KUALA LUMPUR: High-value job opportunities are among the focuses of the newly launched New Industrial Master Plan (NIMP) 2030 as Putrajaya seeks to expand the middle class, says Prime Minister Datuk Seri Anwar Ibrahim.
He said global trends such as the rising role of IR4.0 technology, climate change and sustainability practices, demographic shifts and the globalisation of value chains are changing the nature of jobs.
“Skills transformation is key to developing future competencies and this has been set as a focus of our industrial strategy,” he said when launching the NIMP 2030 at Menara Miti here yesterday.
Anwar said the NIMP 2030 will see the implementation of a progressive wage system that promotes skill development and career advancement.
“Public-private collaborations will be enhanced in the TVET (Technical and Vocational Education Training) and STEM (Science, Technology, Engineering and Mathematics) programmes, ensuring the acquisition of skills required by the industry,” he added.
Anwar said the government’s Economy Madani framework and NIMP 2030 are both aligned in their focus on improving the lives of the people through projected higher returns from the national economic targets.
“This includes employment with meaningful wages and wealth-sharing to build a more equitable and prosperous society,” he said.
Anwar also said employment will see a projected growth of 2.3% from 2023, which is set to provide employment for 3.3 million people by 2030.
“The industry’s growing employment trajectory is due to the creation of high-skilled jobs as the country advances towards higher value-added activities and via improvements in automation and technological advancements,” he added.
Most importantly, said Anwar, through interventions under NIMP 2030, the median salary for the manufacturing sector is expected to grow to reach RM4,510 from RM1,976, which is below the national average.
“This 128% increase from 2021 will be driven by the shift of the industry towards higher value-added activities and the high-skilled job opportunities being created,” he said.
Anwar also said the NIMP 2030 will create more opportunities for local small and medium enterprises (SMEs) to grow through specific action plans. He said SMEs in manufacturing currently contribute only 8% to the GDP (gross domestic product) and 9% to exports.
For a more prosperous society: Anwar (centre) launching the NIMP 2030. He is flanked by Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi (left) and Tengku Datuk Seri Zafrul. — Bernama
“There is a lot of potential to grow our SMEs in manufacturing, in line with our Economy Madani aspiration to strengthen firms of all sizes,” he said, adding that the plans to develop SMEs’ capacities will enable them to be positioned higher in the global value chain.
“This, in turn, will help them scale up into mid-tier companies that could help Malaysia make more foreign exchange earnings.”
Anwar also said he was made to understand that the International Trade and Industry Ministry will launch a new framework in a few weeks to build SMEs’ environmental sustainable goals (ESG) capacity.
“This is important to ensure SMEs’ continued participation in ESG-compliant multinational vendor ecosystems and continued access to ESG-sensitive export markets,” he added.
The NIMP 2030 outlines Putrajaya’s plans to transform Malaysia into a high-tech, industrialised nation.
Relationship reset: Raimondo (centre) visiting Boeing Shanghai Aviation Service Co. In her meetings with Chinese officials, she raised the issue of unfair trade practices. — AFP
Shanghai: The United States wants to work with China to ensure a more “predictable” environment for American businesses in Shanghai, Commerce Secretary Gina Raimondo told officials in the economic hub yesterday.
Speaking with Shanghai Communist Party chief Chen Jining on day four of a bridge-building trip to China, Raimondo said a “stable economic relationship is good for America, good for China and good for the world”.
“The US-China economic relationship is among the most consequential in the world,” she told Chen.
Raimondo told Chen she was looking forward to talks to “bring about a more predictable business environment, predictable regulatory environment, and a level playing field for American businesses here in Shanghai”.
US firms in China have long complained about what they see as an unfair business environment, with limited protection for intellectual property and preferential treatment afforded to domestic competitors.
Those fears have been compounded this year by a broad crackdown on US consulting firms operating in China.
A new anti-espionage law, which came into force on July 1, has also spooked foreign and domestic firms as they try to decipher authorities’ intentions and, crucially, pinpoint what is off-limits.
In a Tuesday meeting with Vice Premier He Lifeng in Beijing, Raimondo raised what Washington sees as unfair trade practices by China, according to a US Department of Commerce statement.
She also emphasised the “importance of strengthening the protection of trade secrets for US businesses operating in China”.
