Oleh/By : DATO' SERI DR. MAHATHIR BIN MOHAMAD
Tempat/Venue : LA HAVANA, CUBA
Tarikh/Date : 27/09/97
Tajuk/Title : THE CUBAN-MALAYSIAN
BUSINESS LUNCHEON
1. Firstly, let me thank the organisers for giving me the
opportunity to address this important meeting of prominent
members of the Cuban and Malaysian business community.
2. I am delighted to be here today and feel honoured to
be able to share my thoughts on how we can enhance Cuba-
Malaysia bilateral economic and trade cooperation.
Increased interaction between our two countries, through
visits and meetings such as this, will certainly help
strengthen economic relations and bilateral ties between
our two countries.
3. Consistent with the realities of the current global
economic environment, we must constantly seek new
partnerships and linkages to grow our economy through
trade and investments. It is in this light that Malaysia
seeks new friends in this region and this visit to Havana
marks our earnest desire to establish and develop mutual
economic linkages with this country and people.
4. We acknowledge that Cuba has great potential for
growth and we want to participate in your economic
evolution. We are here today in Cuba because we believe
in constructive engagement that is aimed at enriching your
economy as well as ours.
5. This meeting in Havana, I am sure, will enhance the
initial ties established during the two earlier visits by
the Cuban delegation to Kuala Lumpur this year, one of
which was led by the Minister of Foreign Affairs and the
other by the Vice Minister of Foreign Trade. I am certain
that arising from this meeting, the business communities
of our two countries can identify areas of mutual
interests for possible joint cooperation. I am told,
investment opportunities exist in such areas as
construction, tourism, mining, power generation, petroleum
exploration and refining, food processing and trading in
consumer items.
6. Many of the members of the Malaysian delegation and
their companies have played a key role in the economic
transformation of Malaysia. They represent sectors like
banking, telecommunications, property development,
manufacturing, mining, construction, energy and tourism.
They are therefore knowledgeable about business in areas
which are important to Cuba's own priority sectors. I
sincerely hope that they can be given an opportunity to
participate in the evolution of the Cuban economy.
7. Bilateral trade between Cuba and Malaysia is still
small. This is due to the structure of trade which is
concentrated on a few products. Last year, according to
the Malaysian statistics, total trade between our two
countries amounted to US$612,000 compared to US$952,000 in
1995. The bulk of Cuba's exports to Malaysia is made up
of industrial alcohol while imports from Malaysia
comprised mainly sound and telecommunication equipment and
air conditioners.
8. Obviously we have not really attempted to identify
items for imports and exports between our countries. It
is important that we identify what can be sourced from
Cuba and what Cuba needs which can be supplied from
Malaysia. We need also to look into shipping and other
means of transportation, as well as the financing
arrangements which are mutually beneficial to us.
9. During this visit, the necessary framework to enhance
trade and investment between our two countries are being
put in place. This is in the form of a bilateral
`Investment Guarantee Agreement', a `Trade Agreement' and
an `Agreement on Partial Abolition of Visa'. Meanwhile,
the private sector of our two countries will also be
signing a number of Memoranda of Understanding or MOUs to
examine the possibility of joint ventures. In addition,
the recent opening of the Cuban Embassy in Kuala Lumpur
will facilitate greater access and awareness of each
other's needs and potentials.
10. We in Malaysia are encouraged by the economic and
fiscal reforms undertaken by the Government of Cuba. The
pragmatic approaches of the on-going Economic Recovery
Programme and incentive schemes for foreign investments
and joint ventures have already laid the foundation for
increased growth in the key sectors of the economy. I am
told that, last year, Cuba's GDP grew by 7.8 percent --
the highest in Latin America. Foreign trade too had
expanded by about 33 percent.
11. Last year also saw the strengthening of the Cuban
national currency and the establishment of nearly 300
joint venture associations with foreign enterprises in
Cuba. Indeed, Cuba's economic evolution in the past few
years has been remarkably positive, taking into
consideration the exceptionally harsh conditions under
which these results were achieved.
12. To date, I understand that no Malaysian company has
invested in any kind of business in Cuba. I therefore,
would like to take this opportunity to reiterate our
interest and readiness to participate in various sectors
of development in Cuba.
13. I note that the Republic of Cuba is in the forefront
of medical, biotechnological and pharmaceutical research.
Through years of dedicated research and well-coordinated
programmes amongst the various research institutes here,
this country has not only emerged as a major manufacturer
of interferons and vaccines but also has generated
treatment methods, medication and diagnostic equipment of
world standards.
14. Malaysia, on its part, would like to explore the
possibilities of sharing and exchanging information and
results in these areas of research. For a start, Malaysia
could be a launching pad for these products and services
in the ASEAN region with a market of almost half a billion
people.
15. In this respect, I am happy to note that a business
arrangement has been made between Raza Manufacturing
Berhad of Malaysia and Heber Biotec S.A., the marketing
arm of the Centre of Genetic Engineering and Biotechnology
(CIGB) of Cuba. I am told that this project will
initially undertake to market CIGB range of pharmaceutical
and diagnostic products in Malaysia. Hopefully, in due
time, this project will grow to a level where it
necessitates the setting up of joint-manufacturing and
research facilities in Malaysia, thus, allowing for the
possible technological transfer from Cuba to Malaysia.
