Mohd Nordin bin Mohd Nor
Director of ICCL Group of Companies
Yang Berusaha Mr Jeffery Tan
Director of ICCL Group of Companies
Friends from the Press
Ladies and Gentlemen
A very good morning to all of you. I am pleased to be invited to join you in officiating ICCL’s Phase 5 – A One Stop Logistics Centre for Regional Distribution & Centre of Excellence for Halal Logistics. I also wish to welcome YB Lim Guan Eng, our Finance Minister and also the immediate ex-Chief Minister of Penang, in joining us today despite his tight schedule.
Logistics is an important and growing industry here in Penang, with many logistics providers having set up their bases here. This is attributable largely to the continuous growth of our manufacturing sector where logistics plays an integral role in supporting the entire supply chain ecosystem.
In 2017, Penang recorded the highest approved manufacturing FDI among states in Malaysia valued at RM8.5 billion. Domestic manufacturing investment also grew 92% year-on-year to reach RM2.3 billion. For the first 3 months of 2018, our state achieved RM580 million in FDI and RM438 million in domestic investment respectively, bringing together our total investment in Q1 2018 to RM1.1 billion as reported by MIDA. It is therefore crucial for us to have a strong logistics network and service to support this continuous growth.
Thankfully, the logistics sector has also evolved to cope along with it. The traditional warehouses have now evolved to become raw material hubs, distribution centres or logistics centres, assisted by automation. The logistics service providers in Penang not only support local factories and businesses but also act as a 3PL (third party logistics) providers regionally for many countries, as international procurement centres or regional distribution centres.
In recent years, through our strategic collaborations, both on federal and state level, the Penang State Government has made great efforts to groom and grow Penang’s status as a logistics hub and a dynamic import and export gateway for the northern states of Malaysia.
The Sultan Abdul Halim Mu’adzam Shah Bridge – also known as the Second Bridge, the upcoming expansion of Penang International Airport, Penang Sentral Integrated Transport Hub and Penang Port’s expansion are some of the major high impact projects that have been and will be carried out in Penang for that purpose. This is also in tandem with the growth in movement of cargoes, where Penang Port is expecting a 10% increase in freights while Penang International Airport is estimating a growth of 15% and 6% for import and export cargoes, respectively in 2018.
With the right infrastructure and ecosystem in place, Penang is well positioned and heading the right track in developing and transforming the state to become the economic powerhouse in the northern region of Malaysia. ICCL’s investment in this new high-tech logistics centre, valued at RM51 million, will directly increase the logistics capacity for Penang, creating logistics capabilities for businesses to tap on and grow together. ICCL’s strategy on transfer of technology from experts abroad will also help to grow the capability of local logistics players.
We must also not forget about the growth of e-commerce, which is an area that will continue to flourish as the digital age continues to advance. With the consumer market being digitalised, it is now easier for consumers to even get their groceries within the same day of purchase – all through few taps of fingers. Having a strong logistics support will pave way for the e-commerce industry to continue its boom and at the same time, creates a whole new market catchment for existing brick-and-mortar businesses.
Furthermore, ICCL’s Halal Logistics Centre of Excellence is a significant initiative to grow the human capital for the expanding halal business sector. The World Islamic Economic Forum (WIEF) Foundation pointed out that halal industry is estimated to grow at 8% year-on-year at the current approximate value of US$2.3 trillion. In 2017, the halal export in Malaysia alone hit a total of RM43.4 billion, with the food and beverage industry taking the huge chunk at RM20.1 billion itself. Here in Penang, the Penang International Halal Hub (PIHH) drives the industry forward and to transform the state into the major centre for the halal market.
The global cold chain market itself is huge – estimated at around US$110 billion and is expected to reach US$272 billion by 2020. In Malaysia, the cold chain industry is valued at approximately RM60 billion according to a US Trade report in 2016. This is contributed largely by the modern retailers, of which in 2015, 47% of them outsourced their cold chain logistics.
The Penang State Government is committed to support and facilitate the growth of the manufacturing and logistics sector through agencies such as investPenang, Penang Development Corporation and Penang International Halal Hub. Transformative initiatives such as automation, robotics, Internet of Things, and active participation in Industry 4.0 will continue to take prominence in our agenda to drive the state forward, and I would like to commend ICCL for taking the lead in automating their logistics centre.
Once again, please accept my heartiest congratulations on the occasion of your launching of Phase 5 here in Bukit Minyak Industrial Park. I wish ICCL a total success in your upcoming endeavours.