ETP Pemandu 2015 Annual Report

2015
Symbolic of our growing nation, the children represent the future of Malaysia.
ANNUAL
Our Jalur Gemilang signifies patriotism and optimism that our country is very
much grounded on. Hope, confidence, transparency, accountability and resilience
- these transformational qualities will drive our nation forward. The 2015 National
REPORT Transformation Programme Annual Report marks an occasion of reflection and

a celebration of our progress towards achieving our 2020 goals.
The Government Transformation Programme The Economic Transformation

(GTP) is designed to provide all Malaysians Programme (ETP) is a focused,
access to improved public services inclusive and sustainable initiative
irrespective of race, religion and region - that will transform Malaysia into
helping us to achieve the ideals of 1Malaysia. a high-income nation by 2020.
CONTENT
2 BUILDING SOCIO-ECONOMIC RESILIENCE
AND SUSTAINABILITY
4 UNITY IS MALAYSIA'S FOUNDATION

FOR THE FUTURE
6 GETTING OUR GROOVE BACK

Malaysia: Five Years into the National
Transformation Programme
22 GROWTH, CONFIDENCE AND RESILIENCE

Year in Review 2015
30 THE NTP
National Key Results Areas (NKRAs)
National Key Economic Areas (NKEAs)
Strategic Reform Initiatives (SRIs)
APPENDICES
266 EXPENDITURE BUDGET 2015
267 AGREED-UPON PROCEDURES BY PWC
268 NTP PERFORMANCE 2015

Key Performance Indicators
289 ACKNOWLEDGEMENT
A NOTE FROM THE PRIME MINISTER
BUILDING
SOCIO-ECONOMIC
RESILIENCE AND
SUSTAINABILITY
Reflecting on the last six

E
ach year since the National Transformation Programme
(NTP) was launched in 2010, the Government has
years, it is clear the NTP released two Annual Reports the Government
Transformation Programme (GTP) and the Economic
has been an instrumental Transformation Programme (ETP).

To present a more cohesive national transformation story to
catalyst in improving public the nation, as well as to demonstrate the synergies between the
GTP and ETP, I am pleased to present the NTP Annual Report 2015.
This year's report combines both the GTP and ETP's achievements
service delivery through and challenges in 2015, whilst also highlighting the impact of the
various initiatives under the NTP since it started six years ago.
the GTP and reshaping the When we launched NTP in 2010, I recall the sense of
exhilaration and excitement many of us felt. We felt hopeful
dynamics of public-private that a much-needed programme to jumpstart Malaysia's growth
potential was about to unfold. Faced with a gargantuan task of
sector collaborations delivering a country into the high income bracket by 2020, my
foremost concern was whether we had the mettle to see through
through the ETP. the implementation of these goals.
2 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

Reflecting on the last six years, it is clear the NTP has been 2015 was a watershed year for the long-mulled Goods and
an instrumental catalyst in improving public service delivery Services Tax (GST) that was finally implemented in April to introduce
through the GTP and reshaping the dynamics of public-private a fairer taxation system in the country. The introduction of GST
sector collaborations through the ETP. proved to be timely in creating financial buffers for the country as
Thanks to concerted efforts from all parties, the Malaysian we grappled with dramatically dropping oil prices that affected
economy fared well since 2010, registering favourable economic national coffers.
growth on the back of rising private investments, structural The Human Capital Development SRI also landed an important
reforms and the creation of new economic opportunities policy win in 2015 with the establishment of the National Human
in the country. Capital Development Council, tasked to spearhead policies and
In 2015, we learnt that some challenges are just beyond our initiatives that will facilitate the creation of a globally savvy work-
control. Like us, many countries - both developed and developing force in Malaysia.
- are in a state of flux, adjusting to the new normal of dropping In Malaysia's journey up the value-chain, the Government is
consumer demand and fragile investor confidence against the cognisant of the struggles of the rakyat to cope with rising cost
challenging backdrop created by uncertainties in large global of living. In this regard, the Cost of Living NKRA employs two
economies, low commodity prices and trade competition. approaches in accomplishing its objective of providing relief to the
Facing a perfect storm of both external and internal pressures rakyat. Targeted cash assistance is delivered through programmes
that impacted the value of the ringgit, putting a strain on investor such as BR1M (Bantuan Rakyat 1 Malaysia), BB1M (Baucar Buku
confidence, for Malaysia, it was a test of the effectiveness of the 1Malaysia), 1Malaysia Book Voucher Programme and BKAP1M
transformation work done in the last six years. (Bantuan Khas Awal Persekolahan 1Malaysia). The Government
Astute policy-making and disciplined implementation are also prioritises making affordable basic necessities such as K1M
necessary considerations in these challenging times. And in that (Klinik 1Malaysia), KR1M (Kedai Rakyat 1Malaysia) and MR1M (Menu
regard, the NTP has served Malaysia well in shoring up resilience Rakyat 1Malaysia) available and accessible.
to deal with the current challenges. These achievements do not mean we can rest on our laurels.
Leveraging upon measures both inclusive and sustainable, We must accept that the race for the best investments and an
programmes under the NTP are in various stages of progress towards insatiable appetite for growth exists in most if not all countries.
the realisation of goals required to deliver us at the doorstep of With constantly changing rules and new trade forces such as the
our 2020 deadline. Trans-Pacific Partnership Agreement coming into play, the next
The GTP, aimed at transforming the civil service, is no easy feat five years will be an uphill battle, but a battle I am convinced can
to begin with. Having set ambitious targets for the GTP 2.0 in 2012 be won on the back of the very same effort and dedication that has
(upon conclusion of the GTP 1.0 horizon from 2010 to 2012), I am taken us through the last six years.
pleased to report that we have delivered big fast results over the As always, I wish to thank the civil service that has been tireless
past three years, as evidenced in the NTP Country Report 2010-2015 in their efforts to move the needle in driving transformation, the
within this publication. private sector for taking up the challenge to continue to collaborate
Likewise, the ETP continues to deliver on the promise of with us in Government as well as the rakyat for your support towards
spurring private sector participation in the economy through the programmes under the NTP.
12 National Key Economic Areas (NKEAs) and Strategic Reform Based on achievements so far, I can say with confidence that
Initiatives (SRI) to create a favourable business environment come 2020, we will be exactly where we envisioned ourselves to
to facilitate business growth. The public sector, working be - a truly developed country.
hand in hand with private sector players continue to push
the envelope to deliver on committed targets through intense
monitoring of key performance indicators (KPIs) and a recursive
problem solving approach.
Registering a gross domestic product (GDP) growth of 5 percent
for 2015, private sector continued to be a key driver through
consumption and investment. This is very much in line with the
aspirations of the ETP, to create an environment that encourages the YAB DATO SRI MOHD NAJIB TUN HJ. ABDUL RAZAK
private sector to take up a key role in driving the economy forward. PRIME MINISTER OF MALAYSIA
NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 3

A NOTE FROM THE DEPUTY PRIME MINISTER
UNITY IS
MALAYSIA'S
FOUNDATION
FOR THE
FUTURE
Moving forward into 2016, I am confident that the NTP will

continue in its trajectory with conviction to deliver changes that
touch and uplift the lives of Malaysians across all walks of life.

N
ational transformation is about embracing an impossible My hope for all Malaysians is that we continue to come
endeavour. It requires courage and steely determination together as a united country, celebrating unity in diversity and
to accomplish. Moving into the last five years towards strengthen it further to preserve the harmony in our nation. We
our 2020 aspiration of joining the ranks of developed nations, must safeguard the solid foundations upon which our nation
the Government stands resolute in making it to the finishing line. has been built against everything that threatens our way of life.
Through the National Transformation Programme (NTP), we Moving forward into 2016, I am confident that the NTP will
have delivered impactful initiatives in sustainable and inclusive continue in its trajectory with conviction to deliver changes that
ways to ensure nobody gets left behind in our country's pursuit touch and uplift the lives of Malaysians across all walks of life.
towards high income status. Despite the many challenges, I am confident that we are on track
There are initiatives aimed at benefitting the rakyat and towards achieving this national aspiration of attaining developed
there are certain aspects of our work, such as reforms in public and high income status by 2020.
finance that appears difficult to stomach but are critical towards
our competitiveness and sustenance as a nation in the grander
scheme of things.
The Honourable Prime Minister and I as his deputy have
pledged our commitment towards staying the course of
transformation, taking into consideration the concerns voiced
by all Malaysians.
The demand for better public service delivery is ever growing YAB DATO' SERI DR. AHMAD ZAHID HAMIDI
and the Government has been responsive to these calls to achieve DEPUTY PRIME MINISTER OF MALAYSIA
stellar service levels and deliver transformational impact for
the people.
As the chair of the Government Transformation Programme
(GTP) as well as my portfolio with the Ministry of Home Affairs, I
will ensure that we will continue to institutionalise and embrace
transformation in totality across areas relating to improved public
service delivery and keeping peace in the nation.
This will bode well for Malaysia. In addition to creating peace
of mind amongst citizens, it will enhance our appeal to tourists
and foreign investors, opening opportunities for job creation and
better standards of living.
Initiatives under the Reducing Crime NKRA have been
implemented, contributing to a significant decrease in Malaysia's
Crime Index by an average of 6.6 percent since 2010. However,
incidences of crime persist within the fabric of our communities,
contributing to public scepticism on the effectiveness of the
Government's crime-fighting measures.
When it comes to feeling a sense of security, we too believe in
the need to uphold ourselves to the ideals of a crime-free society,
a goal more utopian than practical but one that we must aspire
to achieve. The rakyat have my pledge that the relevant agencies
will work to this end.

NATIONAL TRANSFORMATION PROGRAMME COUNTRY REPORT

GETTING
OUR
GROOVE
BACK
MALAYSIA: FIVE YEARS
INTO THE NATIONAL
TRANSFORMATION
PROGRAMME
DATO SRI ABDUL WAHID OMAR

MINISTER IN THE PRIME MINISTERS DEPARTMENT
ECONOMIC PLANNING UNIT

O
nly mid-way into the 10-year to create a more diversified, resilient subsidies to ease citizens cost of living,
NTP, Malaysia is evidently economy capable of weathering without having to overly tax a large
demonstrating signs of a volatile global economic patterns. base of the population.
successful turnaround. 2015 presents the opportunity The Asian Financial Crisis in 1998
Research commissioned by to look back on the halfway mark of was a sobering reminder that without
the staff of the World Bank Group the NTP and takes stock of progress sound fundamentals, continous
through the Competitive Industries achieved thus far. high growth and exuberance is
and Innovation Programme (CIIP) Strategically located between not sustainable. The nature of the
titled Doing, Learning, Being: A giants such as India and China, history downturn was swift and debilitating,
Study of Malaysias Transformation reminds us that the Straits of Malacca requiring the Government to dig deep
Programme 1 confirmed that once anchored bustling ports that into its coffers and reserves to combat
transformative results are being received people from all over the world shocks and keep the economy afloat
reaped as a result of methodologies plying the spice route and trading through pump-priming.
used to implement the National merchandise in Malaysia. Against the backdrop of the
Transformation Programme (NTP). Resource rich and capitalising on Global Financial Crisis (GFC) in 2009,
With a series of labs and roadmaps increasing industrialisation as opposed Malaysias GDP shrank 1.5 percent for
outlining key targets, enthusiastic to a predominantly agriculture based the first time since 1998s 7.4 percent
stakeholders comprising public and economy in the past, Malaysia enjoyed GDP contraction.
private sector individuals as well as steady growth as a highly open upper- Saddled with an overhang of debt
civil groups stood ready to implement middle-income nation with per capita and deficit from the 1998 recession,
intricate three-feet plans drawn up income rising 8.0 percent per year rising subsidy expenditure and weighed
in a series of labs designed to identify between 1970 and 2010, reaching down by challenges such as gaps in
and problem-solve prioritised national US$8,636 per capita. productivity and competitiveness, a
pain-points. It is no surprise that under those diagnosis that Malaysia was stuck
Multilateral agencies such as the circumstances, the nation was able within the middle-income trap ensued,
International Monetary Fund and the to provide for its people amply, thus painting a desperate outlook of the
World Bank, as well as international entrenching the practice of blanket countrys future.
ratings agencies such as Standard
& Poors, Moodys and Fitch have
commended the Governments The New Economic Model
commitment to introduce structural
reforms that are able to boost the HIGH INCOME
countrys economic resilience. Target US$ 15,000
Overall, the true north target of GNI per capita by 2020
the NTP is aligned to the goals of
Malaysias New Economic Model
(NEM) to enable the country to
attain high income economy status
NEW
by 2020 through sustainable and
ECONOMIC
inclusive measures. Under the NTP, MODEL
the Government Transformation
Programme (GTP) was aimed at
improving public service delivery
and strengthening public institutions, INCLUSIVENESS SUSTAINABILITY
Enables all communities to benefit Meets present needs without
whilst the Economic Transformation from the wealth of the country compromising future generations
Programme (ETP) was designed
Doing, Learning, Being: A Study of Malaysias Transformation Programme by Professor Charles Sabel, Professor of Law and Social Science, Columbia
Law School and Luke Jordan, a former World Bank development specialist, January 2015 (Source: https://www.theciip.org/sites/ciip/files/documents/
PEMANDU%20Study%20--Final.pdf)

Rising Like
a Phoenix
Thus formed the impetus to craft
Malaysias comeback strategy. The New
Economic Model unveiled by the Prime
Minister of Malaysia, YAB Dato Sri
Mohd Najib Tun Hj. Abdul Razak in 2009
set the stage for plans that would turn
Malaysia into a globally competitive,
high income nation by 2020.
Released at a time when the world Prime Minister YAB Dato' Sri Mohd Najib Tun Hj. Abdul Razak delivering a speech during the launch
was grappling with the effects of the of the Government Transformation Programme Roadmap in January 2010.
Photo courtesy of BERNAMA Images
GFC tipped by the subprime meltdown
in the US and further exacerbated by
In turn, the Government
unsustainable models in developed
would be able to prioritise its ...the Government
economies that hinged upon funding
growth through debt, the Malaysian
resources in delivering better
living standards and safety nets
would be able to prioritise
Government chose a path that would
depart from that practice in securing
to ensure that all Malaysians its resources in delivering
regardless of stature are able
the countrys future.
to benefit, and in so doing, better living standards
Malaysias new growth model
improve the entire public service
would focus on a few key areas:
delivery mechanism and align
and safety nets to ensure
Fiscal consolidation through it to standards worthy of a that all Malaysians
progressively creating developed high income nation
manoeuvring room by reducing
To implement the above
regardless of stature
our debt and deficit levels
stakeholders from Government, are able to benefit, and
Mitigating the risk of the private sector, civil society and
overdependence on Government members of the public were brought in so doing, improve the
income from oil and gas by together in 2010, into a series of labs
diversifying and restructuring that would pinpoint the problem areas
entire public service
the economy to encourage and identify solutions with clear three delivery mechanism
innovation and productivity feet plans on how to implement and
in key sectors and encourage move the nation closer towards its high and align it to standards
the private sector to invest in income target.
the top 12 areas of the economy These detailed plans were assigned
worthy of a developed
in order to drive economic as key performance indicators (KPIs) high income nation.
growth. The Government could to relevant Government agencies who
become a facilitator by creating would lead on implementing them,
a favourable environment for working in collaboration with fellow
businesses to thrive in this lab stakeholders to ensure success.
country through reforms and Out of these labs emerged the GTP
business reengineering process and ETP.

The GTP comprised six National

Key Result Areas (NKRAs) tackling
areas with social underpinnings
BECOMING A HIGH-INCOME NATION
namely, Reducing Crime, Fighting
Corruption, Assuring Quality
Education, Raising Living Standards
of Low Income Households, Improving
FOCUS COMPETITIVENESS
Rural Development, and Improving
Urban Public Transport. A seventh
NKRA was added a year later, 12 NKEAs
Addressing Rising Cost of Living
and in 2014, Public Service Delivery
+ 6 SRIs
Transformation, which previously 7 NKRAs
resided as one of the Strategic Reform
National Key Economic Areas Strategic Reform Initiatives
Initiatives (SRIs) under the ETP become National Key Result Areas
the eighth NKRA.
To prioritise top sectors of DRIVERS to ensure focus ENABLERS to ensure
the economy that Malaysia had on high-impact areas competitiveness
comparative advantages in and turn
these into hotspots for investment,
the ETP featured 12 National Key companies to thrive, the ETP initially
Economic Areas (NKEAs) namely introduced six SRIs in 2011 namely, Governance
Oil, Gas and Energy (OGE), Financial
Services, Palm Oil and Rubber
Public Finance Reforms, Competition,
Standards and Liberalisation, Human
structures were set-up
(POR), Wholesale and Retail (W&R), Capital Development, Narrowing within each key result area
Agriculture, Tourism, Electronics & Disparity, Reducing Governments
Electrical, Communications Content Role in Businesses (Reducing GRiB) to ensure effective and
and Infrastructure, Healthcare, and Public Service Delivery3.
Business Services and Education. The Formulated from 37 policy
efficient problem-solving,
Greater Kuala Lumpur/ Klang Valley measures recommended by the swift decision-making
NKEA, is not a sector per se, but as the National Economic Advisory Council
main economic hub of the nation holds (NEAC), the SRIs were the result of and win-win relationships
plenty of potential to be explored. consultations held in six labs involving
Governance structures were set-up 500 public and private sectors
between Government
within each key result area to ensure representatives in 2011. and the private sector.
effective and efficient problem-solving, In this report, we share
swift decision-making and win-win observations in key areas where the
relationships between Government transformation ecosystem has yielded
and the private sector. positive results, demonstrating that
In bringing about reforms to increase change for the better has in fact
ease of doing business and creating a occurred with positive outcomes
more competitive environment for delivered for all involved.
2 In 2015, PEMANDU was tasked to review and recalibrate key performance indicators (KPIs) for the Reducing GRiB SRI, as divestment had been completed
by the 33 companies that had committed to do so at the launch of the SRIs in 2011. Furthermore, as reported in the Economic Transformation Report 2014,
Government and state-owned companies have moved to institutionalise the process of divesting non-strategic assets in their operating models. Moving
forward, any divestment programme will be driven solely by their respective governance processes.
3 In 2014, Public Service Delivery SRI was reassigned to the GTP as Public Service Delivery Transformation to allow for greater focus and integration
to effect faster delivery

Sustainability and
Article IV Mission to Malaysia4 that the
authorities have been able to maintain
Resilience Critical to Growth

macroeconomic and financial stability,
while making significant progress in
improving the foundations for sustained
economic growth over the medium
Topping the list of macroeconomic Well aware of the difficult term. The article also commended
concerns for the Government in 2010 dilemmas ahead, tough policy the implementation of GST, and subsidy
was how vulnerable our economy decisions were made and Malaysias rationalisation as measures that helped
was to global shocks due to the high fiscal consolidation was rolled out in the country weather economic shocks
amount of trade occurring with the the last five years. since late 2014.
rest of the world. Global markets are Two very important measures Likewise, ratings agencies such
naturally beyond Government control, rolled out in that period were the as Fitch, Moodys and Standard
but more resilience could be built into rationalisation exercise to dismantle and Poors all who were critical of
the domestic environment. blanket subsidies and create targeted Malaysias fiscal position prior to 2013
One of the most crucial areas to safety nets as part of an effort to have commended these reforms, as
address would be the twin challenges streamline Government expenditure, well as efforts to reduce reliance on oil
of mounting debt and deficit, which and the implementation Goods and and gas revenue through diversification
would lead Government finances into Services Tax at 6 percent on 1 April 2015 into other economic sectors.
an untenable situation if nothing as a broader-based, more effective and Malaysia has in the last five years
was done. The Government was also fairer tax collection mechanism that is been able to meet its fiscal deficit
painfully aware that the success of the ultimately meant to benefit Malaysians. target year on year (Exhibit 1) whilst
NTP and the ability to maintain high In its assessment of where Malaysia also keeping a lid on debt below 55
income status thereafter hinged upon stands, the IMF highlighted in its 2015 percent (54.5 percent of GDP in 2015).
getting its finances in order.
Historically, some countries
pursuing high-income status tended Still On Track To Fiscal Balance
to overlook debt management whilst 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2020
pursuing growth, but this leaves the

Government with little fiscal room to
2016
manoeuvre. Target
The Government chose to be

prudent and avoid over-borrowing -3.0% -3.1%
-3.1% -3.2%
to finance short-term growth and -3.4%
-3.8% Balanced
instead adopt a balanced debt-to- -4.5% -4.3%
Budget
-4.7% by 2020
equity model to stimulate economic
-5.3%
growth and reduce deficits.
Furthermore, Malaysia has a check -6.4%
and balance in the form of a debt Global
Financial
ceiling at 55 percent of GDP under the Crisis
Government Funding Act 1983 and the Source: Ministry of Finance
Loan (Local) (Amendment) Act 2005.
Exhibit 1: On track to Fiscal Balance by 2020
4 International Monetary Fund, 2015 Article IV Mission to Malaysia, 2016 https://www.imf.org/external/np/sec/pr/2016/pr1621.htm