16. I also note that tourism is the most dynamic and
fastest growing industry in Cuba. Last year saw the
arrival, for the first time, of one million tourists to
the Island. Today, Cuba's tourism industry has become the
major source of national income and it is seen as a major
contributor to Cuba's future economic growth. Malaysia,
on its part, has acquired useful experiences in this field
and would like to exchange information and participate in
the construction and management of tourism-related
facilities in Cuba.
17. Yet another possibility for joint venture activity is
in the field of agri-business and food-related industries.
I am told that the Malaysian Padi Beras Nasional Berhad
(BERNAS), a rice production and trading company, has had
an agreement with the Cuban Ministry of Foreign Trade and
the Ministry of Agriculture to produce, procure and
distribute rice in this country as well as in the region.
18. Malaysian entrepreneurs who are present here today
would also like to explore other possibilities of joint-
venture projects, such as in textiles and garments and
footwear manufacturing, mining, oil and gas exploration
and refining, power generation, construction and property
development, and the production of construction materials,
industrial chemicals, plastics, detergents and
fertilisers.
19. Malaysia's economic development over the last four
decades was grounded on sound policies and the people's
efforts. Looking back, it can be said that Malaysia has
undergone significant changes from being the world's
largest producer of tin and natural rubber to a rapidly
industrialising country. Malaysia now produces and
exports a wide range of manufactured goods, and these make
up 80 percent of total export amounting to US$76 billion.
The performance of the Malaysian economy has been mainly a
result of our industrialisation drive, with an
unprecedented growth in the output of the manufacturing
sector particularly in the last ten years.
20. However, we recognise that success also carries a
cost and creates problems and issues of its own. Where
these involve the domestic economy, they are not
impossible to manage but external problems do not lend
themselves to easy solutions. Wherever adjustments have
to be made in order to accommodate international demands,
they will be made. At the same time, Malaysia will
participate fully in the search for a more equitable and
open world trading regime.
21. Vision 2020 is the crystallisation of Malaysia's
ambitious target to become a fully developed nation.
Hence, the thrust of our current industrial policy is
towards developing industries which have high value-added,
high technology, high local content and having strong
linkages with the domestic economy apart from foreign
markets. Having outgrown the era of labour intensive
industries, our emphasis is now on the development of
capital intensive and technologically sophisticated
industries. There will also be a growing emphasis on
productivity and quality-driven growth through skills
upgrading, capital deepening and research and development
to increase Malaysia's competitiveness.
22. Accordingly, a nationwide IT agenda is being
implemented to accelerate the wider usage of IT in the
various sectors of the economy. In line with this
strategy, Malaysia is developing the Multimedia Super
Corridor or MSC as the perfect test bed for companies
wanting to create, distribute and employ multimedia
products and services. Thus far, we have managed to
attract the interest and support of some of the world's
biggest multimedia corporations.
23. With the various development projects that we have
put in place and the 2020 vision that we have set for
Malaysia, opportunities both in trade and investments
abound for foreign business enterprises. Malaysia will
continue to offer a stable, strong and business-friendly
government, consistent policies, a forward-looking,
dynamic and innovative economic regime to help investors
succeed without undue constraints. These are some of the
factors that have encouraged more than 3,000 manufacturing
companies from over 35 countries to make Malaysia their
offshore production base.
24. We in Malaysia have found that foreign investments
have helped to transform our economy. Such investments
have created jobs, increased foreign exchange and transfer
of technology, expanded our industrial base and provided
linkages between the agricultural and industrial sectors.
It also spawned the growth of medium and small-scale
industries. As a result Malaysians are now able to invest
in other developing countries.
25. Guided by this experience, Malaysia has endeavoured
to play a somewhat similar role advocating greater
cooperation through trade and investments among developing
countries who share the common aspiration for self
reliance. It is also our belief that developing countries
should work together to improve their condition through
mutually beneficial trade and other economic activities.
26. Malaysia's globalisation strategy also encourages its
industries to relocate in countries of the South where
viable and appropriate. Malaysian industries are moving
to new locations in search of resources and factors of
production which are abundant and competitively priced.
Malaysian companies have also successfully ventured
worldwide into the services industries like banking and
tourism related projects.
27. As Cuba and Malaysia are countries with small
domestic markets, it is imperative that we adopt a global
outlook to achieve and sustain growth. Therefore, apart
from exploring the economic potential in each other's
country, the Cuban and Malaysian private sectors should
also explore opportunities for cooperation in third
countries.
28. Finally, I urge the Malaysian business community
doing business in the Republic of Cuba to take a longer
term view of their business interests in this country and
seek to establish lasting business relationship that are
reciprocally beneficial. I am certain the Cuban
Government will continue to create the necessary enabling
environment to make this country an attractive place to do
business.
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