Oleh/By : DATO' SERI DR. MAHATHIR BIN MOHAMAD
Tempat/Venue : UCLA, LOS ANGELES
Tarikh/Date : 14/01/97
Tajuk/Title : THE LOS ANGELES CONFERENCE FOR
INVESTORS ON MSC : GLOBAL BRIDGES
TO THE INFORMATION AGE
1. First, let me thank the UCLA for inviting me to
address you today. In this audience, I see both the
present and future shapers of the Information Age. The
present is represented by the leadership of many of the
area's most dynamic content and high technology
companies; the future by the university students who
will provide the future leadership of the private and
public sectors.
2. I think it is especially appropriate that we are
all together today to discuss a practical proposal I
have to achieve the full promise of the Information Age.
I have come here to the world's entertainment capital,
to share a vision of building a bridge between peoples
and places, to connect your creativity and
entrepreneurship with a very special environment we are
creating in Malaysia. By doing so, we can reap rewards
together that neither of us would be able to develop
alone.
3. The success of a country depends on its ability to
adopt and adapt to global forces and not on the basis
exclusively of comparative advantages such as natural
resources, population, or labour costs. Visionary
countries can choose to create value rather than merely
struggle to make the most out of existing circumstances.
Just as companies cannot succeed by trying to do
everything themselves, the same is true of countries --
especially developing countries. Malaysia is not trying
to build a replica of Silicon Valley or Hollywood. We
would be deluding ourselves if we expect storyboards not
to be created in Hollywood or R & D on the highest value-
added components not to be done in Silicon Valley.
4. We realise you are more advanced and that we have
much to learn, but precisely because you are so
developed there are very important things we can do that
you cannot. Malaysia is offering the world a special
greenfield environment designed to enable companies to
collaborate in new ways and reap the rich rewards of the
Information Age. There are no legacies of artificial
constraints created and perpetuated by entrenched
interests. We offer the Multimedia Super Corridor as a
gift to the world -- a global bridge to the Information
Age that will enable genuine mutual enrichment for our
partners possessing the vision to participate.
5. The Multimedia Super Corridor -- or MSC -- is truly
a world first - the careful creation of a region with
the infrastructure, laws, policies, and practices that
will enable companies to explore the Information Age
without the usual constraints which frustrate them. The
MSC is a 15 km wide by 50 km long corridor that runs
from the world's tallest buildings in the Kuala Lumpur
City Centre, down to what will be the region's largest
airport when it opens in early 1998.
6. More than two years of careful study have gone into
developing a package with four key elements which will
make the environment within the MSC very special:
- First, the MSC will have the best physical
infrastructure that can be offered in the world. This
includes the Kuala Lumpur City Centre, a new airport,
rapid train links to Kuala Lumpur, a dedicated Highway,
and two new intelligent garden cities. Kuala Lumpur
City Centre is the Northern gateway to the MSC. The
Kuala Lumpur International Airport to be commissioned in
1998 will initially have 80 gates with two parallel
runways. The airport will also become an integrated
logistic hub with the latest in IT to facilitate
movements of people and goods.
- The first intelligent garden city, Putrajaya, will
be our new administrative capital where most Ministries
will be relocating beginning with the Prime Minister's
office in 1998. Putrajaya will be Malaysia's new
electronic Government administrative centre served by
state of the art communications and transportation
systems. The neighbouring Cyberjaya, is a city designed
to provide the physical and psychological spaces needed
for creativity, the pursuit of information age
technologies and businesses and relaxation. It will be
built around the new Multimedia University. Cyberjaya
will provide top quality intelligent buildings,
multimedia enterprise estates, residential housing,
leisure and recreational facilities, and state of the
art supporting infrastructure. It will support a
working population of approximately 150,000 and a living
population of over 100,000.
- Second, the MSC will have the world's best soft
infrastructure of supporting laws, policies, and
practices. This includes a comprehensive framework of
societal and commerce-enabling cyberlaws on intellectual
property, digital signature, computer crime, distance
learning, telemedicine, and electronic Government. For
example, our new Digital Signature Act creates a
regulatory framework for certifying authorities and
severe penalties for cyber-fraud. In addition, we are
developing a Multimedia Convergence Act that will merge
and update our telecommunications, broadcasting, and
information laws to reflect today's rapid technological
convergence. Finally, we know how critical skilled
workers are and have a series of educational and
training initiatives across the country. All schools
will be connected to the Internet by the year 2000 and a
Multimedia University will produce graduates that will
meet MSC companies skill requirements.