The commerce secretary is one of a number of senior US officials to visit China in recent months – part of an effort by Washington to improve its working relationship with its largest strategic rival.
Raimondo has used the trip to seek more open discussions with the Chinese over restrictive trade curbs and the two sides have agreed to set up a working group to iron out the laundry list of trade disputes between them. — AFP
After having wrapped up a four-day high-stakes visit to China which she described as "successful and productive," US Commerce Secretary Gina Raimondo on Sunday (local time) pointed the finger at China's business environment, talked down China's economy and defended US
The participation by foreign companies and the large number of deals announced at the 2023 China International Fair for Trade in Services (CIFTIS), one of the world's largest services trade fairs, showcased the attractiveness of China's services sector and defied Western media hype that the Chinese economy faces a gloomy future, Chinese analysts and observers said on Sunday.
China's Ministry of Commerce (MOFCOM) has given a further explanation on the results of the latest trade talks amid US Commerce Secretary Gina Raimondo's visit to China, saying the two nations' trade ministers have agreed to meet at least once a year, and will talk directly on "key issues" in ...
Malaysia celebrates 66th anniversary of independence -
PETALING JAYA: It is not vernacular schools causing national disunity, but politicians like Tun Dr Mahathir Mohamad, says Sungai Buloh MP Datuk R. Ramanan.
The Malaysian Indian Transformation Unit (Mitra) Special Committee chairman said it was most regrettable that Dr Mahathir had to resort to a seditious statement in calling for the abolishment of vernacular schools recently.
At 98 years old, Dr Mahathir should play the role of bringing Malaysians together instead of creating division, said Ramanan, who is also PKR deputy information chief. As such, he urged the former prime minister to “stop his continuous inflammatory statements which bring no value to national unity”.
Ramanan also pointed out that unlike private schools, vernacular schools funded by the Federal Government have existed since our independence and are part of the national school system.
“The Chinese primary schools, for example, have over 100,000 Malays, Indians and other bumiputras, and like Indian primary schools, they play a major role in nation-building.
“I invite Dr Mahathir to visit these schools for himself and see their contribution to national unity in their programmes and syllabus,” said Ramanan in a statement yesterday.
He also said that some of the best talents have graduated from these primary schools and are occupying high positions in the government and private sector.
As a result of the existence of these schools, Malaysians have been able to have a grasp of Mandarin and Tamil, which are linguistic assets, said Ramanan.
“One reason why Malays and Indians are sending their children to these vernacular schools for six years of primary education is because they want their children to learn Mandarin or Tamil,” said Ramanan.
He added that with China and India being major economies, Malaysians who are able to speak these languages are marketable and sought after.
Ramanan also said that Bahasa Malaysia is also highly emphasised in these schools.
“It’s unfortunate that Dr Mahathir has chosen to see everything from a racial angle to ensure that he is in the news,” he said, while also questioning if Dr Mahathir’s grandchildren attended private or international schools or studied in national schools.
Ramanan said he was initially very hesitant to respond to Dr Mahathir’s remarks about abolishing vernacular schools, but felt that a rebuttal was necessary to put the record straight.
“It is most unfortunate that Dr Mahathir still refers to Malaysians who are not Malays as pendatang (immigrants) as we celebrate the nation’s 66th anniversary.
“Let me quote American civil rights leader, Martin Luther King Jr, who said ‘we all come in different ships but we are in the same boat now’.
“That is the destiny of all Malaysians, regardless of our race and religion,” he said.
The world’s largest producer and consumer of tobacco, it has an estimated 300 million smokers, nearly a third of the world’s total.
Despite years of anti-smoking campaigns – Chinese President Xi Jinping reportedly gave up smoking in his 40s and banned smoking in government buildings – many continue to light up, driven by social mores, cheap cigarettes, a lack of public education and, crucially, the protection of Big Tobacco.
Cartons of smokes are considered appropriate business gifts while tobacco shops dot the streets, with prices ranging from as little as 10 yuan (RM6.40) a packet to over 200 yuan (RM127.70). Convenience stores prominently display a dizzying array of varieties.
But kicking the habit is far harder than simply going cold turkey. The tobacco industry is both regulated and controlled by the State Tobacco Monopoly Administration (STMA), an agency that provides jobs for over half a million people across the country.
