Eumcci Review January 2011

EUMCCI

Review

Volume VII No. 1 January 2011

The Business Digest of the European Union-Malaysia Chamber of Commerce and Industry

Human Capital Development

Moving Malaysia Towards 2020 KDN PP 14083/07/2011(029992)

Editorial

Malaysia needs to sell its story better abroad Economic Transformation Program demands significant involvement from the private sector Incredibly we already find ourselves at the end of the first decade of this millenium.

This period, on reflection, has been nothing short of turbulent on both natural and economic fronts. Malaysia has weathered the storms reasonably well. In 2010 GDP growth rose to around 7% and foreign direct investment grew 141% to RM17.1bn over the first nine months. Total trade in the same period increased 23% to RM864bn with exports growing more than 20% despite the strengthening ringgit. Further Malaysia was the only emerging market to reach the top 20 in the World Economic Forum’s Financial Development Index 2010, gaining five places to 17th and ranked 21st in the 2010 World Bank’s Doing Business Index. As a result of large inflows of foreign funds, yet to be controlled, the KLCI ended the year on a near three-year high.

Following the establishment of the Government Transformation Program, a map for socioeconomic growth, the supporting Economic Transformation Program was launched. This is a 10-year economic restructring plan to raise the country to developed nation status. This program demands significant involvement from the private sector, including foreign, where the private sector is expected to raise 90% of investment. The 10th Malaysia Plan was also unveiled to build a high-income and high-productivity economy. This plan targets 6% annual GDP growth and raising per capita income to $12,000.

Looking ahead what will 2011 bring for business and for the country as a whole?

There is wide speculation of a possible early general election. Various economists and government bodies are predicting GDP growth between 4.8% and 6% spurred by the ETP. In support, although Malaysia is heavily dependent on export, more emphasis has been placed on intra-Asian trade

and less on traditional markets where Europe in spite of fiscal tightening has shown a production increase. There will also be continued consumption growth leading to likely higher inflation. The various measures announced by MIDA including closer cooperation with other government agencies and ministries should assist encourage additional investment.

Going forward, being dependent on export and foreign investment, Malaysia needs to sell its story better abroad. It has recognised the need to grow its human capital partly through improved education and partly through attracting experienced Malaysians overseas even offering their spouses permanent residency. Issues of further market liberalisation and transparency are being tackled as well as the growing security concerns. The key to success of these policies lies clearly in implementation.

Within the Chamber we have continued to work with various government bodies to review mechanisms and incentives for improving the business climate. I am delighted to advise that our industry sector committees have all been running well and thank them for their diligent efforts. The Chamber has been supported during the year by three main sponsors and I wish to extend my gratitude to Qatar Airways, Nokia-Siemens Networks and FedEx. We continue to increase our membership and have successfully run a number of high profile business led events. These efforts will continue.

May I wish all our members a successful and happy new year and offer my sincere thanks for your continued support.

David Jones Chairman EUMCCI

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Published by EU-Malaysia Chamber of Commerce & Industry (EUMCCI) Office Address Suite 3.03, Menara Atlan (Naluri) 161B Jalan Ampang 50450 Kuala Lumpur, Malaysia Tel: +603-2162 6298 Fax: +603-2162 6198 E-mail: eumcci@eumcci.com Website:www.eumcci.com

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EUMCCI Board Chairman David Jones

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Honourary Treasurer Dato’ Robert Teo Directors Austria: Franz Schröder Cyprus: Wan Azuar Dato Wan Daud Czech Republic: Milan Vagner Denmark: Kim Hansen France: David Attar Finland: Jari Niemi Germany: Alexander Stedtfeld Greece: Stellios Plainiotis Ireland: Ron Anderson Italy: Alberto Ciaramicoli Malaysia: Caesar Loong Malta: Paul Vincent Galea The Netherlands: Marco Winter Poland: Czeslaw Klimczak Slovak Republic: H.E. Milan Lajciak Spain: Luis Lopez Sweden: Hans Bjornered United Kingdom: Jon Addis Editorial Committee Minna Saneri - Editor Karen van Dalsem Stefanie Braukmann Lucien De Prycker Contributing Editors Andrew McFarlane Timmy Quasem Denis Connolly Submissions Articles and other materials of interest to the general membership are actively solicited and may be sent to the Chamber. All materials submitted for publication are subject to editorial review and revisions.

Reproduction No part of the EUMCCI Review may be reproduced or transmitted in any form or by any means, electronic or mechanical without prior written permission.

Circulation 3,000 copies of the EUMCCI Review are distributed, on a quarterly basis to EUMCCI members, all Embassies, industry associations and government officials with whom the Chamber has dealings as well as to European Chambers Worldwide.

Subscription Service Subscriptions from non-members are also accepted at RM80.00 (€28.00 abroad) for 4 issues. Individual copies may be purchased at RM25.00 (€8.00 abroad).

Designed by UR Graphic Sdn Bhd Printed by Anekaprint & Packaging Sdn Bhd No. 6 & 8, Jalan Asa 8, Taman Asa Jaya 43000 Kajang, Selangor On the cover: Rosehaida Abdul Rahman, Senior General Manager in Human Resource Services, Malaysia Airports, part time student Master of Managerial Psychology. page 18

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Contents 3

EDITORIAL

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EUMCCI ACTIVITIES

14 EU NEWS 18 FEATURE Human Capital Development in Malaysia Lifelong Learning Change Agent Looking for buy-in The Key to Motivating Subordinates: Stop Trying Human Capital Management: From Recruitment Towards Retainment Upgrading the Workforce in Malaysia towards 2020 Labour Market in Malaysia

26 EVENTS EU is Pushing for Viable Business Environment to Speed up Green Growth in Malaysia Wonderful ‘Tastes of Europe’ at Annual European Wine Beer & Cheese Fest!

EUMCCI Defence & Security Committee Golf Challenge 2010 ICT Goes Green

32 MEMBERS’ CORNER 34 MALAYSIA NEWS 37 NEW MEMBERS

Chamber Activities

New, fresh look for EUMCCI Do you still recognise us? We have grown over the years to better service you, our valued members

Over the past couple of years, EUMCCI has grown and developed in various new directions.

We have grown from just a few committees, to 13 industry sector committees which function as platforms for member companies to discuss and raise issues of concern to the Malaysian Government. We now regularly organise VIP Luncheons with Ministers as keynote speakers, host panel discussions with experts from the various sectors and have launched our annual position papers – our official lobbying tool. The latest challenge we are taking up is setting up an FTA Task Force to provide valuable input for the European Commission in EUMalaysia Free Trade Agreement negotiations.

With our organisation developing, our publications also needed to reflect our improved, more dynamic organisation.

Review Magazine, new visuals and structure Based on the valued feedback from our readers, we have completed an extensive restyle of the magazine, which includes brand new features, such as interviews with members and experts, more information about the European Union, in-depth committee news and much more, all of which will make the ‘new look’ Review a much more attractive magazine to both read and advertise in.

New Website, New Features In our ‘new look’ Review, there will be more referrals to the EUMCCI website, which has also been revamped and now contains even more in-depth coverage of the most important news and events from EUMCCI,

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along with supporting documents and resources, available whenever you like.

Going forward, you’ll be able to register for our upcoming events through the website, while direct members will be able to receive additional exclusive benefits by simply logging in.

Free E-Bulletin Together with the website, we have also revamped our fortnightly free E-Bulletin, which will continue to provide subscribers with EU-Malaysian business news, information and pictures from our events, as well as links where you can find out more and special pre-announcements.

New Review Magazine Supported By...

The new Review Magazine is supported by a number of very creative and talented individuals.

To begin with, Charles Tong, Graphical Designer and Managing Director of UR Graphic, has been EUMCCI’s preferred graphic designer since the birth of the magazine in 2005. Tong has proved his skill and professionalism once again in the creation of our ‘new look’ Review for 2011.

Secondly, we have the support of Christophe Cham, Creative Director and founder of the communication agency C&CC Creations. Christophe from France, lent us his highly-valued European perspective and experience on graphical design and in creating European business magazines for this ‘new look’ Review.

Lucien de Prycker, Director & Professional Photographer from Belgazone, is a new member of the editorial committee. He is also the new photographer for the magazine and for a number of our events.

Undoubtedly, his pictures have contributed hugely to the new look of our Review magazine.

Stefanie Braukmann, General Manager, SPRG PR agency, has been a member of the editorial committee since 2008. With her vast experience in public relations, combined with her deep knowledge of the Asian and Malaysian market, she has provided valuable advice for the contents and structure of the magazine. SPRG Malaysia, which is part of the Hong Kongbased Strategic Public Relations Group , is EUMCCI’s trusted PR agency.

Chamber Activities

A green future for Malaysia

HR Committee Taps into Guinness On Monday, 15th November, EUMCCI’s Human Resources Committee visited the premises of Guinness Anchor Sdn Bhd for a truly entertaining afternoon, which comprised firstly of a brief background of Guinness Anchor Sdn Bhd, followed by a very interesting tour of the premises, during which the HR committee members got to learn about all the processes and systems in place to ensure that each pint is a perfect pint.

Hardly any other sector like the Green Technology can provide the Malaysian economy with such prosperous ‘impacts’ like a tremendous increase in employment rate; hence supporting the government to become a high income and developed nation by 2020.

With that, Malaysia has to redefine its production processes and energy supply as well as its income generation to be based in more sustainable ways to secure a prosperous future for businesses and future generation alike.

EUMCCI’s Environment, Energy and Green Technology (EEGT) Committee is very positive of Malaysia’s future in tapping into the great potential of Green Technology industry for the country’s development.

The Committee believes that EU is the perfect matching partner in terms of policies, private business orientation, focus on innovation and high technologies to drive Malaysia to be in the region.

Following that, there was a brief talk and Q&A on the HR practices at Guinness Anchor – during which so many questions were asked, that it seemed our gracious hosts from Guinness may never get to leave! Afterwards, everyone was able to sample some of the products and enjoy a networking opportunity with other HR committee members and other concerned parties. After a very enjoyable visit and as the afternoon turned to evening, it wasn’t just the rain that was ensuring people didn’t want to leave!

By T. Brandt Head of EEGT Committee

Introducing our new Wines & Spirits Committee EUMCCI is extremely pleased to introduce the new Wines & Spirits Committee, which will join alongside the other twelve active committees in raising the issues that matter, holding seminars with industry experts, facilitating dialogue and lobbying Government.

Specifically, there are a number of primary objectives of the committee and these include; a) To promote and establish a regular communication and well-informed relationship with Government authorities and other interested parties in order to create optimum acceptability of the branded alcohol products amongst Government authorities and other interested parties; b) To advocate the distribution industry of imported spirits, champagnes and wines to be competitive and to participate in activities of common interest for the well

being of the distribution industry; To assist to overcome any prejudice arising from any misunderstanding or misconception relating the said distribution industry and to promote safe and responsible consumption of the imported spirits, champagnes and wines; c) To collate all information relating to alcoholic beverages consumption issues; To provide a forum for the various Malaysian distributors to facilitate the exchange of ideas and information on matters of common interest and to promote better relationship and understanding amongst

themselves; To enhance the image of the distribution industry of imported spirits, champagnes and wines by dealing with issues in one voice.

The Committee Head is Mr. Frederic Noyere (Möet Hennessy Diageo Malaysia Sdn Bhd.), and the Deputy Head will be Mr. CK Tan (Pernod Ricard Malaysia Sdn Bhd.).