- Third, the MSC will leapfrog available information
infrastructures with 2.5-10 gigabit Open Multimedia
Network that will use the latest ATM switches to provide
Fiber to the Building. This network will have a 5
gigabit international gateway with direct links to the
U.S., Japan, Europe, and other ASEAN countries. This
will be operational by 1998. Value-added service
providers will be able to compete freely on this network
with no restrictions on foreign ownership and cost-based
interconnect tariffs. Telecom Malaysia has committed to
offer competitive tariffs that are comparable or better
than other global carriers and will provide world class
network performance standards.
- Fourth, a fully empowered one-stop shop called the
Multimedia Development Corporation (MDC) has been
created to manage and market the MSC. The MDC will be
opening ten offices around the world over the next two
years so it can be close to the companies who will be
its clients. In addition, the MDC has been incorporated
under the Companies Act so it will be able to operate
independent of civil service rules and regulations. The
MDC has a free hand to hire the best people in the
world, and a business plan to serve the needs of
companies relocating to the MSC both before and after
they decide to establish operations in Malaysia. The
Deputy Prime Minister and I will personally oversee the
activities of the MDC and will resolve issues brought to
our attention.
7. Malaysia will be changing the way its people live
and work particularly within the MSC. This special area
will be a global `test-bed' for new roles of Government,
new cyber laws and guarantees, collaborations between
Government and companies, companies and companies,
education, delivery of healthcare, and applications of
new technologies. We are looking for `Smart-
Partnerships' -- win/win/win relationships between
companies and the Government. For example, we will no
longer require multimedia companies to go through a
traditional Request for Proposal (RFP) process that
requires us to have a crystal clear concept of exactly
what the company must deliver. Leading companies told
us this was inappropriate for new areas of multimedia
where the solutions are developed rather than assembled
from existing knowledge. Instead of traditional tenders
and RFPs, we will ask companies for `concept proposals'
that describe the approach they would take to developing
solutions or achieving the benefits we have requested.
This allows us to select a consortium of companies as a
smart-partner to innovate new products and services in
the MSC. We will be doing this in several application
areas that I will describe shortly.
8. In short, Malaysia is taking a single-minded
approach to developing the country using the new tools
offered by the Information Age. The MSC will be the R&D
centre for the information based industries, to develop
new codes of ethics in a shrunken world where everyone
is neighbour to everyone else, where we have to live
with each other without unnecessary tension and
conflicts. Indeed, the MSC is a pilot project for
harmonising our entire country with the global forces
shaping the Information Age. Phase one involves making
the MSC a success by learning from our partners and the
experience we gain; Phase two will link up with other
islands of excellence within Malaysia; and Phase three
involves making all of Malaysia a Multimedia Super-
Corridor that is connected to other smart-regions around
the world. I expect Malaysia to be in the final phase
by 2020 by which time we hope to be a developed nation.
9. To our knowledge no other country is even
considering anything similar. Other plans may sound
similar because they all use `IT, Cyber, or Multimedia'
to market one or another development. But we are not
adding new facilities to existing ones or adapting a
concept to an existing area; we are building and
installing the latest on a huge 15 km x 50 km greenfield
site designed to realise the full potential of
multimedia. I hope others will link with our Multimedia
Super Corridor and become one of the central pillars in
our global bridge connecting the smart-cities of the
world. It is in our mutual interest to collaborate
rather than undermine each other because we both will
benefit from a better bridge.
10. As we approach the 21st century, fantastic changes
are taking place which make what was impossible in the
old economy of the Industrial Age suddenly possible in
the Information Age. For practical purposes, borders
have already disappeared because knowledge, capital,
company activities, and consumer preferences ignore
lines on a map. Where countries once competed with one
nation's trade surplus resulting in another's trade
deficit, in the future both countries can benefit
because networks of companies collaborate across borders
to deliver value to customers in the most economically
sensible way. Although none of this activity is
captured by the economic statistics developed in the
Industrial Age, its impact is clear and will require new
types of international institutions. In short, the
Information Age has created conditions for the first
time in history that will enable countries and companies
to mutually enrich one another - it is no longer a zero
sum game with winners and losers. This is a tremendous
opportunity for those companies and countries with the
courage to embrace these changes. For a limited time,
there will be a relatively level playing field where
developed and developing countries can work together in
ways that create benefits for both. This is because
many of the healthier developed countries are locked
into obsolete industrial structures and legislative
frameworks and vested interests in these systems
stubbornly oppose any change. Fortunately, these
corporate interests have not had time to develop and
become powerful in developing countries like Malaysia.