In recent years, the problem has taken on a new dimension with the startling popularity of electronic cigarettes, making nicotine palatable – and readily available – even to the young.
How did the world’s second-largest economy get so addicted to smoking? And as the world moves towards tobacco-free societies, would it ever be truly possible for China to kick the habit?
Cigarette normalisation
Shortly after the establishment of the People’s Republic of China in 1949, Beijing declared that tobacco farms and cigarette manufacturing would be consolidated and managed by local governments.
When the country was put through rationing in those early years, cigarettes were among the “essentials” doled out to villagers and residents who registered with the local authorities, allowing officials to document the population.
Cigarette manufacturers also tapped iconography significant to China’s national consciousness. Brands like Xiongmao (Panda), Chunghwa (a metonym for China) and Zhongnaihai (a former imperial garden that now houses China’s leadership complex) all date back as far as the 1930s.
By the time STMA and its commercial arm China National Tobacco Corporation were created in the 1980s to consolidate and centralise tobacco production and sales, smoking was widely accepted.
Leaders ranging from Mao Zedong to Premier Zhou Enlai and Deng Xiaoping have all been photographed holding cigarettes, with ashtrays and spittoons commonplace in offices and government buildings across the country.
And it continues to play a significant role in society today.
When bistro owner Jeanne He was a bridesmaid in 2022 at a childhood friend’s wedding in Yunnan province – the country’s largest producer of tobacco – she had an important responsibility.
“I was in charge of arranging the cigarettes on trays for bridesmaids to hold up and offer to guests before the wedding dinner,” she said.
“The groomsmen had trays of snacks and candy.”
In much of China, working in the tobacco industry is seen to be as prestigious as being in the civil service, with its stable income, generous salaries and employee benefits.
In surveys of fresh graduates, China’s big tobacco firms – largely state-owned enterprises (SOE) – are consistently rated some of the best companies to work for, with degree holders happy to take on blue-collar jobs on the factory lines.
Some 98% of China’s tobacco firms are SOEs with little wiggle room for other market players. Manufacturing some 2.4 trillion cigarettes a year, the industry raked in 132 billion yuan in profits in 2022, nearly 12% up from the 118 billion yuan the year before.
China National Tobacco Corporation does not report sales figures but posted a record-breaking taxable income of 1.44 trillion yuan in 2022.
The second-highest tax payer, the Industrial and Commercial Bank of China, reported taxable income of 109 billion yuan.
The pressure that STMA exerts on the government is largely why tobacco regulation has hit a roadblock, said Dr Gan Quan, director of the China office of the International Union Against Tuberculosis and Lung Disease, a Paris-headquartered non-profit organisation aimed at eradicating tuberculosis and lung disease.
While major cities such as Beijing, Shanghai, Guangzhou and Shenzhen have been able to completely ban smoking indoors since 2007, this has been far more challenging in other cities like Chongqing.
In 2020, the city passed a law banning smoking in public places, but a loophole meant that certain establishments such as restaurants, hotels and entertainment venues were allowed to set up indoor smoking areas, exposing countless others to second-hand smoke.
“Smoking is strictly prohibited in the indoor areas of public places where smoking areas can be designated,” said the text of the law.
Dr Gan, who has spent his career studying China’s tobacco control policies, said: “It has become a pattern that whenever sub-national jurisdictions try to pass smoke-free laws, you have the STMA following them (to exert pressure to water down the laws) because they don’t want the momentum to spread from big cities like Beijing and Shanghai.”
Crucially, there is no national-level smoke-free legislation that will make it mandatory for all provinces and regions to adhere to, wrote Peking Union Medical College’s Dr Xia Wan in CCDC Weekly, a publication by the Chinese Centre for Disease Control and Prevention, in an article in 2022.
In November 2014, the State Council released a draft on national tobacco control guidelines to meet its obligations under the WHO FCTC, the first time such guidelines had been introduced at a national level.
“This draft was supposed to finish seeking advice, opinions and comments from the public by the end of 2014,” Dr Xia wrote.
“But unfortunately, the draft is still stuck in that stage and has not progressed further.”
Furthermore, regulation across cities remains lax, and it is not an uncommon sight to see people lighting up under “no smoking” signs in eateries.
STMA did not respond to a request for comment.
In 2021, China’s top health body, the National Health Commission, released its second report detailing the ill effects of smoking – an update from a 2012 version.
