KEYNOTE ADDRESS BY THE PENANG CHIEF MINISTER
RT. HONOURABLE MR. LIM GUAN ENG
BRIEFING ON PENANG ECONOMIC OUTLOOK AND PENANG TRANSPORT MASTER PLAN
Auditorium A, Level 5, KOMTAR
13th June 2015
A warm thank you to the emcee for the kind introduction and a very good morning – or “Ohayōgozaimasu” [‘good morning’ in Japanese] to our special guests from Japan.
First of all, welcome to Malaysia. We are very pleased to host this morning’s briefing on Penang’s economic outlook and the Penang Transport Master Plan.
1. Japan has one of the most impressive & efficient public transportation systems in the world, especially well-known for its high-technology “shinkansen” trains that can run at speeds of up to 320kmph. Even more amazing is its maglev technology trains that run at almost double the speed of “shinkansen”. I am informed that emphasis on punctuality is never compromised, with the average delay per train on the Tokaido Shinkansen was a mere 6 seconds in 2013.
2. I am also particularly captivated with Japan’s rapid growth strategy which involved land creation by the sea though reclamation. In order to create more space, land reclamation was carried out to great effect in the past decades directly resulting in the birth of the third biggest economy in the world by nominal GDP and the world's second largest developed economy.
3. Among its most recent reclamation projects include the fully-reclaimed Kansai International Airport, and Yokohama city’s Hakkeijima and Wakayama Marina City.
4. While being a top international player in transit technology, Japan is also no stranger to road construction. According to the Japan Statistical Yearbook 2015, Japan in April 2012 had approximately 1.215 million km of roads!
Ladies & Gentlemen,
5. Governed by the CAT principle of “Competency, Accountability and Transparency “since the Penang Government came into power in 2008, Penang has transformed itself into the 8th most liveable cities in Asia as well as one of the leading states in Malaysia.
6. Penang is first in Malaysia to practice the “Open Tender” for public procurement in 2008 – as part of CAT administration. As a result, we were complimented by the Auditor General Malaysia and singled out for praise by Transparency International for our fair & transparent open tender government procurement system.
Ladies & Gentlemen,
7. Today, Penang is Malaysia’s most industrialised state with more than 95% of our GDP derived from manufacturing and services. Even though Penang is the 2nd smallest State in Malaysia making up only 5.5% of Malaysia’s population and less than 0.5% of its land mass, we are certainly a force to be reckoned with by contributing 7.4% to the nation’s GDP in 2014, 7% of the total port container traffic and 12.3% of foreign tourist arrivals.
8. Penang also contributes about 22% of Malaysia’s balance of trade surplus in 2014. Our economic growth rate is expected to be 6.2% this year despite the travails of the present economic climate.
9. Penang is an open economy and a favourite destination for foreign investors. From 2008 to 2014, we managed to achieve RM48.2 billion (1.8 trillion Yen) worth of investments, which is 93% higher than the RM24.9 billion (946 billion Yen) invested from 2001 to 2007.
10. Penang was recognised by UNIDO Industrial Development Report 2009 as top 10 dynamic industrial cluster locations in the world to have demonstrated a successful manufacturing experience among developing economies. For example, Intel runs one of their global R&D hubs in Penang with over 2,000 local engineers doing R&D alone, and Penang was Intel’s first offshore manufacturing facility, set up back in the 1970s. Besides, Citibank runs their global credit transaction services from Penang with an annual transaction value of USD7.2 trillion.
11. If we can fulfil Citigroup needs, Penang can indeed be one of the future global Business Process Outsourcing (BPO) Hubs. We are also the main medical tourism hub in Malaysia and houses the regional headquarters for B Braun, the German medical device company.
12. Japanese companies also have long established their presence in the E&E cluster in Malaysia, primarily the consumer electronics segments such as the manufacture of colour television receivers and multitude of audio visual products. The consumer electronics segment contributed 0.9% of the total E&E sector in Malaysia in year 2013.
13. Total Japanese investments in the manufacturing sector in Malaysia touched RM101 billion in 2015. In fact, Japan was Malaysia’s largest foreign investor in 2014 with RM10.9 billion approved investments. With the growing interest towards Malaysia, Japanese companies are actively engaging with MIDA with the intent to locate their hub for regional operations and offices here – so let me say this – “Come to Penang”.
14. Penang with our world-recognised E&E hub, ready talent pool, quality land and excellent infrastructure will be able to accommodate your needs, especially so when the Penang South Reclamation scheme involving offshore reclamation of 4,500 acres is implemented in very near future.
15. Personally, I myself have led Investment Promotion and Mission to Japan in 2012 together with InvestPenang – the State investment promotion arm – to enhance visibility and further promote Penang as the location of choice for Japanese investors; and strengthen ties with Japanese companies in Japan to attract new investments and reinvestments in Penang.
Ladies & Gentlemen,
16. We are pleased to share that since my administration took over the State, our cash reserves have increased by 50% and our debt has been reduced by 90%, budget surpluses recorded annually since we took over the state government in 2008. We spend up to 12% on our annual budget on these socially inclusive programs.
17. Further the low unemployment rate is translated to households in Penang enjoying household income growth of 7.6% annually between 2012 and 2014. As a result of these progressive policies, our Gini Coefficient has been reduced from 0.42 in 2009 to 0.37 in 2012, an improvement of 11% over 3 years. Comparably, Japan’s Gini Coefficient of income inequality was at 0.32, close to the Organization for Economic Cooperation and Development’s (OECD) average of 0.31 in the mid-2000s.
18. Penang has a thriving E&E sector, rising tourism industry and a UNESCO World Heritage status. Penang is also a green state and we are committed to make Penang the first bicycle and green state in Malaysia en-route to being the premier destination to invest, learn, work, play and eat.
Ladies & Gentlemen,
19. Besides solving Penang’s traffic woes, the PTMP will also uplift economic dynamism in the state to far greater heights via land reclamation. It will create a new strategic commercial hub known as Smart City and will divert development pressure away from the overcrowded area surrounding George Town. Most importantly, the PTMP will be independently funded by the sale of reclaimed land belonging to the State Government.
20. I firmly believe, a sustainable development like the PTMP and SRS will propel Penang’s standing as one of Asia’s most liveable cities.
21. I would like to share a Japanese saying, “Chansu wa jibun de tsukuru mono” meaning “You create your own opportunities”. I strongly believe things won’t come to you. You have to go to them. Face obstacles? You still need to get up. You need to go. Or, you can choose to sit here and wait for help.
22. With the PTMP and SRS – we are doing just that – creating unlimited opportunities for future generations of Penangites.
23. I would like to end this speech by urging our Japanese delegates today to consider the many investment opportunities available arising from the PTMP and SRS – from construction, manufacturing, healthcare, industrial products, Smart Home technology, education, property development and even the Malaysia My Second Home Programme.
24. My sincere appreciation for your presence today. I was informed the delegation will be taken for a tour of the Bayan Lepas LRT alignment and the southern coast future SRS reclamation site, may you have a safe and fruitful visit.
25. “Doumo arigatou gozaimasu” or “Thank you very much”.