YAB DATO’ SRI MOHD NAJIB BIN TUN HAJI ABDUL RAZAK
PRIME MINISTER OF MALAYSIA
AT THE ‘NEW YORK INVEST MALAYSIA 2011’
ON 17TH MAY 2011 (TUESDAY)
AT NEW YORK
Ladies and Gentlemen, business leaders of America, distinguished guests.
- Let me first extend my gratitude to Larry Leibowitz, COO of NYSE Euronext, for hosting Invest Malaysia 2011 and for giving me this opportunity to showcase the best of our country, and let me also thank all of you for taking the time to attend this afternoon’s event.
- I’m delighted to be back in the United States, to be in this great city of New York, and of course to be here at the New York Stock Exchange. As they say, nothing compares to New York City in the Spring – and what a Spring this is, a time of optimism not just here in the United States but in the Arab world and right around the globe.
- The New York Stock Exchange has long been a source of hope – a towering symbol of American prosperity and a beacon of light in the dark days that followed 9/11. The flag that was draped in front of this building then has remained here as ever since as a reminder of what humans are capable of at their best and worst, and today we stand on Wall Street bolstered in our quest to build a world free from extremism and terror.
- In America, of course, the spirit of optimism and the spirit of enterprise have long gone hand in hand. That is the American Dream – the belief that life can be better and richer and fuller for everyone. But to live that life and to achieve that dream, we need investment. Investors are the drivers of prosperity, the engines of growth – something that I know is recognised by President Obama, who used the word investment 13 times in his State of the Union address, and something that I recognise as well.
- Maybe it’s my background in industrial economics but coming here to America I’ve been reminded of the great industrialist Henry Ford. Ford was of course the father of mass production, but what is perhaps less widely known is that a big part of his success was down to his radical decision to pay his workers more – a move that caused widespread bemusement among his fellow industrialists at the time! It was, as it turned out, a very good call – a bold and far-sighted decision that meant he succeeded in creating his own market as workers were able for the first time to afford cars of their own.
- You might think those days are long gone, and with the advent of the new knowledge economy we are certainly very much in a post-industrial age, but this remains, it seems to me, a pretty good illustration of why the interests of Government and the interests of business go hand in hand – or to put it more bluntly, why improving living standards and increasing profitability are two sides of the same coin.
- You could call Henry Ford a pragmatic visionary: he saw the forest and left the trees to the wagon-makers. And today Ford Motors, which listed right here on the New York Stock Exchange back in 1956, recently posted its best first-quarter profit for 13 years.
- As a company it weathered many storms, learnt from its mistakes and evolved to win, just as today Malaysia is doing as a nation – and I am determined to push through the changes we are going to need to drive our transformation. We recognise that what got us where we are today – a middle-income, developing nation – may not get us where we want to be tomorrow – a high income, developed nation.
- So we are determined to develop and adapt – and when you invest in Malaysia, as a result of our transformation programmes you now get over $440 billion dollars in opportunities. You get access to a market of more than 600 million people with a GDP estimated to top two trillion dollars this year. And, as our trading system is powered by the NYSE Euronext platform, you get all this only milliseconds away.
- Malaysia is a multiethnic nation made up of Malays, Chinese and Indians, and since taking office I have resolved to build an open and equitable society in which all Malaysians have an opportunity to flourish, introducing the 1Malaysia policy as a new national banner behind which all of Malaysia’s citizens can unite.
- This is a determinedly democratic impulse and one that is underpinned by my commitment to furthering national unity and social justice, but I make no apologies for saying that it is also about leveraging our economic strength.
- If we are to continue to compete in the new global economy we must make the most of the talents of all our people and not just some of them – reaching out to Malays, Chinese and Indians alike and uniting in the spirit of 1Malaysia to enable each to play their part. For just as America’s great melting pot has always been a source of strength, I am equally clear that there is strength in Malaysia’s diversity.
- The enterprising spirit that made America great has also been key to our success, leading Malaysian companies to command a sizable footprint throughout ASEAN, Asia and the world. I have brought with me today the captains of ten of our of most successful companies including Air Asia, the world’s best low cost carrier; Axiata, which has over 150 million mobile subscribers serving the needs of over 1.5 billion people across 10 countries; and two of ASEAN’s top five banking groups, Maybank and CIMB. They are just some of the many Malaysian companies that are raising the game in ASEAN and beyond.
- Malaysia’s rich historical links with China, India and the Middle East mean we are able to engage with new and emerging centres of economic growth at the same time as developing our relationship with the West.
- This is why more than 5,000 companies from over 60 nations have opened their doors in Malaysia. Already, we are home to more than 160 Operational HQs, 209 International Procurement Centres, 19 Regional Distribution Centres – and these numbers are set to grow.
- So I can confidently say to you today: Invest in Malaysia and you’ll get the whole of Asia. It really is as simple as that.
- Two years ago I announced the liberalisation of 27 service sub-sectors, allowing foreign investors unrestricted market access with 100 per cent equity. It was an enterprising move, undertaken at the height of the financial crisis to send a clear signal to the world that Malaysia – the outward looking face of South East Asia – was open for business at a time when others were turning inwards and taking refuge in the short-term comforts of protectionism.
- Since then we have taken a number of steps to boost the development of Malaysia’s services sectors, including drawing up a roadmap to build the capacity of our SMEs as an important economic driver. We expect the services sector, excluding government services, to grow by more than 7 per cent a year until 2015, raising its contribution to GDP to 61%.
- The era of “government knows best” is over. It’s not my job to tell you how to run your businesses – with a market capitalization of more than $13 trillion, the companies listed on the New York Stock Exchange clearly need no lessons from me. But it IS my job to create an environment in which business is able to flourish.