11. The MSC is the first place in the world to bring
together all the elements needed to create the kind of
environment to engender this mutual enrichment. I see
the MSC as a multicultural `web' of mutually dependent
international and Malaysian companies collaborating to
deliver new products and services to customers across an
economically vibrant Asia and the world. I fully expect
that this `web' will extend beyond Malaysia's borders
and out across Malaysia's multicultural links to our
neighbours. Component manufacturing can then be done in
China, on machines programmed from Japan, with software
written in India, and financing coming from Malaysia's
Labuan International Offshore Financial Centre. The
product may be assembled in Penang and shipped to global
customers direct through our new airport.
12. Malaysian companies are already working with world-
class international companies and technology transfer is
taking place. Moreover, companies and neighbouring
countries are benefiting as well because parts of the
product are produced in other locations. The consumer
benefits most of all because they get top quality
products at the best possible price. In short, all
parties touched by this `web' will benefit and are
enriched through their contribution to it.
13. Phase 1 of establishing the MSC will be complete
when the MSC is home to hundreds of large and small
companies working collaboratively with one another and
with partners across the Asia-Pacific region and the
world. Some of these companies will certainly be
today's leaders. Many others will be the smaller
companies which are members of each of these companies
`web'. Hopefully, a few of tomorrow's leaders will be
from Malaysia with new products and services in the MSC.
I like multimedia because the most successful companies
are those which collaborate with many partners and truly
transfer technology to them-- not out of charity but out
of collective self-interest. These companies know that
they cannot stay at the leading edge if they try and do
everything themselves. They realise that a web of
smaller companies working to common standards can
deliver more benefits to the consumer. I hope to see
some multicultural Malaysian companies alongside
international companies thus mutually strengthening the
capabilities of both.
14. Phase 2 of linking the MSC with other islands of
excellence will be complete when the MSC becomes far
more than a business development. By then,the MSC will
be a global community living at the leading edge of the
Information Society. Citizens' smart homes will be
connected to a network through which they can shop,
receive information, be entertained, interact with one
another, and educate themselves. Phase 3 of
leapfrogging all of Malaysia into the Information Age
will be complete when the entire country is living and
working in these new ways. Of course when they grow
tired of all these new tangled things they can enjoy the
pristine environment which we have preserved in
Malaysia.
15. To achieve this vision, I think it is important to
define a path that leads to it. By 2000, I expect to
see seven specific applications being developed in the
MSC by `webs' of international and Malaysian companies:
- First, Malaysia will be a pioneer in electronic
Government. This will be a multimedia-networked
paperless administration linking Putrajaya to Government
centres around the country to facilitate inter-
Governmental collaboration and citizen access to
Government services. It will start with the Prime
Minister's office when it moves to Putrajaya in 1998
and roll out across the other ministries as they
relocate.
- Second, Malaysia will have the world's first national
multipurpose smart card. A single platform will have
the individual's ID and electronic signature and access
to Government, banking, credit, telephone, transport and
club services. Of course, security will be critical but
the technology is, I believe, already here to enable all
of these services to be on one secure platform. Imagine
the convenience as we are freed from having to carry a
huge pack of plastic cards and selecting one every time
we need to use a card. Imagine the opportunity for
companies of having no uncertainty that this one card
will be in the hands of every Malaysian.
- Third, Malaysia will have a comprehensive programme
for smart-schools. All schools will be connected to the
Internet. A new curriculum is being developed, and our
teachers will be retrained so they can work with
technology to do far more than convey knowledge in the
traditional way. World-class distance learning facilities
will be built at the Multimedia University and we
hope to hold virtual classes with teachers and
students in other universities around the
world. We will use our schools to help students learn
the judgement and skills required to choose between the
overwhelming amount of information that will be
available to them.