Catalysing the Economy

segments including oleo derivatives and
selected food and health based products
has enabled key local oleochemical
companies to increase their revenue
share. This led to a CAGR of 9.2 percent
for oleo derivatives exports from RM1.5
billion in 2008 to RM2.8 billion in 2014.
To date, there are 18 projects under
EPP6: Developing Oleo-Derivatives.
With a focus to shift national
production from basic oleo-chemicals
to higher value oleo derivatives from 1
percent share in 2009 to forecasted 40
percent by 2020, it aims to capture 14
Pengerang Independant Terminals Sdn Bhd deepwater terminal, a private-public partnership percent of global demand for five key
between Dialog Group Berhad, Holland's Royal Vopak N.V. and the Johor State Government
commenced operations in 2014 and was fully leased out within months products (agrochemicals, surfactants,
bio lubricants, bio polyols and
Simultaneously with creating These EPPs, time and again have glycerol derivatives), creating and
macroeconomic stability, emphasis was shown good measure of resilience in impact of RM5.8 billion in GNI and
placed in enabling the private sector to showcasing economic exuberance 5,900 local jobs.
build stronger foundations to support especially in recent challenging times. Among other initiatives, the
the nation's efforts towards achieving Under the ETPs OGE NKEA, Business Services NKEA is also creating
high-income status. developments in Pengerang deliver more value by attracting aerospace
The 12 National Key Economic hope that the Government has original equipment manufacturers
Areas (NKEAs) comprised selected been right to focus on growing the (OEMs) to catalyse this advanced
sectors of economic opportunity for downstream industry. Despite a manufacturing industry in Malaysia.
the private sector which will drive challenging economic outlook, the This subsector has significant multipliers
Malaysia towards high-income continuation of projects such as the in terms of high value job creation and
status. While Malaysia already Refinery and Petrochemical Integrated technology transfer through research &
has a competitive advantage in Development (RAPID) within the development (R&D) initiatives.
some sectors and the potential to Pengerang Integrated Petroleum Over the past five years, EPP7:
carve a niche in others, the NKEAs Complex (PIPC) demonstrates the Making Malaysia The Hub For
underscore Malaysias targeted private sectors confidence in this move. Aerospace OEMs In South East Asia
approach to achieving sustainable Dialog Group Bhds deepwater storage has seen landmark deals including an
economic growth. facility was fully leased out within RM830 million investment agreement
Theses NKEAs receive prioritised months after it was first launched as a between Rolls Royce and UMW. The 25-
Government support due to their result of low oil prices, and the company year agreement will see UMW M&E Sdn
potential to enhance Gross National continues to expand by developing the Bhd and subsidiary UMW Aerospace
Income (GNI). Pengerang Terminal Phase 2 Project. Sdn Bhd making fan cases for Rolls-
To realise private sector-driven It is also important to note that this Royces Trent 1000 engines which power
growth, each NKEA offers private downstream foray does more than just the Boeing 787 Dreamliner.
sector involvement and investment offer a leg-up to generate greater value Large corporations are not the
opportunities through Entry Point and investments from the oil and gas only one benefiting from the high
Projects (EPPs). To-date, 149 EPPs sector. It also acts as a natural hedge transactional activity boom that leads
have been announced, guiding the against volatilities that can be more to a higher income. Small traders
development of the industry or sector challenging for the upstream industry. revenues under the Agriculture NKEA
and were formulated through public The Palm Oil and Rubber NKEA also benefited from the transformation and
and private sector consultations during witnessed a push to grow downstream integration of various small, randomly
labs held in 2010. segment. A strong focus on finished situated outdoor markets into dedicated

community markets - recognised
colloquially as Pasar Komuniti (PAKAR) 3%
GR 8.
15 CA
RM billion 179.4
- with improved facilities that encourage -20 168.5
Public Private 2011
higher hygiene standards and a 151.7
134.5
comfortable shopping environment.
.3%
0 CAGR 5
Starting out in 2012 with just one 2006-201 101.3
110.9
98.7 100.5
92.4 92.4 95.8 94.8
PAKAR in Manjung, Perak with total 81.6 77.8 80.2
85.6 83.0 85.1
74.1
69.7
sales of RM384,081, this initiative has
recorded encouraging growth over the
Launch
years. As of 31 December 2015, there of ETP
are 10 PAKARs located in the states

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
of Kedah, Negeri Sembilan, Pahang,
9th Malaysian Plan 10th Malaysian Plan
Johor, Sabah and Sarawak, having
generated total sales of RM76.6 million
Sources: Department of Statistics and Economic Planning Unit estimates (Constant 2010 prices)
and created 2738 jobs. Between 2012
and 2015, the Government invested Exhibit 2: Realised private investment accelerated post-ETP
RM52 million into this initiative.
Meanwhile, in the Wholesale and
Retail NKEA, 2216 mom-and-pop stores Public Private
underwent improvement EPP2: Small

retailer transformation programme 43% 42% 40% 36% 35%
46% 44% 46% 48% 45%
(TUKAR) from 2011 till 2015. A TNS
65%
Study in 2013 revealed that 77 percent of 57% 58% 60%
64%
54% 56% 54% 52% 55%
TUKAR participants experienced higher
revenues post transformation. Launch
of ETP
Overall, efforts to streamline these
economic sectors and attract more 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
investments into these areas have 9th Malaysian Plan 10th Malaysian Plan
yielded positive results.

Realised investments have clearly Sources: Department of Statistics and Economic Planning Unit estimates (Constant 2010 prices)
accelerated post-ETP as the period
between 2011 and 2015 records a 8.3
Exhibit 3: Private sector dominates investment ratio
percent compounded annual growth
rate compared to 5.3 percent between
2006 and 2010 (Exhibit 2).
RM million
Additionally, over the last five
PITA Export Duty Petroleum Royalty & Gas
years, we have seen the gap between Petroleum Dividend Exploration (Oil & Gas MTJA) % Oil Revenue/Gov Revenue
public and private investment widen
39.6% 41.3%
as the private sector increasingly takes 36.8% 36.5% 35.4% 35.8%
33.7%
the lead in total investments into the 31.2%
30.0%
economy (Exhibit 3), in line with the 21.5%

nations aspirations to see private 14.1%
sector own up to 92 percent of total
investments by 2020.
More importantly, the Government
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
has been able to reduce its dependence Revised Budget
Estimate Estimate
on oil and gas revenue over the last

Source: Ministry of Finance
five years (Exhibit 4) by focusing on
developing other sectors of the economy. Exhibit 4: Government is less dependent on oil revenue

People First,
Performance
Now
The introduction of the NTP
has transformed how civil service
approaches its work. Adopting more
dynamic, responsive and robust
problem solving methodologies,
there has been a vast improvement in
how the public service connects and
responds to the needs of the rakyat.
Much of this culture is embodied
in the work that we see being done
through NKRAs Anti-Corruption,
Crime and Public Service Delivery
Transformation (PSDT).
In 2015, Malaysia jumped seven
points in the World Banks Open Photo courtesy of BERNAMA Images
Budget Survey due to strengthened
oversight of the Auditor General secretariat to the Putrajaya Inquisition PPPs have signed integrity pledges
(AuG)s Office, and the tabling of the for audit issues that go unresolved for with the Public-Private Partnership
AuG Report to three times a year more than a year. Unit (UKAS).
both major initiatives under the Anti- Among other things the agency As one of the many key crime
Corruption NKRA. Malaysia achieved monitors all feedback from the auditees reduction initiatives, NKRA Crime
a score of 46 out of 100 on the overall on a quarterly basis and if necessary, introduced the Omnipresence/
Open Budget Index, slightly above the engages with them to resolve issues Residential Patrols initiative to
global average of 45, aligned with the that are still pending. increase police visibility on the streets
likes of India and the Ukraine, and Further, as testament to the and combat break-ins. Benchmarked
ahead of Thailand, Vietnam and Governments commitment to plug against both of Seattle Police
China. Malaysias score has been leakages in Government contracts by Department and Michigan Police
gradually improving over time, from putting in place preventive measures Departments Motorcycle Patrolling
35 in 2008 to 39 in 2010 and 2012. to curb corruption in the public sector, Units, over the last five years, the
The Auditor Generals Offices up to 2014, NKRA Anti-Corruption initiative resulted in the arrest of 2,111
Follow-Up Audit Division (BSA) saw 574,592 Integrity Pacts pledged suspects by the Urban Residential
plays three major roles in overseeing under the initiative to implement Patrol units.
Government departments that have comprehensive integrity pacts for Taking a leaf out of the Police
been identified as having issues in the public-private partnerships (PPP) Performance Assessment League
AuG Report. projects. This initiative is designed based Table in England and Wales, the Balai
BSA manages the AuGs on a similar model by Transparency League Table initiative also under
Dashboard which displays the latest International in recognising the need NKRA Reducing Crime promotes
actions taken by auditees to the major to adopt an international standard to a performance-based culture in
issues outlined in the Report, acts as strengthen public confidence on the the police force, and also further
the secretariat for the AuG Reports governance of public spending. As encourages local police stations to
Action Committee (JTLKAN) and as a of 2015, all companies involved with reach out to local communities.

With an investment of between RM under NKRA PSDT to optimise patient Meanwhile, with total investments
900,000 to RM1.1 million, 788 police flow and improve patient waiting times worth RM1.29 million at Hospital
stations are annually ranked into five through Healthcare PSDT initiatives Tengku Ampuan Rahimah Klang
categories based on percentage achieved have been largely successful. (HTAR), patient flow at the Emergency
in crime reduction and community With a total investment worth Department has been improved,
outreach. As of 2014, the evaluation RM191,000 at Hospital Sultan raising by threefold the number of
is jointly conducted by Royal Police Ismail Johor Bahru (HSIJB), the Green Zone (non-critical) patients
Malaysia (PDRM) and the Malaysian waiting time for treatment at the that are treated and discharged in
Crime Prevention Foundation (NGO). Orthopaedic Specialist Clinic and less than two hours from 18 percent
Last year, the Muar Police Station Oncology Treatment Centre have seen to 70 percent.
emerged tops in the list followed by significant reductions. Head and neck In addition, the medical ward
Sungai Besi Police Station as the runner- cancer treatment waiting time was discharge process was improved
up. For all five categories, the winners significantly reduced from 120 days allowing 100 percent of patients
received cash incentives, certificates to 30 days, adopting the World Health to be discharged within four hours
of appreciation, the BLT Trophy Cup Organisations standard. This has compared to 72 percent previously
and a Study Visit for the Category A also allowed the number of patients and the medical ward bed capacity
champions sponsored by the Malaysian treated at the centre to increase by 60 was increased by 42 percent, a
Crime Prevention Foundation. percent, from 30 patients to 48 per testament of the improved services
With the rapid pace of urbanisation, day. Besides that, waiting time at the and facilities at HTAR.
it is imperative that our nations Orthopaedic Specialist Clinic has also Towards 2020, NKRA PSDT aims to
healthcare facilities deliver services seen a significant reduction from 115 roll-out Healthcare PSDT initiatives to
more effectively and efficiently. Efforts minutes to 62 minutes. all 133 Ministry of Health hospitals.
...the waiting time

for various treatments
have seen significant
reductions. Cancer
treatment waiting time has
been significantly reduced
from 120 days to 30 days,
adopting the World Health
Organisations standard.
This has also allowed the
number of patients treated
by the clinic to increase
by 60 percent, from 30
patients to 48 per day.

Creating a Business-
18 sub-sectors were liberalised
in 2012, where the implementation
Friendly Environment
process of these initiatives was done
in stages. 15 out of the 18 services sub-
sectors were liberalised in 2013. The
following year saw the liberalisation
The true measure of competitiveness and maturity of of the remaining three sub-sectors
as well as the removal of regulatory
a nations economy really lies its ability to be trade openly burden in sectors such as construction,
healthcare, professional services and
in a liberalised environment. Malaysia has over the years tertiary education.
In taking liberalisation further,
undertaken a policy of progressive liberalisation. The Malaysia is now a member country
liberalisation process is co-ordinated, monitored and guided in the Trans-Pacific Partnership
Agreement (TPPA). Consistent with
by the Malaysian Services Development Council (MSDC), national interests, the TPPA will further
enhance the competitiveness of the
chaired by the Minister of International Trade and Industry. country in regional and global markets.
The Narrowing Disparity SRI -
designed to further step-up capacity
A robust range of policy measures The standards ecosystem in building for Bumiputera entrepreneurs
designed to create the conditions for Malaysia has also been shaped to to result in improved representation
competition has built a foundation ensure Malaysian businesses are able in market equity, high value-added
for lasting growth. This is to facilitate to maintain their competitive edge occupations, and management
the creation of a more efficient, through the adoption of standards in positions has also been successful in
competitive and business-friendly their products and services. As of 2015, a the last five years.
environment in Malaysia that will total of 6,204 Malaysian Standards were Between 2010 and 2015, the
allow world-class, local champions developed by Standards Development Governments Bumiputra Agenda
to thrive and attract valuable Agencies (SDAs) that have been Steering Unit (TERAJU) has provided
foreign investment. appointed by Standards Malaysia. Of RM63.39 billion worth of business
A key development under these, 3,622 standards are on par with opportunities, financing and human
the Competition, Standards and international standards. To further boost capital development through 23
Liberalisation SRI has been the standards compliance in Malaysia, programmes and initiatives for
enactment of the Competition Act the National Standards Compliance Bumiputera entrepreneurs.
2010. The Malaysia Competition Programme (NSCP) was launched in Potential Bumiputera companies
Commission (MyCC) was set up in 2014 by Standards Malaysia. have been provided facilitation and
April 2011 to enforce the Competition The true m e a s u re of assistance for Bursa Malaysia listings.
Act beginning 1 January, 2012 and its competitiveness and maturity of a These companies were given guidance
responsibilities include receiving and nations economy really lies its ability to develop their respective IPO plan
investigating complaints, issuing to be trade openly in a liberalised by TERAJU and Ekuinas to expedite
decisions and undertaking market environment. For Services, Malaysia new Bumiputera listings on Bursa
reviews to assess the nature and has over the years undertaken a policy Malaysia, as part of the Skim Jejak
level of competition within industries of progressive liberalisation. The Jaya Bumiputera (SJJB) programme. To
and sectors. liberalisation process is co-ordinated, date, 11 companies have been listed,
The initiative has gained much monitored and guided by the Malaysian growing total market capitalisation
traction as reflected in the number of Services Development Council (MSDC), of Bumiputera companies from
complaints received by MyCC, which chaired by the Minister of International RM1.93 billion to RM5.62 billion as of
grew from 8 in 2012 to 232 in 2015. Trade and Industry. December 2015.

Sowing
A LINUS taskforce continuously Upholding Bahasa Malaysia and
monitors and tracks the performance Strengthening the English Language
Seeds for
and students down to the individual (MBMMBI) policy.
levels. Students are screened twice Given the polarities that had to be
Future Talent
a year to detect if any one is falling managed in implementing solutions
behind, upon which they will be to this problem, the Government
supported through targeted training chose a middle ground approach
in remedial classes, allowing them and instead decentralised decision-
The Government has taken great to catch up with other students in the making on adoption of these policies
strides to enhance our labour pool mainstream classes. and empowered schools and parents
since the inception of the NTP in 2010. Poor quality of English among to decide on whether to implement
Efforts under NKRA Education, NKEA school students has been a matter these programmes. It is believed
Education, and SRI Human Capital of national concern for a long time that this would be the best decision
Development have borne fruits, and and after many careful deliberations, to move forward as the Government
will continue to do so. a major breakthrough was achieved focuses on ensuring a conducive
NKRA Education saw 132 High in 2015. learning environment.
Performing Schools (HPS) in a span Upon the conclusion of a Ministry The decentralisation of decision-
of five years, exceeding their target of of Education sponsored English making, giving power to schools and
100 schools under the GTP Roadmap Lab facilitated by the Education parents to decide on the best solutions
2.0, and in the process changing the Performance and Delivery Unit for students is a heartening move that
lives of many students. (PADU) and PEMANDU introduced could be a precursor to more exciting
With the focus now set on ensuring the Highly Immersive Programme developments in reforming Malaysias
that existing HPS continue to maintain (HIP) and Dual Language Programme education system and aligning
their standards and quality, the Ministry (DLP) for schools under the existing to become world-class.
of Education will continue to handhold
other potential schools to achieve HPS
status. In aspiring towards 2020, we
aspire for these schools to be the role
model for other schools, painting a
vision whereby other schools can
strive to be similar to these world-
class schools, as well as setting an
international benchmark.
What started as the Literacy
and Numeracy Screening (LINUS)
programme 1.0 which only included
Bahasa Malaysia in 2010 has seen the
inclusion of English in 2013, beginning
LINUS 2.0. In ensuring that exiting
Primary 3 students are competent in
the components of English, Bahasa
Malaysia and numeracy as its objective,
the year 2015 saw 94.1 percent of
English literate students, 98.6 percent
of Bahasa Malaysia literate students
and 99.1 percent being numerate.

Inclusiveness
Sustainable development required
that growth enablers must be delivered
to all citizens whether they live in
urban or rural settings. On that note,
NKRA Rural Development has been
hard at work in the far reaches of the
nation to deliver an equitable standard
of living for all Malaysians.
Efforts under GTP 2.0 have resulted
in 345,665 households nationwide now
having access to clean and treated
water, and 143,899 households having
24-hour electricity as of December 2015,
under both the Water Delivery and
Electricity Delivery initiatives. Both
initiatives hope to cater to 99 percent
of Malaysian households by 2020.
In striving to remove the stigma
associated with rehabilitated inmates
and to reduce the rate of recidivism,
NKRA Crime launched the Industrial
Prison Programme in 2013, at the
As we strive towards high-income and then meting out assistance, the inception of GTP 2.0. As of December 2015,
status, there will inevitably be clusters e-Kasih database (which captures the 1,757 inmates have completed certified
in society that will struggle to keep up. details of the households that require skills training under Sijil Kemahiran
In a span of five years, the NKRA teams assistance) received the United Nations Malaysia (SKM-SLDN), Sijil Kecekapan
Crime, Cost of Living, Low Income Public Service Award in 2012. Kemahiran (SKK-CIDB) and Program
Households and Rural Development In May 2013, the Asian Development Pemanduan Kenderaan Perdagangan
have implemented various to reduce Bank (ADB) acknowledged that (Metro). Aimed at upskilling inmates
disparity, and bridging the divide Malaysia has the biggest reduction to increase their chances of finding
between the economically well-off amongst other ASEAN countries on employment after their release, prisons
and the disadvantaged. the percentage of population below are set up with in-house bakery
Over the last five years the 1AZAM the poverty income line, recording a facilities with training provided. This
Programme has helped many families 55.3 percent reduction. initiative has also introduced an element
escape the hardships of poverty. Through The World Bank Reports Economic of self-sufficiency, in which the bakery
six 1AZAM Programmes such as AZAM Monitor 2014 calls Malaysia a success produces is own bread to the prisoners.
Tani, AZAM Niaga, AZAM Kerja, AZAM story in shared prosperity, to mean This initiative emulates other
Khidmat, AZAM Bandar as well as all households experience income prison programmes around the
1AZAM Sabah and 1AZAM Sarawak, growth, but growth is higher for world such as the Prison Industry
which provide the means of generating those households at the bottom of Enhancement Certification Program in
sustainable income, financial assistance, the distribution, a pattern that leads the United States, Prison Industries in
skills training as well as motivation, the to lower inequality. In the report, the Australia, and Prisons Industries Unit
poverty rate fell from 3.8 percent in 2009 World Bank commended Malaysia for in the United Kingdom.
to less than 1 percent today. drawing on its natural resources over In aspiring towards 2020, this
As testament to the tremendous the last 40 years to nearly eradicate initiative hopes to see a greater
efforts reaching out to the needy to absolute poverty, from 49 percent in percentage drop in recidivism,
ascertain how they can be helped 1970 to 1 percent in 2014. a greater percentage increase in

inmates employed after release, and alternative grocery items of a more A total 185 KR1M5 stores have been
an increase in the number of bakery affordable nature, compounded by a established nationwide.
facilities set up as well as prisons that high quality. Meanwhile, the Klinik 1Malaysia
are self-sufficient for food. With RM 86 million invested in (K1M) initiative was also launched,
In efforts to cushion the effects of this initiative to date since 2011, items giving the rakyat access to RM1 for
the rising costs of living, NKRA Cost are sold under the brand of Produk medical consultation or treatment.
of Living launched the Kedai Rakyat Rakyat 1Malaysia in KR1M and non- There are 334 K1M6 operating
1Malaysia (KR1M) initiative to provide KR1M participating stores or outlets. nationwide.
Kuala Lumpur:
of our very own MRT system under
the Greater Kuala Lumpur/ Klang
Liveable City 2020

Valley NKEA.
Recognising the need to enhance
the reach of urban rail in the Klang
Valley, the Government invested RM
As the nations main economic Given that the city is expected 32 billion into constructing the MRT
hub, it is important to ensure that to be home to 10 million people in Line 1 project which extends from
liveability in Kuala Lumpur is aligned 2020 from 6 million in 2010 creates Sungai Buloh to Kajang. Service will
with that of other world-class cities. the need for a comprehensive and commence end 2016 and it will serve
The Greater Kuala Lumpur/ Klang sustainable development plan that a corridor of up to 1.2 million people.
Valley NKEA aspires to be among the can adequately address the challenges Construction of MRT Line 2 sees
top economic and liveable cities in the of rapid urbanisation. the existing Sungai Buloh station pass
world by 2020. In taking a leaf from cities such through Serdang and Putrajaya and is
The Economist Intelligence Unit as Singapore and Taipei which are expected to serve a corridor of 2 million
(EIU)s 2015 Global Liveability Ranking characterised by their robust Mass people. Construction will commence
places Kuala Lumpur in the 73rd spot Rapid Transits (MRT), Malaysia soon with completion targeted for the
amongst 140 cities, up five places from undertook its biggest infrastructure second quarter of 2022.
its 2010 ranking. project to date with the construction Both lines will significantly
improve mobility in the GKL/KV area.
With rail as the backbone of our
integrated public transport network,
efforts under NKRA Urban Public
Transport have also further increased
connectivity through initiatives such
as the KTM Komuter, LRT Kelana Jaya
and the LRT Extension Project (LEP).
The KTM Komuter saw investments
worth RM1.98 billion injecting 38
six-car sets into its service in March
2012, increasing its daily ridership
by 46 percent compared to 2012.
Frequency has improved to 15 minutes
from one hour, as well as increasing
train capacity, now catering 1,100
passengers per train set.
5 6 As at December 2015

Meanwhile, LRT Kelana Jaya saw have continued to reinforce this. The launched the free city bus initiative,
RM1.65 billion worth in investments year 2015 saw Malaysias first ever GO-KL. With its zero-fare rate and 15-20
launch 35 sets of LRT Kelana Jayas Bus Rapid Transit, the BRT Sunway minutes frequency, 40,000 passengers
four-car train in March 2010, increasing operating with its intent of benefitting in a city of 1.7 million people enjoy its
its daily ridership to 19 percent a population of 500,000 with 5.4km free service daily.
compared to 2011. Frequency has since in Subang Jaya, taking a leaf from
been improved to 2.5 minutes during densely-populated cities such as
peak hour. Curitiba and Colombia.
The backbone of our public As a learning from cities such as
transport network is of course not Adelaide, Perth and Christchurch, the
without its support, and bus initiatives NKRA Urban Public Transport also
Sustaining Socio-Economic
Another challenge involves putting
in place a good framework to govern
Development Efforts
political funding in Malaysia as part
of efforts to ensure a level-playing
field in Malaysian politics. Although
recommendations have been made
The remaining five years, as we executives and employees alike over as early as 2010, this initiative has not
make the dash towards the 2020 the next five years. gained enough traction as politicians
deadline will be a crucial stretch As markets liberalise and with from both side of the divide do not see
that will require much effort from all the Trans-Pacific Partnership kicking the impetus to push for this reform. The
factions including the private sector. into action, local businesses must to setting up of the National Consultative
One of the reasons that Malaysia find ways to build top notch products Committee on Political Funding in
was left behind in the race towards high and services that can stand the test August 2015 provides some assurance
income by countries that started off on of competition with the best. On its but more work has to be done, and
the same footing as us, South Korea part, the Government will continue support to be won to push for better
for example was that Malaysia has not to facilitate and create a conducive regulation of political funding. This
been able to hit the right markers in environment for businesses to thrive. effort continues.
increasing productivity growth. There
was not enough impetus for innovation
or drive amongst local companies to Malaysian businesses must become more
win it big in the global market like what
brands such as Samsung and Hyundai globally competitive so there will be no need to quarrel
have achieved.
Malaysian businesses must become
in a small market like ours. Companies must realise
more globally competitive so there will
be no need to quarrel in a small market
that the Government can only facilitate a competitive
like ours. Companies must realise that environment but it cannot be the driver of innovation.
the Government can only facilitate a
competitive environment but it cannot This has to happen at companies, driven by executives
be the driver of innovation. This has
to happen at companies, driven by and employees alike over the next five years.

