American Companies Explain the Benefits
The
investment climate in Malaysia doesn't have to speak for itself.
American companies are speaking for it. Nick Zefferys, governor and
past president of the American-Malaysian Chamber of Commerce (AMCHAM),
points to initiatives like PEMUDAH, a special task force to facilitate
business in Malaysia, as a boon for U.S. companies looking to set up
shop there. PEMUDAH has reduced the paperwork and the red tape for FDI
in Malaysia.
"Foreign companies used to have to fill out stacks
of paper and make trips back and forth to wade through the
bureaucracy," Zefferys explained. "Now, many of the unnecessary
licensing procedures and outdated laws have been discovered and
eliminated. Approvals are much faster because the delivery system is
streamlined. What used to take months now takes days - and the
government is committed to a policy of continual improvement toward
being competitive."
Malaysia may be getting more competitive,
but the country has always enjoyed political stability, an attribute
that American companies cite again and again as a reason for locating
and expanding there. A market-oriented economy with a well-developed
financial and banking center and low overall inflation is another.
There's also a developed infrastructure of well-maintained seaports,
airports, highways, and railways, along with high-quality
telecommunications networks, fully developed industrial parks -
including free-trade zones - and an enviable quality of life.
Chow
Chiu Mei, general manager of TRW Automotive, an automotive supplier
headquartered in Livonia, Mich., said the telecommunications
infrastructure in Malaysia is better than what China and Thailand have
to offer, and qualified labor is available with low turnover. TRW
employs 130 at its facility in Cyberjaya. "We've found the skills we
need here, and the people are multi-lingual, which makes it easy to do
business in multiple countries," Mei said, noting that the company
employs Malays, ethnic Indians, and ethnic Chinese, all of whom also
speak English.
Entegris, a materials integrity management
company headquartered in Billerica, Mass., moved most of its production
from Germany to Kulim, Malaysia, which is near the island of Penang.
The company is also moving more of its U.S. production there. Entegris
is located in the Kulim Hi-Tech Park. The park was opened in 1996 and
is the first high-technology industrial park in Malaysia. The vision of
the park is to become the "Science City of the Future." BASF, Fuji
Electric, Infineon Technologies, and First Solar are also among the
tenants.
"Malaysia is investor-friendly, with tax holidays and
other incentives for firms expanding here," said Chai Eng Leng, plant
manager for Entegris' Kulim facility. "We plan to move two or three of
our product lines to our facilities here each year until the transition
is complete."
Western Digital has been expanding throughout
Malaysia for decades. Its U.S. headquarters are in Lake Forest, Calif.,
but the firm has facilities in Johor, Sarawak, Penang, and Kuala Lumpur
to produce millions of hard drives for PCs, DVRs, game consoles, and
MP3 players. "What's been most important to us is the economic
stability and growth we've seen over the decades," noted Thomas Fong,
director of finance for Western Digital. "It's too expensive for us to
do most of our business in Singapore. Malaysia is more expensive than
Thailand, but the knowledge workers here - along with the availability
of power and water and the stable government - have caused us to
continue to grow our operations in Malaysia."
With thousand of
companies producing world-class products across Malaysia, it's almost
difficult to call it Asia's best-kept secret. Still, with China and
India getting so much media attention, Malaysia has slipped underneath
the radar screen for many site selectors. But Malaysia has all the
right ingredients that promise to make this nation a recognizable
powerhouse of global trade in the years ahead. And as the "Gateway to
Asia," Malaysia is poised to give foreign investors direct access to
coveted markets with the lower risks that come with a political
stability the country has enjoyed for 50 years.