For further information, please get in contact with our Committee Coordinator, Ms. Ai Li Ch’ng-Koch, ailikoch@eumcci.com.

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Chamber Activities

European Business Organisations (EBO)

Sector Website

Since 2000, EUMCCI is a member of the EBO network and actively involved to improve communication between the commission and the private business sector.

The EBO was created in 1999 by representatives of EU business associations in non-EU countries and specific interest groups from the European Commission.

The main objective of this group is to promote exchanges of views between these associations and their host countries and to establish closer relationships between the Commission services and these organisations raise awareness on EU policy priorities and activities and improve the basis for further development and implementation of EU policies.

The EBO Network which extends in more than 20 countries over three continents (Asia-Pacific, Europe and the Americas) aims at providing a lobbying, information and networking platform for European businesses worldwide. The growing network of European Business Organisations currently connects European

EUMCCI’s New Services

business associations and chambers of commerce located in Argentina, Armenia, Australia, Brazil, Chile, China, former Yugoslav Republic of Macedonia, Hong Kong, India, Indonesia, Japan, Kazakhstan, Korea, Malaysia, Philippines, Russia, Singapore, Sri Lanka, Taiwan, Thailand, Ukraine, USA and Vietnam.

On 15-17 November 2010, the EBO Worldwide Network met in Brussels for their 10th Annual Meeting.

Read more: http://www.ebonetwork.eu/

EUMCCI has launched a new website focused on the services sector in Malaysia.

The site is based on our EU-funded project; “Enhancing the EU-Malaysia business dialogue and cooperation in the services sector” which focuses on four key areas in the services sector. The key areas are Green Technology, Logistics, ICT and Financial Services. By introducing our new website, both the project and these four sectors are given visibility and support.

Given the importance of the project for EUMalaysian business dialogue and cooperation in these four service sectors, EUMCCI released the new website to give stakeholders, members and anyone with an interest in the services sector in Malaysia an in-depth insight into activities, events of interest that are coming up and the latest developments. In 2010, the focus was on the Green Technology sector with lots of news and activities. This and next year, the three other sectors will also get increased exposure and attention. www.eu.servicessector.com.my

Larger EU presence at IGEM 2011

7-10 September 2011, Kuala Lumpur Convention Centre

From the 7th to the 10th September 2011, the International Greentech & Eco Products Exhibition & Conference Malaysia (IGEM) will return, once again, to KL’s convention centre. The four-day event is expected to draw more than 500 companies / organizations from around the world and over 80,000 visitors. Owing to the fantastic success of IGEM 2010, EUMCCI is determined to make IGEM 2011 the biggest and most successful green technology exhibition yet in Asia, for EU organisations.

This year, EUMCCI will coordinate the EU presence again and will almost double the EU presence with around 50 booths under its EU Pavilion.

tutions to adopt green technology and boost eco-technological innovators in the field of eco-design, eco-materials, ecoproducts and low carbon Green Technologies.

Following the successful premier of IGEM 2010 as the region’s largest green exhibition and conference in 2010, IGEM 2011 is set to continue on as an unprecedented success in creating a vibrant mix of opportunities to help spur industries and insti-

Set as an annual event, IGEM is strategically positioned to take the Green lead in the region by introducing like-minded industry players and professionals from various sectors, public and private, big and small, local and foreign, new as well as established

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together, to explore and seize the many opportunities arising from the exciting and emerging green market in both the country and the region.

Moving towards commercialization of Green Technology that can be both distributed by the market and become universally adopted, IGEM 2011 will continue to make areas such as sustainable energy, renewable energy and green energy for adoption and start-ups its main focus, while providing an essential platform to launch, feature and showcase innovative eco-products, green technologies and services. It is a prestigious event where green product buyers and sellers interact, transact and forge new partnerships and cross border collaboration.

For more information about EU presence, please email IGEM@eumcci.com

Committees

The head of the EUMCCI Human Recources Committee about...

Preparing students for the real world Malaysia has come a long way when it comes to education. There are many public and private higher institutions of learning that offer more and more graduates every year. In the fast moving global economy today, companies have high expectations from these new entrants to the labour market. Meanwhile, there is less time to train them into their positions, so the graduates have to be able to contribute independently and in high quality to the organization, quickly after their arrival.

Chan Swee Hwa is Head of the EUMCCI Human Resource Committee and Human Resource Director of TNT Express Worldwide (M) Sdn Bhd. The HR Committee was formed in November 2009, has 30 members and promotes the importance of human capital in trade in general and among member companies specifically.

How can these graduates prepare themselves best for their new working environment? Ms Swee Hwa: “I think one of the most important things that students should be armed with is communication skills, be it joining international organizations or local ones. Their command of English must be

Many organizations, like MNC’s, banks and big conglomerates already have a structure in place like the management trainee program where young graduates exhibiting high potential are trained, work in several departments, enrol in courses, have a mentor and learn about real business and to be a part of the future of the company in 2 or 3 years’ time. Swee Hwa: “Of course, all of these trainees are focusing on a higher position after completing the program. The difficulty then is to retain them with the company and not lose them to other parties who offer them more attractive compensation.”

“I think one of the most important things that students should be armed with is communication skills, be it joining international organizations or local ones.” decent, their behaviour professional and they need to have good work ethics, suitable for working in a corporate environment.” For those who are working for a number of years already, these things go without saying. The new graduates, especially Generation Y, need to be made extra aware of time-keeping, attendance , basic accountability and delivering quality work, according to Ms Swee Hwa. Universities can also play a role here. Many are partnering with companies and engaging people from industries to talk about their line of business and to help in preparing students for their employability.

Swee Hwa: “Internships, practical training and other exposure to the working life help students with their first steps after graduation. For the companies that are

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working with these students, it is a good chance to recruit and select the right person to fill their vacancies, and train them in advance during their trainee period.”

GEN Y is known to be less loyal to organizations and is wish to get ahead in their career quickly. They are also looking for instant rewards. Swee Hwa: “Some organizations create a service bond to tie employees down with the organization. I think companies should instead find other creative ways to work with these issues.

The fact is that the generation after Generation Y, who will soon enter the labour market, will be even harder to keep interested. So organizations should review their management practices and policies to better cater to the needs and attention span of these young people. Conventional ways and rigid policies will not work in the future.”

Committees

The head of the EUMCCI Education Committee about...

Jobs post graduation “The soft skill gap and the cultural difference is a major part of the employability challenge for Malaysians in EU Corporations.”

In Malaysia, the educational system is often not well connected with the world beyond the campus. Many universities are looking for a way of making sure that the curriculum is actually designed to help students towards a satisfactory working life after college. This will undoubtedly require universities and employers, especially European corporations, to work together.

Williams: “Many universities have departments that encourage public-private partnership. The exchange of ideas and knowledge about trends, identifying issues, and making recommendations will help both parties to progress in the right direction.

Universities need to know what the demand in the market is, and vice versa.” Here and there, Williams can see examples of putting knowledge obtained from Europe into practice: UKM develops European environmental technology into technology suitable for the tropical Climate in Asia. The University is involved in the development of state of the art green technology for Malaysia, making use of the knowledge learned from European companies.

Universities can also play a role in helping Malaysian businesses that want to enter the European market. Supporting these companies to help them understand the single market in the European Union can benefit local corporations and the economy as a whole. Knowledge of the European business environment can also be shared with the students.

In Malaysia, academic programmes are often not aimed at jobs post-graduation.

While in Europe teenagers learn how to work with basic tools, such as Word and Excel, in secondary school, Malaysian graduates are not often able to create a simple spreadsheet or letters. Williams: “Yes, there is often a technical skill gap and I also think there is a soft skill gap. The

relatively low power distance in many parts of Europe and the independence, responsibility and decision-making skills that European companies expect from their employees means that working with Malaysians is often considered a challenge for many Europeans. To improve the employability in international corporations, students should be taught to work independently and to take responsibility in a less formal, less hand-holding environment.

The cultural difference can also be major part of the adjustment problem.”

Williams finds that one of the problems with Malaysian graduates not fitting in a European business environment is also caused by the lack of awareness about cultural differences. Williams: “Luckily, at the moment there is a movement towards student exchanges into several European countries, not only England. By doing this, I think that students learn how to appreciate the western culture in a more diverse way.

By studying in several countries, the programme can cover more subjects and the students can learn about European culture.”‘I actually think that the familiarity with the European culture is not that big.

With people who have studied abroad, you can see that their employability is better.

They can often adjust better to the working environment and are more interesting to recruiters. What often frustrates these people most is the lack of opportunity for promotion here in Malaysia. Here, employees are often promoted based on seniority, not necessarily on merit or skills.’

Dr Geoffrey Williams is the Chief Executive Officer of OWW Consulting in Malaysia and Singapore. He is Head of the Education Committee and also one of the Deputy Heads of the EUMCCI CSR Committee. The Education Committee is composed of both larger and smaller universities and EU corporations are also welcome to attend.

The Ministry of Higher Education is currently piloting a new “High End Industries Graduate Internship Programme (HEIGIP)” which the EUMCCI and many European companies are supporting. “We are very pleased to see the HEIGIP and hope as many EUMCCI members will take part to help make it a success” Williams added.

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Committees

Committee message board: ›› Education: Call for advisory board members The Education Committee invites Chamber members to join the advisory boards of several universities and secondary schools,

to discuss strategy, curricula and other educational-workforce related issues. Mail for more information: eumcci@eumcci.com

›› Environment, Energy and Green Technology: EU Pavilion on IGEM 2011 After the very successful participation with three EU Pavilions in IGEM 2010, once again, EUMCCI together with EU Delegation organise the participation in the International Greentech & Eco-

Products Exhibition & Conference (IGEM) 2011 at September 7-10. With 50 booths, the EU pavilions will have even more exposure. More information: igem@eumcci.com

›› Head of Committee meeting The EUMCCI Committee heads met on 8th December to discuss joint issues, such as Customs, capacity building and best practises. The meeting ended in a networking session. The

next topic for the head of Committee meeting with be the newly launched Free Trade agreement between EU and Malaysia, the date will be communicated soon.

›› Editorial: Looking for members and guest editors The Editorial Committee of Review Magazine is looking for enthousiastic, committed members who would like to develop the magazine further and contribute with ideas, write ups,

arranging interviews, et cetera. The committee comes together every three months and commui9cates by phone and e-mail a lot. For more information: editor@eumcci.com.

›› Editorial: Next issue Review Magazine featuring Health Care The April issue of Review Magazine will feature Health care in Malaysia. The editorial Committee is looking for sponsors and guest editors among members who would like to contribute with their professional (non commercial) stories to this special

issue. Corporations may contribute with their advertorials or advertisements as well. For more information: editor@eumcci. com.

›› CSR: Book on ‘Responsible Management in Asia’ The book ‘Responsible Management in Asia – Perspectives on CSR ‘ covers the history and development of Corporate Social Responsibility (CSR) in Asia and how it has helped to create pathways to social and environmental sustainability across the region.

Drawing on case studies from Bangladesh, Hong Kong, India, Indonesia, Malaysia, Singapore and elsewhere, leading specialists describe the emergence of CSR from philanthropy and charity to a uniquely Asian form of responsible management. Community-based partnerships between business and civil society are discussed from a practical, Asian perspective. Decent work programmes through social partnerships and concrete action programmes at the factory level offer new insights into workplace management. In the marketplace, the demands of consumers for greater accountability have been a key driver of CSR for Asian companies as well as multinationals operating in Asia.