Staying
On its part, the Government
is committed to see through the
the Course
implementation of the NTP to
ensure relevance, sustainability and
inclusiveness for all.
The NTP is certainly yielding Ultimately, at the end of it all
positive results five years into the when the programme reaches its 2020
programme, and Malaysians can deadline, Malaysians will be able to
be confident that the country is on proclaim proudly that between 2010
the right track towards high income and 2020, the nation collectively
status. Whilst taking comfort in the came together and united to support
outcomes of the work done in the national transformation so that a better
last five years, it is crucial that all Malaysia could be delivered to future
parties stay the course to complete generations.
commitments made through the GTP
and ETP roadmaps.

YEAR IN REVIEW 2015
GROWTH,
CONFIDENCE
AND RESILIENCE
DATO SRI IDRIS JALA
CHIEF EXECUTIVE OFFICER, PERFORMANCE MANAGEMENT AND DELIVERY UNIT
W
e began our two programmes have impacted
transformational Malaysia. The 2015 edition of
journey by taking an PEMANDU's Annual Report
interventionist approach, tackling illustrates Malaysias story of
challenges needing big, fast results. growth, confidence and resilience
Knowing that no Today, we have shifted gears to brought forth by transformation.
sustain and institutionalise the This report is a testament of the
journey is without changes. Since its launch in 2010, commitment of the civil service,
our transformation initiatives have private sector and many Malaysians,
its challenges, we progressed well according to plan, who have tirelessly contributed
step into 2016 from a on the back of steady economic

growth year after year.
to the goal of taking the country
to become a high-income and
position of strength, As Chief Executive Officer

of the Performance Monitoring
developed nation in 2020.
The report highlights a five-
holding our heads and Delivery Unit (PEMANDU),

I have been tasked to oversee
year view of progress; a broad
and insightful perspective of
high and determined the progress of the Government
Transformation Programme (GTP)
transformation, featuring the good
work done within that period and its
as ever to keep going and Economic Transformation resultant impact on the rakyat.
Programme (ETP). Together with The report also presents the
till we reach 2020 the civil service, private sector and annual developments of the GTP and
our fellow Malaysians, we have the ETP in 2015, staying true to our
when we will become concluded our sixth year of national intent to be accountable to the public
a high-income nation. transformation.

For 2015, I would like to share
for the commitments that have been
made when we launched our GTP
a holistic overview of how these and ETP Roadmaps in 2010.

Sustainable
Those dwelling in the city can testify to investment and consumption from
the initial adjustments brought forth the private sector, in line with the
Growth
by an infrastructure project of such an aspirations of the ETP to see increased
unprecedented scale in Malaysia. But participation of the private sector in
today, we are at a concluding phase of driving the economy forward.
The story of Malaysia has been Line 1 and very soon, the nation will In addition to growth, I would
consistently anchored on growth. be able to feel the impact of such an like to point out that despite the
This includes progress in Government, ambitious project. introduction of measures such as
progress in the economy and progress These stories of progress the Goods and Services Tax (GST) and
in society as a whole. highlighted throughout this report will the effects of subsidy rationalisation,
The Government today is better stand up to any amount of scrutiny, inflation remained in check, with the
positioned to deliver public services proving that the Government is Consumer Price Index (CPI) registering
effectively, and it has continually serious about improving outcomes 2.1 percent in 2015 compared to 3.2
sustained the work of building better for all Malaysians. percent in 2014.
standards of living for all. Contained All of them come under the banner When we prioritised growth in the
within our annual updates that follow of sustained economic growth that economy, we worked hard to ensure
in this report are stories of changed is private-sector-led. Coming in well that we had and will always take
lives brought forth by the shared above global growth of 2.4 percent a mildly expansionary approach. This
commitment to transformation. in 2015, Malaysia achieved a healthy measured and prudent strategy has
I am heartened and privileged to Gross Domestic Product (GDP) growth built our capability to attain growth
hear stories of hope and determination of 5 percent. Between 2010 and 2015, outcomes which have surpassed
from some of our fellow Malaysians, GDP grew 30 percent from RM797.3 estimates.
who witnessed to the remarkable billion to RM 1.13 trillion (Exhibit 5). It is clear that the measures taken by
social and economic transformation It is encouraging to note this Malaysia between 2010 and 2015 to be
in their midst. growth was fuelled by continued more fiscally resilient are bearing results.
Chik Azmily from Kelantan is
one of them. A salary of RM500 a
month as a daily labourer was not Growing Steadily With Low Inflation
cutting it for him, as it just wasnt GDP at Current Prices (RM bil)
2016 GDP FORECAST
4.0%4.5%
enough to support his family. Real GDP Growth Rates (%)
Consumer Price Index (%)
Through the 1AZAM Tani initiative, as
RM billion %
implemented by the good people from 1200
7.4
8
the Malaysian Agricultural Research 6.3

7
1000 6.0
and Development Institute (MARDI), 5.4 5.6 6
5.6
the 31-year-old managed to increase 800 5.2 5.0
5
4.7
his monthly income by an astounding 3.6 4.8
3.2 3.2
4
600 3
ten times to RM5,000, solidly boosting
2
his family out of hard-core poverty. 400
2.0 2.1 2.1
0.6 1.7 1.6 1
From individual stories of
0
transformation, we also have 200 Launch
of ETP
-1
remarkable stories of infrastructural -1.5
0 -2
changes. One that really stands 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
out is the thousands of Malaysians 9th Malaysian Plan 10th Malaysian Plan
coming together to bring the first
Source: Department of Statistics Malaysia, using current Prices
phase of the Klang Valley MRT Sungai
BulohKajang (SBK) line into reality. Exhibit 5

YEAR IN REVIEW 2015
Since 2013, Malaysia has remained in four percent of GDP or below (Exhibit 6). Meanwhile, Malaysias public
the fiscal Safe Zone. The Safe Zone In 2015, fiscal deficit continued to debt stood at 54.5 percent of GDP,
indicates the fiscal health of economies, be reduced according to target, at 3.2 remaining below the legislated debt
requiring that public debt be below 75 percent of GDP compared to 5.4 percent ceiling of 55 percent of GDP. Debt
percent of GDP while deficit is kept at in 2010. guaranteed by Federal Government
was at 15.3 percent of GDP in 2015.
Hence, even with all guaranteed
Malaysia In The Safe Zone debt consolidated, the Government
Public Debt (% of GDP) AS: Asia debt is below 70 percent, fulfilling
AF: Africa
250% EU: Europe the requirements for the Safe Zone.
Sovereign AS1 OC: Oceania
Crisis Level SA: South America Many governments aspire to
achieve this situation; but to get into
200%
EU8
this Safe Zone, tough and unpopular
policy decisions had to be made. In
150% AS2
EU2 EU9 the past year, we continued to develop
EU4
greater fiscal resilience by keeping on
AS8
100%
EU1
EU5
track with subsidy rationalisation
EU3
EU6
EU7
EU11 and reducing non-critical spending
2009 2010 2011 2012 2013 2014 2015
EU10
SA1
on supplies and services and asset
50% MALAYSIA AS9
AF1 AS3
AS5
AS6 OC2
AS10 purchases. In April 2015, the GST
AS4 OC1 was implemented, helping to create
AS7 Safe Zone
0% a buffer for Government revenue in
-12% -10% -8% -6% -4% -2% 0% 2%
the low-oil-price environment.
Surplus/Deficit (% of GDP)
Note: All figures are as of 2015 est.
Countries markers are masked and coded for confidentiality
Source: MOF; BNM; CIA World Factbook; PEMANDU Analysis
Exhibit 6
Confidence
is one of the factors contributing to investments in the country, with the
economic growth. remainder contributed by the public
and Validation
In 2015, private consumption, at sector (Exhibit 8).
52.4 percent of GDP, was four times Realised investments accelerated
more than public consumption at between 2011 and 2015 at a compound
In a recent note, Standard & Poor's 13.5 percent (Exhibit 7). Consumption annual growth rate (CAGR) of 8.3
Ratings Services (S&P) acknowledged as a whole now accounts for 65.9 percent, against 5.3 percent between
that Malaysia will remain on a steady percent of the GDP. This trend, which 2006 and 2010. This space, too, is
growth path, indicating that, "exports has persisted for the last five years, dominated by the private sector,
of manufactured goods and growth in is supported by a flourishing private following the implementation of the
private consumption and investment sector, increased investments, ETP in September 2010 (Exhibit 9).
are likely to drive this expansion". stable labour market conditions, This is an excellent lead-up to the
The recent private -sector and wage growth. aspiration of getting private-sector
performance in the economy can lend Over the last five years of economic players to own the lions share of the
evidence to this expected trajectory. transformation, the private sector has investments, targeted at 92 percent of
We have confidence that the private also grown to own a significantly larger total investments by 2020.
sector will continue to play its role in portion of the investment ratio. In 2015, It is absolutely necessary we do this,
driving consumption, which in turn, it contributed 65 percent of the total in the interest of pursuing sustainable
S&P Affirms Malaysia's Foreign And Local Currency Ratings. Source: http://www.bernama.com/bernama/v8/bu/newsbusiness.php?id=1229527

and responsible growth for Malaysia. If
Private Consumption Increasingly Drives GDP Growth the private sector can take the lead in
attracting investments into the country,
Public Private
50.2% 51.4% 51.8% 52.4% the Government can instead focus on

48.1% 48.8%
developing a conducive and business
friendly environment to enable sectoral
growth, whilst continuing to improve
quality of life, the welfare of the rakyat
and strengthening our institutions.
13.6% 13.6% 13.8% 13.6% 13.5% Many initiatives are now visibly
12.6%
in place to enhance confidence in our
public sector institutions. We have
2010 2011 2012 2013 2014 2015 charted some progress in the Anti-
Note: Figures used are in constant prices Corruption NKRA, which expanded
Source: BNM
the Corporate Integrity Pledge into
Exhibit 7 the Corporate Integrity System
Malaysia, as well as introduced
Private Sector Dominates Investment Ratio reforms into the way the Auditor-
Public Private
Generals Reports are tabled and acted
upon, while educating the younger
35%
generation about the consequences
43% 42% 40% 36%
44% 45%
46% 46% 48% of condoning corrupt practices.
64% 65% We also have strengthened the
57% 58% 60%
56% 55%
54% 54% 52% Reducing Crime NKRA which focuses
on reducing index crime, especially
Launch
of ETP street crime. The scope of the NKRA
has been reviewed to reinforce the
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
prevention of vehicle theft, house
9th Malaysian Plan 10th Malaysian Plan
break-ins and address the issue of
Sources: Department of Statistics and Economic Planning Unit estimates (Constant 2010 prices) criminal recidivism through the
upskilling of inmates. All this is done
Exhibit 8 to ensure that the rakyat feel safe and
secure in their own country.
Realised Investment Accelerated Post-ETP The Public Service Delivery
.3 % Transformation (PSDT) NKRA has
RM billion AGR 8 179.4
2015 C
2011- also been continually building on
168.5
Public Private
151.7
134.5
the capabilities of the civil service, so
that it can deliver high-quality services
CAGR 5.3%
2006-2010
110.9
92.4 92.4
101.3 98.7 100.5
95.8 94.8
efficiently and effectively to the people,
85.6 85.1
81.6
74.1 77.8 80.2 83.0
as well as to build public confidence
69.7
and trust of the rakyat when they
Launch
witness such progress.
of ETP Partnerships have been formed
with various ministries, and their key
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
workflows have been examined and
9 Malaysian Plan
th
10 Malaysian Plan
th
appraised. We have been recording

Sources: Department of Statistics and Economic Planning Unit estimates (Constant 2010 prices)
early successes in many such
Exhibit 9
transformational initiatives.

YEAR IN REVIEW 2015
highest-ranked developing Asian

Malaysia's Position in Competitiveness Rankings economy (Exhibit 10).
The World Banks Ease of Doing
World Bank Ease of IMD World WEF Global Business 2015 Report was also positive
Doing Business Report Competitiveness Yearbook Competitiveness Report
in its assessment of Malaysia, noting an
improved business environment over
the past year, placing the country among
the top 20 global economies, and first
among emerging East Asian economies
18/189 14/61 18/140 on the ease of doing business.
2016 2016 2015 2015 represented another first
in the transformation calendar as
Malaysia played host to the inaugural
Exhibit 10
Global Transformation Forum. Over
3,000 delegates from 70 countries
During the Gym1Malaysia are underway to scale this successful comprising iconic transformational
transformation, for instance, the pilot project to all hospitals nationwide. leaders and individuals from both
project recorded a six-fold improvement With well-placed policies, public and private sector shared
in the number of visitors. In the effective programmes and progressive their transformational experiences
DBKL lift breakdown transformation economic transformation, the story of from personal, organisational and
project, the pilot managed to decrease Malaysia has been the focus of various national perspectives.
breakdown times by 50 percent. international studies and evaluation, a Malaysias ability to compete globally
These efficiency-improving pilot clear indication of confidence and the is a result of our capabilities to respond
projects were commenced with the countrys gradual foray into the worlds proactively to economic consequences
intention of scaling them up nationally. economy as a global player of influence. brought forth by global volatility.
One of them is Healthcare PSDT, an In September 2015, the World Economic Geopolitical tensions, and currency
effort to reduce patient waiting times Forum ranked Malaysia among the and commodity price fluctuations,
and improve patient experience in 20 most competitive countries in the have been said to have dampened global
Government hospitals under the world in its Global Competitiveness economic recovery. But the Malaysian
Ministry of Health. Dedicated healthcare Report 2015-2016. At 18th position, story of growth and confidence offers an
officers have successfully reduced Malaysias obtained its highest ranking alternative and assuring perspective of
waiting times in 16 hospitals and plans since 2005, apart from also being the how resilient the nation can be.
Building
demand patterns, as larger economies In addition, like many other
like the US, the Eurozone and China countries with depreciating currencies
Resilience
worked on strengthening their own versus the US dollar, Malaysia is not
economies. unique in being impacted by this
for the Future

As a result of underlying global externality. In 2015, our Gross National
economic trends, we expect the high Income (GNI) per capita as calculated
income threshold, as calculated based using the Atlas method, is estimated to
It is without a doubt that 2015 on the World Bank Atlas Method, to drop to US$10,110 in 2015, compared to
was a hotbed of challenges. The decline in 2015 because of significant US$10,760 in 2014. This was due to the
value of the ringgit was affected, just depreciation of the Euro and Yen average exchange rate in 2015 that also
like many other global currencies, vis--vis the US$. From US$12,735 in factored in the currency devaluation
from the ill effects of the dramatic 2014, we estimate the threshold to be against the US dollar in the second
drop in oil prices and shifts in global reduced to US$12,303. half of the year.
2 PEMANDU estimate based on World Banks GNI per capita calculation using the Atlas Method

Notwithstanding, as the ringgit On top of market corrections and Government coffers from being overly
continues to strengthen and reflect improving external conditions, we affected by lower oil royalties and
its true fundamentals in the coming also have seen growth in Government taxes due to the severe drop in Dated
months, and as Malaysias economic revenue. Rising to RM165.4 billion for Brent Crude from US$100 per barrel
transformation continues to deliver 2015, 0.8 percent higher than collection to US$50 per barrel.
results, we remain confident that our in 2014, the increase is attributed to Analysis also reveals the CAGR
high-income target will be achieved GST collection, estimated to be at for tax revenue between 2011 and
by 2020. RM27 billion in 2015, thus buffering 2015 expanded 8.6 percent compared
to 6.3 percent between 2006 to 2010, a
positive sign that the Government is
Government Revenue Increasing on the right track with consolidation
RM million measures to further strengthen our
15: 8.6% fiscal resilience (Exhibit 11).
2011-20
Direct Taxes Indirect Taxes
R
nue CAG
Tax Reve 37,462 53,670 Greater diversification in NKEA
35,429
34,706 sectors has also tremendously
2006-2010: 6.3%
Tax Revenue CAGR 32,643 decreased the Governments
dependence on oil revenue. In 2015,
30,760 30,507
28,129
25,772
Malaysias oil revenue dropped to an
25,058 estimated 21.5 percent as oil prices
126,742 plummeted drastically to below US$50
116,937 120,523
102,242
111,771 per barrel for Dated Brent Crude, a far
69,396
82,138 78,375 79,009 cry from what the Government used to
61,572
receive prior to 2010 (Exhibit 12).
Had we not carried out the ETP to
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 further develop and attract investments
Revised
Estimate into the economic sectors in which
Malaysia had competitive strengths,
this would be an alarming situation.
Exhibit 11 However, as can be seen from (Exhibit
13), Malaysias GNI structure is well-
Government is Less Dependent on Oil Revenue diversified, with contributions coming
in from other NKEAs to offset the hit
RM million
taken from low oil prices.
PITA Export Duty Petroleum Royalty & Gas
Petroleum Dividend Exploration (Oil & Gas MTJA) % Oil Revenue/Gov Revenue
39.6% 41.3%
36.8% 36.5% 35.4% 35.8%
33.7%
31.2%
30.0%
Malaysias ability
21.5%
to compete globally
is a result of our
capabilities to respond
proactively to economic
consequences brought
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Revised
Estimate
Exhibit 12
forth by global volatility.

YEAR IN REVIEW 2015
NKEA SECTOR GNI Value at current prices (RM billion)
Agriculture 64.5
Palm Oil/Rubber 61.0
Oil, Gas & Energy 171.1
Electric & Electronic 53.0
Wholesale & Retail 168.6
Education 9.0
Healthcare 9.8
Communication Content & Infrastructure 51.0
Tourism 67.1
Financial Services 62.7
Business Services 46.2
Other Industries 360.8
TOTAL GNI 1,124.7
Exhibit 13
It is important to note that despite resilience will also be a narrative that Over 7.1 million Malaysians have
the need to review the countrys is inclusive. Priority for people living received Bantuan Rakyat 1Malaysia
Budget 2016 and take precautions in the rural areas and low-income (BR1M) assistance in 2015, of which
to buffer ourselves against the households remains paramount, in approximately 4.6 million households
possibility of a global recession, the our efforts to ensure that they enjoy have been receiving BR1M in 2014 and
Government is not cutting back on in our nations development and 2015. BR1M has been increased on an
capital development projects and economic bounty, and that the rising annual basis from its introduction at
will continue to stay the course in costs of living do not unduly burden RM500 per household (with a monthly
this regard. the rakyat, especially the bottom 40 income of RM3,000 and below) to
Some of the larger projects percent of the income pyramid (B40). RM950 as of 2015.
in the country, such as the MRT Our transformation journey has By channelling lesser resources
development and the Pengerang worked towards a commitment for towards more targeted groups, we were
Integrated Petroleum Complex, a more targeted and coordinated able to channel resources to create
continue unhindered even in the face social benefits system. Towards this greater impact and at the same time
of a slowing economy. end, BR1M, a targeted direct cash making our subsidy bill more efficient.
The Government also remains assistance for households earning This is to ensure that nobody gets left
committed to ensure that the Malaysia less than RM4,000 per month, has behind in our national transformation
story of growth, confidence and been assisting those who are in need. journey towards high income.

Keeping
in global markets with competitive,
world-class products and services.
Focus and
The public sector must not waver in
its pursuit of refining and improving
Staying on
on the quality of service delivery, whilst
being accountable and transparent in
Track
their delivery.
I cannot stress enough the
importance of maintaining the
momentum that has been built in the
There is no doubt that 2016 will last six years in order for us to attain
be a challenging year for our country high-income status in inclusive and
due to the challenging global economy. sustainable ways.
Like all other nations, Malaysia will be Knowing that no journey is without
affected but we can take comfort that its challenges, we step into 2016 from
even in these trying times, instead of a position of strength, will to succeed
experiencing a contraction, Malaysias and determination to keep going till
economy registered a modest growth we reach 2020 when we will become
of 5 percent in 2015, with external a high-income nation.
agencies such as World Bank, IMF,
Moodys and others commending the
Government for having taken the right The work does
measures to diversify the economy and
build fiscal resilience. not stop here. With
The hard work carried out and
tough decisions taken in these last
four more years
few years since the beginning of the left to the reach
NTP is yielding positive results. We
can sustain growth. We continue to the NTPs finishing
command confidence. We are resilient
in the face of global challenges.
line by 2020, the
The work does not stop here. With Government, together
four more years left to the reach the
NTPs finishing line by 2020, the with the private
Government, together with the private
sector, must remain resolute, stay
sector, must remain
the course and remain committed resolute, stay the
to seeing this programme to its
completion in 2020. course and remain
One of the areas of priority in these
next few years would be to nurture
committed to seeing
more Malaysian champions. Local
companies must continue to step
this programme to its
up innovation to be able to thrive completion in 2020.