With more than half the male population smoking, over one million people lose their lives to tobacco use every year, a number that could double by 2030.
It also noted that “e-cigarettes are unsafe and pose a health hazard” but offered no solutions to the issue.
Electronic cigarettes
Electronic cigarettes and electronic nicotine delivery systems – more commonly known as vapes – have been regulated in China since 2022, and cartridges with flavours have been banned in a bid to stop young people from picking up smoking.
But results are mixed: While such vapes are no longer easily available, one can still walk up to any number of e-cigarette shops dotting the streets, where retailers pull out flavoured stock from under the counter.
In private chats on social media platform WeChat, sellers also directly market to consumers, sending catalogues every time a new flavour hits the market.
At a shop in Beijing, where this reporter was offered an ice lemon tea-flavoured vape, the shop assistant said it was impossible to stamp out demand.
“We’re just more discreet about it and don’t display what we have on offer. Also, if we see young people coming in to buy, we won’t sell to them,” said the assistant, who wanted to be known only by her surname Su.
In eateries and even shops across major cities, people can still be seen puffing away indoors, leaving cloyingly sweet vapour in their wake.
With smoking so socially accepted, those who have successfully quit say it usually takes a life-changing event to provide a much-needed jolt.
Aircraft engineer Li Peng, 52, kicked the 30-year habit only after discovering nodules in his lungs during a medical check two years ago.
“I’ve been smoking since I was a young apprentice nearly 30 years ago, and even though my wife kept urging me to quit, I found it hard because it’s such a social activity, too,” he said.
“After the medical scare, where the doctor told me I could either quit or risk it developing into something more severe, I got the boost I needed to go cold turkey.
“But I’ll admit it was very difficult in the beginning, especially during mornings in the toilet.”
Yet, given the industry’s strong hold over the market, China is unlikely to go cold turkey any time soon.
Dr Gan said: “The anti-smoking lobby is calling for the tobacco monopoly to be broken up from the regulator, but I don’t think the government is willing or interested in doing that because it takes huge political will and capital.”
Since 2021, STMA has been swept up in a corruption probe that has involved nearly two dozen current and former senior executives, including the retired head of an Anhui subsidiary who killed himself after investigations started.
The arrests and investigation of several top STMA officials for corruption are merely part of the anti-corruption campaign rather than an attempt to reform and rein in the tobacco industry, Dr Gan noted.
“The main issue is really a lack of (anti-smoking) education... for instance, if you compare cigarette packets to places like Hong Kong and Singapore, the language is very weak and not prominently displayed,” he said.
“And we don’t do that because of opposition from the tobacco monopoly.” — The Straits Times/ANN
The writer,ELIZABETH LAW is the China Correspondent at The Straits Times.
CHINA’S stuttering economic recovery post-Covid-19 pandemic reopening has stirred concerns that a protracted deep economic slowdown will have global repercussions, given its interconnectedness with each and every economy in this globalised world and transmission to both emerging and developed countries through different channels.
A slowing China economy is a bane for the world economy. While the global economy continues to gradually recover in 2023, the growth remains weak and low by historical standards, and the balance of risk remains tilted to the downside. It is not out of the woods yet.
Global manufacturing and services activities are losing momentum. Global trade, especially exports, remain in the doldrums, weighed down by weak consumer and business spending amid a continued inventory adjustment in the semiconductor sector.
Prices of commodities and energy have also softened. Global monetary tightening has started to weigh down on activity, credit demand, households and firms’ financial burden, putting pressure on the real estate market.
A slew of disappointing economic data for two consecutive months (June and July) from China indicated that the world’s second-largest economy (17.8% of the world’s gross domestic product or GDP) is indeed losing steam.
Falling exports, weak consumer spending, slowing growth in fixed investment and continued concerns about the property sector have dampened the recovery.
The emergence of deflation concerns adds to the complexity of China’s flagging recovery.
The Chinese government has provided a range of strategic measures aimed at targeting specific sectors.
These range from consumption (spending on new energy vehicles, home appliances, electronics, catering and tourism) to the property sector (reducing down-payment ratios for first-time homebuyers, lowering mortgage rates and easing purchase restrictions for buying a second house) and tax relief measures to support small businesses, tech startups and rural households.
China’s slowdown is a key risk for the world economy, commodities and energy markets as well as the semiconductor industry.