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Special challenges in responsible tourism, green building initiatives and the growing risk of climate change are discussed by leading practitioners from major Asian companies and the growth of Sustainable Responsible Investment (SRI) in Asia highlights opportunities amidst these challenges. With insights from the Global Reporting Initiative, the International Labour Organization, UNI Global Union, Vontobel Asset Management and leading practitioners including OWW Consulting, Volens and others, the book offers new perspectives on the opportunities emerging for businesses and managers working in partnership with civil society stakeholders to build uniquely Asian responses to global challenges.

Responsible Management in Asia is edited by Geoffrey Williams, deputy head of the EUMCCI CSR Committee. Hardback £65.00 978-0-230-25241-7 Members of EUMCCI get a 25% discount if they order directly through EUMCCI. Send an email to communications@eumcci. com

Committee in Focus

Oil & Gas Committee According to the 2010 BP Statistical Review of World Energy, Malaysia had proved oil reserves of 5,5 billion barrels at the end of 2009 and held 83 trillion cubic feet of proven natural gas as of January 2009. While a lot of the country’s oil reserves are found off Peninsular Malaysia, much of the country’s natural gas production comes from Eastern Malaysia, offshore Sarawak and Sabah. Nearly all of Malaysia’s oil comes from offshore fields.

Malaysia is one of the world’s leading exporters of liquefied natural gas.

The EUMCCI Oil & Gas Committee provides a platform for members to discuss and lobby industry issues as well as focus on the following topics: • Manpower sourcing and training.

• Cooperation: EU - Environmental initiatives.

• Upstream: Deepwater & Marginal Fields.

• To promote Malaysia as an Oil & Gas Deepwater Hub.

The Committee’s vision may be summarised as follows: • To be the central focal point for all issues related to the oil and gas industry in Malaysia.

In order to achieve this aim, the Committee is actively working on: • To be a centre of debate to identify and prioritize key issues in the Oil and Gas Industry.

• To be a forum to facilitate business, discuss and propose an environment to improve the business conditions.

• To be a channel to raise issues to government authorities to create a clear and transparent relationship with Malaysian government and to build up a lobbying tool for the European companies to improve interrelation and communication with PETRONAS and subsidiaries.

Head of the Oil & Gas Committee: Mr Robert Jaimond Senior Business Consultant, i3M Asia Pacific Deputy: Mr Luis Ochoa Anchor Chain Sinar Malaysia Sdn Bhd

Corporate Social Responsibility Committee The EUMCCI Corporate Social Responsibility (CSR) Committee with representatives from several European and Malaysian companies is focusing on more attention for CSR in Malaysia. The CSR Committee published a book which is a compilation of case studies of good CSR practices and episodes in Malaysia. It also covers the development of CSR in Malaysian companies, especially those with business links to the EU. CSR consists of a wide spectrum of issues ranging from business ethics, corporate governance and socially responsible investing to environmental sustainability and community investment. CSR envisages the ideal whereby enterprises integrate social and environmental concerns in their business operations and in interaction with their stakeholders. The last one is mostly on a voluntary basis.

The CSR Committee’s Mission statement: • A platform to foster closer cooperation and engagement with governmental agencies to further enhance the protection and enforcement of CSR in Malaysia.

The Chambers Committee is actively discussing and giving recommendations about: • Having a good CSR practice in tandem with transparency as an integral part of developing a high income nation.

• Increase of wages and productivity through education.

• Transformations of labour laws in favour with employees.

• Encouraging SMEs to reducing Greenhouse Gas and Carbon Dioxide.

The EUMCCI CSR Committee believes that this is the best way to demonstrate what

CSR really means and to inspire others to do the same.

Head of the CSR Committee: Mr Loong Caesar, Partner Raslan Loong Deputies: Dr Geoffrey Williams, Managing Director and CEO OWW Consulting Sdn Bhd Mr Arno Thöny, General Manager Meliá Kuala Lumpur

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EU News

BMCC Signs Strategic

›› Facts about Europe Safety and health of workers in EU One of the cornerstones in the development of the safety and health of work in EU was the adoption of the Framework Directive 89/391/EEC with a particular focus on culture of prevention.

The framework directive aims to improve the protection of workers from accidents at work and occupational diseases by providing preventive measures, information, consultation, balanced participation and training of workers and their representatives. It covers all workers in the EU, employed by private companies and public institutions/organisations. Selfemployed and domestic servants are not covered by the framework directive. The framework directive covers a range of total 19 ‘daughter directives’ on for example:

MOU with MATRADE

1. Requirements for working places; 2. the use of work equipment the use of personal protective equipment; 3. work with display screen equipment; 4. manual handling (Directive; 5. provision of safety and health signs at work; 6. pregnant workers chemical agents; 7. minimum requirements for improving the safety and health protection of workers potentially at risk from explosive atmosphere; 8. the protection of workers from risks related to exposure to biological agents at work.

New Routes to Europe

Estonia joins Eurozone

For Malaysian companies involved in trade, commercial exchanges, transport of goods to Europe, finding new routes are of utmost interest. The Romanian Embassy in Malaysia organised a number of seminars in Kuala Lumpur and Klang to promote Danube River as an alternative choice for accessing Eastern and Central Europe.

Estonia becomes 17th member of euro zone Estonia became the 17th country on the first of January to adopt the euro. The small Baltic state began to switch from its kroon currency to the euro with official celebrations in capital Tallinn, which included European Monetary Affairs Commissioner Olli Rehn and the prime ministers of neighbouring Latvia and Lithuania.

Developing and expanding the transportation capacity on Danube River was high on the agenda of the Danube Summit, an event that took place recently in capital city of Romania - Bucharest. The Summit which gathered 22 delegations representing the 14 states from the Danube region is part of an integrated effort to build, the EU Strategy for the Danube Region. It is supposed to become a genuine European model of regional development, on an initiative launched by Romania and Austria in 2008. The Danube Strategy will be an internal EU strategy where riparian third-states are invited to participate and will comply with the three principles that are also applicable to the EU Strategy for the Baltic Sea Region.

These connectivity (transportation, energy, and telecommunications), environment protection and water management, socialeconomic development.

The Baltic state of 1.3 million became the 17th euro zone country at midnight and was the first former Soviet state to adopt the euro, capping 20 years of integration with the West.

Estonia sees the change as marking the end of its struggles since a 2009 recession lopped 14 percent off its output. It hopes to entice investors by removing fears of devaluation and make borrowing more secure for its people, many of whose mortgages are already in euros from top Nordic banks.

The switch marks the culmination of the country’s successful transition from a former Soviet state, which regained its independence in 1991.

Source: Reuters

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Jon Addis, BMCC Chairman (far left) with Molly Jagpal, BMCC Director - Business (second left) at the MOU Exchange Ceremony witnessed by YAB Dato’ Sri Mustapa bin Mohamed (third right)

The British Malaysian Chamber of Commerce (BMCC) and Malaysia External Trade Development Corporation (MATRADE) have signed a milestone Memorandum of Understanding (MoU) for bilateral trade cooperation that will help to support the two-way expansion of trade, investment and tourism. The MoU was officially exchanged at the opening ceremony of the recent INTRADE 2010 showcase event where Minister of International Trade YAB Dato’ Sri Mustapa bin Mohamed witnessed the exchange alongside Jonathan Addis, Chairman of the BMCC. “We see this MoU as an important pillar of our wider International Gateway initiative,” said Addis.” “It will open doors for stronger two-way knowledge, innovation, market and sector exchange as well as inward investment and support for trade missions.”

The Gateway project will eventually link over 200 key British, Irish, Welsh and Scottish Chambers of Commerce, and development and investment agencies with the BMCC and Malaysia.

The International Gateway initiative is led by Molly Jagpal, Director – Business at BMCC. “Malaysia needs to continue to ensure that existing investors are well catered for. This MOU will therefore see BMCC working as a key partner alongside MATRADE in helping to raise the profile of Malaysia as a competitive and business-friendly country.” Bilateral trade figures for the first half of 2010 showed a strong pick up with Malaysian exports to the UK rising by 11 percent year on year and UK visible exports to Malaysia jumping by 21 percent.

EU News

Poland: An active Partner for Malaysia Malaysia is the 2nd biggest trading partner for Poland in the Far East and bilateral trade turnover between both countries has dramatically increased since the mid2000’s, reaching the amount of ca. $725 million USD last year (vs. $815 million USD in 2008). In 2009, Polish exports amounted to ca. $59 million USD. The top five products exported from Poland to Malaysia are: defence equipment, furniture, electrical & electronic products, processed food and chemicals. In the same period, Malaysian imports to Poland reached a value of $540 million USD. The main products imported from Malaysia to Poland are: electrical & electronic products, natural rubber, rubber products, furniture and wood products as well as textiles.

The promotion of Poland, the Polish economy, industry, services and products in Malaysia, as well as the investment and tourism opportunities in Poland are the main tasks of The Trade and Investment Promotion Section of The Embassy of The Republic of Poland in Kuala Lumpur. This section participated in several international conventions and exhibitions organized in Malaysia including Defence Service Asia

The Polish Trade and Investment Promotion Section at the Defence Service Asia DSA

DSA and the International Greentech & Eco-Products Exhibition & Conference (IGEM). This year, Poland will be actively present in many other Malaysian international fairs and conferences.

In 2008, The Malaysia Poland Business Association – MPBA was established, bearing its main task to support the deve-

lopment of business and trade relationship between Poland and Malaysia, as well as the protection and support of business interests in both countries. The association also plays an important role in creating and enhancing the network of business opportunities between Polish and Malaysian companies, especially those from the small and medium size sector.

Large Business Delegation to Accompany the Austrian President’s State Visit to Malaysia The Austrian President Dr. Heinz Fischer visited Malaysia together with a large delegation from 7 to 9 November 2010. It was the first State Visit of an Austrian President to Malaysia and also a perfect opportunity to strengthen the bilateral trade and economic relations between the two countries.

The Austrian Embassy – Commercial Section organized a Malaysian-Austrian Economic Forum for about 250 high-ranking participants on 8 November at the Renaissance Hotel. This Economic Forum provided participants from Malaysia as well as members of the Austrian economic delegation with a deeper insight into and a better understanding of the economic opportunities in Malaysia and Austria.

While Malaysia is the thriving economy in the heart of South East Asia, Austria occupies a similar position in Europe especially with its excellent contacts in Central and Eastern Europe. There was a special emphasis on topics like investment opportunities, existing trade and taxation agreements and other instruments. The group of about 60 Austrian business delegates could get first hand information about the dynamic Malaysian market in the heart of South East Asia through presentations from MIDA and MATRADE. Guests-ofhonor and guest speakers were the Austrian Federal President Dr. Heinz Fischer and the Malaysian Deputy Prime Minister Tan Sri Muhyiddin Hj Mohd Yassin. The highlight of the event was the signing ceremony of a memorandum of Understanding between the Austrian company

Signing of a ,Memorandum of Understanding’ between Doppelmayr Seilbahnen GmbH and Taiping Cable Car Sdn Bhd, MD Michael Doppelmayr and Dato’ Seri Talaat bin Husain.

Doppelmayr Seilbahnen GmbH and the Malaysian company Taiping Cable Car Sdn Bhd to build a cable car to the peak of Bukit Laruk in Perak. The forum was followed by a networking luncheon with the Austrian business delegation.

