Oleh/By		:	DATO' SERI DR. MAHATHIR BIN MOHAMAD 
Tempat/Venue 	: 	ROME, ITALY 
Tarikh/Date 	: 	24/09/84 
Tajuk/Title  	: 	A LUNCHEON MEETING WITH ITALIAN 
			INDUSTRIALISTS AND BUSINESSMEN 




 Distinguished guests;

Ladies and Gentlemen.

When the famous Italian author Salgadi wrote his exciting stories of the
pirate "Sandokan" who sailed in the Malaysian waters and pillaged British
ships, I understand that he wrote this from pure imagination having never
visited Malaysia or even Southeast Asia. However, I have been informed
that many Italian youngsters, and may be some of you in your younger days,
have been fed on a steady diet of Salgadi's version of Malaysia and the
exploits of Sandokan.

2. Salgadi may have made Malaysia well known in Italy but the lasting
impression of a romantic, violent and underdeveloped region that Sandokan
may have left in the minds of Italians is anything but accurate. I hope
that in the course of our dialogue today I will be able to change the
wrong impression and give you a modern nation determined to join the
league of developed industrial nations.

3. Let me now give you a categorical assurance that you will never come in
contact with pirates such as Sandokan in doing your business in
Malaysia. However, some Malaysian businessmen may refer to foreign
businessmen as pirates because they are reaping huge profits in their
business operations in our country. The Malaysian Government, however, is
quite happy that foreign businessmen make substantial profits in Malaysia
because, for the private sector, profit is the ultimate yardstick of
success and success is what we encourage in Malaysia. In addition after
these foreign businessmen or industrialists finish their tax holiday
periods, under the generous incentive schemes we offer, the Government
will be able to tax them; and the biggger their profits, the bigger the
revenue for the Government. It is with this attitutde of enlightened
self-interest that the Malaysian Government encourages the private sector
to take full advantage of the opportunities for profits in Malaysia.

4. In Malaysia we envisage a symbiotic relationship between the private
sector and the Government where the success of one benefits the other and
where the efficiency and dedication of the Government brings benefit to
the private sector. In Malaysia we have coined the phrase 'Malaysia
Incorporated' to describe the dynamic inter-relationship between the
private sector and the Government -- all working together like in a
gigantic corporation -- for the ultimate benefit of all.

Ladies and Gentlemen, 

5. This then is the nation and the Government I represent, a Government
dedicated to development and a nation in a hurry with the capacity and
determination to develop and to join the ranks of developed
nations. However, we are aware that we cannot do all this alone.

6. Though today Malaysia is the world's largest exporter of a few primary
commodities such as rubber, timber, tin, palm oil and pepper; though today
we are a net exporter of oil and gas and though today due to the
industrial efforts of the past decade, we are the world's largest exporter
of electronic semi-conductors and rubber products such as swimming caps,
gloves, catheters and rubber bands and also the third largest exporter of
room air-conditioners, after Japan and the USA, we are modest enough to
realise that much of our efforts and the fulfilment of our aspirations
cannot succeed without the help of the foreign investor and his
contributions of technology, management know-how and access to export
markets. This is the reason why we are here today investigate Malaysia as
a base for your offshore operations, to manufacture, to serve the 250
million ASEAN markets and also world market.

7. In Malaysia we have a high regard for things Italian. Your high fashion
products from Gucci to Valentino, from Giorgio Armani to Lamborginni and
Gilbarto and other designs of footwear, clothing, spectacles, etc. are
highly respected and purchased by those who can afford them. Malaysians
are also very familiar with and respect the engineering technology of
Italy as exemplified in your motor vehicles such as Fiat and Alfa Romeo,
though I must say that the Japanese car makers have created a serious dent
in your sales in Malaysia. However, for the purpose of this Mission it is
sufficient that you are aware that we in Malaysia have a high regard for
Italian know-how and technology not only for the manufacture of fashion
products but also engineering, chemicals, footwear, furniture, precision
products, electronics, aerospace, and a host of others.

8. Also firms such as SGS Ates, General Goma and Marconni have set up
manufacturing operations in Malaysia. They are among the 27 Italian
companies that have been approved for manufacturing operation in our
country and the success of some of these have created a high regard for
Italian ingenuity and profit motivation. However, Italian investments in
Malaysia is relatively small when compared to that of other European
countries and especially considering the potential for technology
transfers that Italian investors possess.

Ladies and Gentlemen, 

9. You may ask youselves why should you come to Malaysia? What do we have
to offer to you that will persuade you to invest in our country? In fact,
the question you may well ask yourselves is what you must look for when
you invest in any country. This is the question that every investor
seeking opportunities for profits overseas should ask himself. Needless to
say this question need not be of concern to those of you who are
complacent about your present position and are manufacturing today only to
supply your regional or local markets protected by high tariff walls. This
question is also not relevant to those who have given up the battle to
fight for their rightful place in international markets competing with
products coming from other developed and developing countries including
those in the Far East like Japan, Korea, Hong Kong, and Taiwan.