THE NTP

THE NTP
NATIONAL KEY RESULTS AREAS (NKRAs)
32 Addressing the Rising Cost of Living
38 Improving Rural Development
46 Improving Urban Public Transport
56 Raising Living Standards of Low-Income Households
64 Assuring Quality Education
78 Reducing Crime
88 Fighting Corruption
96 Public Service Delivery Transformation
NATIONAL KEY ECONOMIC AREAS (NKEAs)

106 Greater Kuala Lumpur/Klang Valley
124 Oil, Gas and Energy
134 Financial Services
144 Wholesale and Retail
152 Palm Oil and Rubber
164 Tourism
172 Electrical and Electronics
180 Business Services
190 Communications Content and Infrastructure
198 Education
212 Agriculture
220 Healthcare
STRATEGIC REFORM INITIATIVES (SRIs)

232 Competition, Standards and Liberalisation
244 Public Finance Reform
250 Narrowing Disparity
256 Human Capital Development

THE NTP NATIONAL KEY RESULTS AREAS
Addressing The Rising Cost of Living
DEVELOPING DATO' SERI DR.
BETTER AND
AHMAD ZAHID HAMIDI
DEPUTY PRIME MINISTER OF MALAYSIA
FOCUSED SOCIAL Addressing the Rising Cost of

Living (COL) NKRA continues to be
SAFETY NETS
a priority area for the Government;
namely, by alleviating the economic
burden of a society adjusting to the
IS KEY
nations transition towards high-
income status by 2020.
The COL NKRA is notably
distinct from the other six NKRAs.
It addresses the concerns of
the rakyat through continual
reactive measures social
safety net initiatives delivered
on a needs-basis in response to
market conditions to safeguard
the welfare of Malaysians, in
particular the bottom 40 percent
(B40) in economic terms. Through
this NKRA, short-term and
immediate relief is delivered to
vulnerable segments of society,
helping them cope with the rising
cost of living and better managing
their households expenditures.
Reflecting on 2015, a few
important milestones were
achieved to help the government
arrive at a more efficient and less
burdensome public expenditure

BB1M helps to somewhat
reduce my financial burden
as a student, since I prefer
to purchase original, first-hand
model for our safety nets. In a bid
to dismantle inefficient blanket textbooks where possible.
subsidies, and create a more
targeted system to benefit those
Rachel Ruran Leong
Universiti Malaysia Sarawak student
most in genuine need, subsidy
rationalisations were carried out.
In addition, the introduction of the
6 percent Goods and Services Tax
(GST) in April a more effective
and broad-based tax channels
T
more funds to the government
hrough the NTP, the Government
to help alleviate the rakyats cost
has introduced a number of INSIDE THIS NKRA
burdens.
targeted initiatives to cushion
The introduction of GST and
subsidy rationalisation activities,
the B40 group against economic 1 Direct Assistance
to Those In Need
uncertainties and to support them to
while important, have indirectly become more financially resilient.
contributed to the increase in The COL NKRA takes two
approaches in accomplishing its
2 Increasing Accessibility
to Basic Amenities
prices for goods and services,
objective of providing immediate relief
which places additional pressure
to the rakyat. Firstly, by providing
on the rakyat. Acknowledging the targeted direct cash assistance through
importance of these measures programmes such as BR1M (Bantuan
in strengthening the countrys Rakyat 1Malaysia), BB1M (Baucar Buku
long-term financial resilience, 1Malaysia) and BKAP1M (Bantuan
the government will continue Khas Awal Persekolahan 1Malaysia).
Secondly, through the increase of
to mitigate such price impacts
the availability of (and accessibility
and stay focused in rolling out
to) affordable basic necessities and
COL NKRA initiatives to support services such as K1M (Klinik 1Malaysia),
Malaysians in need for as long KR1M (Kedai Rakyat 1Malaysia) and
as necessary. MR1M (Menu Rakyat 1 Malaysia).

1 Direct Assistance to Those in Need NUMBER OF STUDENTS

RECEIVING BKAP1M
Through programmes such as The BKAP1M initiative aims to
BR1M, BB1M and BKAP1M, targeted ease the burden of parents preparing
groups of Malaysians are provided with for their childrens schooling expenses.
direct cash assistance, enabling them In 2015, a total of 5.13 million students
2015
to better manage the costs of basic and have benefited from this initiative. 5,127,222
educational necessities. Since 2014, an amount of RM100
The BR1M initiative is a targeted has been provided to all Malaysian
direct cash assistance for households students from Primary One to Form
earning less than RM4,000 per month. Five in both public and private schools.
The amount of BR1M provided has To ease the burden of education 2014
been increased on an annual basis expenses of purchasing books, a 5,153,811
from its introduction at RM500 per total of 1.3 million tertiary education
household (with a monthly income students (including those in Form
of RM3,000 and below) to RM950 Six) have received RM250 in book
as of 2015. In 2015, under the BR1M vouchers under the BB1M programme.
2013
initiative, a total of 7.1 million Introduced in 2013, this initiative also
Malaysians (including households and aims to foster interest in reading 5,202,778
individuals) received BR1M assistance, among Malaysians.
of which approximately 4.6 million
households have been receiving BR1M
in 2014 and 2015.
PARENT APPRECIATES BKAP1M ASSISTANCE
A
s a beneficiary of the BKAP1M school expenses, she says. However,
initiative, mother Alliene Ong with the rising cost of goods presently, for
is quite appreciative of the its true impact to be really felt, I suggest
Governments efforts to cushion the that the aid amount per student should be
impact of school necessities on her budget. raised to RM300 per year. Still, any aid is
I have a daughter who is 16 years old this better than none, and I am not personally
year. She is in Form Four, and has been aware of any other country that has such
receiving the BKAP1M assistance for the an initiative in place, so I gratefully accept
past three years now. The RM100 that the the BKAP1M aid, and am thankful that the
Government hands out at the start of every government provides such assistance to
year has been quite helpful in terms of the people who need it most.
preparing for her studies, she elaborates. Alliene believes that the governments
Alliene uses the RM100 from BKAP1M move in giving this aid to the rakyat,
to buy her daughters school stationeries. as well as other COL NKRA initiatives,
With my limited monthly household demonstrates its commitment to lighten
income and other expenses to budget the rakyats burden. Although the KR1M,
for, BKAP1M has helped to somewhat for example, is out of my way so I do not
reduce the financial stress during the shop there so frequently, the concept is
Alliene Ong with her daughter, Aina Kamalia beginning of the year caused by all the still a good one, she explains.

UNIVERSITY Daniel Darnas Rachel Ruran Leong
STUDENTS Swinburne University

of Technology Sarawak
Universiti Malaysia
Sarawak student
BENEFIT
FROM BB1M
PROGRAMME
U
niversiti Malaysia Sarawak stationery, for instance, I was able to that certain name brands are slightly
student Rachel Ruran Leong buy other things that helped with cheaper in the KR1M, but when I'm
is in her final year of a four- my courses that I otherwise could back visiting my kampong (village), the
year programme, and has been a not have. KR1M means that we no longer have to
beneficiary of BB1M for the past three Both Rachel and Daniel agree that travel all the way to town to purchase
years since she started her course. the amount of the BB1M vouchers our daily necessities.
She believes that she is one of the few should not be increased. Rachel Daniel, meanwhile, thinks that
who use it for its intended purpose believes that trying to help all students the existing initiatives are helpful. He
of purchasing textbooks, although purchase brand-new books for the believes that the Government should
shes heard of others using it to buy entire year would not be the most amplify their communications on
stationery, hard disks or even shoes, efficient use of the funds required. these initiatives so that more people
the latter two especially during the first Daniel in turn feels that this initiative can benefit from them.
few years it was introduced. is supposed to be supplementary aid,
Im a very old-fashioned person; not full-fledged financial assistance.
I like using physical books, and my
university mostly uses international
Though I feel there could be
a rebalancing of the amount of
By using the
textbooks from Pearson, Cambridge distribution over two semesters in a BB1M to buy textbooks
and the like, which can be expensive.
BB1M helps to somewhat reduce my
year, RM125 for each half, for example.
Having the voucher valid for three
and stationery, for
financial burden as a student, since I months only forces students to finish instance, I was able
prefer to purchase original, first-hand
textbooks where possible, and each
the whole RM250 in a single semester.
It does not encourage good planning
to buy other things
textbook can cost RM200-RM300, and budgeting amongst students, that helped with my
Rachel explains. he adds.
Daniel Darnas, who was on a study Nevertheless, Rachel likes BB1M.
courses that I otherwise
loan which covered his tuition and It is a very good start, and I am happy could not have.
allowances at Swinburne University with the BB1M initiative as it stands,
Daniel Darnas
of Technology Sarawak, shared that she explains. She is also very happy
BB1M helped cushion his savings. By with yet another COL NKRA initiative,
using the BB1M to buy textbooks and the KR1M. While on campus, I find

2 Increasing Accessibility a reasonable cost in terms of rental,

logistics and infrastructure.
to Basic Amenities Through the 334 K1M clinics

nationwide, Malaysians are provided
access to affordable basic medical
services at just RM1 per visit (senior
A key focus of the COL NKRA is to products at lower prices. Available citizens are exempted from any
ensure that people in less-developed in all KR1M stores, Produk Rakyat payment). With qualified nurses and
areas, as well as the urban poor, have 1Malaysia brands locally-produced medical assistants sporting at least
access to lower-cost basic amenities, and generically-branded grocery five years of experience, K1M clinics
necessities and healthcare. Through goods are usually sold at 15 percent-30 are able to carry out minor surgeries,
initiatives such as K1M, KR1M and percent lower than similar premium- stitching, wound cleaning and
MR1M, the COL NKRA aims to deliver brand goods. Spanning a total of dressing, as well as treating illnesses
essential goods and services such as 234 types of goods, Produk Rakyat like cough, flu, fever, diabetes and
groceries, healthcare and food at prices 1Malaysia brands are now more hypertension. Strategically located
that are affordable to all layers of the accessible to the general public, as in various housing areas, there are
rakyat, thus helping the rakyat retain they are stocked by 569 other stores. between three and four K1M clinics
more of their disposable income. In 2015, the set-up of KR1M outlets fell available across each state. Since its
185 KR1M stores nationwide short of its target, due to implementation inception in 2010, K1M clinics have
provide Malaysians the option challenges such as the inability to carried out more than 21.87 million
of purchasing basic household secure strategic business locations at basic treatments.
(Top left) Services provided at K1M are no longer confined to outpatient care. Selected K1M now offers Maternal and Child Health. (Right) A food stall serving MR1M
dishes located at a Rest and Recreation area (R & R) in Rawang. Photo courtesy of BERNAMA Images. (Bottom left) KR1M outlet operates on a mini market format that
offers various basic necessities under the Kedai Rakyat 1 Malaysia (KR1M) label and sold up to 50 percent cheaper compared to other brands in the market

MOVING FORWARD
I
n 2015, the Malaysian economy The implementation of the GST,
faced economic volatilities from while important in transforming the
the external environment, which taxation system to be more efficient,
saw the decrease in oil-based revenues has indirectly increased the cost of some
to the government and the Malaysian goods and services. The Government has
ringgits slide in value. These, amongst ensured that basic necessities such as
other factors such as demand for rice, sugar and cooking oil are zero-rated
imported goods and services and the (untaxed), and that hospital services are
strengthening US dollar, reduced the exempted from GST. This is to ensure
strength of our currency and affected that the needy will not be burdened by
our purchasing power, particularly of the impact of the GST.
imported goods. Noting such challenges, the COL
In achieving greater fiscal discipline, NKRA has been cognisant of the
the Government has also been rakyats pressing needs, especially
required to make the difficult decision for vulnerable households that lack
to restructure the countrys subsidy the financial capacity to weather the
models; in particular by rationalising impact of such challenging economic
how subsidies are distributed. The times. As such the government
removal of fuel subsidies - whilst adding maintains its commitment in
pressure on transport and logistics sustaining initiatives within this NKRA
costs - was an essential move to ensure to ensure that assistance reaches those
products & services reflect their actual most in need.
production costs and remain competitive
in the long run.

Improving Rural Development
CREATING DATO SRI

ISMAIL SABRI YAAKOB
SUSTAINABLE
MINISTER OF RURAL AND REGIONAL DEVELOPMENT
RURAL In our journey towards

becoming a developed and high-
COMMUNITIES
income nation, our national
development has continued to
emphasise being inclusive to
address the needs of the rakyat in
urban and rural areas.
The concerns of our fellow
Malaysians living in the rural
parts of Malaysia continue to be a
priority. Since we started the NTP
journey in 2010, our focus has been
to enhance and equip the rural
areas with the provision of basic
amenities, and to transform rural
areas into thriving and sustainable
centres of commerce.
Over the past 6 years, the
initiatives under the Improving
Rural Development NKRA (RD
NKRA) have impacted the lives of
over 5.567 million Malaysians in the
rural areas, through the delivery of
roads, clean/treated water, housing
and 24-hour electricity to improve
standards of living. From 2010 to
2015, the RD NKRA targeted 139,061
houses to be supplied with 24-
hour electricity, but by the end

Over 5.567 million more
Malaysians living in rural areas
today enjoy the same access
to basic utilities like water,
of 2015, 3.5 percent more than the
target (143,899 houses) had been electricity, and road connectivity
supplied with such.
This ensures that no one is left as those in the cities.
behind in the fast changing world
of national transformation. If the
villages have all the facilities of
modern infrastructure, we will be
able to reverse the trend of rural-
I
to-urban movement. The rural
landscape can then support more nclusive development to create
successful and sustainable INSIDE THIS NKRA
high-value economic activities.
rural communities has been the
With better job prospects &
opportunities in their villages,
aspiration of the RD NKRA since the 1 Providing Universal Access
to Basic Amenities Through
beginning of Malaysias transformation Inclusive Development
people who moved out to the cities journey. First established as the Rural
may consider returning to revitalise
their communities.
Basic Infrastructure (RBI) NKRA in
2010, its main purpose was to ensure
2 Building Rural
Economies
Malaysians in rural areas were provided
with basic infrastructure such as
roads, water, electricity and housing.
Today, the majority of rural areas have such as eco-tourism and premium
access to basic infrastructure, through fruit farming have enabled various
initiatives that bring development in economic activities to be innovated,
rural areas, for the rakyat to enjoy further empowering entrepreneurs
amenities that are readily available in to be more independent, as well as
urban areas. provide better access to markets and
Sustainability beyond the provision business opportunities. Malaysians in
of basic amenities was the premise of these communities have since been
the RD NKRAs 21st Century Village encouraged to remain in their villages
(21CV) programme that came into and still be part of the nations growth
being in 2012. Since then, initiatives and successes.

1 Providing Universal Access In terms of improved road

connectivity, some highlights in
to Basic Amenities Through 2015 include areas such as Batang

Padang, Perak, where an 11km road
Inclusive Development development has helped improve

the economy of the villages around
the regions that the road connects,
contributing to the increase in
property value among the villages
and neighbouring areas. This stretch
of infrastructure has also enabled
broader access to markets for rural
palm oil farmers/producers in the
kampung (village). In Kulim, Kedah,
a 3km road has opened access to
several new residential areas around.
This has broadened and improved the
relationships and network between the
neighbouring villages.
From 2010 2015, a total of 24,004
households have been relocated in
newly-built housing, while 57,645
households benefitted from the
refurbishment of their houses within
the same time period.
Road maintenance works at Jalan Madrasah Lebai Che Will, Wakaf Bharu, Kelantan These improvements came about
after overcoming several challenges in
As compared to 2010, over 5.567 have running water, with 345,665 2015. Malaysians living in rural areas
million more Malaysians living in rural households covered throughout East are mostly not accustomed to having
areas today enjoy the same access to and West Malaysia. 143,899 additional to pay for these basic amenities.
basic utilities like water, electricity, and households now get 24-hour access to Some of this is due to habit and
road connectivity as those in the cities, electricity. Under the Program Bantuan lack of education (e.g. on the health
proving that Malaysias transformation Rumah (PBR) housing initiative, over benefits of clean running water).
journey can be less lopsided and city- 82,472 households were built and Others prefer to maintain a simpler
centric. In this manner, the rural-urban restored for families that could not lifestyle without them. In this regard,
migration can be reduced. It is hoped afford them. early and frequent engagements
that through this, population density Solar hybrid systems, using both with the local stakeholders helped
can be kept at a more comfortable level. solar panels and a diesel generator to smooth out matters, making them
People can then live and work where backup, were introduced in Semporna, aware of what was to happen within
they were born and bred, supported by Sabah in 2015. The success in Semporna their vicinity and addressing their
(and supporting) their families, friends as well as in Bario, Sarawak, was a key concerns. Infrastructural development
and neighbours. factor in deciding to bring the solar challenges, such as building roads
There has been tremendous hybrid systems into other rural areas. deep in rural areas, often face climate
sustainable growth in rural villages from Their usage is expected to cover most and geographical constraints. There
2010 to 2015. 2.71 million Malaysians remote areas in Sabah and Sarawak are also land entitlement issues;
now have access to new and improved next year. This will help increase hence, all land issues are now ironed
roads (5,286.25km as of December 2015). business activities, foster economic out prior to the tendering process by
During the same time, approximately growth and also provide villagers with identifying and resolving the land
1.73 million more Malaysians now information technology. with issues.

2 Building Rural Economies
(Left) One of the attractions in Kampung Semelor, Perak is the village jetty under the Desa Lestari initiative
(Right) Cabin chalets constructed at some of the 10 villages under the Desa Lestari programme to encourage ecotourism
Major projects within the 21st harm the future of Malaysias resources. Under the implementation of Desa
Century Villages (21CV) programme Programmes under 21CV have Lestari, two iconic projects have been
were the main focus of the RD NKRA successfully transformed rural areas into introduced; namely, stingless bee
since 2012. Their successes have vibrant and attractive places to live, work farming project and the construction of
increased confidence that building and visit. The Large Scale Fruit/Vegetable cabin chalets to spur the development
successful rural economies in Malaysia Farms Entry Point Project is one of the of homestay programmes. A total of
is an attainable goal. Residents in initiatives under 21CV that offers job 28 villages ventured in the stingless
Desa Lestari villages under the 21CV opportunities to the rural people. Farms bee farming project, achieving yearly
programme are enjoying higher of over 200 acres in size are planted with incomes between RM10,000 and
incomes and economic growth. different kinds of premium export-quality RM19,000. Meanwhile, 10 villages
Additionally, Rural Business Challenge fruits. Tonnes of pineapples, bananas, have participated in the construction
(RBC) winners are beginning to set papayas and melons are marketed within of cabin chalets as part of ecotourism
precedence for Malaysias youth in the country and abroad, reaching as far activities that generate between
reversing urban migration. All of this as Korea and Japan. RM18,000 and RM54,000 per annum.
is part of the effort to narrow disparities
by building sustained, high-income,
and value-added rural economies.
The 21CV programme was designed
to boost rural economies and make
them more attractive to the youth
in the community. Desa Lestari,
part of the 21CV programme, aims
to promote village communities to
take up high-value industries, create
skilled occupations and promote
green tourism. This way, the villages
can position themselves to be more
sustainable, as well as serve to be
Ecotourism activities have improved the livelihood of the rural people at Kampung Lonek,
unique tourist destinations that do not Negeri Sembilan

Kampung Bukit Bulat in Melaka winners have set up the Persatuan her home in Sungai Petani immediately
and Kampung Lonek in Negeri Usahawan RBC Malaysia (Malaysian after graduation to start up her own
Sembilan are frontrunners of this RBC Entrepreneurs Association). It venture. According to her, this was
initiative. Kampung Bukit Bulat caters exclusively to RBC programme due to the abundance of business
villagers boast expertise in dealing with winners, so that they can help each opportunities available in Kedah.
stingless bee farming and crop farming. other further develop their ventures She started her own chocolate-making
The villagers also generate additional and diversify into other business business that has since seen her
income by packaging tourist activities opportunities. The association aims to brand Hazleen Chocolate expand
(nature tourism) with honey-hunting kick-start its long-term goals of having nationwide with offices in Sungai
expeditions, as well as promoting at least one RBC Mart and RBC Bistro in Petani, Klang and Kuantan.
honey products as organic, by virtue of every state commencing 2016.
zero chemicals used during harvesting. Since 2012, RBC has awarded Their successes
Both Kampung Bukit Bulat and RM59.07 million worth of grants to
Kampung Lonek generate about 77 aspiring young entrepreneurs who have increased
RM40,000 a year, with consistent year-
on-year increases in revenues. These
were running their businesses in the
rural areas. 2012 and 2013 winners
confidence
establishments also provide homestay (31 of them) have provided 213 job that building
chalets, tour-vans, commercial opportunities and created 180 new
activities, and traditional games/ entrepreneurs. The average increase successful rural
activities packages for tourists.
The RBC is also a key component
of income for 2012 winners in 2014 was
171 percent; for 2013 winners in 2015,
economies in
of the 21CV Programme. The RBC is
aimed at encouraging rural youth
the average increase was 106 percent.
For instance, Hazleen (one of the
Malaysia is an
entrepreneurship. Over the years, RBC winners of the RBC) returned back to attainable goal.
Another iconic Desa Lestari project - stingless bee farming

TRANSFORMING BUSINESSES THROUGH THE RURAL BUSINESS CHALLENGE
One of the Rural Business Challenge (RBC) production operations with larger-size
participants in 2013, 36-year-old Syuhaini Abdul machines and equipment, expand the number
Rahman attributes her success in winning the of sales and marketing channels, and design
Challenge to her meticulous preparations her packaging technology. Today, thanks to the
throughout the entire year, as well as closely RBC, I have increased my annual gross income
sticking to the requirements of the Challenge to RM1.5 million, she discloses.
of developing rural areas and bringing benefits According to Syuhaini, most rural
to the rural community. entrepreneurs focus on production, and not
Syuhaini operates FBC Resources, a factory so much on marketing or developing their
producing bakery goods, pies and cakes. Prior sales channels. However, this means that
to winning the RBC, my business was making their products were not getting the necessary
RM960,000 in revenues yearly. I was renting exposure. It would be good if the government
the upper floor of a shophouse, I was operating provided support to rural businesses on their
small-scale machines, and the product sales and marketing strategies; that way, they
packaging was pretty plain, she elaborates. can keep on focusing on what they do best in
She came to know about the RBC via terms of production, she suggests.
the Malaysia Agriculture, Horticulture and As for people in the rural community who
Agrotourism International Exhibition (MAHA) 2012, would like to go into business for themselves,
and decided to enter the Challenge. Winning the Syuhaini advises them to look at the resources
RBC has changed my business tremendously, she available out-of-town, and use them as a
said. Using the RBC grant, she has been able to start to their business. There is a demand
start construction on a 10,000 square-foot factory, for countryside products in towns and urban
and apply for HACCP and halal certification. centres, so they should consider selling and
She has also been able to scale up her marketing those goods, she clarifies.
HARNESSING RURAL TREASURES

The RD NKRAs various initiatives are aimed by trade, his oyster farm has been the result volunteers help him with agitating oyster cages,
at improving the economic prospects of rural of a knowledge transfer process courtesy of cleaning the cages and sorting the oysters by
communities, and demonstrating that high- Universiti Sains Malaysias (USM) Associate size, amongst other chores.
income opportunities are available to them, if Professor Dr. Aileen Tan Shau Hwai from the Ultimately, Ridzwan believes that it is
they are willing to take the chances and put in School of Biological Sciences. The university, possible for the ecotourism potential to be
the effort. Mohd. Ridzwan Ishak from Bujang together with Ministry of Science, Technology economically rewarding for a villager like him.
Valley in Kedah is a sterling example of such a and Innovation (MOSTI) and Ministry of Higher
man, whose hard work and perseverance has Education (MOHE), provided research funding to
paid off handsomely. both operate the knowledge transfer, as well as
A born-and-bred resident of Kampung open an oyster hatchery in Balik Pulau, Penang.
Sungai Batu Besi, which is situated along Sungai One of two such hatcheries in Southeast Asia,
Merbok, the 45-year-old Ridzwan is the owner- this hatchery is the source of Ridzwans oysters.
operator of an oyster farm (of which there are The oyster farm, which cultivates only
only 10 in Peninsular Malaysia). Despite its food oysters (as opposed to the pearl oysters
remote location and limited accessibility, the cultivated by most farmers in Sabah, for
farm nonetheless receives anywhere between instance), also plays host to a steady inflow of
60-100 tourists a year. He cultures up to 60,000 conservation volunteers (many of whom are
oysters, harvesting 1,000-3,000 every month. regulars) who wish to see how clean aquaculture
However, Ridzwan was not always an works. According to Ridzwan in an interview with
aquaculture aficionado. A former fisherman the English daily publication The Star, these