EUMCCI Review 15

2 EU Countries in Focus

Spain Spain’s mixed capitalist economy is the 12th largest in the world and the 5th largest in Europe. Its per capita income roughly matches that of Germany and France.

Until 2008 the economy of Spain had been regarded as one of the most dynamic within the EU, attracting significant amounts of foreign investment. However, Spain’s unemployment rate rose from a low of about 8% in 2007 to more than 19% in December 2009 and continues to rise.

Output is expected to remain flat in the second half of 2010 and to grow by 1% in 2011 and by 1¾ per cent in 2012. The unemployment rate is projected to decline to 16½ per cent by the end of 2012.

Budgetary consolidation at all levels of government is projected to result in a decline of the government deficit from 9% of GDP in 2010 to 6¼ per cent in 2011 and to 4½ per cent in 2012.

Key Economic Facts General Information * Size Population Language Capital EU-Member since Currency GDP Growth Unemployment Inflation

504.645 km² 46.2 million Spanish Madrid 1986 Euro €1,051 billion -3.4% 18.0% 0.8%

* Data 2009 estimate Spanish Economic and Commercial Office

Top Five Export Products to Malaysia - Ships - Stainless steel - Boilers, machinery and valves - Electrical equipment - Medicaments

Top Five Imports Products from Malaysia - TV products, electronics - Air-conditioners, printers, etc - Latex gloves - Refined oil products www.spainbusiness.com

Sweden Traditionally, Sweden’s economy encouraged a high standard of living in combination with high-tech capitalism and extensive welfare benefits The economy has recovered strongly from the recent recession. Solid, though more moderate, growth is expected to continue as external demand gains momentum. Unemployment is projected to decline, but rather slowly. Core inflation is expected to remain subdued, amid low wage pressures and still ample spare capacity.

Sweden has the second highest total tax revenue behind Denmark, as a share of the country’s income. As of 2007, total tax revenue was 47.8% of GDP, down from 49.1% 2006.

Sweden is one of the world’s leading producers of iron ore; important mines are at Kiruna and Gällivare. Copper, lead, and zinc ores and pyrite are also extracted.

Key Economic Facts General Information * Size Population Language Capital EU-Member since Currency GDP Growth Unemployment Inflation

450,000 km² 9.3 million Swedish Stockholm 1995 Swedish Krona (SEK) €333.2 billion -4.6% 8.1% -0.5%

*Data 2009 estimate Malaysian-Swedish Business Association (MASBA)

Top Five Export Products to Malaysia - Ships - Stainless steel - Boilers, machinery and valves - Electrical equipment - Medicaments Top Five Imports Products from Malaysia - TV products, electronics - Air-conditioners, printers, etc - Latex gloves - Refined oil products www.masba.org Sources: CIA World Fact Book, OECD, World Bank

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Feature

Human Capital Development in Malaysia By studying while working, for example, individuals open themselves up to a process of lifelong learning that more and more people are taking.

The Malaysian Government is investing in the development of the nation’s human capital; both national, as well as international organisations are investing progressively into the growth and development of their staff, helping their organisation reach success and helping to bring Malaysia towards its goals towards 2020.

That’s not to suggest that individuals themselves don’t make a strong contribution. By studying while working, for example, individuals open themselves up to a process of lifelong learning that more and more people are taking, in many cases along with their organisation.

In this feature about Human Capital Development, we will look at the current trends in the HR market, show what progress has already been made towards 2020, and will give you an overview of the current Malaysian Labour Market.

Lifelong learning Change agent looking for buy-in As a young adult starting out, Rose undertook a degree in Business Administration. After that, she worked as a Human Resource manager in various Malaysian organizations. Besides her demanding job as a Senior General Manager and change agent in HR services now, xx years after her graduation, Rose was looking for personal development in a new and different direction. As a result, in October last year, she decided to invest in her own development and commenced a Masters program in Managerial Psychology at HELP University College in Damansara Heights.

“I feel I need to have the ability to understand the emotions of those around me better, people that come from a different background than me” Photo by Lucien De Prycker

Rosehaida Abdul Rahman, Senior General Manager in Human Resource Services, Malaysia Airports, part time student Master of Managerial Psychology, HELP University College.

18 EUMCCI Review

Rose: “In spite of the careful time-balance required between work during the daytime at one end, and the evenings and weekends required for my studies and family at the other, the learning and development makes it worthwhile.” Rose believes that her job will be enhanced and made more manageable by studying human behavior in organizational settings. “I am convinced that studying managerial psychology would greatly help me in understanding and even predicting people’s behavior in my working environment. And that way, I think I can achieve the buy-in and support I need, to implement the transformation initiatives I am involved with as a change agent.”

Feature

The Key to Motivating Subordinates: Stop Trying The trick is to learn as much as you possibly can about each employee’s expectations from the workplace.

“I just don’t get it. We pay higher bonuses than anyone else in the industry, and go to great lengths to make sure non-financial rewards like social/cultural initiatives and training are top class. Yet, my subordinates don’t seem to be motivated enough to perform at the highest level,” said Ramli, a senior executive from a multi-national company at a recent leadership program while describing his challenges relating to employee motivation. “They seem to do just enough to get the job done, but passion and ownership is totally missing,” he went on to add.

Most managers struggle when it comes to motivating their subordinates. Most try really hard to do whatever they can, and constantly ask themselves what more they can do. Asking yourself what you can do to motivate your employees is a futile question because however hard you try, you cannot motivate anyone. The truth is, like most of us, employees are motivated by their own unique self interest. Unless your actions directly address an employee’s self interest, any motivational initiatives you attempt are likely to fail. So instead of asking what more can you do to motivate your subordinates, you need to find out how each employee is already motivated, and try your best to address their needs.

But how is it possible for a manager to keep track of so many individual needs?

Step 1: Find out what they Want While each employee’s needs are different, most employees around the world have three buckets of expectations from the workplace: 1. What is my Role ?

2. What is my work Environment like?

3. How will I Develop my skills and my career?

ROLE: In this bucket employees want to know about the nature of their work and how it fits in with their personal purpose.

Meaningful work they can relate to on an emotional level, is important to most high performers, and to generation Y in particular. They decide based on purpose.

ENVIRONMENT: Employees want to know if the work environment is in accordance with their personal values. If meritocracy is important to an employee, she will not thrive in an environment that believes in giving equal bonuses to all. If autonomy is important to another, she will not excel in a very regimented environment.

DEVELOPMENT: Finally, growing one’s skills and career is important to most.

People with a high achievement drive want to achieve mastery at something, which can only be done by developing some natural strengths further. Employees want to know if their manager will give them opportunities to convert their strengths into mastery.

So how can managers use RED? The trick is to learn as much as you possible can about each employee’s preferences. You now have an instant and easy to remember the framework. Start using every opportunity during the course of a normal day or week to ask questions around Role, Environment and Development. Simple questions should help like How are you doing in your role? Are you having fun?

What have you done lately to invest in your own learning and development? What are you working towards in your career?

will be able to address them. For example, if someone wants to be challenged more, you can assign them on new or special projects. Finally, if you know about your employee’s career development interests, you can assign work that will help them build mastery in their preferred domain. By staffing them on the right projects, by giving constant coaching and feedback, and by investing in appropriate training, a manager can facilitate the mastery process without spending inordinate amounts of time and money. As the employee begins to develop mastery in the field, their motivation soars.

But this would only be possible if the manager knew the employee’s strengths and career interests in the first place. Trying to motivate someone in the absence of such information is impossible. So stop trying, and start asking.

By Denis Connolly, Director of Client Strategy the ICLIF leadership and governance centre

Step 2: Address their needs The more you ask, the more you’ll understand their needs, and the better you

EUMCCI Review 19

Feature

Human Capital Management:

From recruitment towards retainment Talent management practices are the nuts and bolts of an organization’s work to improve performance and remain competitive in tough times.

The process of developing and integrating new employees, developing and retaining current ones, and attracting highly skilled workers to work for a company despite the economical downturn, is considered a major challenge. Worldwide, finding the right person for the job is one of the main concerns of managers.

Many organizations realize that they have to better meet the demand for improved talent management in today’s complex, diverse, and global business environment. Companies that engage in talent or Human Capital Management are strategic and deliberate in how they source, attract, select, train, develop, retain, promote, and move employees through their organization. Since the initial hiring process has been advancing in the last couple of years, it is vital to place the individual in a position where his skills are being extensively utilized. With the more personal human resources approach, the mindset now is not only to hire the most qualified and valuable employees, but to also put a strong emphasis on retention.

Retaining skilled employees There is a serious challenge in retaining talents.

The average turnover rate across most industries

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Feature

in Malaysia ranges from 12 to 28% per year.

These figures show how much time and effort needs to be spent on re-hiring employees. Anthony Raja Devadoss, Regional Senior Director APAC, KellyOCG: “Most organisations do not get to the desired ROI when they’re continually hiring and training their staff but not getting to the part when these talents actually start contributing to the goals or objectives of the organisation.” Organisations are striving to master the art of retention, not always successfully. In Malaysia, many jobs are available and with an unemployment rate of approximately 3.7%, staff can afford to be choosy on the compensation & benefits or the industry. Raja:”I find it is a myth that it’s all about the remuneration and the more you pay the better you retain staff. Today with the multigenerational workforce, applying one solution to all employees

Koh: “With many MNCs operating in Malaysia, employees could also be given opportunities to move into other roles within the same company either in Malaysia or in other countries in which the company operates.” It is important for organizations to focus on retention by placing a premium on developing people – requiring executives to promote employee development, investing in the internal talent pipeline and talent acquisition and emphasizing the development of new leaders with new competencies.

Talent management In a challenging era of retaining talent, every organisation needs to understand who their performing staff are and how to develop them further to meet objectives for their organisation. Towers Watson: “A comprehensive talent management strategy is now

“It is a myth that it’s all about the remuneration and the more you pay the better you retain staff”

would not be sufficient.” Raja is glad to see that nowadays, many companies are considering a better quality life and in some cases family health benefits. Raja: “Providing clear career progression and job security are on the rise amongst many MNCs. Also, treating people with respect and dignity should be practiced rather than being preached as well.”

Siew Lin Koh, Towers Watson agrees: “While many employers acknowledge the impact of their actions on employee wellbeing, they have not made the connection yet between wellbeing related items such as a convenient work location, flexible scheduling and time off. In order to retain employees, organizations should start looking into these wellbeing related items, besides just a competitive base pay.”

more important than ever because the business environment gets more challenging and organisations need to groom their future leaders, so top performers need to be retained.” Anthony Raja says: “We need to invest in our people like we do in our business for an organic growth or in order to expand our market presence. In order to invest in your people, you need a talent management strategy, which covers what skills/knowledge we need in our business, how do we develop them further and finally retaining them.”

bolts of an organization’s work in leveraging its talent to improve performance and remain competitive in tough economic times.

Communication A good example of motivating employees and investing in their development and retainment is with AQ Services Malaysia, one of the winners of the EUMCCI Europa Awards 2010. The introduction of a quarterly bonus scheme based on individual and team measurable performance was a good staff retention tool, while their continued efforts in staff events fostered great team fun and spirit.

As a result, AQ Services Malaysia had a strong year in 2009 despite the downturn, growing their revenue and lowering their staff turnover. Their creative staff motivation approach-turned-business solution has earned them the EUMCCI Europa Award 2010 for Human Resource.

