GEORGE TOWN: Malaysia's bid to be known as among the world's Top 10 engineering centres and competency hubs requires innovative incentives offered to multinational corporations (MNCs) for them to expand into high value-added activities.
The Malaysian American Electronics Industry (MAEI) is proposing that the incentives be not just based on capital investment, but also on knowledge-based industries, notably the pioneer status offered by the Malaysian Investment Development Authority.
"Despite boasting a large and long history of electrical and electronics (E&E) presence here, Malaysia is not known as a preferred destination for research and development or as a competency hub for E&E," MAEI chairman Datuk Wong Siew Hai told Business Times recently.
He said the proposed incentives is one of several suggestions on MAEI's Budget 2014 wish list submitted to the Ministry of Finance in June this year.
He said by serving as an E&E competency hub, Malaysia would stand in better stead to attract the world's best talents to work here.
"The country is losing its top performers, including students, to other countries and global markets due to a lack of opportunities in Malaysia, while all the other major Asian countries like Taiwan, China, South Korea, Japan and Singapore boast world-class industry-centric research and development centres."
MAEI - an industry committee of the American Malaysian Chamber of Commerce - comprise 24 US-based companies in both the semiconductor and non-semiconductor sectors.
Many of the firms have been doing business in Malaysia over the last four decades.
In addressing the lack of a talent pool locally in R and D and engineering/design, especially among post-graduates, Wong said the association is asking that the government allocate resources to improve the whole education system from primary to university levels with an increased emphasis on science and engineering with the English language.
"The implementation of the National Education Blueprint is unclear and the industry requires immediate execution from the government to revamp the local education system to restore confidence in Malaysia's ability to produce a pool of quality graduates."
On electricity tariffs, MAEI is calling for rebates on electricity bills to be allocated for electricity usage to sectors with high contribution to the Malaysian economy.
"Electricity tariff in Malaysia is among the highest in the world and is 44 per cent higher than that in the United States' Austin, Texas, and 12 per cent higher than that in Taiwan.
"Since the semiconductor manufacturing sector is ranked 12th highest in terms of energy consumption and second in terms of value creation and contribution to the Malaysian economy, we are asking that the tariff rate structure in Malaysia remain globally competitive," he added.
MAEI is also requesting that the government address infrastructure issues such as lack of maintenance of industrial trade zones, property security and basic infrastructure facilities like lightings and closed-circuit televisions.