REALISING DREAMS THROUGH OPPORTUNITIES

At 27 years of age, Sharol Hafizi requirements of the Challenge, and support to the increase in size and capabilities of
Jamaludin of Agro Highlands Enterprise from family and friends. my business.
is very grateful to the RD NKRA and the With a grant of RM2 million, Sharol Sharol believes RBC is a great
Ministry of Rural and Regional Development has transformed his business to one that platform to reduce or eliminate rural-
for their efforts in growing the rural economy is still moving with an upward trajectory. urban migration by the youth. Mostly,
via the Rural Business Challenge (RBC). I now have 32 room units in the midst of this migration is due to low income jobs/
Sharols Cameron Highlands business a strawberry field, catering for up to 100 opportunities. But through business, you
focuses on growing strawberries and people, complete with seminar/meeting can earn similar figures as urban jobs; thus,
providing chalet accommodation for agro- room and a dining hall. I now earn revenues the youth will do this if there is support for
tourism. Prior to winning the RBC, he could of between RM30,000-RM60,000 a month. rural businesses. They only need space
only provide eight room units; sufficient for Sharol currently hires 11 employees and opportunity, which RBC and similar
40 people. My revenues then were about and provides steady business to three initiatives can provide.
RM10,000-RM15,000 a month. I could only entrepreneurs. For example, the dining I am thankful to the Ministry of Rural
hire two to three employees a small scale hall has an external caterer running it. I and Regional Development for the RBC. It
operation by any measure. also have online sales agents who get paid a has changed my life my vision, which was
Sharol believes that he won the commission, as well as external tour guides only a dream, has become a reality. Without
Challenge in 2013 due to three major factors; which I source for his guests. So basically, RBC, all my achievements would still be
providence, the project itself nicely fitting the there is an economic multiplier effect due unrealised dreams.
Tiered strawberry fertigation above the Agro Highlands chalets

MOVING FORWARD
M
oving forward, Malaysias these aspirations. The outcome of the
rural economy will projects under the Communications
continue to play an Content and Infrastructure (CCI)
increasing role in the overall countrys National Key Economic Area (NKEA)
development. The results of the RD and their benefits must be brought
NKRA must include the benefits from into the rural areas as well as the
growth being equitably distributed, suburban ones.
decent job opportunities being Better broadband penetration and
made available to everyone, and quality (via the High Speed Broadband
natural resources being sustainably 2 and Sub-Urban Broadband projects),
managed. On a macroeconomic scale, as well as multi-modal connectivity
agricultural productivity must increase with urban centres, are not solely
sustainably, strengthening agricultural aimed at making country living even
markets that contribute to food security more attractive, but also to provide
and proper nutrition for all. rural Malaysians the facilities to
While higher targets for current increase their economic output and
initiatives, as well as improved quality choice of business opportunities,
of supply (e.g. cleaner water, better while staying right where they are.
roads) have been set, the RD NKRA is By doing so, they, too, can become
now focused on developing improved part of Malaysias next-generation
and more forward-looking goals to fulfil people economy.

Improving Urban Public Transport
MAKING PUBLIC DATO SRI

LIOW TIONG LAI
TRANSPORTATION
MINISTER OF TRANSPORT
A CHOICE
Enhancing and developing our
urban public transport system is
all the more necessary, given that
Malaysia is in a crucial phase of
transition, particularly in the
urban transportation ecosystem
as one of the seven National Key
Results Areas (NKRAs) under
the Government Transformation
Programme (GTP).
We are committed to deliver
efficient, cost-effective, reliable,
comfortable and safe public
transportation services to the people
especially within high-density
locations like the Greater Kuala
Lumpur/Klang Valley (GKL/KV) area.
We are on track to establish
a world-class urban public
transport system with heightened
convenience and reliability. Vision
2020 demands nothing less than
a city fully equipped with an
efficient and accessible public
transport system.
The introduction of the LRT
Line Extension Project (LEP) Phase
1 and the Sunway Bus Rapid Transit
(BRT) in 2015 are the latest chapters
in our transformation journey.

We are on track to
establish a world-class UPT
system with heightened
Daily ridership and customer convenience and reliability.
satisfaction continues to record
tremendous improvements from
our 2010 baseline. More so as we
move forward with the completion
H
of larger transportation projects
like the LEP and Monorail that are aving public transport
INSIDE THIS NKRA
currently in progress, with the KL- become the preferred choice
for GKL/KV commuters
Klang BRT being planned.
We are very pleased to announce
underlines the efforts to transform the 1 Improving Connectivity
and Accessibility
city's transport system. The Improving
the launch of the completed LEP in Urban Public Transport (UPT) NKRA
2016 Kelana Jaya and Sri Petaling
to Putra Heights will have a
aims to create a reputable, reliable
service that enables one to easily
2 Customer Satisfaction
is a Critical Success Factor
significant impact on the urban reach all city destinations. Work is

landscape and become an avenue being done to improve connectivity
and accessibility, with a focus on 3 Adoption of Public Transport
Key for Rapid Urbanisation
for the rakyat to rely on urban
public transport demand and customer
public transport. satisfaction, as well as overcoming
Certainly, there will be some rather unique obstacles in project Large-scale infrastructure projects
challenges in achieving this noble implementation. have been carried out to add capacity
aspiration. What is of utmost The GKL/KV region covers the to the public transportation network.
priority is that all Government business and administrative capitals Initiatives also focused on improving
of Malaysia. It is expected to reach a the efficiency and reliability of
and non-governmental bodies
population of 10 million people by existing services. Ultimately, making
involved in the transportation
2020. Catering to the transportation public transport more attractive is the
ecosystem collaborate with more needs of that magnitude requires a ultimate goal, so as to further reduce
cohesiveness and focus for the significant upgrade of the region's overall traffic congestion in the built-up
benefit of the rakyat. public transportation infrastructure. areas of GKL/KV.

1 Improving Connectivity and the future Kelana Jaya LRT

lines. Unlike traditional stage bus
and Accessibility services that have to compete with

normal traffic, the BRT frequency is
predictable; commuters can expect a
bus every four minutes during peak
hours, and eight during off-peak
hours. With this service, commuters
can pre-plan their journey and arrive
at their desired destinations on time.
Phase 1 of the LRT Ampang Line
Extension Project (LEP) began
operations in 31 October 2015, with
the opening of four stations in Awan
Besar, Muhibbah, Alam Sutera
and Kinrara BK5. The Ampang LEP
benefits residents of Bukit Jalil, Projek
Perumahan Rakyat Muhibbah, and
Bandar Kinrara in Puchong, increasing
the Ampang Line daily ridership to
196,000 and providing them with
comfortable access to the LRT, and by
extension, the rest of the integrated
public transport network.
The Klang Valley Stage Bus
Network Revamp project that
Newly completed Awan Besar Station of the LRT Ampang Line Extension Project (LEP) kicked-off in December 2015 was
targeted at upgrading bus services
Significant amounts of investment, drive in and out of Greater KL every day, that were previously inconsistent
time and effort have been spent to facing traffic woes (especially during due to unpredictable frequency and
ensure the successful implementation peak hours). at times, unannounced no-shows,
of high-impact public transport Malaysias first Bus Rapid Transit especially in low demand areas. This
projects in the Greater KL/ Klang (BRT) system was completed and initiative aims to serve a total of 241
Valley area. These projects, which launched in June 2015. The 5.4km- routes compared to 182 routes before
promote improvements in terms long Sunway BRT is strategically its implementation. Commuters will
of connectivity and accessibility of located throughout the busy suburbs enjoy wider coverage and accessibility
public transport modes, are part of of Sunway and Subang Jaya, serving a to stage bus services. The streamlining
Malaysias economic and sustainable population of approximately 500,000. exercise will also introduce a bus route
development objectives. The BRT enjoys convenience features numbering system that is standardised
Reforming Greater KLs similar to those of a light rail transit across all operators. This system aims to
transportation network is a top-priority (LRT) system, with the usage of help passengers familiarise themselves
to meet the need of Malaysians to travel dedicated lanes, environmentally- with the destination routes of each bus
to their desired destinations with ease friendly buses as well as customer- service by reading its number alone. Still
and convenience. All commuters want friendly infrastructure. Currently in the early stage of implementation,
to save on travel time and to feel safe incorporating seven stations and one the Land Public Transport (SPAD) is
and comfortable during their commute; Park & Ride facility, the Sunway BRT currently refining the implementation
through the delivery of high-impact also has terminal stations that serve plan of the streamlining exercise and
projects, the UPT NKRA aspires to as interchange stations, connecting improving the communications of its
alleviate the burden of Malaysians who the service to both the KTM Komuter plans to the public.

FIRST BUS RAPID Shamsul Rizal
COO, BRT Sunway
TRANSIT IN MALAYSIA
COMMENCES SERVICE
W
hile the full benefits of more affordable than rail, as it is Shamsul sees the BRT as going
the BRT Sunway line merely a normal road with no track, through the inevitable teething
have not been realised electrification, or signalling, and uses problems of any new operation.
yet, it has shown positive signs while standard buses as rolling stock. The However, the existing ridership
being actively trialled during its first BRT would work equally well at-grade can be improved through better
two months. However, BRT Sunways (on ground level), which would reduce dissemination of information with
Chief Operating Officer Shamsul Rizal the costs tremendously. The use regards to its benefits, including
reckons its true impact will only be of all-electric buses also helped cut the ability to plan ones travel and
felt once various other projects come costs, as they run very quietly and did fare discounts. I was speaking to
online. Aside from the full phase of the not require the construction of noise a woman who said she had to catch
LEP (scheduled for mid-2016), mixed barriers or soundproofing. the bus at six in the morning, because
and commercial developments such as Shamsul highlights that capacity if she caught it any later, the traffic
Sunway Geo and the expansion of the could be easily increased via the usage jams would make her run late. When
Medical Centre will also contribute to of articulated buses or running buses I told her that the buses on the BRT
making the BRT a preferred mode of more frequently (or both). Currently, run every four minutes at peak, and
transport, he adds. at peak hour, the BRT can already that they could make the full loop in
With a population of 500,000 transport 1,000 passengers per hour 32 minutes, I never saw her that early
served by three major highways (NPE, per direction. again, he laughs.
LDP, KESAS), the busy township of
Sunway faces massive congestion in
the morning, as it also hosts several
tourist attractions. The BRT aims to
help alleviate congestion and enable
Sunway residents to commute beyond
Sunway safely, conveniently and
comfortably, through connectivity with
the rest of the public transportation
network (LRT, KTM Komuter and bus),
Shamsul explains.
The decision to adopt the BRT
system, which is relatively new to
Malaysia, was mostly due to its cost-
efficiency. Building a fully-elevated
guideway was expensive, but it was

DEVELOPING A TRULY
INTEGRATED PUBLIC
TRANSPORTATION
NETWORK
Mohd. Azharuddin Mat Sah
CEO, Land Public Transport
Commission (SPAD)
W
ith the UPT NKRAs aim to encompassing upgrade of the existing from Sungai Buloh to Kajang in 88
drive up the modal share Ampang (LRT1) and Kelana Jaya (LRT2) minutes. Already, the MRT is having
of public transportation Lines, and when fully completed, will positive economic impacts on areas
within GKL/KV to 40 percent of all provide for end-to-end connectivity like Balakong and Sungai Buloh (for
commutes by 2030, it is necessary that for both lines via the Putra Heights more information, refer to the KVMRT
the public transportation network is interchange station. We are also All Set To Go sidebar under the GKL/
integrated, convenient, accessible, taking the opportunity to upgrade our KV NKEA chapter).
easy to use and affordable when existing infrastructure, rolling stock, Meanwhile, SPAD is also looking
compared to driving. signalling systems and everything else, into improving all other modes of
Within GKL/KV, the public especially on the Ampang line, which public transportation for first- and
transportation master plan states that has been in existence for 20 years, last-mile connectivity, including bus
rail service is the backbone of such he elaborated. and taxi services.
an integrated network. Throughout Already, the first phase of the LEP The Bus Network Revamp (BNR)
2015, the UPT NKRA has seen both has seen an average daily ridership of is one such initiative put in place in
the addition of much-needed capacity 4,000 since it opened in end-October December 2015. Its objectives are to
to existing rail services, as well as 2015. Our Park n Ride facilities are increase bus area coverage by up to
the construction of large-scale rail constantly full, taking around 2,000 17 percent (including previously under-
infrastructural projects. These are cars off the roads, Dato Zohari served routes), increase frequencies, as
starting to come online, with the first enthuses, pointing out that such a well as enhance operator performance
Klang Valley MRT line scheduled to response from the residents of the and bus network efficiency.
begin operations by the end of 2016, surrounding areas implies they found Weve allocated specific routes
and the full LEP to begin in mid-2016. the LRT more convenient than driving. to each operator, with a view to
As Prasarana Rail and The Klang Valley MRT promises to improve their services, and we
Infrastructure Projects Sdn. Bhd. be equally advantageous to residents intend to monitor them better,
(PRAISE) CEO Dato Ir. Zohari of Klang Valley, initially offering a SPAD CEO Mohd. Azharuddin Mat
Sulaiman points out, the LEP is an all- comfortable, state-of-the-art journey Sah explained.

According to him, operators
can concentrate their efforts and
For Azharuddin, it is no longer
business as usual for taxis. The
Throughout 2015,
expenditures on more buses, reduce industry has to evolve more cohesively, the UPT NKRA
waiting time and provide better with streamlined services, clear
service quality to the rakyat through guidelines and regulations to govern has seen both the
dedicated routes. We hope that over
time, the bus operators will up their
them, he said.
With this in mind, SPAD
addition of much-
game and make buses a good choice commissioned a taxi lab in December needed capacity
for first- and last-mile connectivity 2015, which focused on strategically
between rail and other public realigning the industry to meet todays to existing rail
transport hubs, and for direct services demands. These included discovering
within GKL/KV where the rail services the optimal business model for the services, as
dont reach, he added.
Similarly, taxis play a big role in
industry, increasing service availability
during peak times and other low-supply
well as the
defining first impressions of how good situations, improving driver competency construction of
an urban public transport system and behaviour, ensuring vehicles are
is. SPAD envisions the taxi services in top condition and encouraging the large-scale rail
provided within GKL/KV to be best-
in-class within ASEAN. The business
uptake of technological innovations.
Competition needs to be seen as
infrastructural
model for the taxi industry needs to a stepping stone and not a stumbling projects.
be transformed, Azharuddin said. block to allow the best services to
Current and upcoming technologies, be enjoyed by the rakyat. We are
consumer preferences and legislative deliberating the various factors
issues present a strong impetus including elements of innovation
for the industry to embrace new and competition in this matter in the
service paradigms. interest of all parties, he added.

2 Customer Satisfaction different rail services, incorporating a

standardised ticketing system (i.e. LRT,
is a Critical Success Factor Monorail and ERL). Meanwhile, the

Automated Fare Collection (AFC) system
for KTM Komuter is currently being
upgraded and targeted for completion
Improving commuters confidence have seen an increase in the satisfaction by end Q2 2016.
by providing a reliable and regular index from 48 percent (2010) to 74 Public transport demand has
public transport system is a key percent (2015). According to the survey, improved tremendously after the
component of the UPT NKRA from the commuters are most satisfied with injection of 38 new six-car trains to the
the beginning. On-time performance rail services i.e. LRT, KTM and ERL. The KTM Komuter service since March 2012,
is one of the major factors that feedback shows that improvements improvements to the peak frequency
affect customers satisfaction; this in rail services in becoming more of the LRT since 2014, and provision
has continued to improve despite reliable and efficient are appreciated of additional capacity through the KL
challenges faced by public transport on the ground. Rail services today Monorail Capacity Expansion project
operators. The Customer Satisfaction are the cheaper alternative to private which is currently on-going. Commuters
Survey for public transport is transportation as well as offering enjoy the increased frequency from
conducted yearly to reflect this demand enhanced safety and comfort. Another 30-45 minutes (before 2012) to every
and captures public feedback. major contributing factor to commuters 15 minutes (as of 2015) on the KTM
The Customer Satisfaction Survey satisfaction is the convenient interchange Komuter, with a 95 percent morning
results, conducted by SPAD in 2015, and interconnecting system between peak on-time performance, and
reliable service for the LRT with a three-
minute frequency during peak hours.
The improved efficiency of rail services
has strongly contributed to the rising
Customer Satisfaction Survey results
every year.
Stage buses and budget taxis which
serve as supporting services to the rail
system are also important in addressing
the demand and satisfaction for public
transport. These initiatives have room
for further improvements and are
currently being addressed. Utilisation
of stage buses in GKL/KV ensures that
effort is focussed on addressing the
increase in public transport demand,
better connectivity to rail services, and
improved efficiency of bus services
for commuters.
This demonstrates the amount
of work that has gone into the
UPT NKRA. It also shows that the
commuters notice and appreciate
the myriad improvements to urban
public transportation.
The new monorail four car set train, which doubles the capacity, and of which five have been in service as of end
December 2015

3 Adoption of Public Transport Key strategies are designed to make private
vehicle usage a less attractive form of
for Rapid Urbanisation transport into the city.

On the supply side, major
infrastructural improvements have
been achieved towards boosting the
carrying capacity especially during
peak times via the delivery of 38 new
six-car sets for the KTM Komuter
service, 35 four-car sets for the LRT
Kelana Jaya Line and an additional 14
new car sets to support the LRT Line
Extension Project for Kelana Jaya Line
to be delivered soon. The free GoKL
bus service has also been introduced
for four routes within the Central
Business District (CBD).
Station interchange facilities
have been built to provide seamless
transfers between separate rail lines.
Several Park n Ride facilities in
various locations provide up to 10,000
parking bays and fulfil the objective
to facilitate first-mile connectivity.
Instead of driving all the way into
the CBD, commuters can opt to drive
to these facilities and park their cars
safely instead, relying on the public
KTM Komuter six-car-set train transportation network to bring them
the rest of the way without hassle.
The UPT NKRA, through its expand even further upon the launch Furthermore, passengers can
concerted efforts over the years, has of MRT Line 1 in 2017. now transfer smoothly from the
always been focused on transforming As with most other industries, Kuala Lumpur Sentral Monorail
public transport into an attractive public transportation is both supply- station to Stesen Sentral Kuala
alternative mode of travel for urban driven and demand-driven. Aside Lumpur via a covered link-bridge
commuters. The modal share of urban from addressing the supply side of through the Nu Sentral Shopping
public transport has risen from 10 the equation, the UPT NKRA also has Centre. Another significant milestone
percent in 2009 to 20 percent by the provisions to look into the demand side. that has been accomplished is the
end of 2015, despite facing various A combination of both pull and push approval for the delayed Integrated
implementation challenges along strategies is essential in ensuring the Transport Terminal (ITT) Gombak
the way. Evidently, these figures people embark on the paradigm shift to commence construction in June
indicate that a higher percentage of towards embracing public transport as 2016. This terminal will cater for
the public has been opting to use a way of life. Pull strategies revolve express buses servicing the Eastern
public transport during the peak-time around making public transport Corridor. More than 400 buses will be
morning commute, a public transport options more attractive and viable removed from entering the CBD after
mind-set that is anticipated to for the public. Meanwhile, push ITT Gombak is operational.

CREATING GREATER
ACCESS TO AN INTEGRATED
TRANSPORT NETWORK
One of our key
T
he long-awaited Gombak The ITTs were the outcome of a
Integrated Transport Terminal, UPT lab held in 2009, with the aim of
initiatives under or ITT Gombak, is well on its

way to become a reality. According to
decongesting the CBD from express
buses coming in from other parts
the UPT NKRA is to Veejendran Ramdas, Head of the UPT
NKRA at the Ministry of Transport
of West Malaysia. We are looking
at Puduraya as our model, because
ensure the rakyat (MOT), construction is scheduled to Puduraya is central in the town,
start mid-year 2016. We estimate it and it is also connected with the
benefit from better will take about two years to complete; monorail. It also caters to taxis, and
after which we should be able to move the KTM Komuter is not far from it,
connectivity and 400 East Coast buses from the Hentian so that model was used to spur the
greater convenience. Pudu and Pekeliling terminals to ITT

Gombak, he said.
development or construction of more
terminals, Veejendran points out.
ITT Gombak will be the second
of three planned ITTs, with the first
one which caters to Southern buses
having started operations in Bandar
Tasik Selatan, and known as Terminal
Bersepadu Selatan (TBS) in 2011. The site
for ITT Gombak was chosen based on its
easy multi-modal accessibility, especially
to the LRT Gombak station. We dont
want to merely create a terminal for
buses; people must have access to other
modes of transportation as well. They
should have taxis, buses, rail services,
Veejendran asserted. Another ITT is
being planned at Sungai Buloh, which
will cater to Northern buses.
One of our key initiatives under
the UPT NKRA is to ensure the rakyat
benefit from better connectivity and
greater convenience," Veejendran said.