10. Our interest quite frankly is directed to those who wish to grasp the
oppportunity to set up a viable competitive operation either today or in
the near future within the fastest growing region in the world i.e. ASEAN
and in one of the fastest growing countries in the ASEAN region
i.e. Malaysia. In short, if you are interested in expanding your world
market operations and increasing your profits, then we are interested in
you.

11. We do not offer you the rhetoric of future success nor do we give you
assurances of the future based on a murky track record of the past. What
Malaysia offers you is a solid record of past achievements in political,
social, economic and industrial fields. We have an enviable record of
political and economic strength and stability that will match that of the
most advanced developed nations. In fact, our record of political
stability will be difficult to match by most countries in the free world.

12. I myself am the leader of a political party called the National Front
which holds more than 2/3 majority in Parliament. Being a coalition of
different parties representing diverse ethnic interests, the party has
held undisputed political power since 1957, that is from the time of our
Independence. This has been done within a system of parliamentary
democracy with free elections every 5 years. Why do we have such an
enviable record? This is simply because the Government and those of my
predecessors have dedicated and are dedicating ourselves to promoting the
total welfare of the people through Government-sponsored development
projects and private enterprise initiative in areas of mining,
agriculture, services and manufacturing. From the businessman's point of
view this means when you invest in Malaysia you can be assured that the
Government in power, whose policies, rules and regulations are oriented to
maximise the efficiency and profitability of your operations, will
continue for a long time to come. This assures you predictability, and
with a Government which has predictable policies and rules you too can
plan for the long-term with reasonable assurance that the growth of your
projects will not be stunted by haphazard and arbitrary plans and
policies.

13. I will not talk to you about our economic strength, our financial
performance or the banking facilities available, because all this
information is clearly stated in the literature that will be made
available to you today. The details regarding the opportunities for
investment in the resource-based industries in Malaysia, namely rubber,
timber, tin, clay, and others and our thrust to attract engineering and
precision industries and high technology industries are also available in
the publications issued by the Malaysian Industrial Development Authority
whose representatives are here today. They will be happy to meet you and
to talk to you about details regarding your plans for investment.

14. I would like to take this opportunity, however, to talk about
Malaysian labour. We have a young educated labour force which is growing
at a rate of 3.1% per annum. More than 70% of the Malaysian labour force
is below the age of 40 and most of them have a working knowledge of
English. The Malaysian Government, as you may know, has introduced what is
called the 'Look East Policy'. Let me clarify that this policy is merely
designed to inculcate within this dynamic young labour force the work
ethics and commitments to labour and industry, loyalty to the firm,
consciousness of quality, etc. that have made Japanese and Korean
companies today world beaters in many manufacturing areas.

15. The policy of the Malaysian Government is designed at promoting and
maintaining industrial peace and harmony so as to create a favourable
environment for accelerated socio-economic development. We have an
enviable record of industrial relations and Government's machinery for the
prevention and settlement of industrial disputes through conciliation and
arbitration has led to a situation of decreasing labour unrest and
increasing industrial harmony between the management and workers. I
mention this factor because I am aware that the problem of industrial
unrest is one that besets many companies in developed nations and I want
to assure you that this is not a feature of the Malaysian economic
environment.

16. Finally I would like to remind you that when you look at Malaysia you
should not look at the 14.5 million people that inhabit the country which
has one of the highest standards of living in Asia. When you look at
Malaysia you should also see the opportunities that lie within the ASEAN
region with its growing standards of living and which has within itself
most of the major raw materials required by the industrial world. Malaysia
can offer you a door to tap the ASEAN market within the framework of the
various tariff agreements that have been and are being formulated within
ASEAN to give manufacturers in our region an advantage in the regional
markets when competing with products from outside the region. We are by no
means at a stage similar to the common market of the EEC. The EEC has had
many decades to work out its problems and is still going through the pains
of growth. Thus ASEAN does not wish to rush into areas where even the
angels fear to tread. We want to make speed, but it is a "deliberate
speed" planned to ensure that the structure that we build will not be
thrown asunder by strains that leave different members dissatisfied with
their lot within the region. Be that as it may, and many may conceive the
ASEAN economic integration as a slow process, regional economic
cooperation nevertheless is an expanding reality and the manufacturer who
has his foot within the door of ASEAN today will reap the rewards of his
initiative in the future. I am sure that the Malaysian private sector
whose leaders are with me today and those from the Government will be able
to give you more information and details as to how you can do business in
Malaysia while at the same time tapping the opportunities that the ASEAN
markets represent.

17. As I have said earlier Malaysia is not new to Italians. However, today
we present to you Malaysia in a new perspective, a perspective of
development, mutual cooperation, mutual benefit and profits. The Malaysian
investor who will be your joint venture partner and those who have come
with me are neither overawed by foreign investors nor are we hostile to
your intentions in our country. We welcome you as an equal partner in our
endeavour to industrialize our nation. The Malaysian and Italian
Governments have signed a Double Taxation Agreement in January this year
for the avoidance of double taxation and we are presently negotiating an
Investment Guarantee Agreement. The framework for active cooperation for
mutual benefit already exists and is being constantly improved. Malaysia
has taken the initiative to reach out to you and we therefore now await
your response.

Thank you.