Bart Veenbaas, AQ Services: “It is all about communication and creating rhythm in the organization. We have meetings every week, quarterly reviews, yearly meetings with the whole organisation together with our offices abroad.” In those meetings, the company shares the financial situation and progress of the organisation, introduces new projects and also spend a lot of time of getting to know each other better, to teambuilding. Veenbaas: “Employees talk to each other a lot through Skype, but even then, real face-to-face contact and having fun together is very important to make them feel good and comfortable with the company.”

With the introduction of this programme, employees responded very positively. KPI’s, rhythm and goal setting makes goals clear and everyone knows what is expected from him or her. This way, external stakeholders also notice the smoother processes, the shared values of the employees and other ‘aligned’ components of the company.

Whether there is a well-conceived talent management strategy in place or not, all organizations need to find ways to acquire, develop, engage, and retain their talent.

Talent management practices, and the tools used to achieve them, are the nuts and

EUMCCI Review 21

Feature

Labour market in Malaysia Labour market is one in which workers find paying work, employers find willing workers and where wage rates are determined. Malaysia has a tripartite labour system.

The Human Resource Committee of EUMCCI is playing an active role in lobbying on behalf of member companies. Recently the Ministry of Human Resources has been seriously considering making amendments to the labour legislation with the objective of creating a labour environment that is in tune with the current and future business and economic growth in the country. Furthermore a proposal has been drafted for the implementation of a national minimum wage for workers.

The HR committee was asked to give feedback concerning these issues. The MoHR also requested proposals from social partners such as MEF, MTUC, FMM, MAPA and Khazanah as well as from the labour department, trade union department and Industrial Court.

Diagram 1

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Source:

The Malaysian labour legislation consists mainly of 3 acts: - Employment Act 1955 - Industrial Relations Act 1967: and - Trade Unions Act 1959

22 EUMCCI Review

CIA World Fact Book

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The labour market is one in which workers find paying work, employers find willing workers and where wage rates are determined. Malaysia has a tripartite labour system. The Ministry of Human Resources formulates labour policy and implements and enforces the labour law. In addition, the trade union federations and employers organizations represent their constituents regarding labour matters by giving advice and guidance, as well as actively participating on government advisory commissions. (See Diagram 1).

Diagram 2

Labour market in Malaysia

The labour force in Malaysia is steadily growing. Hence it becomes more important to restructure the antiquated labour law.

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Source: ILO; MoHR; CIA World Factbook 2009; EuroStat.

Six focus areas have been identified as follows; (i) Employment governance (ii) Employing workers (iii) Self-regulation (iv) New provisions in tandem with government’s vision, policies, directions and aspirations (v) Out-dated provisions and regulations (vi) Clarification of ambiguous provisions and introduction of new provisions

Within these areas, various amendments have been proposed. The objectives are: - To strengthen employment governance - Move towards self regulation - Introduce new provisions and regulations in tandem with current policies, directions, and aspirations of the Government - Do away with obsolete provisions or regulations, and - Clarify the current ambiguous provisions

Feature

Diagram 3 2WKHU H[SHQVHV FORWKV HQWHUWDLQPHQW 50

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$FFRPPRGDWLRQ 50 Source: Ministry of Human Resources

Unemployment rate Within the Asian area, Malaysia’s unemployment rate is 3.7%, compared with the EU unemployment rate of 9.2%. (See Diagram 2).

Minimum wages Minimum Wage is defined as ‘necessary wage for a period of time to live in reasonable and frugal comfort’. ILO defines it as ‘the level of wage that renders workers’ sustainable social well being’. The government is considering to implement a minimum wage system as in some areas wages remain as low as RM350. Even in industrial estates in Selangor workers are paid as low as RM450 to RM500 per month. However the process of establishing such regulations has been long an

exhausting and it might be due to the fact that there is no clear answer if a MW harms an economy or if it’s beneficial.

Malaysia is facing a lot of hurdles on its way to create a minimum wage system. It is not only questionable in which regions or industries the start should be done it is also necessary to establish a national minimum wage council to rectify the disruptions in the economy due to decades of institutional mechanism, and ensure the progression of the economy.

On 18 June 2007 the Malaysian Trade Union Congress made a proposal to the government to implement a national minimum wage of RM1200 including RM300 Cost-of-living Allowance. Other

Website on Human Capital

institutions agreed on these calculations as well. (See Diagram 3).

How to determine wage rates for workers in private sector? Three approaches are conceivable: 1) Wages council act 1947 (occupational minimum wage rate set by social partner) 2) Collective bargaining 3) Market forces The Ministry of Human Resources recently presented an outline about minimum wages in Malaysia. A minimum wage is defined as follows: - The lowest hourly, daily or monthly wage; - Cover the minimum needs of the worker and his/her family - Calculated on the basis of time and output; and - Guaranteed by law Malaysia is facing the challenge to install a meaningful minimum wage system and many details have to be set. Should such a system be introduced in all areas and sectors or should Malaysia begin slowly in urbanised areas? Should the minimum salary be similar in each area or should it be tailored to local conditions? Furthermore the question arises, which authority should be in charge of determining the minimum wages?

By collecting feedback from different institutions and Chambers such as EUMCCI, the MoHR will create a system based on collective consensus.

The Moving Company with over 100 Branches Around Europe

The website with the most extensive and up to date information about Human Capital is undoubtedly at www.hci.org HCI (Human Capital Institute) is the global association for talent management and new economy leadership, and a hotbed for best practice and new ideas.

John Preston 03 9171 4673 59 Persiaran Mewah, Bandar Tun Razak, 56000 Cheras, KL

Check it out!

EUMCCI Review 23

Feature

Photo by Lucien De Prycker

Upgrading the Workforce in Malaysia towards 2020 The ambitions of the Malaysian government are high and the country is moving fast forward towards the set goals. Many developments in the past like the improvement of the infrastructure, paid out well.

However, top of the list what is holding back investors putting their money into Malaysia, is the lack of qualified workforce.

The quest for qualified workers Providing enough skilled professional workers for the emerging markets needed to fulfill the 2020 national goal is considered a challenge for Malaysia. When we look at the global employment markets, we can already see a difficulty in recruiting talent for professional businesses.

Companies have also long complained about a shortage of skilled labour in Malaysia and economists say it is severely affecting the country’s ability to attract more high technology industries. The government is aware of the shortage in skills and the potential hurdle it passes to the country’s 2020 goal.

Studying and working overseas have long been considered attractive options for those Malaysians who can afford to make the move. About half of those living abroad can be found in neighbouring Singapore.

Australia, Britain and the USA are popular as well. In Malaysia, there obviously is a skill gap. This trend is widening as the demand

24 EUMCCI Review

for talent is growing and academic institutions need to be even better connected to the industry because the short life cycle of products, faster developing markets and the world becoming smaller and smaller each day.

Internship Program There is a need to develop and implement an effective skills policy reform which is based on well-informed plans, working with different stakeholders through strong transparent governance, institution collaborations and systems. One of the initiatives is the High End Industry Graduate Internship Program (HEIGIP). This program intends to draw out a structured synchronized program for enhancing the national high end skills capabilities with vision, mission and objectives of developing the nation’s quality workforce in support of Malaysia’s economic transformation according to future high end industry skills, demands and workforce.

HEIGIP intends to device high end skill training policies, execution plans and system reforms through integrating evidence-based and structured consultative approach with all stakeholders. With this it will regulate training quality and accreditations, with the focus of ensuring consistent matching to future industry requirements in quality and quantity. Thus the incorporation of efficient and transparent information system within its overall

objectives and operation is necessary, in order to help ministries to make informed decisions.

Transforming the education system The current education system will also be revamped under the 10th Malaysian Plan.

This is part of the integrated human capital and talent development framework that the government adopted to nurture and develop Malaysians across their entire life cycle, from early childhood education until their adult working lives.

Under the framework, the government also plans to raise the skills of Malaysians to increase their employability, besides reforming the labour market to transform Malaysia into a high-income nation. The new education system will improve student performance by introducing a new curriculum for primary and secondary schools this year, introducing early childhood programmes, investing in teaching staff and allocation specific funds for illiteracy and yearly assessments for schools.

Acknowledging and addressing the skill challenge in Malaysia has led to activities which will help Malaysia develop into the high performing knowledge economy it is targeting in 2020. Activities are there and they will pay out in the next decade. An exciting time for all involved.

Questions to

YB Senator Dato’ Sri Idris Jala, CEO of PEMANDU YB Senator Dato’ Sri Idris Jala is the Minister in the Prime Minister’s Department in Malaysia and the Chief Executive Officer of the Performance Management and Delivery Unit (PEMANDU), tasked with implementing and driving the progress of the Economic Transformation Programme (ETP).

Before that, he used to work for Shell and was the CEO of Malaysia Airlines from 2005-2009. Here Dato’ Sri shares his vision for Pemandu YB Senator Dato’ Sri Idris Jala is the Minister without Portfolio in the Prime Minister’s Department in Malaysia and the chief executive officer of the Performance Management and Delivery Unit (PEMANDU).

Before that, Dato’ Sri used to work for Shell and was the CEO of Malaysia Airlines from 2005-2009. PEMANDU is responsible for overseeing, implementing, assessing the progress of, facilitating as well as supporting the delivery, and driving the progress of the Economic Transformation Programme (ETP).

What do you feel is your biggest challenge in PEMANDU? The biggest challenge is to focus on delivering results. The PEMANDU team needs to work with all parties directly involved in the Government and Economic Transformation Programmes, with an intense focus on execution. Along with this, getting the entire nation aligned and heading in one direction to achieve the Prime Minister’s ambition of Malaysia becoming a high-income nation that is both inclusive and sustainable by 2020, is an exciting, but achievable challenge. For this to happen, it is important that investors interested in Malaysia, understand and have confidence in what we are doing. This is why we have chosen to publish detailed action plans for both the Government and Economic Transformation Programmes.

There is a lot that needs to be done, and we have to move at lightning speed.

The Government Transformation Programme has been delivering tangible outcomes. To fight corruption, we have put in place the Whistleblower Protection Act and policy, published in a transparent manner 3,756 government contract award winners on MyProcurement Portal, arrested

797 people for corruption and published the list of the 283 convicted offenders on the Malaysian Anti-Corruption Commission’s website. Between January and November 2010, Index Crime has dropped by 16% while street crime has decreased by 36%. In addition, by 2012, we would have put in place more than 7,000 km of new and upgraded roads, 1,900 km of which will be in Sabah and Sarawak.

Where the Economic Transformation Programme is concerned, there has been a lot of investment activity from within Malaysia, and outside. To-date, we have seen 37 Entry Point Projects and related development which translate into RM106 billion worth of investments, and 102,000 jobs. In addition, there is are clear signs of market confidence. The FBM KLCI reached a historical closing high of 1,572.21 points on 7 January, 2011. Market capitalization grew

by RM153.2 billion or 13.65% from end August to end December 2010 (from RM1,122.11 billion to RM1,275.28 billion).

We are definitely making progress, but we still have a long road ahead of us.

What is your personal vision for PEMANDU? I am personally inspired by my team at PEMANDU as I have my dream team working with me. This is not a job I can do alone, and having people who are committed, driven and literally taking the `bullets’ to ensure that we are transforming as a nation keeps me excited about the mammoth challenge we have in front of us.