MOVING FORWARD
I
n 2016, the UPT NKRA aims Klang BRT from Pasar Seni to Bandar by allowing public transport users to
to deliver other high-impact Klang via Federal Highway for wider have access to real-time information
public transport infrastructure coverage, better connectivity and on arrival times, exact positioning
projects that are currently ongoing higher public transport capacity of vehicles and service disruption
in order to improve public transport along the corridor; and semi-overhaul information. These projects are
coverage, capacity, connectivity of KTM Komuter Class 83 for higher targeted to be fully operational by the
and accessibility. Completion of railway capacity. end of 2016.
the full-phase LEP is targeted to be The Integrated Cashless Payment To address the first-mile
completed in July 2016 with 25 new System (ICPS), a common payment connectivity to most KTM Komuter
stations, servicing new areas such as system for urban rail and bus networks, stations, the Parkway Dropzone
Bandar Kinrara, Puchong, Subang is also targeted to be operational by project, currently in progress at the Kg.
Jaya, USJ and Putra Heights. As part January 2018. Under ICPS, all relevant Dato' Harun Petaling Jaya, Serdang and
of the Greater KL/KV NKEA under the operators ticketing systems will be Batu 3 Shah Alam Komuter stations,
Economic Transformation Programme, integrated with a central back-end is scheduled to launch in the middle
the first phase of Line 1 (Sungai Buloh system which allows passengers to of 2017. Finally, the fundamental
Semantan) for the Mass Rapid Transit enjoy an uninterrupted journey across issues faced by the taxi industry
(MRT) network will be completed by all lines. The current paper ticketing are currently under focus by SPAD,
Dec 2016, with full completion by system used by KTM is not able to which has conducted labs to see how
July 2017. MRT Line 2, which was be integrated with other lines, thus taxi services can be improved. The
approved by the Government in completion of the KTM Automated outcomes of the Taxi Transformation
October 2015, will further transform Fare Collection System is important Lab are to be tabled to the Government
the public transport network. The to ensure that it will be able to be for approval, with the expectation to
KL Monorail capacity expansion is integrated with ICPS. roll out implementation by 2016.
slated to add greater capacity to the For better monitoring of public These are exciting times for urban
current service by introducing 12 sets transport performance, critical public transport. With large-scale
of four-car trains; five of which have areas include the completion of the investments being put in place to
been commissioned. Performance Monitoring Hub System encourage more citizens to switch
Many issues are on the table to be (PMhS) and Centralised Taxi Support to using public transport, we look
resolved in 2016 onwards. Currently System (CTSS) that will serve as a forward to the day when we can realise
in progress, the UPT NKRA will platform to monitor all stage buses and our target of 40 percent modal share
focus on fully commissioning and taxi services in the GKL/KV area. The for urban public transport, hence
completing delayed projects such as Journey Planner App that is currently resulting in less congestion on urban
the KL Monorail capacity expansion, ongoing development will better roads and improved mobility and
implementation of the 34km-long KL- enhance the passengers experience quality of life.

Raising Living Standards of Low-Income Households
ALLEVIATING DATO SRI

ROHANI ABDUL KARIM
POVERTY PART
MINISTER OF WOMEN, FAMILY
AND COMMUNITY DEVELOPMENT
OF INCLUSIVE
In transforming Malaysia into
a high-income developed nation
by 2020, we will not leave the
PROGRAMME
most vulnerable groups behind,
through our efforts that are both
socially responsible and targeted
to Malaysians living below the
poverty line. Over the last six years,
the national poverty level has been
steadily dropping; from 3.8 percent
in 2009 to 0.6 percent in 2014. This
accomplishment is the result of the
combined initiatives from both
private and public sectors.
These efforts should not be
underestimate because the reality
is that it has not been the easiest
road to travel. Some of our lowest-
income households live in the
most remote parts of Malaysia,
requiring the use of waterborne
and airborne transport to get to
them. Prior to our inclusive NTP
work, many Malaysians lived in
areas without basic utilities like
running water, electricity, and
roads. I applaud and respect the
dedication of our civil servants,
Participants at the 1AZAM Training Centre, Kuching

Prior to our inclusive
NTP work, many Malaysians
lived in areas without basic
utilities like running water,
as well as NGO personnel and
volunteers who have changed electricity, and roads.
this landscape for good. They
selflessly risk their lives, making
long, dangerous journeys to
deliver food, dental and medical
services to these locations anyway.
A
The multi-pronged 1AZAM
(A k h i r i Zaman Miskin) s the nation transitions
towards high income status, INSIDE THIS NKRA
programme, delivered in tandem
policies and initiatives that
with NGOs that know the ground
better, continues to eradicate
provide safety nets for vulnerable 1 Optimal Resource Allocation
Malaysians, particularly low income

poverty by addressing the groups, are an imperative.
different requirements to do this
sustainably, as we have learnt
This NKRA focuses on lending
these truly-needy low-income
2 Economic Empowerment
that there is no one-size-fits- households a helping hand by

empowering them to become self-
all model. In 2015 alone, over
193,390 people have benefitted
sustaining. That way, they can lift 3 Initiating Rural Transformation
themselves up out from poverty. Our

from it, contributing to the total of objective is to reduce a reliance on
85,866 people who have increased direct cash assistance by instead
their income by at least RM600. embracing the value of teaching
I commend the implementing them how to fish. Over the years,
ministries, agencies and local there have been many cases of those
who have made it out of poverty, who
government offices and their NGO
in turn reach out and help to mentor
and corporate partners, as well as
others to do the same. Ultimately,
the people themselves who have these are sustainable programmes
seized this opportunity to better to help eradicate absolute poverty in
their lot in life. Malaysia for good.

As a first step, the Implementation is the 1AZAM programme, which is welcomed the participation of non-
and Coordination Unit (ICU) designed to be flexible to cater to all governmental organisations (NGOs)
established the e-Kasih database the different groups, and hence is and private sector partners to help fund
that hosts the details of all low- divided into several focus areas. and support programmes that relieve
income households in the country. Winning the fight against poverty poverty. These programmes are partner-
This database is the key driver for all is best done in a holistic fashion and driven; the NKRA implementation
the other initiatives that aim to raise in collaboration with other parties teams, with the necessary support,
the living standards of the registered who are similarly involved. Therefore, are there to set up governance
individuals. One of the initiatives the government has enlisted and and reporting frameworks.
1 Optimal Resource Allocation Connecting with the bottom 40

percent, and going down on the
ground to understand the many
different circumstances that are all
categorised under poverty, plays a
big role in ensuring optimal resource
allocation. Civil servants that go down
on the ground to accomplish this have
for many years risked their lives in the
process. The information they gather
is crucial in identifying the needs of
these targeted and vulnerable groups.
To get to low-income families
located in deep, remote areas in
Sarawak, for instance, would take
a journey through Bario and Pa'tik
to reach the destination in two days.
Once these families are connected with,
meeting their differing needs would
include the use of direct cash assistance,
provision for equipment or resources.
This process has been documented
through the e-Kasih database, which
houses all the information of low-
income households nationwide,
reporting that the dynamics of each
family or individual are different, and
it takes an officer who is on the ground
to understand and identify their needs.
Nonetheless it is this vital
information that is shared that
enhances the effectiveness of initiatives
that, when implemented, ensure the
biggest impact for their participants.

2 Economic Empowerment
AZAM Tani focuses on agricultural and agro-based activities by providing training, farming equipment, and financial assistance to aspiring farmers
or livestock breeders
Meeting the NKRAs main objectives training, farming equipment, and implementing all the other AZAM
means properly equipping low- financial assistance to aspiring channels listed above.
income households so that they can farmers or livestock breeders. AZAM The 1AZAM Programme has moved
earn a good living while contributing Niaga provides support for potential to the Beyond 1AZAM programme, as
productively to the economy. To entrepreneurs with business coaching its aspiration is to have all 1AZAM
implement the initiatives effectively, and micro-lending. AZAM Kerja helps participants enter into a sustainable
the appropriate initiatives must be with job matching and placement, as programme via microfinancing
properly channelled to their intended well as teaching applicants how to opportunities. 1AZAM participants
recipients. Since its inception in 2011, better present themselves to appeal who have received material assistance
e-Kasih has connected its beneficiaries to hiring managers for their desired and training, and have successfully
with the right 1AZAM focus areas. Aside jobs. AZAM Khidmat gives training moved out of poverty into the lower-
from government agency programmes, for the services industry and the middle-income group, will be further
1AZAM also features projects from self-employed, as well as microloans assisted through this programme. In
NGOs. Once 1AZAM recipients have and equipment. AZAM Bandar this phase, material aid is no longer
found their feet, the Beyond 1AZAM concentrates on activities which needed. However, participants are still
programme kicks in for selected benefit the urban poor. given all the support they need in terms
high-achieving individuals to further In East Malaysia, 1AZAM Sabah of training, mentorship, coaching and
enhance their capabilities and increase and 1AZAM Sarawak are separately other such help to ensure they obtain a
their earning potential. operated by their respective minimum 50 percent increase in their
AZAM Tani focuses on agricultural autonomous state governments. income from existing 1AZAM projects
and agro-based activities by providing They are the ones responsible for for three months or more.

SUSTAINABLE LIVELIHOOD
THROUGH 1AZAM
1 AZAM initiatives have impacted
the lives of many low-income
families, especially those in
less-developed areas. For example,
31-year-old (as of 2015) Chik Azmily
his farming, as well as start farming
kelulut/stingless bees for their honey.
He intends to expand his agricultural
activities by renting abandoned/
unused plots of land. He also plans
Kelantan, who joined the initiative in
2012. The 64-year-old Tiu was similarly
assisted with agricultural equipment
and inputs, which he put to full use
on a 1-acre piece of land. In addition,
Che Abdul Aziz, who hails from to sell the produce on his own in Tiu has gone into kelulut farming as
Kampung Beoh Gunong in Kelantan, nearby farmers markets, rather than well. This has enabled him to double
was earning RM500 a month as a daily go through the wholesalers. his monthly income from RM500 to
labourer hired to look after the home 1AZAM Tani has also benefitted Tiu RM1,000, despite the fact that the crops
gardens of others, as well as harvest Hock Tong of Kg. Pasir Parit, also in are not harvested round-the-year.
oil palm fruits.
Through the 1AZAM Tani initiative
as implemented by the Malaysian
Agricultural Research and Development
Institute (MARDI), which Che Azmily
participated in from 2013, he was
provided agricultural equipment and
inputs (seeds, fertiliser and herbicides/
insecticides). Meanwhile, his wife was
provided sewing machines to help her
with her tailoring work. This enabled
him to plant short-term seasonal cash
crops such as cucumbers, tubers, leafy
vegetables and watermelons, which he
then sells to wholesalers. Meanwhile,
his wife has been awarded a contract
to tailor batik shirts from the owner of
a batik factory.
Che Azmily had managed to
increase his monthly income by
an astounding 1,000 percent (or 10
times) to RM5,000, solidly boosting
his family out of hardcore poverty.
1AZAM Tani has allowed him to start
constructing a house using materials Chik Azmily (top) and Tiu Hock Tong (bottom) experience an increase in monthly incomes with
he bought with the proceeds from assistance from 1AZAM Tani

Tim has been a participant in the 1AZAM Niaga channel since 2014, before
which, he was using his house as an ad hoc sundry shop. Following his participation,
he was able to obtain a proper business licence and expand his retail space. This
has in turn enabled him to rearrange his products in a more ordered fashion.
LIH NKRA initiatives, particularly

the 1AZAM programmes, are especially
appreciated in East Malaysia, where
they are run by the autonomous state
Governments of Sabah and Sarawak.
The proportion of low-income
households is higher in various
groups there, and they benefit more
from these initiatives.
One such beneficiary is Sidi
Tuba from Sungai Liuk, Mukah in
Sarawak. Prior to 2010, when he
joined the 1AZAM Tani channel, Sidis
total household income was RM450.
Under the Department of Agriculture
Sarawak (Jabatan Pertanian Sarawak),
Sidi started planting corn and other
vegetables on his 3.6-hectare plot of
land. The harvest is then sold at the
Mukah market and all around the
village. His income has increased
by a staggering twenty-fold to over
RM9,000 a month, well over the
median income for all Malaysians, an
achievement that he and his family
can smile proudly about.
The Department has also
assisted Tim Kawen of Kampung
Rejoi in Siburan, Sarawak. Tim has
been a participant in the 1AZAM
Niaga channel since 2014, before
which, he was using his house as turn enabled him to rearrange his provide his family a more comfortable
an ad hoc sundry shop. Following products in a more ordered fashion. home, and with his sundry shop
his participation, he was able to He has since more than quadrupled operations, his fellow villagers are
obtain a proper business licence and his income from RM600 to RM2,800 able to purchase their daily supplies
expand his retail space. This has in a month. He has also been able to without going down to town.

3 Initiating Rural Transformation together to eradicate poverty at the

lowest level where the NGO operates
has seen some good results. From
2014 to end-2015, the Government,
In 2013, as part of GTP 2.0, 1AZAM Some low-income households, NGOs and private sector companies
expanded to include other vulnerable especially those in remote areas or have successfully collaborated
groups. 1AZAM has also partnered with from communities facing high levels on 80 projects.
NGOs and the private sector to expand of poverty, benefit from non-1AZAM Since 2014, 123 community or
its range and funding of initiatives, thus initiatives such as the food basket group-based programmes have
creating enabling environments for programme that enables households been implemented to benefit those
other programmes. The 1AZAM projects to save on basic commodities. Other not registered in e-Kasih. These are
in collaboration with NGOs and the forms of direct cash assistance, as groups or communities who live
corporate sector have consistently well as basic access to healthcare and in unique areas that require more
achieved their year-on-year KPIs, and dental service, improved connectivity immediate and robust forms of
the willingness of NGOs to collaborate and access to basic utilities, and programmes focused on their specific
with government agencies in delivering childcare services for their children, demographics. These programmes
the 1AZAM programme have been are part of the effort to provide them have received good cooperation in
most beneficial. NGOs have come to with economic enablers. rural areas as compared to urban
realise the value and the impact of the NGO listings consist of areas due to their nature of being
programme to their recipients even beneficiary groups so that resources relevant to the targeted groups.
though the selection is very strict by can be allocated efficiently when
the implementing agencies. delivering this assistance. Working
(Left) Build capacity through training - sewing skills to generate income (Right) KPWKMs visit to Tasputra, a centre for handicapped children

MOVING FORWARD
W
hile the o ve r a l l out to the bottom 40 percent (B40) Meanwhile, existing 1AZAM
incidence of poverty households in Malaysia. recipients will benefit from being able
has dropped, the Orang The NKRA will collaborate with to register themselves under a local
Asli in Peninsular Malaysia and Bank Negaras Credit Counselling crowdsourcing portal (orang.e.com) set
Bumiputeras in Sabah and Sarawak and Debt Management Agency up by the Ministry of Urban Wellbeing,
still face relatively high poverty rates, (Agensi Kaunseling dan Pengurusan Housing and Local Government
especially in rural and remote areas. Kredit) in order to introduce financial (KPKT). The free-for-life portal
Given the limited budget for 2016, the debt management services to B40 increases the visibility and supply of
NKRA will therefore move forward households, which tend to take out Malaysian talent, and provides 1AZAM
by aligning itself with all poverty personal loans to support their daily recipients to expand into new markets
eradication programmes under the expenses. As at 2014, households for their products.
11th Malaysia Plan, which focuses on earning RM3,000 a month and below By complementing the Poverty
further improving the people economy had an indebtedness level of seven Line Income (PLI) measurement with
while ensuring the capital economy times their annual household income. the Multidimensional Poverty Index
continues to flourish. The adoption of ICT will be (MPI), additional insights into the
In this instance, the people economy accelerated, increasing access to true nature of poverty in the country
is rakyat-oriented, covering the top information in various fields, and will be gained, and the NKRA can
priorities and interests of the rakyat, such expanding business and income- better streamline the support that
as the rising cost of living, household earning opportunities. The eRezeki B40 households get, thus enhancing
incomes, education and employment programme, launched in June 2015, the delivery of the appropriate
opportunities, entrepreneurship, aimed to raise the B40 households programmes to the appropriate
as well as an adequate social safety average income. This programme people. Amongst other things, this
net. NKRA initiatives in line with the will be further expanded by providing means that the current collaboration
people economy include provision of basic ICT training before matching with the private sector will continue,
financial debt management services participants with relevant jobs such by tapping on CSR programmes to
for the poor, accelerating the adoption as data entry, price monitoring and reach out to eKasih participants and
of Information and Communications document translation. These micro- ensuring that assistance is given to the
Technology (ICT), and enhancing tasks can be accomplished from home right target groups.
programme delivery systems that reach or the Pusat eRezeki centres.

Assuring Quality Education
DATO SERI
MAHDZIR KHALID
MINISTER OF EDUCATION
In a world that is becoming

smaller through greater
accessibility and connectivity,
we have to ensure the Malaysian
education system provides our
children with the foundation to be
globally competitive and prepared
for the challenges of the future.
RAISING
To this end, we have focused on
initiatives that raise the quality
of our educational system and
QUALITY
have over the last six years moved
towards putting a performance-
oriented culture of learning and
THROUGH
academia in place.
Our National Transformation
PERFORMANCE-
Programme (NTP) initiatives are a
subset of the Malaysia Education
Blueprint (MEB), which provides
DRIVEN
guidelines on how to improve
Malaysias educational system in
support of our nations goals. Our
CULTURE
objective here is to lay a robust
foundation to deliver quality
education to our children and
ensure the sustainability of its
delivery over time.

Delivering quality
education to students
requires the four parties
of principals, teachers,
In the long run, our objective
is to have a holistic and flexible parents and students to
education system that takes into
consideration every students work together and make
specific needs. This will ensure
that the nation is equipped
their schools great.
with a high-quality skilled
and productive workforce,
able to contribute immensely
to the country economically,
T
scientifically and culturally.
he Assuring Quality Education
National Key Results Area INSIDE THIS NKRA
(EDU NKRA) has focused on
improving the quality of education 1 Access to Early Education
delivered to students by our educational

system. Ad hoc measures are neither
enough to fix systemic issues, nor set
the proper foundations for sustainable
2 Raising the Bar to Meet
Learning Standards
improvements in student learning
environments. Hence, thorough
planning and multi-dimensional 3 Raising the Prestige of
a Humble Profession
implementation on all fronts was
required. This resulted in initiatives
that sought to instil a performance-
driven academic culture. They included raise school standards and provide
programmes that were designed to effective learning environments, and
ensure students are provided with enhance the prestige of teachers, as
the proper head start with access to well as support them, so that teaching
quality education at an early age, becomes a profession of choice.

But education is not solely focused

on employability of the graduates.
Malaysian youth have to be equipped
to become productive and contributing
members of the society to which
they belong. This is why many non-
governmental organisations (NGOs)
and the private sector see education
as a social good that everyone can
contribute to. Some of the initiatives
by the NGOs include the Malaysia
Collective Impact Initiative and the
introduction of crowdfunding platforms
such as give.my and 100% Project.
Ensuring that everybody has equal
opportunities to become successful is
the reason why the NKRA also has a
A solid foundation provides the impetus to develop skills for future employability special focus on students with special
education needs.
To do this, a number of challenges Almost all of the lowest-performing These and other initiatives will
had to be tackled. All students in both schools in the country have leveraged continue into 2016, which is the start
urban and rural areas, must have equal themselves upward. of Wave 2 of the MEB. The theme
opportunities and equitable access to However, there remain challenges for Wave 2 is Accelerate system
high-quality early education. School to be addressed. A high-income improvement, which will build on
principals and teachers must be developed nation needs a steady supply Wave 1 programmes and take them
upskilled and re-motivated to provide of skilled labour, and an educated to the next level. Wave 2 will see the
a consistent delivery of education that workforce, so that local recruits can rolling out of new school curricula,
will be of high standards. The teaching fill the countrys needs. Employers further improvement in English
ecosystem had to be enhanced; high- and Human Resources recruiters proficiency amongst Malaysian
performing graduates have to see have said that Malaysian graduates students, strengthening the teaching
teaching as an attractive career option. dont always have the skillsets that and learning of Science, Technology,
At the same time, students from pre- employers look for. Proficiency Engineering and Mathematics (STEM)
school all the way to secondary in the English language, still the subjects, and other structural
and higher education must have worlds lingua franca and language changes to improve the delivery
similar levels of educational support, of science, and the development of of education.
regardless of which schools they attend. critical thinking and problem-solving Building future generations of
Several notable achievements skills, are areas which the NKRA aims Malaysians with a performance-
have been made. More children have to prioritise. The introduction of the driven and outcome-based culture will
access to pre-school education and Dual Language Programme (DLP) and require a holistic education system that
childcare, and financial assistance has Highly Immersive Programme (HIP), to ranks amongst the top third globally,
been given to those who cannot afford be implemented in 2016, has proved comprehensively covers all levels
it. The benchmarks set by our High that the Government is serious in and types of education, and remains
Performing Schools (HPS) have made tackling the shortcomings in English accessible to all regardless of age,
them exemplars for others to follow. proficiency amongst our students. gender or economic status.

1 Access to Early Education those from low-income households.
Meanwhile, much work has been done
to address the lack of pre-schools in
the country. 417 new private pre-
Pre-school initiatives, which aim to pre-school operators to help them open schools have opened nationwide in
improve access to good quality early up new centres. It has also enforced and 2015, of which 252 new private pre-
education for all Malaysians, have enhanced the regulatory framework schools received launching grants to
seen an increase in enrolments into governing pre-schools, as well as help them on their way. In total, 555
pre-schools, with more geographical monitor students' progress as they public and private pre-schools have
locations benefitting from them. Early move through to primary education. been opened to improve access to pre-
childhood education is essential to It is heartening to note that pre- school education.
childrens academic development school enrolments have increased But high accessibility alone is not
in their later years. The EDU NKRA to 84.63 percent in 2015 (from 67 enough. The education the children
follows global best practices guidelines percent in 2009). 32,772 students have receive must be of good quality as
in having this as a focus area. Hence, received fee assistance to encourage well. An enhanced Standard Kualiti
it has focused on providing financial continued access to education at Prasekolah Kebangsaan (National
assistance to students, and also to the the earliest ages, especially for Pre-school Quality Standard) has
been created in the form of an online
instrument to assess the quality of pre-
schools. Subsequently, pre-schools
that are below-par can be provided
support for continual improvement.
There is also a national benchmarking
framework put in place. Once the
students move into primary education,
the revamped Literacy and Numeracy
Screening programme, LINUS 2.0, aims
to ensure 100 percent of Primary Three
students have basic mastery in Bahasa
Malaysia (BM) and English literacy.
LINUS 2.0 also targets 100 percent
achievement in numeracy by that age
as well. At the moment, 94.1 percent
of Primary Three students are English-
literate, 98.6 percent are BM-literate
and 99.1 percent are numerate. This
goes to show that LINUS 2.0 has made
great strides to ensure that by the end
of Primary Three, a higher percentage
of students are literate and numerate.
More efforts will be undertaken by the
Ministry of Education (MOE) to ensure
that all students are literate by the end
Lifelong learning begins with the proper training at the very foundational stages of Primary Three.

