CYBERJAYA, Malaysia, 6 September 2003 — Malaysia’s seven-year-old high-tech Multimedia Super Corridor (MSC) has surpassed expectations and will be expanded and linked with similar cyber-cities worldwide, Prime Minister Mahathir Mohamad said yesterday.
Sales in the MSC, launched in 1996 as Asia’s answer to California’s Silicon Valley, hit over four billion ringgit ($588 million) last year and are projected to reach 5.85 billion ringgit this year, he said.
More than 900 firms, including 59 world-class companies, are operating in the zone, nearly double the government’s goal of 500 firms by this year, he told a news conference after annual talks with members of the MSC international advisory panel.
Some 21,000 skilled jobs are expected to be created this year, up from 17,000 last year.
“We have done far better than the targeted objectives in terms of numbers but things are changing very rapidly and we have to be more innovative to remain relevant and to attract investors,” Mahathir said. “We are still trying to improve the climate and attractiveness of the MSC.”
Under the second phase of development, the 77-year-old premier said the government would set up high-tech centers in other states to establish a web of corridors and may allow companies based there to enjoy tax breaks and privileges currently given to MSC firms. “The key theme centers around the need to go global and to develop the necessary innovative capabilities,” Mahathir said.
“The MSC, as a global ICT (information, communication, technology) hub, needs to develop habitat for entrepreneurship and innovation, new business models and new technology adoption. There is a need for high quality talent and new partnerships between local developers. The key objective is to become (the) regional and global leader in specialized opportunity areas.”
The MSC is the brainchild of Mahathir who wants to turn Malaysia into a developed nation by 2020. Capital expenditure in the zone is seen rising to 850 million ringgit this year, up 37 percent from 2002, officials said. The second development phase involves linking the MSC to other cyber-cities, setting a global framework for cyber-laws and to have 250 world-class companies by 2010, officials said.
The third and final phase to 2020 will see Malaysia transformed into a knowledge-based economy with 500 world-class firms and establishing an “International Cyber-court of Justice”. Industry analysts said the MSC was creating jobs faster than the number of skilled workers churned out by the education system.
Mahathir, however, said the country had sufficient manpower and needed to simply increase training for its people. Investment in the MSC has picked up pace in the past year, with British banking group HSBC, Sweden’s telecoms firm Ericsson and German luxury carmaker BMW launching regional centers in the zone.
Derek Williams, Oracle Corp. executive vice president for Asia Pacific, said a key growth sector for the MSC was software exports. For example, he said, a local firm has developed airport management system software jointly with Oracle that has been sold to 12 airports worldwide, including the United States.
Bob Bishop, chairman and chief executive of Silicon Graphics Inc., said he foresees “more customization of designs for Asia and the MSC is branching out in that direction.” Stan Shih, chairman and chief executive of Taiwan’s Acer Group, said there had been “lots of progress” in the MSC but cooperation with other countries was vital because Malaysia, like Taiwan, was a small market.
“Why are US companies ahead in this industry? Because they are a huge market, so closer partnership is required (in the MSC),” he said. “The future of Asia, the next economic growth engine (in the region) except China, is the knowledge-based service industry.” Acer, which has a factory in northern Penang state, has plans to set up an office in the MSC in two years, he added.