I hope that each one of the PEMANDU team will be transformed individually, and that this is the beginning of a life-long journey for them. I know for sure that they will be very different people by the time they

complete their tenure at PEMANDU. How important is the role of human capital development in the overall Economic Transformation Programme?

Human capital is critical to the success of the Economic Transformation Programme.

It is undeniable that significant improvements have to be made to increase the size and enhance the nature of the talent pool in Malaysia in order to deliver the required Gross National Income growth for the respective National Key Economic Areas.

A third of the Entry Point Projects that represent RM120 billion of Gross National Income contribution require direct investments in human capital. Some of the other Entry Point Projects will also require human capital development albeit indirectly.

Examples of human capital required for the success of the ETP include aquaculturists (Agriculture), accountants (Financial Services), wealth managers and financial product specialists (Financial Services) and nurses ( Healthcare).

The 3.3 million jobs expected to be created in the NKEA sectors involve a cross section of human capital across a range of qualifications that range from unskilled labour to the vocationally-trained to diploma holders and advanced professional degree holders.

YB Senator Dato’ Sri Idris Jala explained the ‘10 imperatives for effective transformation’ in a bylined article in StarBizWeek on 1st January 2011.

Read the article on www.eumcci. com/Jala

EUMCCI Review 25

Events

EU is pushing for viable business environment to speed up green growth in Malaysia The EU Delegation and EU-Malaysia Chamber of Commerce and Industry (EUMCCI), in collaboration with the Ministry of Energy, Green Technology and Water, jointly organized the EU-Malaysia Green Technology Business Platform on 15th December 2010.

The aim of the session was to provide an opportunity for EU companies to have a dialogue with Malaysian stakeholders on areas of business collaboration and investment opportunities in the green technology sector. The session was co-chaired by YB. Dato’ Sri Peter Chin, Minister of Energy, Green Technology and Water. In his opening

HE Vincent Piket, the EU Ambassador, recapped the ongoing EU-Malaysia Green Technology cooperation, which started last year with Expertise Transfers Sessions, and involved a very strong participation by EU companies in IGEM Green technology Fair 2010 with a large EU Pavilion and now the Green Technology Business Platform. He also referred to the recent UNFCCC talks at Cancun: “The climate change agenda remains a top priority for us. The results of the Cancun meeting open up more avenues for market-based inputs to climate action.

At Cancun, countries decided to establish a mechanism to enhance technology development and transfer as well as a Green

Dato Peter Chin Fah Kui, Minister of Green Technology and HE Vincent Piket, EU Ambassador to Malaysia

remarks, the Minister referred to the recent meeting of the Green Technology & Climate Change Council, headed by the Honourable Prime Minister, where he reiterated the urgent need for the major sectors to come up with the roadmap and targets to contribute to Malaysia’s pledge to reduce carbon intensity by 40% in 2020 based on the 2005 level. He also stressed on the role of the private sector in this endeavour.

“In the New Economic Model, green technology is featured prominently and I hope the EU can provide some financial models and funding schemes to push for green technology. I thank the EU companies for the strong support shown during IGEM 2010 and look forward to even better support during IGEM 2011,” said YB. Peter Chin.

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sustainable technologies in place, which although voluntary now, could be made mandatory in the near future.

The head of EUMCCI Energy, Environment and Green technology committee, Thomas Brandt, pointed out the need for capacity building for people and appropriate incentives to create a conducive environment for green business. Europe has a long experience and much knowledge on sustainable development, which has created a totally new market for jobs, products, technology.

Waste management was also another area discussed, where the EU businesses asked

EU-Malaysia Green Technology business platform

Climate Fund. This is the reason why we are so interested to learn what EU businesses can offer to the Malaysian drive towards green growth. Moreover, it’s important that we hear from businesses what hindrances they face in putting forward green solutions. That sort of information is key for government policies” The EU companies were given the floor to raise questions and present recommendations. The companies urged the Malaysian Government to incentivize the adoption of green technologies in buildings and recommended statutory requirements to be fulfilled e.g., benchmarking buildings to enable effective analysis of the impact of sustainable features and renewable technologies. The Minister replied by saying that there were already existing standards on

on the plans to have a coherent nationwide policy for integrating various waste management technologies to ensure the best adaptation by the Malaysian waste industry. The Minister stated that “waste to energy” was another important agenda of the green technology initiative and invited the companies to explore business opportunities in this area.

At the end of the event, HE Vincent Piket highlighted the importance of awareness raising, in industry as well as in society at large, and the need to invest now to get a return in the future. The meeting also raised the issue of low energy prices prevailing in the Malaysian market and the effect this has on the adoption of green technology in Malaysia, including energy efficiency and renewable energy.

EUMCCI Direct Members Enjoy Special Benefits on QATAR AIRWAYS Great savings on all Qatar Airways European/USA/South America destinations through authorized agents. For more details please contact the authorized travel agents:

a) Diethelm Travel Malaysia Sdn. Bhd. · For Ticketing Email tkt@diethelmtravel.com.my Phone 03-2715 7878 PIC 8 consultants at service · For Enquiry (besides ticketing/bookings) Email corp.sales@diethelmtravel.com.my Phone 03-2715 7878 PIC Raimond Wee

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EUMCCI Review 27

Events

Wonderful ‘Tastes of Europe’ at Annual European Wine Beer & Cheese Fest!

Both the main event itself and our two new workshops were a tremendous success.

Join our next European Wine Beer and Cheese Fest: ‘ Tastes of Europe’ in May!

For the 9th year running, EUMCCI, along with the support of our co-organisers and bilateral chambers’, successfully organised the annual European Wine Beer & Cheese Fest. The fest, held on Friday 29th October, was the final and main event in a series of three that saw the annual Fest expand to include two highly successful workshops; a coffee tasting workshop, which was held on Wednesday, the 27th October, and a wine and cheese tasting workshop, held just before the main event on Friday, 29th October.

The main event meanwhile, which saw more than 30 exhibitors show off their European produce, attracted over 400 visitors and saw everyone thoroughly enjoying themselves as they sampled some of Europe’s finest wines, beers and cheeses – many also available to purchase at fantastic prices. As the evening progressed, a number of lucky draws took place, with participants having a chance to win a number of sensational prizes, including two tickets to Jakarta (courtesy of KLM), and two tickets to Europe (courtesy of Qatar Airways).

All in all, both the main event itself and our two new workshops were a tremendous success and we already look forward to planning the next one in May 2011!

Were you at the European Wine Beer & Cheese Fest? Are you in any of our pictures?

Find out by visiting eumcci.com/ewbc2010

28 EUMCCI Review

Events

EUMCCI Defence & Security Committee Golf Challenge 2010 On an early November morning, the 1st EUMCCI Defence and Security Committee Golf Challenge commenced at the Kelab Rekreasi Tentera Udara (KRTU) Air Force Base. The Defence & Security Committee were pleased to welcome 44 players onto the green, all ready to compete in an enjoyable morning of golf.

race, but in the end the Malaysian team won the Challenge Trophy.

Players were included in one of the two main groups, either Malaysia or the EU. Each flight was then composed of two golfers representing Malaysia and two other golfers representing the EU. It was exciting to see both teams having a neck-and-neck

Sincere thanks is expressed for our Guest of Honour, Y.B. Datuk Dr. Abdul Latiff Ahmad, Deputy Defence Minister for honouring us with his presence, Lieutenant General Dato Roslan Saad for being the Malaysian Team Captain, for all our

Saturday, 27th November 2010

2010 GOLF CHALLENGE EUMCCI D&S COMMITTEE

Besides the main challenge between the Malaysian and EU team, EUMCCI had a number of prizes for other achievements, such as: Top Scorer, 1st runner-up & 2nd runner-up; hole-in-one, etc.

Y.B. Datuk Dr. Abdul Latiff Ahmad, Deputy Defence Minister at the Luncheon

sponsors, Comlenia, Nokia Siemens Networks, Qatar Airways, Fedex the D&S Committee and to all participants! We are looking forward to seeing everyone again for the next Golf Challenge in 2011!

Were you at the EUMCCI Defence & Security Golf Challenge 2010? Interested to know who the winners were?

Find out by visiting eumcci.com/ golf2010

Sponsors & Partners

Captain of Team Malaysia, Dato Roslan Saad, Lieutenant General hoisting the trophy

EUMCCI Review 29

Events

EUMCCI Events: Recent activities: October 14-17 IGEM 2010 (International Greentech & Eco products exhibition) Go to www.eumcci.com/igem2010 for pictures 27-29 October European Wine, Beer & Cheese Fest Go to www.eumcci.com/EWBC2010 for pictures 4 November ICT Green Panel 27 November 1st EUMCCI Defence & Security Golf Challenge Go to www.eumcci.com/golf2010 for pictures

ICT Goes Green Green ICT is part of a broader EU initiative to promote cooperation with Malaysia in the services sector. In his opening speech at the ICT Green Panel on November 4th, HE Vincent Piket categorised the ICT as one out of four priority services sector: together with logistics, financial services and environmental services.

The topic of the first speaker, Mr Nur Faezal Elias was “Malaysia’s Green ICT Initiatives”.

Mr Nur Faezal Elias, chairman of the MTFSB working group for Green ICT, talked about recent issues concerning ICT guidelines for the government.

“What actually is the meaning of green ICT and how can green ICT help reducing green house emissions?” Developments in this area can indirectly lead to such reductions.

Nowadays people don’t have to take a flight from one place to another in order to attend a meeting, they can easily be part of the meeting via live video conference. In the end, this helps reducing CO2 emissions caused by aviation.

Ms Emily Kok, 2nd speaker, is specialised in “the life of a PC” and an expert in questions like “how to increase the lifetime of electronical devices”. Existing systems should rather be upgraded than replaced by entirely new systems. The exchange of

15 December EU Green Technology Business Platform

various components can actually help to keep the system working. Additionally companies are using different versions of operating systems which automatically lead to compatibility problems which can sometimes be solved by updating a few components.

Ms Emily Kok reminds us that a simple “google-search” is already responsible for certain amount of CO2 emissions. Windows recently announced that they will keep upgrading windows XP until 2014. This is a direction towards expanding life for existing hardware.

Tan Sri Rainer Althoff, Chairman of NSN stated that “It is all about creating awareness”. People are less motivated to change their behaviour concerning their energy consumption if not incentivized.

Last but not least Dr Timothy Senathirajah provided some examples of Green ICT from Scandinavia However, Malaysia is actively engaged towards creating a ‘green awareness’ and high profile discussions like this one are a small step into a greener future. The event was held at Double Tree by Hilton.

Upcoming events* 16th February CEO Breakfast Dialogue with Tan Sri Zarinah, Securities Commission 22nd February Breakfast talk cum dialogue with Malaysian Communications & Multimedia Commission 23rd February EUMCCI HR Committee workshop by ICLIF** 24th February Oil & Gas Committee Workshop** March • Breakfast Talk with Natural Resources & Environment Ministry • Insight to the Malaysian Economy – panel discussion • IPR Committee Breakfast Talk – Exploiting your Brand** • VIP Luncheon with the Minister of Higher Education • VIP Luncheon with the Minister of Energy, Green Technology & Water * All events are subject to change in view of availability of our VIPs. Please go to www.eumcci.com for confirmed details. ** Upon invitation only More information: events@eumcci.com

30 EUMCCI Review

members

Belga-Zone pictures the cover of Review Magazine Belgian professional photographer and director of Belga-Zone Production Sdn Bhd, Lucien De Prycker joined the Editorial Committee of Review Magazine and is the photographer of the cover for this publication. De Prycker has been in Malaysia for 8 years and his company is specialized in advertising, industrial and fine art photography. In particular, Digital Imaging, special effects for commercials and high-quality product photography is what companies in and outside Malaysia are booking his services for.