2 Raising the Bar to Meet (HPS) programme. A total of 132 HPS

have been identified to date. The
Learning Standards programme aims to elevate the quality

of Malaysias best schools. These
schools are expected to perform well
at the international level. HPS push the
In increasing and converging the compared to those in lower-income boundaries of student excellence by
standards and quality of schools across communities. Hence, programmes creating an environment that facilitates
the nation, previously low-standard that encouraged and supported learning. The programme not only
schools have been challenged to good schools to become better, as looks at academic excellence, but at
become more performance-driven. well as seeing to the improvement of the school culture and attitudes of both
In the past, student outcomes have underperforming ones, were put in students and teachers. By doing so, it
varied to some degree between place. This is a part of the effort to raises the bar for other schools in the
states, districts, even individual ensure more equal opportunities and system. HPS-identified schools receive
schools. Parents in more affluent improve student outcomes. various incentives to help maintain
communities could see to it that their This was accomplished firstly their standing. In return, they have
children attended better schools, as through the High Performing Schools been working on bringing surrounding
schools upwards in ranking, through
teacher coaching and networking.
M eanwhile, the S chool
Improvement Programme (SIP)
supports all schools, especially the
lower-performing ones. One of the key
thrusts of the SIP is to raise all schools
out of the lowest bands (Bands 6 and
7), while having more schools in Bands
1 and 2. Remarkable progress has been
made on both ends. The percentage of
schools in Bands 6 and 7 has dropped
from 6.98 percent in 2010 to 0.95 percent
(95 out of 10,010 schools nationwide).
36.8 percent of all schools are now in
Bands 1 and 2, up from 19.4 percent
in 2010 and 31 percent from 2014. The
SIP allows MOE to focus efforts and
resources towards underperforming
schools. These schools can then start
closing their performance gap with
their higher-performing counterparts.
With the SIP in place, schools now
are more aware of their performance,
making them more driven to climb up
the ranks.
The complete and ongoing
turnaround and transformation of
SK Lemoi is a SIP success story that
merits mention. A rural school in the
deep jungles of Pahang, SK Lemoi
A conducive learning environment plays a key role in determining student performance caters exclusively to the indigenous

Orang Asli. It was in the lowest school
DEVELOPING SKILLS FOR

band in 2010 and only 8 percent of the
students passed their UPSR. With the
support of MOE, private foundations
and the community, coupled with
strong school leadership, the SIP was
able to work a minor miracle there.
BRIGHTER PROSPECTS
In a short three years, the school
T
climbed up three bands to Band 4
and achieved a 92 percent pass rate he Employment Transition job training. Once they have turned 16
from an abysmal 0 percent in the Programme, part of the or older, the school also discusses the
UPSR English subject. The school Special Education Needs (SEN) students prospects with their parents,
also achieved an overall 60 percent initiative, has experienced some success who may be able to connect the school
pass rate in the UPSR examinations. in the short time it has been operating. with other business owners.
At the same time, schools with Sekolah Menengah Kebangsaan (SMK) One of the beneficiaries of this
Special Education Needs (SEN) students Jalan Reko, one of the schools taking programme is Ahmad Hudzeir
and facilities are seeing changes part in the programme, has had a SEN Mohamadiah. An alumnus of SMK
to how their needs are being met. class running since 1995, and in terms Jalan Reko, Ahmad is a barista who also
Several pilot programmes under the of physical accessibility, has installed prepares food at Aneka Selera Restaurant
SEN segment have been successfully ramps and ensured that SEN classrooms at Bandar Baru Bangi. The school had
implemented under the Public- are on the ground floor. SEN students here arranged for him to undergo training at
Private Partnership (PPP) model include those with both physical as well Kagumas Culinary Arts College in culinary
along with NGO support. The SEN as learning disabilities, and the school and hospitality skills.
Employment Transition Programme assesses their specific requirements before His employer, restaurant owner Zul
saw its implementation in five schools putting them in the appropriate levels. Azwan, commends Ahmad as one of his
across East and West Malaysia. Out of The schools principal, Wan Roslan top employees, despite his shyness and
129 students who participated in the Wan Yaakob, believes that SEN students lack of social and communication skills.
industrial attachment component, 56 of should be capable of becoming self- He makes up for it with his skillfulness
them (43.4 percent) went on to full-time sufficient and living independently in food presentation. Zul has been hiring
employment. In Sabah, the programme of their parents. In order to provide workers with disabilities for 11 years, and
was carried out as a consortium with these students with the opportunities believes that with prior training before
17 other schools in collaboration to do so, SMK Jalan Reko works with entering the workforce, and a great deal of
with Kumpulan BTC, a local catering the Kagumas Culinary Arts College, patience when teaching them the ropes,
company. The programme is now Tesco Kajang and various restaurants they can become dedicated, reliable and
undergoing the process for nationwide in Bangi to provide skills and on-the- competent employees.
implementation. Another programme,
the Buddy Club initiative, sees SEN
students integrating with their
mainstream students from pre-school
all the way through to college. The
pilot programme debuted with the
use of football and tandem cycling
as the unifying platforms, and has
succeeded in bringing students
from both streams together. In 2015,
800 students from 18 schools were
involved in the Buddy Club initiative.
The programme will expand to another
30 schools in 2016.

GROUNDING WORLD CLASS EDUCATION

ASPIRATIONS WITH PERFORMANCE
T
he EDU NKRAs efforts to foster
schools of international quality
has been paying off over
time. In 2012, SABK Imtiaz Yayasan
Terengganu Besut (Imtiaz) became part
of Cohort Two of the High Performing
Schools (HPS) initiative. Since then,
this Terengganu-based religious school
has become one of the best schools in
the state and indeed, the country.
The brainchild of Dato Sri
Idris Jusoh (now Minister of Higher
Education), Imtiaz started out as a
privately-funded institution, with
an initial intake of seven students
in 1999. At present, it has over 2,000
students across seven campuses religious grounding, the students socioeconomic backgrounds, although
throughout Terengganu. Imtiaz were encouraged to be holistic in their poor students are given priority.
derives from the Arabic word for studies; to take up the soft skills that Abdul Wahab is very thankful for
excellence; hence its vision of being the country needs, to be multi-lingual, the MOEs initiatives aimed at improving
a best-in-class Islamic school. and to be multidisciplinary, as well both students and school. Every new
According to its principal, Haji as to build their character. We also development or initiative that MOE
Abdul Wahab bin Mohd. Arshad, Imtiaz took on the MOE's Virtual Learning comes up with, I try to take up and adapt
has excelled in many international Environment initiative (1BestariNet) for use in the school. For example, we
competitions, including becoming and made it part of the school ethos, use the School Improvement Partners
gold and silver medallists at the Abdul Wahab explained. (SIP+), which we find to be quite
Kaohsiung International Invention Imtiaz also inculcated higher-order useful, and School Improvement
and Design EXPO 2015. It has also thinking skills as well as problem- Specialist Coaches (SISC+) as well.
been collaborating with Cambridge solving skills in the students, using Were currently implementing the DLP,
University since 2013, enabling its current world affairs as a teaching which is designed to improve student
students to sit for the International aid. We want our students to have proficiency in English.
General Certificate of Secondary encyclopaedic knowledge as well, so Im glad to have the opportunity
Education (IGCSE). For both the Form that they can compete at a global level. to introduce the school to a wider
Three PT3 assessment and the SPM, it Having become a government audience, and we hope to make this the
was the best-scoring school in the state. school in 2007, Imtiaz is open to best school in Malaysia. Were planning
Imtiaz blended studies from students across Malaysia, with only 60 to further develop the Imtiaz brand
multiple syllabi, and was the first (and percent enrolment from Terengganu, to into higher education; hopefully, in
thus far only) smart religious school increase students exposure to the rest 2020, we will have Imtiaz colleges and
in Malaysia. Aside from a thorough of the nation. Students come from all universities as well.

3 Raising the Prestige expect to be fast-tracked and achieve their
full potential sooner. Underperforming
of a Humble Profession ones will be given remedial training,

coaching and mentoring. If they do
not improve, they will be redeployed
into non-teaching roles that may suit
Both school leaders and teachers continuous professional development them better. Educators can also freely
have access to new performance- (CPD) opportunities throughout a career move between various career choices;
linked career and remuneration that is both exciting and fulfilling. In whether as teacher, leader or subject
packages, in an effort to ensure that 2015, 69,530 SPM leavers applied matter specialist.
teaching is viewed as a high-status, to join Teacher Training Institutes If English proficiency is important
well-paying profession. This is in line (Institut Pendidikan Guru), of which for students, it is even more important
with UNESCOs statement that quality 2,924 were accepted after the screening for their English teachers. The
teachers are the most important factor and interview processes. The selected Professional Upskilling for English
in student learning. Ensuring that the candidates were from the top 30 percent Language Teachers (ProELT) is a large-
teaching profession attracts excellent of the SPM leavers. scale teacher proficiency improvement
and high-quality candidates is key This starts with a look at the programme. By the end of 2015, three
towards improved educational levels, remuneration and compensation English teacher cohorts (a total of
and therefore, boosting productivity packages for both school teachers and 15,502) have attended this programme.
and prosperity. leaders. Principals and head teachers For Cohort Two, 87 percent of B1
Despite its importance in shaping are covered under the New Deals (Intermediate) teachers have improved at
and nurturing generations of students initiative. New Deals reward high- least to B2, while 43 percent of B2 (Upper
who will become future leaders and the performing (and improving) school Intermediate) teachers have improved
workforce of the nation, the teaching leaders with financial and career to at least C1. With the upskilling of
profession faces unfair perception incentives. In addition, a revised career the English teachers proficiency in the
challenges. This is a worldwide package for principals has been created. language, the teaching and learning of
phenomenon; a 2006 study by the Processes have also been put in place English in the classroom are expected
New Zealand (NZ) MoE pointed out to streamline succession planning for to improve significantly.
that teachers in NZ were not respected school leaders approaching retirement.
as a group, nor seen as high-status Teachers can also look forward
professionals, as did a 2014 poll in the to greater attention on their career By 2025, teaching
USA, which had respondents report a development. Previously, five different is envisioned to become
decline in trust and respect between performance evaluations were in use. In
teachers and students. The perception 2015, a single Unified Instrument (UI) to
a profession of choice,
gap must be addressed to ensure that evaluate both teachers and principals open only to the top
teachers are motivated to deliver quality were rolled out (as part of a pre- 30 percent of school
education to Malaysian students. implementation testing process) among
The EDU NKRA, therefore, is 410,000 teachers. Implementation
leavers. Teachers
focused on turning around this system shortcomings were identified and will be provided with
and mindset. This is to be done by
supporting teachers and focusing on
remedied in preparation for the full
nationwide roll-out in 2016.
continuous professional
their core skills. The MEB has even loftier In 2016, the UI will be used to assess development (CPD)
goals. By 2025, teaching is envisioned teachers performance in place of the opportunities throughout
to become a profession of choice, open Laporan Penilaian Prestasi Tahunan
only to the top 30 percent of school (Annual Performance Assessment
a career that is both
leavers. Teachers will be provided with Report). High-performing teachers can exciting and fulfilling.
http://unesdoc.unesco.org/images/0023/002347/234755E.pdf
http://www.educationcounts.govt.nz/publications/ECE/2535/5971
http://www.theatlantic.com/education/archive/2014/01/poll-teachers-dont-get-no-respect/283318/

TEACHERS
PLAY A
Fadzli Mohd Saleh
BM Teacher, Sekolah Kebangsaan
Bandar Utama Damansara (4)
CRITICAL
ROLE
C
ikgu Fadzli Mohd Saleh, Year Fadzli also feels that todays that they become proper members
Six Coordinator and BM teacher students still respect teachers, if of society, and not just feeding them
at Sekolah Kebangsaan Bandar somewhat differently. They think facts. Parents and the community at
Utama Damansara (4), has always felt of teachers more as their peers, large should realise this.
that teaching was his vocation. I was rather than as their elders. This is Cikgu Zakaria bin Muhammad,
the one educating and taking care of something each teacher has to be headmaster of the school, agrees.
my younger siblings, because both my clever in handling. Parents also play Teachers play a critical role and
parents were working, he explains. an important role in determining carry an amazing responsibility; our
Even as a younger teacher in an how their children treat teachers, efforts and achievements should be
urban area, Fadzli was still regarded he elaborates. appreciated by the society. This is why
highly. Teachers were assumed to be Furthermore, Fadzli believes that those who want to become teachers
all-capable, so he was called in as a teaching is becoming a profession of must have a true vocation or calling.
community exemplar whenever there choice. From my experience in this Without it, they will find it difficult to
were larger-scale events happening. school, many if not most teachers enter cope with the challenges we face on a
I thought that as I get older, and the profession because they wanted to. daily basis.
move to different places, that would Some are using it as a stepping-stone But it is all worth it in the end. As
change but even 20 years later, the towards other careers in the profession a Muslim, the teaching profession
communitys respect for me has not (such as becoming a lecturer or a is an extremely honourable one.
dimmed; still Im called Teacher subject-matter expert); others want Worldly riches cannot compare to the
instead of by name. to continue as school teachers. gratitude, blessings and well-wishes
While appreciation for the teaching However, there is a need to of my students because I have taught
profession may have declined, Fadzli make people perceive being a school them well, Fadzli notes.
believes it depends on the individual teacher as seemingly reputable as Fadzli appreciates the MOEs
teachers and how they play their role private-sector jobs such as becoming initiatives to develop more highly-
in the community. If the teacher can a doctor or an architect. More and skilled teachers and increase the
fulfil the high expectations that the more, teachers are being called upon appeal of the profession. These
community places on him or her, then to be educators as well. This also initiatives increasing the various
respect will be accorded. entails disciplining the students, so District Education Offices (Pejabat

Pendidikan Daerah, PPD) autonomy, achievements of their students, and
the SISC+ programme, CPD and so forth can recall many occasions where
are extremely beneficial for teachers. their students call out to them in the
Of course, we have to avail ourselves of marketplace or other public areas.
all these opportunities to improve our The percentage of students who
own careers. do this may not be very high, but
Zakaria is amongst the many having just one who remembers and
quality school headmasters who appreciates what we did is enough for
are in line to benefit under the New us because we have impacted the lives
Deals initiative, which provides high- of our students, Zakaria says.
calibre school leaders and teachers
with various incentives. He notes that
such leaders usually demonstrate
their capabilities through the high
performance of the schools under their
care, further incentivising principals
and headmasters like him to improve Teachers play a critical
their schools' performance, which is
also good for the schools. role and carry an amazing
This adds to the motivation of
the schools to improve themselves. responsibility; our efforts
This school, for instance, has shown
continuous improvement in the UPSR and achievements should be
results for three years running, and
were confident we will reach HPS appreciated by the society
status in the next few years to come.
Both Cikgu Fadzli and Headmaster
Cikgu Zakaria take pride in the

BUILDING TALENT
CAPACITY WITH
GREATER LANGUAGE
PROFICIENCY
B
oth High Immersion to support it through the creation of resource readiness in terms of teaching
Porgramme (HIP) and Dual events, activities, English programmes, capacity and capability to teach
Language Programme (DLP) teaching and learning; the students Mathematics and Science in English,
are optional programmes under the to take charge of their own personal (3) parental agreement (parents have to
Memartabatkan Bahasa Malaysia & development and learning; and also the sign a consent form should they want
Memperkukuh Bahasa Inggeris (Uphold parents and the community to provide their children to learn Mathematics
Bahasa Malaysia & Strengthen the additional support such as financial aid, and Science in English) and finally,
English Language) policy, which is corporate social responsibility (CSR) (4) for the school to meet or exceed the
meant to improve students English activity implementation and expertise. national average pass rate for BM. For
proficiency. These programmes are HIP will be rolled out in phases the first DLP cohort in 2016, schools are
initiatives introduced as a result of to all primary and secondary schools benchmarked against the 2014 UPSR BM
an English Lab held by MOE, and are in Malaysia by 2018. It will begin with Comprehension and Writing national
optional for schools. approximately 94 schools in February average of 1.85 for primary schools or
HIP aims to codify best practices 2016 and expand to a total of 1,200 the 2014 SPM BM national average of
of school leaders and scale them up schools by end 2016. 4.55 for secondary schools.
to all schools via sharing, learning Meanwhile, there will be Once a school qualifies as a DLP
and support. Through HIP, schools approximately 300 schools piloting school, it must have a minimum of 15
will be provided a toolkit including the DLP in 2016. DLP will see Science, students to have a class implementing
a self-assessment tool and a best Technology, Engineering and the teaching and learning of
practices guidebook on how to improve Mathematics (STEM) subjects in these Mathematics and Science in English.
the English proficiency of students schools being taught in English. DLP This must be verified with the written
through increased language immersion will begin for Primary One, Primary and signed consent of parents. This
and usage. HIP aims to create a peer Four, and Form One, beginning with flexible approach will empower schools,
learning and sharing environment Mathematics and Science subjects. district and state education offices
within schools, between schools and These qualifying schools were to customise the needs of students
with the community. selected on the basis of four different according to the wishes of parents.
This involves the principal in criteria: (1) the readiness of the school With DLP, a bottom-up approach is
leading the initiative; the teachers leadership to implement DLP, (2) introduced with the element of choice

for schools and parents, in accordance chairman Datin Noor Azimah Abdul Rasidah Kasim, Group Chief Human
with Shift Nine of the MEB. Rahim points out. Resource Officer at Affin Hwang Capital,
There is no need for all schools It has been acknowledged shares the same opinion. In my 25 years
to participate in DLP, as DLP is an that English proficiency is critical, of experience in HR, Ive conducted
optional programme to prepare and especially in the 21st Century and in many job interviews with graduates
ready ALL Malaysian school children the face of both the Asean Economic who, on paper, were incredibly bright.
to have the ability to master a second or Community (AEC) and the Trans- CGPAs of 4.0, made the Deans List,
third language besides BM. For schools Pacific Partnership Agreement (TPPA), you name it but when it came to
which did not meet the criteria set further exposing Malaysia into the analysing case studies or even just
out by MOE, schools can write to the larger regional and global markets. answering standard questions during
Ministry for it to make preparations Human Resource (HR) specialists the interview, in English especially,
to be evaluated as a DLP school in in particular are clear about the need they were unable to give voice
the following year. However, these for fresh graduates to be fluent in to their ideas.
potential schools can begin with the English. Anthony Raja Devadoss, Eventually, it is hoped that both
implementation of HIP first. Asia Pacific Vice President of Kelly the HIP and the DLP will ensure that
By using English as an alternative Outsourcing & Consulting, points students become fluently bilingual
medium of instruction for these out that employers are looking for in both Bahasa Malaysia (BM) and
specific subjects, and by increasing language proficiency skills. English. The Minister of Higher
the amount of extracurricular time The business language today Education, Dato Seri Idris bin Jusoh,
spent conversing in English, it is hoped is still English, he explains. Are is confident of Malaysians capabilities
that students are exposed to English for you able to demonstrate your skills along those lines.
more than 20 percent of the time while something as simple as delivering I have met a number of people from
at school. "International research an elevator pitch? Probably only 30 Timor Leste (East Timor) who spoke five
indicates that students cannot achieve percent of all workers can do that. If languages. I dont see why Malaysians
operational proficiency through the everyone has the same skillsets, all cant do something similar. So I believe
15-20 percent English hours that are things being equal, the one who can there is no problem: it is just a question
currently offered in classrooms," articulate best has the highest chance of making ourselves used to the idea
Parent Action Group for Education of being hired. of being multi-lingual.

MOVING FORWARD
M
any of the forthcoming an optimal educational strategy highly proficient in English will
initiatives under the EDU that works to everybodys best find it easier to find employment,
NKRA are positioned interests. Also on the agenda are the communicate with international
to implement the MEB Wave Twos revised curricula for primary and business partners better and have
policies spanning the years from secondary education in 2017, as well greater access to knowledge and
2016 to 2020, which are designed to as revamping student assessments academic resources. Malaysia will
carry out structural changes aimed at to emphasise Higher Order Thinking also benefit; it will be easier to
accelerating the pace of change in the Skills (HOTS) such as critical thinking conduct business and more foreign
education system. and problem solving. investments will likely be the result.
The EDU NKRA will intensify Enhanced English proficiency is At the same time, MOE will work to
its focus on increasing English a top priority for the government, ensure that new teachers exit training
proficiency throughout Malaysia. It as English remains the global with the minimum standard required
will also work to further empower business language, as well as the for English proficiency and that current
school leaders, teachers, parents language of the scientific community teachers undergo training to improve
and students alike in formulating internationally. Students who are their current standing.

accelerated learning pathways will
also be explored to allow high-
These initiatives
performing students to complete their are examples of how
schooling faster.
In overhauling the curricula for delivering quality
both primary and secondary schools,
more emphasis will be given to the
education to students
STEM-type subjects. In particular, requires the four
the provision of ICT infrastructure
will be critical in providing students parties of principals,
with first-hand experience of an
always-connected world, as well as teachers, parents
to empower the delivery of online
educational sessions and classes.
and students to work
Teachers and educators will also together and make their
be provided the necessary training
in order to familiarise and immerse schools great. 2016 will
themselves in the digital age as well.
Indeed, the integration of ICT
therefore see greater
into the schools pedagogical and decentralisation of
instructional methods is essential
in ensuring that students are able to decision-making
pick up HOTS, as questions requiring
the development of such skills will
and empowerment
be increased progressively in the of schools and
national assessments.
These initiatives are examples parents, extending
of how delivering quality education
to students requires the four parties
from work already
of principals, teachers, parents and carried out in 2015.
students to work together and make
The revision of the primary school their schools great. 2016 will therefore
curriculum, and the introduction see greater decentralisation of
of a new secondary curriculum, decision-making and empowerment
are to prepare students with the of schools and parents, extending
knowledge, skills and values needed from work already carried out in
in the global economy of the future. 2015. MOE and PADU, together with
Rolling out in 2017, these new and PEMANDU, will continue to monitor
revised curricula will have non- the education system closely to
priority content removed, while solve problems, as well as uncover
skills and competencies identified new ways and means to continue
as critical for success will be fully enhancing it, in alignment with Wave
embedded in it. Aside from allowing Two of the MEB.
the schools some flexibility in terms
of timetables (as long as the learning
and content outcomes are achieved),

Reducing Crime
FIGHTING
DATO SERI DR.
AHMAD ZAHID HAMIDI
DEPUTY PRIME MINISTER OF MALAYSIA AND
CRIME FOR
MINISTER OF HOME AFFAIRS
A SAFER
While Malaysias Index Crime
has been consistently trending
downward since the beginning of
MALAYSIA
our NKRA initiatives in 2010, the
larger picture concerns the right of
every Malaysian to be safe and to
feel safe, whether he is in his own
home or walking along the streets
of his neighbourhood.
With a focus on ensuring
the former, we also sought to
strengthen the latter by introducing
the Perception of Crime Indicator
(PCI) in partnership with Universiti
Sains Malaysia (USM) in 2015.
The PCI would measure how
safe Malaysians feel today and
to understand the factors that
drives a persons fear of crime. The
results reminded us that efforts in
communicating and building trust
with the rakyat must continue in
tandem with other initiatives in
reducing overall crime today.
We are determined to continue
the initiatives that have contributed
to the overall decrease in Index
Crime since 2009, whilst also
introducing the Modern Policing
initiative to transform Royal
Malaysia Police (PDRM) via four
enablers - Service, Technology,

Empowerment and Process (STEP)
- in our aspirations to become a
world class policing force by 2020.
Modern Policing
Policing is everyone's shared
responsibility and the communities
is critical in our efforts
know best on how to carry out
crime prevention activities in
to transform PDRM into
their areas. More Talk to Us becoming a world-class
programmes will be organised
with local communities at all policing force by 2020.
police stations. We encourage you
to take part actively in making your
Dato Asri bin Yusuff
Deputy Commissioner of Police (DCP)
neighbourhood and our nation safe
and secure.
B
Ensuring our critical
infrastructures resilience is vital to oth actual crime rates, as well
as the rakyats perception INSIDE THIS NKRA
Malaysias security landscape. We
of crime rates, have to be
are working with private sector and
government partners at all levels
addressed and improved in order to 1 Modern Policing Initiative Designed
to Transform PDRM into a World
fully achieve a higher standard of Class Police Force by 2020
to develop an effective, holistic, living by 2020. All levels of Malaysian
critical infrastructure protection
and resiliency plan that centres
society have to be fully engaged in this
move towards curbing crime, just as
2 Maintaining Vital Police
Logistics to Improve
Efficiencies
the relevant government departments
on continued investments in
and agencies have also been working
business, technology, civil society,
and coordinating to achieve through 3 PCI: Bridging Perception
and Reality
government, and education. various crime reduction initiatives
The government will continue since 2010.
to invest in the nation's most Initiatives such as the Safe City
pressing short- and long-term Programme (built on Crime Prevention
security needs, including Through Environmental Design or
CPTED principles), the Omnipresence
modernising our 209-year-old
programme (especially at crime hot
police force, strengthening security spots), and the Community Policing
along our borders and allocating Programme have significantly reduced
critical resources to address the Index Crime by 45 percent from 2010-
threats of terrorism. 2015. Incidents of car theft have also
The threats to the public safety further decreased by 10 percent in 2015,
following a major 20 percent reduction
and security of Malaysians today
in 2014 as a result of a focused move to
are real. We must be ever-vigilant
cripple major car theft syndicates, which
and strive towards responsible, broke a 5 year rising trend (2009 - 2013)
dedicated and effective crime proving that it is possible to achieve
prevention and policing. what was previously unthinkable.