- That is why, early last year, I created the Government Transformation Programme, or GTP . Its aims are twofold – to make the government’s delivery of public services more effective and to move Malaysia forward to become an advanced, united and equitable society with high standards of living for all.
- I am mindful that this will not be easy, for change seldom is, but I am proud to say that the GTP is already producing real results.
- The new My Procurement website has radically increased the level of transparency involved in government tenders. Details of successful bidders for the 3,500 government contracts are now listed online, making it easier to identify and to prevent corruption. And the new Whistleblower Act makes it straightforward and simple for government employees to report their concerns. Added to this, street crime is down by 15 per cent, the largest year-on-year drop in our country’s history, making Malaysia is a safer place than ever to do business.
- Last October we launched the Economic Transformation Programme, a long-term strategy designed to turn Malaysia into a high-income, fully developed nation by 2020. We have identified 12 key areas that can drive economic growth, and have developed 131 Entry Point Projects to kick-start development across those sectors.
- From building a home appliance manufacturing hub to accelerating the replanting of oil palms, and from ensuring high-speed broadband for all to positioning Malaysia as a centre for duty-free shopping, we are investing billions of dollars in our country’s economic future.
- It is has only been just over six months since we started this process, but already we have launched 72 projects and initiatives across 54 separate Entry Point Projects.
- The total investment commitment so far stands over 35 billion dollars, and we expect it to create almost 298,000 jobs over the next ten years.
- Our commitment to developing the Malaysian economy has not got gone unnoticed internationally. Last year foreign investments in approved projects amounted to almost $10 billion, an increase of almost 32 per cent on the previous year. And the biggest source of foreign investments? None other than the United States of America.
- This pattern of foreign investment growth looks set to continue in 2011. Last month Japanese trading and investment giant Misui paid 1.1 billion dollars for a 30 per cent stake in Integrated Healthcare Holdings. It is the largest foreign acquisition of a stake in a Malaysian company so far this year, and a clear reflection of the faith that international investors have in our economic stability and good governance.
- On 7 January 2011, Bourse Malaysia hit 1,572.21 points, the highest mark since 1998. We are confident that we will see even further rises following FTSE’s upgrading of Malaysia’s capital market status from Secondary to Advanced Emerging, which will take next month. Barclays Capital predicts that this will attract up to three billion dollars of new capital inflow and improve Malaysia’s place in international indices.
- But it’s not just the markets that are waking up to Malaysia’s potential. The same thing is happening in governments around the world. For example, we are one of only 11 nations approved under China’s Qualified Domestic Institutional Investor programme. The US Securities and Exchange Commission has also made Malaysia a Designated Offshore Securities Market, allowing you to trade directly in all securities listed on the Malaysian market.
- If ASEAN were a single country, it would be worth $2 trillion and rank as the 9th largest economy in the world and 3rd largest in Asia. It is home to more than 600 million consumers, most of them young and with rising incomes. The OECD expects to see ASEAN’s GDP grow by an average of 6 per cent annually over the next four years, at a time when Western economies are still struggling back from recession. The 10 members of ASEAN are drawing ever closer, through the introduction of initiatives such as ASEAN Exchanges, a collaboration between seven member states that will streamline capital markets across the association.
- The United States has consistently been Malaysia’s largest investor over the past 30 years, and many major US companies – including Microsoft, Dell and Intel – already have bases here. But in the coming decade, thanks to the ETP, GTP and the dedication of my government, Malaysia is truly going to step up to the next level.
- We already have in place the social and economic structures we will need to meet our target of developed nation status by 2020. Across the country new infrastructure is being developed to support this growth – not just dusty plans but real buildings, real roads and real bridges.
- We have incredible human capital, including Asia’s finest speakers of English as a second language, and we are taking action to attract the best and brightest Malaysians currently working overseas back home.
- We are a safe, secure and reliable place to do business, ranked fourth in the world for investor protection. And our intellectual property laws and businesses regulations are respected and enforced.
- Companies such as General Electric and Honeywell have already seen our potential and are planning to boost their investments in the coming years. National Instruments, Citigroup and St Jude Medical are also poised to significantly increase their headcounts. So Malaysia is only going one way, and the earlier you get in, the greater the rewards you will reap.
- You don’t need me to remind you of New York State’s motto — Excelsior, or “ever upward”. Since the days of the founding fathers that guiding principle – always striving to reach higher, to do better, to achieve more – has summed up the spirit not just of this city or of this state but of every American from every corner of the United States.
- But you are not alone in your ambitions. Malaysians share them too. So while many nations are still struggling out of recession, Malaysia’s economy is heading ever upward. Our levels of investment are heading ever upward. And the prospects for American companies like yours are heading ever upward too.
- Now is the time. Malaysia is the place. So join us, and together we will continue to scale new heights.
But these are not the only reasons why Malaysia is a great place to invest. Let me give you ten more.
First, we have economic strength in our diversity
Second, we let our enterprising spirit drive us
Third, we are able to capitalise on our rich heritage
Fourth, we continue to liberalise key services
Fifth, we are making government serve business and not the other way around.
But it is not just our government that is being transformed, it is our economy as well. Which brings me to my sixth point
Seventh, we are seeing record foreign investment flowing into Malaysia’s industries.
But foreign investment is also an increasing presence in our capital markets, the eighth reason to keep investing in Malaysia.
Ninth, you can make the most of ASEAN.
I have given you nine compelling reasons why Malaysia is the right place to invest. My tenth point is quite simple – now is your opportunity to get in on the ground floor.