Oleh/By : DATO' SERI DR. MAHATHIR BIN MOHAMAD
Tempat/Venue : KUWAIT
Tarikh/Date : 06/04/97
Tajuk/Title : THE RECEPTION WITH KUWAITI
AND MALAYSIAN BUSINESSMEN
1. I would like to thank the Kuwaiti Chamber of
Commerce and Industry for the opportunity to address a
gathering of prominent members of the business community
of The State of Kuwait.
2. The State of Kuwait and Malaysia have enjoyed
excellent bilateral relations based on mutual trust that
has evolved through historical and commercial
associations. Both are members of the Organisation of
Islamic Conference (OIC) and share similar views and have
cooperated with one another on issues involving the
Islamic faith and the Muslim community at the
international level.
3. Bilateral trade between our two countries has been
growing steadily from US$36.96 million in 1992 to
US$107.68 million in 1996 recording an increase of 48
percent per annum. Nevertheless Malaysia's imports from
Kuwait for the period ending December 1996 which amounted
to US$37.39 million contracted by 83.2 percent as
compared to US$68.51 million recorded for the same period
in 1995. Major import items from Kuwait include crude
petroleum(94.5 percent) and copper waste and scrap (3
percent). Malaysian exports amounting to US$70.28 million
to Kuwait in 1996 has shown an increase of only 2.6
percent as compared to the corresponding period in 1995.
Substantial amount of exports to Kuwait comprised
products like electrical and electronic goods (23.2
percent), jewellery and other precious metals (15.9
percent), wood and wood products (5 percent). Given the
numerous opportunities and incentives for investment and
trade in both the countries, I believe the time has come
to foster strategic linkages between our entrepreneurs
and captains of industries in order to create
partnerships in economic development not only at
bilateral but also at regional and global levels.
4. In 1996, Malaysia launched its Second Industrial
Master Plan (IMP-2, 1996-2005). The Plan is a testimony
of the Government's commitment to propel Malaysia to
become a fully developed nation by the year 2020. Under
the IMP-2, some US$100 billion worth of investments will
be needed to achieve the target of increasing
manufacturing value-added share of the Gross Domestic
Product (GDP) to 38.4 percent by the year 2005.
5. As Malaysia advances to realise her long-term goal,
the stress on productivity and global competitiveness
becomes more pronounced. To achieve this goal, Malaysia
has embarked on a concerted drive to enhance trade,
economic and commercial links with other developing
countries and newly-emerging economies. Of course we
will continue with our exports to developed countries as
well. Last year we export US$18 billion worth of goods to
the United States alone, most of which was made up of
manufactured goods. The Malaysian private sector has
been very supportive of this drive. They have
established business contacts and networks in many
countries in Africa, Latin America and Asia, developed
and developing which have resulted in a greater flow of
trade and investment. Although a lot of our manufactured
goods carry foreign brand names, it should be noted that
many are manufactured by Malaysia-owned companies. Today
these Malaysian companies are producing similar goods
carrying their own brand. The quality is the same as
those they manufacture as the Original Equipment
Manufacturer (OEM) products.
6. The Government's objective is to ensure that
Malaysia remain a viable and profitable manufacturing and
export base to serve both the domestic, regional and
global market. Various measures and policies have been
drawn up to attract domestic as well as foreign
investments, particularly in the manufacturing sector.
Policies have been constantly reviewed for further
deregulation, transparency and efficiency of this sector.
7. As a result of the positive revisions of its
policies, Malaysia has largely been rather successful in
attracting foreign direct investments, particularly in
the export-oriented industries. As you are probably
aware, Malaysia now is the world's leading producer and
exporter of a range of manufactured products such as
rubber gloves and threads, room air-conditioners,
semiconductors and audio-visual equipment. We were made
to understand that Kuwait has undertaken liberalisation
and deregulation measures to reinvigorate its economy.
Recently Kuwait has also introduced laws to protect and
encourage investments and to promote privatisation. I
believe such liberalisation and deregulation measures
will eventually result in creating substantial markets in
the South, that are able to supply a wide range of
products, ranging from raw materials to products with
high technology contents.
8. The Kuwaiti business community must not only look at
the opportunities available in Malaysia, but must
consider Malaysia as a strategic location in the ASEAN
region as a whole. With the inclusion of Vietnam, ASEAN
now has 420 million people and all the seven-member
countries registered an average annual economic growth
between seven and nine percent. Intra-ASEAN trade for
January - June 1996 stood at US$56.2 billion and a GDP of
around US$510.7 billion.
9. By the year 2003, ASEAN could see the completion of
ASEAN Free Trade Area or AFTA. By that time, ASEAN
manufactured products will have tariffs of not more than
five percent across the board. The huge ASEAN market and
its liberal trading environment will indeed provide and
offer tremendous business opportunities in the near
future. In this regard, I would like to encourage
Kuwaiti investors to increase their business presence in
this region, by using Malaysia as a gateway into ASEAN.
10. To complement and enhance Malaysia's regional and
international linkages, the island of Labuan has been
designated as an Offshore Financial Centre, with the
necessary infrastructure support and facilities put in
place. An attractive package of fiscal and non-fiscal
incentives has also been offered to companies that locate
their regional headquarters in Malaysia, which are
comparable to the best in the region.
11. The emergence of a full-fledged Islamic banking
system would undoubtedly bring an added dimension to the
market. Even though Malaysia is said to be leading the
way in the implementation of Islamic banking, it would be
difficult to implement a functional Islamic investment
and capital markets at the international level without
some degree of consensus among Islamic scholars on these
matters. There is certainly a great desire on the part
of many Islamic banks to be involved in project
financing, particularly in the East Asian countries where
there are a growing number of new high-profile projects
emerging.
12. The presence of prominent members of the Malaysian
business community here today are in evidence of their
keen interest to forge and strengthen bilateral trade,
economic and commercial ties between our two countries.
The business meetings and discussions that you will have
during their stay here should certainly lead to fruitful
results.
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