While his Fine Art work for both home and office decoration has been sold in many countries around the world, here in Malaysia it is decorating 3 floors of Shell’s Global Solution offices in Tower 2 of KLCC. Technically challenging assignments for the commercial industry have required his services when accuracy and fast follow-up were top priority. The list of industries covered are more than impressive and include; high-end jewelleries, watches, tires, aviation, shipping, fashion, portrait,

interior & architecture, F&B, Embassies, shopping malls and even several celebrities have all been on his list of clients. At regular times, Belga-Zone crosses borders and has been sent on various assignments outside Malaysia.

For companies, workshops in photography and Photoshop software (for MacAsia classes) were organized, he published a coffee table book on Kuala Lumpur in 2004 and his work has been highlighted in a number of magazines and newspapers, both inside and outside Malaysia, the latest being in a Belgian newspaper as recent as November 2010.

For EUMCCI, Lucien is providing several photographic sessions along with the cover pictures for EUMCCI Review Magazine for the coming year.

For more information please visit www.belgazone.com / belgazone@gmail.com / Lucien: M 016 6102484

New Sub-Regional Head for Asia South and Country Head for Malaysia, Nokia Siemens Networks Dharmesh Malhotra is appointed SubRegional Head for Asia South and Country Head for Malaysia, Nokia Siemens Networks. Located in Malaysia and holding a dual role, Dharmesh will be responsible for growing Nokia Siemens Networks business both nationally and regionally. As such, he will oversee all sales operations in Malaysia, Singapore, The Philippines, Sri Lanka and Brunei.

Dharmesh joined Nokia Networks in 2004 and has held several senior positions across APAC. With 20 years of experience in sales and operations across telecommunications, IT and engineering industries, Dharmesh is a dynamic and results-

32 EUMCCI Review

oriented leader who is committed to customer satisfaction and in ensuring strong discipline of execution.

Prior to this appointment, Dharmesh was the Head of Services in Indonesia for Nokia Siemens Networks for 18 months. Within this role he was instrumental in growing and delivering the services business.

In his career, Dharmesh has managed large teams of people based in multiple locations.

He is results-oriented and believes that a successful business revolves around building highly motivated teams, relentless in their pursuit of ensuring customer loyalty and execution excellence.

Dharmesh holds a Bachelors Degree in Engineering, specialising in Electronics. He is married with two children, enjoys music and is an avid follower of sports.

members

Impiana Resort Cherating, acknowledged

by Ministry of Tourism Impiana Resort Cherating, Pahang is recently acknowledged as a 4 Star Hotel status by the Ministry of Tourism Malaysia.

Over the years, the Impiana Group has achieved exponential growth in building, owning and managing its brand of hotels, resorts and spa collection focused on guest experience. It offers diverse leisure options from city hotels & spa to beach resorts & luxury boutique Private Villas that no other local hotel group in this region can match.

The Impiana Resort Cherating is an architecture meticulously designed to resemble the finest in traditional Malay culture. It is situated in the East Coast’s

sandy beaches and home to the most exotic sea turtles.

Since this first resort in Cherating opened in 1994, Impiana Hotels & Resorts Manage-

ment Sdn Bhd (IHRM) has opened five other resorts in Kuala Lumpur, Ipoh Perak, Kata Noi Phuket, Patong Phuket and Chaweng Noi, Koh Samui.

LBB promotes Agrologistics & Green Logistics at MAHA 2010 From 26 November until 5 December the Malaysian Agriculture, Horticulture and Agrotourism show (MAHA) was held at the Malaysian Agro Exposition Park in Serdang.

The MAHA, being held every two years, is Malaysia’s leading agriculture exhibition and the largest of Southeast Asia. There were 2,500 booths displaying the latest agriculture products, farming technologies and solutions. A total of 22 countries were taking part in the exhibition. This year the MAHA attracted 2.7 million visitors.

LBB International, a Netherlands based logistics consultancy, research and supply chain management firm, presented the latest concepts and solutions in agrologistics and green logistics at the MAHA 2010. ‘Agriculture innovation for Growth’, the theme of the MAHA 2010, requires the application of agrologistics concepts. According to the CEO of LBB International and Head of the EUMCCI Logistics Committee, Ir. Marco Tieman, this allows Malaysia to reduce cost structures and create a competitive advantage for Malaysia’s agriculture sector. Ir. Marco Tieman met with the Minister of Agriculture

YB Datuk Seri Noh Omar at the MAHA 2010.

Green logistics, or also called environmentally friendly logistics, is something new. As fundamental logistics systems and sustainability are sometimes contradictory, it is not a straightforward journey towards green logistics.

However, according to Tieman, there are five key principles in achieving a sustainable logistics system, namely: 1. Green supply chain design (sourcing close by, integrate reverse logistics, choose green packaging) 2. Slow transport (choice for mode of transport that is less polluting, like water and rail) 3. Green last-mile delivery through competitive collaboration (sharing of trucks) 4. Green warehouse (green building that can optimise temperature and uses renewable energy)

5. Green order (provide the customer the choice for a green delivery) The Logistics Committee has started with a Green Logistics project in order to create awareness for Green Logistics among the shippers and logistics service providers in Malaysia. The Logistics Committee hopes that green logistics will be an important component of sustainability programs in the country.

EUMCCI Review 33

malaysia news

››› Europe and Malaysia will grow together with a bilateral Free Trade Area (FTA)

By Karel De Gucht, EU Trade Commissioner Trade and investment are crucial elements of the global recovery. However, in spite of its benefits, trade is often an extremely contentious political issue, both domestically and on the global stage.

The British historian Thomas Macaulay had this paradox in mind when he said that “Free trade, one of the greatest blessings which a government can confer on a people, is in almost every country unpopular.” That was back in 1824, yet it still rings true today.

The challenge for policy makers is therefore clear: while trade is often seen as one of the factors that got us into a crisis, we have to turn around this idea and support international trade to get out of it.

Eighteen months ago, global economic confidence was at its lowest. The financial crisis then took a heavy toll on the real economy, including on international trade, which dropped by around ten percent in 2009.

Today, we may not be out of the woods yet but things look definitely better. I believe this is in good part the result of a determined response from many governments.

Europe has played a key part in stimulating the global recovery and has also been at

34 EUMCCI Review

the forefront of global efforts to avert the risks of a protectionist spiral, both by what we did and by what we didn’t do.

Our borders have stayed open for business and foreign investment have kept flowing.

Europe has not wavered on its commitment to free trade - and will not do so in the future.

We have argued for and obtained strong political statements by the G20 against protectionism and in favour of completing the WTO DDA Round – stressing its importance as the best single way of addressing protectionist risks at the global level.

Globally, WTO rules have provided insurance against a protectionist race to the bottom and it is fair to say that the multilateral rules-based system has passed its worst “stress-test” to date.

The EU and Malaysia should continue to work together in the WTO to secure a balanced and comprehensive multilateral deal, which would not only give a significant boost to the global economy but would address longstanding concerns of developing countries, notably on agriculture.

However, the current deadlock at the WTO should not put our wider vision on hold and should not stop us from trying to foster our trade relations at the bilateral level.

Malaysia is the EU’s second largest trading partner in ASEAN, behind Singapore but clearly ahead of much larger countries like Indonesia, Thailand, the Philippines and Vietnam. Our bilateral trade amounted in 2009 to around €23bn. In terms of approved FDI projects, the total EU stock is €8 billion. That is serious money.

But we cannot sit on those laurels. After all, the economic crisis has wiped out about 20% of both the EU’s and of Malaysia’s external trade. Moreover, on inward FDI the picture is far from rosy: Malaysia’s recent figures suggest that in 2009 inward FDI fell by more than 50% compared to 2008.

In other words, there is a job to be done on foreign trade and investment. How? First of all, as anywhere else, through domestic policies. We have seen some encouraging signals from the Malaysian Government in the past year, with the unilateral liberalisation and dismantling of several barriers in the services sector and restrictions on investment. Of course I hope the liberalisation drive will continue. This will also be consonant with the policy of implementing the New Economic Model (NEM).

But next to domestic policy, we need to build up a new framework for the MalaysiaEU bilateral trade. Why? Firstly, because a long-term, stable trade relation would make

malaysia news

a world of difference as compared to the current unilateral granting of preferences by the EU under the so-called GSP (Generalised Scheme of Preferences). This is an EU scheme for developing countries and we need to anticipate the day when Malaysia no longer qualifies for it.

Secondly, because the gains of a new, more ambitious arrangement for liberalising our bilateral trade can be huge. A study conducted in 2006 indicated that Malaysia would be a clear “winner”: Malaysia’s GDP would be boosted by 8% by 2020 if a comprehensive Free Trade Area (FTA) were to be concluded.

We tried to create this new framework through the EU-ASEAN FTA negotiations.

But last year, ASEAN and EU concluded that, at present, the conditions do not exist for such a region-to-region FTA. But we cannot afford to sit still and wait for the wind to turn. This is why the EU is now seeking alternative ways forward, namely

through the negotiation of FTAs with individual ASEAN countries. Let there be no mistake: the EU is not giving up on ASEAN as a region. It is a strategic goal of the EU to promote and assist ASEAN’s integration.

Negotiating bilateral FTAs with individual ASEAN members is such a way. It is like producing the bricks, the building blocks that can later form a bridge.

In this perspective, Prime Minister Najib and the EU Commission President Barroso launched the Malaysia-EU FTA negotiations on 5 October in Brussels. In the same vein, bilateral FTA negotiations with Singapore were launched in December last year, while the EU and Vietnam will do the same in the near future.

The objective of the FTA negotiations with Malaysia is simple: we wish to create new opportunities for businesses from both sides. Companies wishing to sell goods or offering services between the two sides should enjoy preferential treatment. And

consumers should get access to a wider variety of products at better prices.

For the EU, Malaysia represents a growing market for exports and investment, as well as a crucial link to the wider ASEAN region.

European companies who are thinking about setting up shop in one of the ASEAN countries may well be encouraged by the FTA do so in Malaysia.

Likewise, it makes eminent sense for Malaysia to get preferential access into the EU, the world’s largest market. The EU, with its half a billion largely prosperous consumers, is without doubt an attractive destination for Malaysian exports.

Establishing a free-trade agreement is a means to an end. That end is encouraging mutually beneficial economic partnerships and forging closer people-to-people links.

Ordinary European and Malaysian citizens will be the ultimate beneficiaries of deeper trade and investment relations.

››› MIDA collaborates to develop switching and routing products in Malaysia Malaysian Investment Development Authority (MIDA) and Cisco announced in November a strategic initiative to manufacture the Cisco Carrier Routing System (CRS) in Penang. The initiative is seen as a compliment to the Electrical and Electronics (E&E) sector in the Malaysia.

Through this initiative, Cisco will bring to Malaysia its manufacturing processes, technologies, knowledge and skills and will be working with a contract manufacturer in Penang. According to Malaysia’s Department of Statistics Malaysia, the E&E sector represents a strong contributor to the national economy, accounting for over 520,000 jobs and 41 percent of Malaysia’s total exports in 2009.