- Fourth, I hope the MSC will become a
collaborative cluster of academic and corporate R & D
centre, using distance learning to produce world-class
graduates and next-generation innovations. Multimedia
University will be the centre for this, and I would like
to invite faculty and students from UCLA to help develop
our new institution in Malaysia through exchanges of
students and faculty. I would also like to invite
companies interested in partnering with Multimedia
University to contact us. This university will have
close links to MSC companies to ensure it will produce
graduates with the right skills.
- Fifth , Malaysia will be a regional
centre for telemedicine. With our Chinese, Ayurvedic,
Malay and Western medical knowledge and vast biogenetic
resources, we are a natural hub. Rural clinics can be
connected to medical experts from Malaysia and to the
great clinics world-wide using new tele-instruments for
remote diagnosis, therapy, or even surgery. The doctor
no longer has to be in the same room as the patient and
our new cyberlaws will make this legal. Key information
can be transmitted using new instruments such as
electronic stethoscopes operated by nurses or
technicians. This can be viewed and compared with other
patients by the world's best doctors and the data on
millions of patients already in the world's computers.
- Sixth , I hope the MSC will be a remote
manufacturing coordination and engineering support web
that electronically enables companies in high cost
countries to access plants across Malaysia and Asia as
virtual extensions of their domestic operations. While
we have real strengths in manufacturing, we recognise
the need for companies to operate a network of
facilities around the region.
- Seventh , the MSC should become a
marketing and multimedia customer service hub leveraging
Malaysia's unique multicultural links to provide
electronic publishing, content localisation,
telemarketing and remote customer care to a market of
2.5 billion people. For example, a Japanese company's
catalogue can be translated into Chinese or Bahasa
Malaysia/Indonesia or Indian languages by a company that
takes orders through a system that automatically
localises the sizes and currencies.
16. Over time, each of these Flagship Applications will
generate a web of world-class and Malaysian companies
collaborating to develop and deliver innovative products
and services. They will take root and grow in an
environment that provides the required lifestyle,
infrastructure, laws, and policies. Equally important,
I expect links will develop which will connect each of
these webs together into one large MSC web. Indeed, it
is these links which will allow the MSC to sustain its
competitiveness over time. Malaysia is a country with a
vision and a strategy to achieve the vision called
Vision 2020. Our goal is to attain developed country
status by the year 2020. These interlinked webs will
allow us to achieve the goals of Vision 2020 by
developing a strong services sector to balance our
already strong manufacturing sector while helping to
improve the productivity and quality of life in the
nation. Equally important, the MSC will provide a
platform to tie us together and celebrate our culture
while helping to educate us in new and different ways.
17. Beyond Malaysia, the MSC becomes a global bridge
when its web is interlinked with those of other regions
around the world. This bridge will, I hope, connect
with the digital entertainment community in Hollywood
and to the high-tech companies in Silicon Valley. For
example, storyboards can be developed in California but
animation be executed in the MSC, electronically
transmitted back to LA for editing, sent back to the MSC
for colour-balancing, and then transmitted to the studio
for final approval and distribution. Let us explore
ways to mutually enrich our companies and countries
through this gift being provided by Malaysia.
18. The breadth of what I am describing has probably
never been attempted anywhere else in the world. You
may be thinking, `Why Malaysia?'
- First , Malaysia's physical location at
the centre of ASEAN and its multicultural links with the
biggest Asian markets is unique. The Malaysians are
made up of people of Malay, Indonesian, Indian and
Chinese origin. We are only a few hours flight from the
major Asian capitals. We have language skills and
cultural knowledge that can be very helpful. Most
people speak English as well as one or more languages
such as different Chinese or Indian dialects, or Malay.
With the new airport and communications infrastructure
being built, Malaysia will be a highly efficient and
effective hub for the region.
- Second, Malaysia still has a cost advantage as compared
to the `tigers' in the region. In fact, a recent study
done by international consultants on the cost of doing
business in Malaysia indicated it is among the most
competitive in the ASEAN region. To sustain this the
Government will continue to provide the
enabling environment. Our people are among the most
productive in Asia.
- Third, the newness of multimedia to Malaysia provides
an important advantage -- we have no inherited systems
or entrenched interests determined to defend their current
positions. We have the political will and the power
to rapidly change any existing laws or policies that
impede the ability of companies to capitalise on the
benefits afforded by the Information Age. We
will not be diverted by excessive politicking
in Malaysia. In Malaysia things that need to be done
will be done quickly unobstructed by corruption.
