Oleh/By : DATO' SERI DR. MAHATHIR BIN MOHAMAD
Tempat/Venue : BISHKEK, KYRGYZ REPUBLIC
Tarikh/Date : 16/07/96
Tajuk/Title : THE KYRGYZ-MALAYSIA
BUSINESS MEETING
1. Let me first of all say how pleased I am to be
here today in Bishkek and to be given the
opportunity to speak at this joint Kyrgyz - Malaysia
business meeting. This meeting once again brings
together the Kyrgyz and Malaysian business sectors
after their first meeting in Kuala Lumpur last year.
2. This is the first official Malaysian business
delegation to visit the Kyrgyz Republic. It is
therefore not surprising that in the immediate past
the level of our bilateral economic relations has
been at a relatively low level. However, with the
globalisation of the world economy, a whole new
chapter in relations among nations is being
established. The Kyrgyz Republic has recently
intensified efforts to promote trade and investment
with other countries in Asia. Likewise, Malaysia
too has intensified efforts to establish linkages
with emerging economies in this region. It should
therefore be our common desire to elevate economic
cooperation between the Kyrgyz Republic and Malaysia
to a higher plane.
3. Malaysia has followed with great interest the
bold market reforms and economic restructuring that
the Kyrgyz Republic has undertaken since 1991. The
confidence expressed by international agencies like
the World Bank and the Asian Development Bank of the
economic reform process in the Kyrgyz Republic
underscores the potential of the economy. These
developments in the Kyrgyz Republic complement the
economic dynamism of the rest of Asia. By the year
2000, Asia is set to become the most important
region of the world economically, politically and
culturally. We in Asia should therefore explore new
ways of enhancing economic cooperation so that the
dividends from this growth could be jointly shared.
4. Based on the strength of Malaysia's past
economic growth of eight percent plus since 1988,
the Seventh Malaysia Plan, which was launched
recently, envisages continued growth of 8 percent
per annum until the year 2000. The focus of the
Plan will be on accelerating productivity and
efficiency with special emphasis on skills
upgrading, capital deepening and technological
development. The manufacturing, services and
construction sectors are expected to be the major
contributors to this growth. The manufacturing
sector which is expected to grow at 10.7 percent per
annum during this Plan period is expected to account
for 37.5 percent of GDP by the year 2000.
Manufactured products are expected to continue to
spearhead the growth in merchandise exports and is
targeted to grow at an annual rate of 16.9 percent.
Earnings from the export of manufactured products is
expected to reach US$128.9 billion by the year 2000
as compared to US$74.1 billion in 1995. The
achievement of these targets is expected to result
in Malaysia emerging as one of the foremost trading
nations of the world by the end of this century,
5. Malaysia is also a member of ASEAN, a seven
nation grouping with a population of 420 million
people. By the year 2000 this regional grouping is
set to become a free trade area with zero tariff for
most manufactured products, and where tariff exists,
it will not be more than 5 percent. This enlarged
market will provide opportunities to the business
sector of the Kyrgyz Republic. The Kyrgyz business
sector could use Malaysia as a staging point to
expand their trading operations with other countries
in the South East Asian region.
6. As a member of the community of developing
countries it is imperative that Kyrgyz and Malaysia,
which share common aspirations of self reliance
should work together. Malaysia places great
importance on developing trade and economic
cooperation with countries of the South. In line
with the spirit of South-South Cooperation, the
Government of Malaysia has encouraged Malaysian
companies to invest and contribute to capacity
enhancement of the South countries. South-South
Cooperation has acquired greater significance in the
light of the Uruguay Round market opening process.
Malaysia's total exports to the South countries has
registered strong growth, representing 16.9 percent
of our total exports in 1995 as against 12.2 percent
in 1990.
7. Trade has acted as a catalyst of growth in most
countries. Through enhanced trade and economic
relations, developing countries can complement each
other in optimising their individual resource
endowments. On this premise, there are certainly
many opportunities for the Kyrgyz Republic and
Malaysia to work together in developing areas of
complementarities which could lead to mutual
prosperity. Admittedly, our current level of
economic relations is still at relatively low
levels. For example, bilateral trade between our two
countries, based on Malaysian records, amounts to
only US$0.33 million (RM0.82 million) in 1995,
comprising virtually of Malaysian imports from the
Kyrgyz Republic. Realising the need to enhance our
economic relations, we had in 1995 bilaterally
signed the Trade Agreement, the Investment Guarantee
Agreement, and the Economic, Scientific and
Technical Cooperation Agreement. These agreements
should now provide the framework for the Kyrgyz and
Malaysian business community to work together to
increase and diversify the range of products traded
between our two countries.
8. Malaysia is happy to note that there are many
positive signs emanating from the Kyrgyz economy
during this transitional stage of macroeconomic
stabilisation. It has been reported that during
first-quarter of 1996 foreign trade turnover and
industrial growth has risen. Malaysia is also
encouraged by the commitment of the government to
continued reform as seen in the recently unveiled
blueprint on economic development until the year
2005. Given these developments, the Kyrgyz Republic
represents an attractive market for trade and
investment.
9. The Kyrgyz Republic is well endowed with
resources like minerals, leather, wool and cotton
which can support viable manufacturing industries.
The Government for its part is providing support to
small and medium industries. It is reported that
there are currently 5,600 medium and small
businesses and cooperatives in the country. The
Malaysian private sector could complement the
efforts of the Kyrgyz Government by going into joint
ventures with small and medium industries sector in
the Kyrgyz Republic.
10. Malaysian development experience has shown that
one of the prerequisites for sustained economic take
off is an efficient infrastructure system. It is
therefore fitting that the Kyrgyz Republic is
targeting to upgrade its highways, communications
facilities and power generation capability to
support other economic activities in the country.
Malaysian companies have successfully ventured into
the South markets and accumulated considerable
experience in highway construction, housing and
hotel development, power supply, oil and mineral
exploration and telecommunications. Malaysia is
prepared to share her experience in these areas and
participate in the Kyrgyz Republic's infrastructure
development projects.
11. It is also noteworthy that the Kyrgyz Republic
is a member of the Central Asian Economic Union
which is set to become a free trade area
incorporating the neighbouring countries of
Kazakhstan and Uzbekistan. In fact Kazakhstan and
the Kyrgyz Republic have already lifted customs
barriers between them, which have resulted in an
increase in the volume of trade. This will provide
opportunities to Malaysian companies which could
explore the possibility of using the Kyrgyz Republic
as a base for their business operations in the
Central Asian market. The proposed market
integration which would create a larger market in
Central Asia would help sustain industries that
would otherwise not be possible. Alternatively,
Kyrgyz and Malaysian businessmen could go into joint
ventures to undertake viable projects in the
neighbouring countries which will now be part of the
same market.
12. Lastly, I urge the Malaysian business community
doing business in the Kyrgyz Republic to partake in
the economic restructuring of the country.
Malaysians need to take a longer term view of their
business interests in the Kyrgyz Republic and seek
lasting business relationships that are reciprocally
beneficial. On its part, the Government of the
Kyrgyz Republic has set for itself a minimum long
term growth target of between 3-4 percent and a
doubling of GDP by the year 2005, which has set the
stage for economic prosperity in the Kyrgyz
Republic. I am certain the Kyrgyz Government will
continue to create the necessary enabling
environment to make the Kyrgyz Republic an
attractive place for the business sector. I wish
you all every success in your deliberations.
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