LIGHT-YEARS AHEAD

Malaysia 2016 | INDUSTRY & INNOVATION | INTERVIEW

TBY talks to Datuk Dr. Mohd Yusoff, President & CEO of the Malaysian Industry – Government Group for High Technology (MIGHT), on pursuing growth in the high technology sector, increasing the economic role of high technology exports, and establishing Malaysia as a regional leader in the aerospace industry.

Datuk Dr. Mohd Yusoff

The promotion of science and technology has been high on the government's agenda. Which high technology industries are particularly important for Malaysia?

All high technology sectors have importance in the nation-building scenario. Since we were formed in 1993, we have looked at more than 25 high technology sectors. Aerospace is one of them, not only because of its ability to generate business but because of its ability to fulfill the aspirations of a country that wants to become industrialized or developed. All of the most advanced technology lies in aerospace; it is one of the most regulated industries because it requires discipline and you need to comply, be certified, and approved before entering. Therefore, the aerospace sector became in a sense the flagship for high technology development. Before that, it was the automotive industry that led the cause. The creation of Proton gave us insight into what high-tech industries are all about. At the other end, we are looking into areas of telecommunication, pharmaceuticals, biotechnology, and nanotechnology as well.

How is Malaysia moving toward high technology exports?

We are one of the top ten manufacturers of the world, especially in terms of electrical and electronics (E&E). In other areas of commodities, we are also a major exporter. We are always thinking of the added value and we always compare ourselves to Singapore, where the added value is around 70-80% compared to 30% in Malaysia. There is, therefore, still room for improvement. In commodities, we have been talking to companies such as Sime Darby and Felda about going into downstream activities, which are less subject to market fluctuations. Their responses have been positive and we are seeing investments from them and others in R&D and manufacturing. We also leverage foreign investments from groups like MIDA and MATRADE to fuel development in the high technology sectors. Most potential investors in high technology first want to be familiar with the competitive environment of a country because they need to know whether there are suppliers of essential materials or components, and MIGHT is able to provide that knowledge to investors. One of these investors is Spirit Aero Systems, from the UK, which is a Tier-1 supplier to Airbus and Boeing. Investments like this help develop the market in Malaysia, making it easier for new SMEs to operate and in turn enhance our capacity to export high technology products.

How does the new National Aerospace Blueprint differ from previous master plans?

This is the second blueprint to be introduced. The first one was from 1995 to 2015—a 20-year guide to bring Malaysia's aerospace industry from almost zero to a $4.6 billion industry. The new blueprint focuses on four priority areas. One area of focus is parts and components manufacturing. Another area is Maintenance, Repair and Overhaul (MRO), where we want to capture a larger share of the market. In the first blueprint, we aimed for 5%, and we achieved that target—now we are pushing for 10%. This calls for different types of competency; whoever develops this type of capability first will win the larger market share so we are pushing to get into these composite maintenance and repair capabilities. We are also focusing on developing avionics. In the new blueprint, we focus on systems integration and recently on the Internet of Things, which is also going to somehow be integrated into that activity. Finally, there is a fourth area of focus on training and education. We will need thousands of skilled workers as more facilities are being opened. The one thing that we like in the current development is that the work in Singapore is spilling over into Malaysia; therefore, we might see a lot of aerospace activity in the southern part of Malaysia, which was not there before. The ultimate objective is to become the aerospace industry hub for the ASEAN region.