Developing employees MIDA will provide support on local talents and skills development to enable an effective execution of the initiative. MIDA expects 1,000 Malaysians to be trained with the high-technology skills and with exposure to the new technologies and solutions. Together, both parties will identify

the candidates with the help from the Ministry of Human Resources Malaysia.

With the human capital development plan in place, the initiative will help develop highly-skilled, knowledge-based employees critical to the nation’s growth plans. ”We truly support leading multinational companies to establish their manufacturing operations and facilities in Malaysia as it helps the country move up the value chain and leapfrog towards a high-income economy. This initiative will not only demonstrate Malaysia’s global competitiveness, but also create job opportunities in the market. As such, our role is crucial to ensure that the plan is well-supported by the right kind of talents,” said Datuk Jalilah Baba, Director General of MIDA. Improve internet infrastructure The fully modular and distributed routing system will enable service providers to deliver a suite of data, voice, and video services over a highly available and highly scalable Internet Protocol Next-Generation Network (NGN) infrastructure. It is

designed to help service providers increase business profitability, service flexibility, and operational efficiency and in Malaysia, this will make possible services such as video-on-demand, high-definition video conferencing, TelePresence, online gaming and real-time interactive services.

Source: MIDA

EUMCCI Review 35

malaysia news

››› Private Higher Education to Spur Economy

The education sector as the driver for economic growth is pertinent in challenging times especially with the elaborate plans underscored in the Economic Transformation Programme (ETP).

In line with this, deputy lab leader of Education under the National Key Economic Area (NKEA) Professor Leong Yin Ching underscored education as the key cornerstone for the success of Malaysia’s economic growth plans especially for private higher education providers. “Education is a vital sector for businesses as it provides good social returns,” Leong affi rmed.

“Of the various economic sectors, services contributed about 45 per cent (RM335 billion) of total gross domestic product (GDP) in 2008 while other services made up 92 per cent of the contribution; education provides the balance of eight per cent.

“Another aspect of good social returns with investment in education is productivity gains in the long run. A study of the European Union established the fact that a permanent one-year increase in the average education levels of the labour force translates into a 0.45 per cent increase in annual labour productivity growth.”

Leong further added that in the country, education had one of the highest output multipliers in the economy, about 2.34 times for public education and 2.19 per cent for private education. The average output multiplier for selected economic sectors levelled at 1.8 times.

Source: BorneoPost Online

36 EUMCCI Review

››› Call for Malaysia to Step-Up Sustainable Investment at ASrIA Roundtable Thanks to the IFC, EU-Malaysia Chamber of Commerce & Industry, OWW consulting, and Standard Chartered Bank for their support of the ASrIA Kuala Lumpur Sustainable Investment Roundtable. David St. Maur Sheil, Executive Director of ASrIA, strongly recommended SRI investors to recognise the added value of engaging with and supporting best practice in all sectors.

The comment, at the ASrIA Roundtable, came a week after the Bursa Malaysia launched their CSR reporting guidelines for listed companies, which will encourage more high quality SRI flows into Malaysia.

This Roundtable, one of seven held by ASrIA around Asia in 2010 brought Malaysia new insight about global and regional sustainable investment trends and development. “It is very valuable to have this ASrIA SRI roundtable and discuss ESG issues with the local investor community now,” commented Dr. Geoff Williams, CEO of OWW consulting. Ms. Minna Saneri, General Manager of EUMCCI, invited their members to engage in SRI actively.

Dr Geoffrey Williams, Deputy Head of CSR Committee

not for profit, membership association dedicated to promoting corporate responsibility and sustainable investment practice in the Asia Pacific region.

More details of roundtables can be found on www.asria.org.

The Association for Sustainable & Responsible Investment in Asia (ASrIA) is a

››› Export permits for strategic items under STA The export permit for all strategic items under the Strategic Trade Act (STA) i.e. military items and Dual Use items – category 1-9, will be enforced from July 1 2011 onwards and companies will be required to apply for the export permits from April 1 2011.

Persons and organizations who are involved with the export, transshipment, transit and brokering of strategic items in Malaysia are involved with the Strategic Trade Act (STA).

The STA provides control over these activities, including arms and related material, and other activities that will or may facilitate the design, development and production of weapons of mass destruction (WMD) and their delivery systems.

Export permits and broker registration are available for single/multiple use and bulk permits, special permits and broker registration certificate.

Violating the Act can lead to a penalty varying from a fine to capital punishment.

EUMCCI advices anyone who is involved with export from Malaysia to review the Strategic Items List to see if their exported items are in the control list under the STA. For more information: MITI and google on ‘Strategic Trade Act MITI’ Strategic Items List: http://www.exportcontrol.org/ links/1049c.aspx

New Members

Bank Perusahaan Kecil & Sederhana Malaysia Berhad

Menara SME Bank Jalan Sultan Ismail P.O.Box 12352 50774 Kuala Lumpur Tel: +603-2615 2020, 2615 2828 Fax: +603-2698 1748 Email: sally@smebank.com.my Website: www.smebank.com.my

Chief Executive in Malaysia Datuk Mohd Radzif Mohd Yunus, Managing Director

Contraves Advanced Devices Sdn Bhd

Batu Berendam F.T.Z. PO Box 39 75700 Melaka, Malaysia Tel: +606-233 18 88 Fax: +606-232 85 98 Email: info@contraves.com.my Website: www.contraves.com.my

Chief Executive in Malaysia Mr Gordon Douglas Hargreave, Chief Executive Officer

Federal Express Services (M) Sdn Bhd

801B, Level 8, Tower B, Uptown 5 5, Jalan SS21/39, Damansara Uptown 47400 Petaling Jaya, Selangor Tel: +603-7720 6000 Fax: +603-7725 0944 Email: Ashley.yeo@fedex.com Website: www.fedex.com/my

Chief Executive in Malaysia Mr Ramesh Kumar Singam, Managing Director

GTower Hotel

Impiana Hotels, Resorts & Spa

199 Jalan Tun Razak 50400 Kuala Lumpur Tel: +603-2168 1919 Fax: +603-2168 1833 Email: sales@gtowerhotel.com Website: www.gtowerhotel.com

21st Floor, Menara KH Jalan Sultan Ismail 50250 Kuala Lumpur, Malaysia Tel: +603-2141 6233 Fax: +603-2142 2295 Email: nora@impiana.com Website: www.impiana.com

Brief Company Profile The establishment of SME Bank - or Bank Perusahaan Kecil & Sederhana Malaysia Berhad as a development financial institution on 3 October 2005 is to nurture, develop and meet the unique needs of entrepreneurs in the small and medium industries. As a developmental institution, SME Bank responds to the funding and business growth needs of SMEs. The principal activities of the Bank are to provide financing and business advisory services to Malaysian SMEs.

Brief Company Profile Contraves Advanced Devices Sdn. Bhd. (Contraves) is one of Malaysia’s leading electronic systems manufacturing and service companies. Our capabilities range from assembly of complex PCB’s (SMT and throughhole), cables and cable harnesses to the complete manufacturing of sub-assemblies and systems.

Brief Company Profile FedEx Express is the world’s largest express transportation company, providing fast and reliable delivery to more than 220 countries and territories.

Chief Executive in Malaysia Ms Goh Chui Lang, Chief Operating Officer Brief Company Profile GTower Hotel is a 5 star boutique hotel located in GTower smart and green building with hi-tech MSC compliant specification. Centrally located in heart of KL’s business, embassy, shopping and entertainment and 5 minutes away from Ampang LRT subway.

Chief Executive in Malaysia En. Mohd Yusof Mohammad Isahak, Executive Director Brief Company Profile Impiana Group is Asean’s leading luxury boutique and award winning 4-Star collection of hotels, resorts and spa.The Group has achieved exponential growth in building, owning and managing its brand of hotels, resorts and spa collection focused on guest experience.

It offers diverse leisure options from city hotels & spa to beach resorts & luxury boutique Private Villas that no other local hotel group in this region can match.

EUMCCI Review 37

New Members

Level 31, Quill Building 7, Tower D Jalan Stesen Sentral 5 KL Sentral, 50470 Kuala Lumpur Malaysia Tel: +603-2302 9000 Fax: +603-2303 9001 Website: www.nokiasiemensnetworks.com

Chief Executive in Malaysia Mr Dharmesh Malhotra, Head of Asia South sub-region and Country Head for Malaysia.

Rémy Cointreau International Pte. Ltd.

(Malaysia Representative Office) PJ8 Office Suites, B-3-3A Block B West, No.23, Jalan Barat Seksyen 8, 46050 Petaling Jaya Selangor D.E., Malaysia Tel: +603-7960 3333 Fax: +603-7960 3330 Email: jason.LEE@remyasia.com Website: www.remyasia.com

Chief Executive in Malaysia Mr. Jason Lee, General Manager

Tesco Stores Malaysia Sdn Bhd

Head Office, Level 3, No.3, Jalan 7A/62A, Bandar Menjalara 52200 Kuala Lumpur Tel: +603-6287 6000 (General) +603-6287 5202 (Direct) Fax: +603-6287 6007 Email: Azlam.Alias@my.tesco.com Website: www.tesco.com.my

Chief Executive in Malaysia Mr Tjeerd Jegen, Chief Executive Officer

No.568-9-23, 9th Floor, Mutiara Kompleks 3 ½ Miles Jalan Ipoh 51200 Kuala Lumpur, Malaysia Tel: +603-6257 4740 Fax: +603-6257 4751 Email: kkarakolidis@yumulai.com.my Website: www.yumulai.com (Under Construction)

Chief Executive in Malaysia Mr. Kosta Karakolidis, General Director

Nokia Siemens Networks

Yumulai Engineering Asia Pacific Sdn. Bhd.

38 EUMCCI Review

Brief Company Profile Nokia Siemens Networks is a leading global enabler of telecommunications services. The company provides a complete portfolio of mobile, fixed and converged network technology, as well as professional services including consultancy and systems integration, deployment, maintenance and managed services. It is one of the largest telecommunications hardware, software and professional services companies in the world. Operating in 150 countries, its headquarters are in Espoo, Finland.

Brief Company Profile The French-based Rémy Cointreau Group is the global leading manufacturer of ultra premium spirits and champagnes. With a strong presence in more than 150 countries and an annual turnover of over 800 million euros, the Group is the sterling result of the union between a long-standing family heritage and modern commercial acumen, backed by an outstanding portfolio of brands leading the premium and ultra premium wines and spirits markets. These brands include Rémy Martin Cognac, Louis XIII by Rémy Martin, Cointreau Liqueurs, Piper-Heidsieck Champagne, Charles Heidsieck Champagne, St Rémy Brandy, Metaxa Brandy, Mount Gay Rum and Passoa.

Brief Company Profile Tesco Stores (Malaysia) Sdn. Bhd. was incepted on Nov 29, 2001, as a strategic alliance with local conglomerate, Sime Darby Berhad of which the latter holds 30% of the total shares. Tesco Malaysia currently has 36 stores nationwide – 27 hypermarkets, 8 Extra and one Superstore – and two distribution centres – Bukit Beruntung, Selangor and Simpang Pulai, Perak. Tesco employs more than 13,000 people, where 99% of the staff are locals.

Brief Company Profile Yumulai is an Engineering Company specialized in machine design and manufacturing as well as supply of high end technology and engineering services related to the Wood Processing Industry.