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Speech by Chief Minister of Penang, YAB Lim Guan Eng

At Dialogue With New Companies Located At The Batu Kawan Industrial Park

And The Penang Science Park

Tuesday, 29th Jan 2013 Traders Hotel, Penang

Ladies and Gentlemen,

A very good morning to all of you, and on behalf of the Penang State Government, I would like to welcome you all to this Dialogue with the new companies located at the Batu Kawan Industrial Park and the Penang Science Park.

The State Government is organizing this Dialogue session to provide a conducive business friendly environment for all the Batu Kawan Industrial Park and Penang Science Park tenants to network with your neighbours and also discuss with the relevant agencies matters related to your operations.

Ladies and Gentlemen,

While FDIs play a vital role in vitalizing the growth of the state’s economy and generating the critical knowledge based employment, the Penang state government recognizes the importance of the small and medium enterprises (SMEs) as they are the backbone of the state’s economy. Taking into consideration the importance of SMEs in Penang’s economy as well as in generating employment and income for the people of Penang, the Penang State Government has formulated a 3-prong approach to help spawn and develop local SMEs to compete regionally and globally. I am also proud to say that the Malaysia SME magazine has recognized Penang as the only State in Malaysia that emphasizes SME development.

The Penang State Government walks the talk. We pledged to set up the SME Market Advisory, Resource and Training (SMART) Centre in 2010 and now the centre, through investPenang is facilitating the SMEs through various activities such as organising capacity building workshops, business matching sessions, developing online directory and providing intelligence. The (SMART) Centre serves as a one-stop centre to attend to the needs of local SMEs. In short, the SMART Centre sets out to develop the local supply chain as well as to enhance management and technological capabilities of the local SMEs in order to enable them to compete in the global markets.

The Penang SME Centre is the second phase of the State’s 3-prong approach for SMEs development. The state government realizes the importance for the local SMEs to have proper premises to start-up their business as well as adopt a mentoring system to let them penetrate the market. On September 13 last year (2012), The SME Centre at Bayan Lepas was officially opened and is made ready for occupancy. The SME Centre serves to incubate promising and innovative SMEs and more importantly is rented out to qualified SME start-ups at subsidized rates of approximately RM0.80 cents psf.

When these SMEs grow bigger, they would have to leave and make way for other new start-ups. Therefore, the third approach was to develop and establish SME villages, particularly in Bukit Minyak Industrial Park, Penang Science Park and Batu Kawan Industrial Park. These SME villages are strategically located, in close proximity with existing and new MNCs as well as large local companies, thus enabling and supporting the just-in-time (JIT) concept practiced by most companies. The SME villages will lower the cost of doing business for the SMEs, MNCs and large local companies and at the same time enhance SME’s productivity and efficiency, putting them on par with global suppliers.

The SME Village located at the eastern part of Penang Science Park (PSP) will house local SMEs involved in the provision of supporting and ancillary services to their multinational corporation (MNC) customers that are located in the PSP itself as well as in other industrial parks on Penang Island and Seberang Perai. At present, almost 30 companies have confirmed to be located at the SMI Village at PSP with a total value investment of approximately RM250 Million, generating 2075 employment.

Further to this, another 150 acres has been allocated for SMEs in the SMI Village in Batu Kawan. At Phase 1, 29 local SMEs have been allocated land at a subsidised rate of 10% with total investments of approximately RM196 million creating employment of 2,011. This is in addition to the foreign companies (FDI) that have already confirmed their presence such as Honda, Ibiden, VAT, MAL and Bose.

The price accorded to the SMEs in the SME Village at Batu Kawan was at a 10% subsidized rate compared to the new price as of 21 November 2012. Therefore in total, the SMI Villages in Batu Kawan Industrial Park and Penang Science Park produce approximately a total value investment of almost 450 million and 4100 employment.

The local companies which are located in the SMI Villages in PSP and Batu Kawan are part of the critical supply chain which provides specialized services and manufacturing support in areas such as design, development and manufacture of precision engineering, automation, system integration, software, measurement instruments, customised systems and medical devices. This will no doubt give Penang’s economy a tremendous boost. However, The Penang State Government will not stop there. We will continue our efforts to review our success and identify new locations and build even better facilities to further promote Penang as a location of choice for investment.

The Batu Kawan Industrial Park is a comprehensively planned industrial park with well-equipped infrastructure facilities and support services to serve the industrial community. In addition to this, the Batu Kawan development consist of 6,717 acres which is part of the integrated mixed development of the area which includes modern township with affordable housing, recreation and sports facilities, educational institutions and commercial facilities.

In terms of the infrastructure, The SME Villages in Penang Science Park and Batu Kawan are located strategically closely to the 1st Penang Bridge and the North-South Highway. We are also in the midst of upgrading the Penang International Airport and the electrified double tracking railway project is expected to be completed in 2014. Too add to that, the second Penang Bridge, Southeast Asia’s longest bridge spanning 24 km, linking Batu Maung on Penang Island and Batu Kawan on mainland Penang is 90% completed and expected to be open to the public in September 2013.

Ladies and Gentlemen,

This Dialogue Session with the Batu Kawan and PSP companies is part of the facilitation process carried out by the Penang State Government through investPenang to enable ease of doing business in Penang. It is important that we receive your feedback so that we can build even better facilities to improve our delivery system to serve the industrial community in Penang. We will therefore continue to hold such dialogues in the future to further promote SMIs.

Also, I would like to thank PDC, MPSP, DOE and Police for supporting this event by sending their officials to share with us their roles and responsibilities and programmes that could benefit the companies.

I hope that all the participants will take this opportunity to discuss their operational needs and requirements with the departments present today.

I wish you a pleasant and fruitful session.

Thank you.







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