- Finally , we are highly committed to
making the MSC a success and we have a track record of
meeting our commitments. We are a pragmatic Government
which has consistently proven our critics wrong even
when we adopt unconventional policies and strategies.
Malaysia's history since independence has shown
consistency and predictability so that long term
investment will not be threatened by the twists and
turns of volatile local politics. The Malaysian
Government sees multimedia as the strategic sector to
achieve our Vision 2020, the attainment of developed
country status through productivity-led growth, and the
MSC is at the leading edge of this key sector.
Consequently, we simply cannot and will not allow the
MSC to fail.
19. We have been very busy over the last two years
working with leading companies such as NTT to understand
the future needs of world-class companies. McKinsey &
Company has interviewed hundreds of companies to
understand their requirements and is working with us to
learn lessons from the experience of other countries.
20. To ensure that the MSC will not fail, Malaysia is
offering a ten point Multimedia Bill of Guarantees. The
Government of Malaysia formally commits the following to
all companies receiving MSC Status from the Multimedia
Development Corporation:-
a. Malaysia will provide a world-class physical and
information infrastructure;
b. Malaysia will allow unrestricted employment of
knowledge workers from overseas;
c. Malaysia will ensure freedom of ownership of companies;
d. Malaysia will allow freedom of sourcing capital
globally for MSC infrastructure and freedom of
borrowing funds;
e. Malaysia will provide competitive financial
incentives including no income tax or an Investment tax
allowance for up to ten years, and no duties on the
import of multimedia equipment;
f. The MSC will become a regional leader in intellectual
property protection and cyberlaws;
g. Malaysia will ensure no censorship of the Internet;
h. The MSC will offer globally competitive telecom
tariffs;
i. Malaysia will tender key MSC infrastructure contracts
to leading companies willing to use the MSC as their
regional hub; and
j. Malaysia will ensure that the newly established MDC, a
high powered implementation agency, will act as an
effective `one-stop shop' to meet company needs.
21. These companies must be providers/heavy users of
multimedia/IT products and services and employ a
substantial number of knowledge workers. The Multimedia
Development Corporation is registering interested
companies and will be taking formal applications for
companies seeking `MSC Status' in March. In addition to
seeking world class companies, the MDC is also seeking
world class employees to help it build the MSC.
22. To the students, I invite you to submit your
resumes to the MDC and fill out the employment
application on its website. There are opportunities at
its ten worldwide offices and at headquarters in
Malaysia. To the companies, I welcome your
participation and input. We need your vision,
creativity, entrepreneurship, and skill to give life to
the MSC. To the international community, we offer you a
perfect environment to try and find solutions to some
tough questions whose answers must cross borders: (a)
How will value that is collaboratively created in
several countries but sold in another be taxed?; (b) How
can intellectual property rights of knowledge-based
products and services be defined and protected?; (c)
How can responsibility for the accuracy and integrity of
information on the Internet be ensured? Finally, how
can society be protected from new forms of fraud,
counterfeiting, piracy, and viral attacks on the systems
that run companies or even countries? In Malaysia, we
are looking at the possibility of creating a new Cyber-
Court of Justice as an international centre to look into
these issues.
23. We may sound very ambitious for a small country,
but America itself was a small country in the 19th
Century. At that time, England launched the Industrial
Revolution but America won it. Why? Because the
technology could be moved to an environment much more
conducive to realising its full potential. Malaysia has
come late to industrialisation, and this has given us
the will and skill to make sweeping changes that others
cannot because we have much less to lose. The MSC
provides all the critical components required to create
the perfect environment to achieve the promise of the
Information Age. Today, it is much easier to move
technology and knowledge than it was 100 years ago.
This is why we believe we can build the global bridge
needed to move beyond the limits of the Industrial Age.
While I may be an optimist, I believe this path to
prosperity will be chosen over the alternative of
hegemony and win-lose economic relationships. The
globalising and harmonising forces of the Information
Age will prevent a clash of civilisations or the Century
of Asia. It will create the World Century, the true
Commonwealth of the World.
24. We hope you will become our partners in this
exciting endeavour to build a bridge to the promise of
the Information Age. The Multimedia Super-Corridor
cannot succeed alone, or we will have an island instead
of a bridge for the global aspirations, capabilities and
vision of many leading edge companies who are prepared
to collaborate in a new environment. We hope you will
join us in constructing an enduring bridge into the
Information Age and realise the promise of the upcoming
World Century.
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