Prior to the Covid-19 pandemic, China was the world’s most important source of international travellers, accounting for 20% of total spending in international tourism (US$255bil overseas and making 166 million overseas trips in 2019).
We consider three channels through which China’s slowdown can have spillover effects on Malaysia via direct and indirect transmissions: trade and commodity prices, services and financial markets.
Overall, the estimated impact of a 1% decline in China’s GDP growth could impact about 0.5% points on Malaysia’s economic growth.
Trade is the most important channel as China has been Malaysia’s largest trading partner since 2009, with a total trade share of 16.8% (exports share: 13.1%; imports share: 21.2%) in the first half of 2023 (1H23).
Spillovers from slower China demand and commodity prices are negative for Malaysia, a net commodity exporter.
After recording seven successive years of increases in exports to China since 2017, Malaysia’s exports to China declined by 8.8% in 1H23.
In sectors such as tourism, China’s tourists are one of the major foreign tourists in Malaysia. In the first five months of 2023, Chinese tourists totalled 403,121 persons or 5.4% of total international tourists in Malaysia, and was only 12.9% of 3.1 million persons in 2019.
According to the Malaysia Inbound Tourism Association, though the number of Chinese tour groups coming to Malaysia has increased in July and August to between 800 and 1,000 for the summer vacation, the number of tourists per group is smaller between 10 and 20 persons.
While direct financial links between China and Malaysia are limited, there will be indirect spillovers through spikes in global financial volatility as investors worry that China’s deep economic slowdown would temper global growth, and also has spillovers to the US economy.
Will China foreign direct investment (FDI) inflows into Malaysia slow?
Capital movements will be influenced by the inter-linking of factors such as economic growth and investment prospects in the host country (Malaysia).
These include stable political conditions and good economic and financial management as well as conducive investment policies.
The US-China trade war and rising trends of geoeconomic fragmentation have witnessed FDI flows among geopolitically aligned economies that are closer geographically as well as geopolitical preferences.
Throughout the period 2015-2022, China’s gross FDI inflows into Malaysia averaged RM7.5bil per year. Even during the Covid-19 pandemic, China’s economic slowdown did not deter the inflows of FDI into Malaysia (RM7.8bil in 2020; RM8.1bil in 2021; and RM9.8bil in 2022).
In 1H23, China’s gross FDI inflows increased by 25.2% to RM2.1bil though it is likely that the full-year FDI will be below the average FDI inflows of RM8.6bil per year in 2020 to 2022.
China was the largest foreign investor in Malaysia’s manufacturing sector in 2016 to 2022 before dropping to second position in 2022 and the fourth position in 2021.
There was a contrasting picture when it comes to China’s approved investment in the manufacturing sector, which saw two consecutive years of decline (2022: 42.5% to RM9.6bil and 2021: 6.5% to RM16.6bil) and declining further by 17.8% to RM4.3bil in the first quarter of 2023.
We believe that Malaysia will remain one of the preferred investment destinations to China, given both countries’ strong established friendship and bilateral ties in trade and investment as well as people-to-people movements.
Malaysia needs to enhance its investment climate with progressive policies to rival regional peers to offer the country as a China Plus One destination for China and foreign companies.
Malaysia can offer investments to build a chip-testing and packaging factory, advanced manufacturing technologies such as robotics and automation, manufacturing electric vehicle supply chain, petrochemicals, renewable energy, agriculture and food processing.
China can offer the technology, innovation and technical know-how as well as talent that deepen the country’s industry integration with global supply chains and also links Malaysia and China to South-East Asia.
China can invest in Malaysian manufacturing companies to help them adopt advanced manufacturing technologies and further improve their competitiveness.
The RM170bil prospective investments (comprising RM69.7bil from 19 memoranda of understanding and RM100.3bil from the round-table meeting) concluded during the prime minister’s visit to China are set to provide a massive investment boost to our economy for years to come.
Among these are China’s Rongsheng Petrochemical Holdings, which will invest RM80bil to build a petrochemical park in Pengerang, Johor; and investment from Geely, with an initial investment of RM2bil in the Tanjung Malim Automotive Valley, which will gradually increase to RM23bil in the future.
LEE HENG GUIE is Socio-Economic Research Centre executive director. The views expressed here are the writer’s own.
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