Reducing Crime
The rakyats expectations of under GTP 2.0 that include strategies factors causing the rakyats fear of
PDRMs service delivery to keep to become a community-oriented crime is a start towards identifying
improving and for law enforcement force, and carrying out intensive potential solutions. PDRM had
officers to be more customer- communication efforts to change previously been engaging with the
oriented, are increasing. Hence, the rakyats disbelief of its safety on public throughout the GTP via the
NKRA initiatives have also evolved the streets. International Liaison Unit (ILU), a
to meet those expectations; from Today, the rakyats perception of special unit that looks after expats
purely focusing on crime reduction, its personal safety plays an integral and tourists, and open days at
improvement of the criminal justice role in its level of acceptance the local police stations/district
system, and increasing the publics on whether the crime situation police headquarters. These public
satisfaction with frontline police has improved or worsened. The engagement initiatives assisted in
services in GTP 1.0 between 2010 to formulation of the Perception of providing greater public confidence
2012, to the 2012 to 2015 initiatives Crime Indicator (PCI) to gauge the towards the work PDRM is doing.
1 Modern Policing Initiative Designed 2015 saw the introduction of the

Modern Policing initiative, which the
to Transform PDRM into a World aspires to transform PDRM through

the STEP enablers that will transform
Class Police Force by 2020 PDRM's command-and-control culture

to a more service-and community-
oriented force, and ultimately building
greater trust with the rakyat to feel safe
under its watch.
Phase One of the Modern
Policing Initiative involved the Balai
Transformation project which was
piloted at three police stations
Brickfields (KL), TTDI (KL), Trolak
(Perak). These pilot police stations
were selected, based on their localities,
to represent a good cross-section of the
Malaysian communitys demographics,
from the typical urban residential area
to the typical rural residential area.
The pilot project of six months
aimed to review existing process
flows in these stations, identifying
gaps or weaknesses to be improved.
As a result, a series of reporting
process improvements under the
Police Reporting System (PRS) was
PDRM's Talk to Us initiative at Jalan Berhala, Brickfield implemented

PDRM's Talk to Us program will be rolled out nationwide at all police stations in 2016
By eliminating redundancies, community, such as suggestions to

From a nine-step reporting this will ensure a speedier and patrol certain areas more often at night,
process to a five-step better reporting experience for and other unconventional ones such
reporting process crime victims, with the intention of as improving their friendliness and
increasing rakyat satisfaction towards approachability. With such a positive
Auto feeding personal info at police and boosting productivity outcome, the Talk to Us programme
the PRS entry page via linkage amongst the police station personnel. will be rolled out nationwide at all
to the National Registration To build trust with the public, police stations in 2016.
Department (JPN) and in line with the foundations of a
Symplifying incident community-oriented Modern Policing,
reporting in the PRS the Talk to Us pilot programme was
also launched at Balai TTDI and Balai
Aligning the PRS workflow Brickfields to enhance public service
by dispensing with manual satisfaction. These engagements
documentation and record- have elicited valuable feedback
keeping to online tracking from the public on how the police
can improve performance for the
Process improvements recorded during Phase 1
of Modern Policing

Reducing Crime
TRANSFORMING
ROYAL MALAYSIAN
POLICE INTO A
WORLD-CLASS FORCE
W
hile the incidence of Index S.K.K. Naidu, from the Brickfields entails changing the mindset of the
Crimes has dropped by Residents Association, agrees that a police from being law enforcers to being
45 percent since the sense of distance between police and community-and service-oriented;
beginning of the GTP in 2010, the the communities they serve makes law equipping the officers with the latest
publics perception of crime rates has enforcement more difficult, pointing in mobile and ICT technologies to help
not improved. Between 90 percent out that when both parties work them fight crime more effectively;
(based on a Frost & Sullivan study together, they can take advantage of devolving authority to the balais and
conducted in 2013) and 96 percent synergistic effects in curbing crime giving them greater autonomy in
(based on a USM study conducted in through Community Policing. When decision making; and simplifying both,
2015) of Malaysians surveyed believe we held Talk to Us sessions at our public facing and backend processes
that crime rates have not dropped. local pasar malams (night markets), the to improve efficiency and make the
Deputy Commissioner of Police community was incredibly supportive experience of visiting the balai more
(DCP) Dato Asri bin Yusuff, who and provided PDRM with a great deal pleasant, he explains.
is PDRMs Deputy Director of of information. The same thing is true The pilot project is designed to
Management (Service/Personnel) at of our joint patrols with PDRM, because showcase an example of the modern
Bukit Aman, believes that this is in large residents can point out various spots frontline PDRM as a proof-of-concept
part due to the disengagement between of concern to them, Naidu explained, that the Balai Transformation
the community and the police force who adding that while there is a lot that still project works to better fulfil the
serve and protect them. He aims to have needs to be done, he believes that the needs of the rakyat, as well as to act
this, along with other systemic issues, transformation of PDRM via Modern as a benchmark for the full rollout
addressed by the Modern Policing Policing will have a profound effect on nationwide in the near future. DCP
initiative. Modern Policing is critical the ground. Asri also hopes that the pilot projects
in our efforts to transform PDRM into Modern Policing starts off with success will serve to create a blueprint
becoming a world-class policing force the revamping of police stations (or or model for future stations.
by 2020. It is the only way we can make balais) under the Balai Transformation Modern Policing will further see
ourselves flexible enough to address the project. DCP Asri believes that the first more police in specific roles moved
ever-increasing security demands of the step in this process is to strengthen down from the district headquarters
21st Century. the underlying STEP enablers. This to the stations. In particular, the

Dato Asri bin Yusuff
Deputy Director of Management
(Service/Personnel),
Modern Policing is critical in
PDRM, Bukit Aman our efforts to transform PDRM
into becoming a world-class
policing force by 2020. It is the
only way we can make ourselves
flexible enough to address
the ever-increasing security
demands of the 21st Century.
investigating officers of crime and to potential criminals to sheer away. a significant amount of effort. It
traffic incidents will be placed in the There is a balance that has to be requires the IGP and our top cops to
stations. Previously, these officers struck; too much police presence push the initiatives through, as well as
were located at the district HQ, which sends a different kind of message, for the new generation of police officers
meant that even after youve made but no doubt PDRM will know how to be trained into the proper mindset,
your report, you would still have to get it just right. Naidu opines.
to wait for the investigating officer. Both DCP Asri and Naidu are of While this is a big and heavy task,
With Modern Policing, they will be the opinion that such a fundamental we have to do it to meet the expectations
right there in the balai, making the transformation of PDRM will entail of the rakyat, DCP Asri says.
whole process more comfortable for
the rakyat, DCP Asri elaborates.
In the long run, DCP Asri sees
PDRM itself being transformed from
being a force that polices the public
to one that facilitates public policing.
We will engage the community more
closely, encouraging them to create
their own Police Volunteer Reserve
forces; also, we will support developers
of new residential projects to create
auxiliary police forces where possible.
Both forces will be provided on-duty
uniforms, and will have full police
powers when they are on duty.
Naidu agrees that having an
increased uniformed presence on
the streets has a significant crime
deterrent impact, sending a message

Reducing Crime
2 Maintaining Vital Police Logistics 2,000 PDRM personnel mounting

motorcycle patrols daily, with over
to Improve Efficiencies 200,000 suspicious individuals

questioned and 260,119 residential
houses visited annually. This has
resulted in another 2,111 arrests
nationwide in 2015.
Street Crime numbers are still
being tracked, well beyond the
GTP 1.0 timeframe. While the index
demonstrated a significant drop in the
number of incidents reported during
the early years of KPI implementation,
there is a need to remain vigilant.
Resources are still being deployed
to ensure that this decreasing trend
continues. In fact, 2015 resulted in a
drop in street crime of 16.9 percent,
which was an improvement over the
KPI target of 15 percent.
Under the Omnipresence
programme, personnel were
redeployed at street crime hotspots,
i.e. popular shopping streets and
Prisons Department - Industrial program where inmates received practical training and technical
skillsets in order for them to find employment upon release tourist havens. Beyond that, under
the Safe City Programme, the local
Initiatives geared at reducing PDRM has recorded a drop of 10.1 councils (such as DBKL) carried
Violent and Property Crimes have percent for Index Crime against a KPI out rejuvenation activities using
shown themselves to be effective over target of 5 percent annually. A big the CPTED principles at black spot
time. These initiatives not only target part of this reduction is the decline in locations.
the actual incidence of such crimes, car theft (a reduction of 1,358 cases). Maintaining vital police logistics
but also some of the causes behind This is the 2nd consecutive year that especially their vehicles is critical
these crimes (e.g. drug addiction). such decline has been recorded. towards ensuring police response
Gang robberies, street crimes, house Additionally, 14,450 crackdowns on car and crime-fighting activities can be
break-ins, and car theft have been theft syndicates via Ops Lejang were carried out effectively and efficiently.
reducing at a steady pace. This has carried out this year. This has resulted An internal budget reallocation
largely been due to intensive and in 5,857 arrests and the charging of 17.4 exercise was carried out in 2015 to
targeted PDRM operations to cripple percent/1,022 suspects (Jan Oct 2015). assist the PDRM in this respect. As a
criminal syndicates. The number PDRM has also reported a drop result, the PDRM managed to replace
of criminal re-offenders have also in house break-ins of 6.3 percent, 1,200 MPVs out of the 3,541 which
dropped, thanks to concerted efforts though not achieving its KPI target of have reached their 8-year lifespan.
to up-skill ex-convicts and increase 10 percent. Despite this, 10,848 house Another 500 are expected to be
job opportunities upon release break-in operations (Ops Pintu) were replaced in 2016 and the eventual
from prison. Upon completion of conducted nationwide with 3,527 replacement of all vehicles by 2020.
rehabilitation programs, drug addicts arrests. Another special house break- Although the prison recidivism rate
are further monitored and supported in initiative is the Motorcycle Patrol in Malaysia is one of the lowest in South
to ensure they stay on the wagon. Unit (URB). Nationwide, the URB has East Asia (8.7 percent), agencies such

as the Agensi Anti-Dadah Kebangsaan
(AADK) and the Prisons Department
continue to perform a crucial function
in rehabilitating ex addicts and former
inmates. Most street crime perpetrators THREE-PHASE CRIMINAL
are addicts looking for easy money
hence the involvement of AADK under
this NKRA. After a major revamp of
REHABILITATION PROGRAMME
T
their internal criteria measurement of
staying clean, AADK introduced a new he Malaysian Prisons Department recidivism has been reduced by 100
KPI in 2015 to measure the percentage has put in place a three- percent in those who have undergone the
of Orang Kena Pengawasan (OKP) who phase criminal rehabilitation two focused courses as of 2015. In fact, the
are rehabilitated drug addicts who programme (Pelan Pembangunan first batch of bus-driving course-takers
have stayed clean for a minimum of one Ihsan) aimed at minimising recidivism, are fully employed, while 80 percent of
year. As of December 2015, the agency or ex-convicts re-entering a life of crime the second batch are also fully employed
has achieved 37 percent against their after serving their sentence. Where Phase with Maju Express Bhd, earning between
KPI target of 57 percent which is still One is a disciplining programme, and RM2,000 RM4,000.
quite a substantial achievement of Phase Two involves character building, Wi t h n a t i o n a l ly- a cce p te d
5,980 OKPs remaining clean for a year. Phase Three provides properly-repentant certifications assessed by DSD, we see
As for the Prisons Department, prisoners with skills training. that the stigma of accepting ex-convicts
inmates are given practical training ACP Hj. Wan Ramzan, head of this as employees is gradually shrinking; the
and technical skillsets to find gainful particular NKRA initiative, points out companies involved in inmates practical
employment which in turn will reduce that since 2012, the Prisons Department training have seen the results, and are
the likelihood of going back to a life has provided skills training in 47 fields happy to hire them. Therefore, when
of crime. As of December 2015, 1758 (including high-tech areas). As audited prisoners come out from prison, they
inmates have completed certified skills by PwC, we have achieved our KPI target are not only equipped with the skills
training under Sijil Kemahiran Malaysia of 1,500 prisoners undergoing skills they need to improve their lives, but
(SKM-SLDN), Sijil Kecekapan Kemahiran training, he pointed out. sometimes also with a job offer in hand.
(SKK-CIDB) and Program Pemanduan Two of the courses that the Prisons Their parents are happy, because their
Kenderaan Perdagangan (Metro). Department has focused on include children are working proper jobs and even
Following the establishment of a the baking skills and commercial sending money (up to RM1,500 a month)
bakery-cum-training facility in Kajang driving. Baking skills are taught in back to them. The prisoners themselves
Prison in 2012, an additional facility three institutions; Kajang, Tapah and appreciate this initiative to improve
was commissioned in Kluang Prison Kluang. As a six-month certificate themselves and their employability,
last year. The completion of the second course, when prisoners are released, Wan Ramzan discloses.
bakery decreased the training time for they can either become an entrepreneur
inmates, ensured more prisons are or work in bakeries. The prisons are
self-sufficient in producing their own now self-sufficient in bread throughout
bread as a cost cutting measure as Peninsular Malaysia, and from North and
well as provided a commercial return Central regions alone, the costs savings
by supplying bread at local bakeries is RM1.2 million annually, Wan Ramzan
and grocery stores. highlights. Meanwhile, two batches have
graduated the commercial vehicle (bus)
driving courses; 23 in the first, and 40 in
the second (completed in December 2015).
While data is not available for all 1,500
prisoners across all training courses,

Reducing Crime
3 PCI: Bridging Perception and Reality Dato Seri Dr. Ahmad Zahid Hamidi in
collaboration with the Malaysia Crime
Prevention Foundation was held in
November 2015 to have an open and
In 2015, the Perception of Crime Improving these indicators is a constructive discussion on issues of
Indicator (PCI) was developed using shared, collaborative effort involving crime and security under the United
the four indicators of signals, my all parties. For example, fixing broken Against Crime banner. Leveraging on
space, amplifiers and service. Based streetlights requires that the relevant MCPFs long history as one of the most
on the PCI baseline results in Dec 2015, authorities such as the local council active crime prevention NGO in the
Malaysians still dont feel safe and the to be informed that they were broken. country, a series of Crime Roundtable
level of their fear of crime is quite high, Neighbourhood watches, organised sessions will be held nationwide in 2016
at around 80 percent. by the various Rukun Tetangga to maintain the initiative of obtaining
The formulation of the PCI is and Residents Associations are yet valuable and honest feedback from
aimed at providing clearer insights another thing the public should do / the rakyat. The NKRA also collaborated
into the causes of the rakyats fear of continue to do. with Safer Malaysia, a committee under
crime and clarifying the gap between The engagement approach in 2015 the Bar Council established to become
reported and perceived crime rates to improve public perception was a focal point for the communities to
that exists today. The PCI will also aid focused on opening the conversation share solutions on fighting crime and
in formulating the actions needed to on crime. The conversation took place specifically on educating children
be undertaken in order to improve the via monthly crime opinions published in that crime does not pay. Finally, in
publics understanding of the true newspapers on topics ranging from car partnership with Astro Radio, a series
crime situation in Malaysia such as: theft to crime prevention and quarterly of public service announcements on
radio features on BFM and Lite FM crime prevention and safety tips were
Cleaning up the negative
featuring local crime fighting NGO, aired across three major radio stations
environmental and human signs
MARAH and top PDRM brass discussing (Lite FM, MY FM, Sinar FM).
i.e. drug addicts, Mat Rempits
on Modern Policing, Amanita and the By taking the above actions to address
(motorcycle hooligans), poor/
Tidak Apa Attitude of Malaysians. In these indicators in 2016 and continuing
broken lighting, dirty streets
addition, a Crime Roundtable Session the conversation on crime, the NKRA aims
Educating Malaysians to stop the officiated by YAB Deputy Prime Minister, to see better public perception as a result.
Tidak Apa Attitude (Doesn't Matter
Attitude)when witnessing a crime
Empowering PDRM to
ensure optimal response
time to crime incidents
Intensifying communications
on crime reduction efforts
and successes as well as
continual reminders to
not share unauthenticated
crime incidents, and
Simplifying the reporting

process and ensuring a
customer oriented experience
at police stations through the
MCPF's Roundtable on Crime Prevention "Towards a Safer Malaysia" held at the Sime Darby
Modern Policing initiative. Convention Centre on 3 Nov 2015

MOVING FORWARD
C
rime today is no longer on processes, technology, introducing evidence-gathering and serves as a
an issue with purely local a ruler to determine the manpower check-and-balance mechanism.
implications. It has taken on requirements at a station and also In addition, concerted efforts will
national security aspects, including addressing the equipment needs of be made to communicate Modern
the threats of domestic terrorism, the personnel at the station. Policing within the force itself and
transnational criminal activities The processes which will be looked externally to the rakyat. In order for
and cyber-crime as well. Some of at will be the criminal investigation, PDRMs over 100,000- strong men and
the consequences of physical/blue- traffic investigation and also forensic women personnel to get on board, the
collar crimes pale in comparison to processes. The objective is to Modern Policing message needs to be
what white-collar and digital crimes improve the efficiency of the relevant tailored according to their interests and
could cause. Borderless crimes of this investigation personnel and to support demographics. Externally, PDRM will
nature also affect Malaysians locally, them with technology. also be looking at ways to project its
especially the threat of ISIS recruiting Among the technological image externally to the public. This
people domestically and the setting up improvements under Phase Two to will also include obtaining the support
of home-grown terror cells. look out for include the introduction and participation of the public as this
In addition to retaining the of an integrated control centre at police is vital to ensure the success of this
successful crime prevention initiatives stations for quicker response. This will initiative via intensive community
from 2010, this NKRA will have its scope be complemented by police personnel engagements.
expanded to include border security equipped with body-worn cameras. Transforming the force to achieve
and the Eastern Sabah Security Zone Other technological tools to be world class policing status by 2020 will
(ESSZONE), as well as cybersecurity introduced are a resource management be a challenging journey, but with full
and terrorism. The first phase of system (which will allocate resources support and commitment from both
this expansion programme will be according to needs and crime rates), the government and rakyat, PDRM can
to review all measures concerning and also a mobile system for ease of transition from traditional policing to a
border security with a lab which will making on-the-spot police reports. thoroughly modern police force, ready
be conducted in March 2016 with the The introduction of the body worn to tackle 21st-century crime.
aim of strengthening our borders. cameras (which has been implemented
Phase Two of Modern Policing will in other countries such as Singapore,
commence in early 2016 with a focus Australia, UK, etc) also assist in

Fighting Corruption
DATUK PAUL LOW

SENG KUAN
MINISTER IN THE PRIME MINISTERS DEPARTMENT
The Government remains

committed to fight corruption
under the National Key Results
Area (NKRA).
For a country like Malaysia
that is on a firm path towards high
income status, corruption is like a
malignant cancer that undermines
optimum decisions, supports
abuses and denies opportunities
BREAKING
for healthy growth. It is a regressive
practice that robs society of the
standards of living that we should
THE VICIOUS
be aspiring towards.
Amongst the NKRAs,
corruption is one of the toughest
CYCLE OF
problems to tackle because it
involves breaking long-entrenched
practices that exist across
many levels within businesses,
CORRUPTION
Government and society.
A fundamental problem with
corruption lies in the fact that
as long as there is a giver, there
will be a taker and vice versa.
The culture of tolerance towards
corruption needs to be reversed,
while each and every one must
take ownership of the fight against
corruption by making a definite
stand that we are the solution
and not the problem.
Combating corruption, and
upholding good governance and

integrity must be made through
effective law enforcement as well
Fighting corruption remains
as preventive measures. Many of
our initiatives under this NKRA
at the forefront of the Governments
are aimed at strengthening and
institutionalising anti-corruption
priorities, and the relevant parties are
mechanisms within every
Ministry and agency; establishing
continuing to work in a holistic and
ownership and accountability integrated fashion in order to see that
starting from the Minister-in-
charge and the Chief Executive. Malaysians can live in a culture that
embraces integrity in every sphere.
This has led to the
establishment of the Governance
and Integrity Division (BITU) in the
Prime Ministers Office under my basis during the implementation working towards incorporating the
purview, which is taking the lead in of each major project to improve Corporate Liability Provision into
implementing all NKRA initiatives early detection of fraud and the MACC Act and encouraging
through a national framework corruption. We have also taken corporate entities to strengthen
formed under the Integrity and steps to ensure Government their own internal anti-corruption
Governance Committee (JITU). procurement processes become processes and guidelines.
JITU is represented by more transparent to the rakyat. Willingness to report corruption
Secretary Generals, integrity Malaysia is ranked 54 th in is increasing significantly, but
units, and top officials from the 2015 Corruption Perception convictions can only follow with
the Malaysian Anti-Corruption Index (CPI) with a score of 50 clear evidence. We have to build
Commission (MACC) and Auditor out of 100, highlighting the need reliability and trust into the
Generals (AuGs) Office. Covering for all parties to 'walk the talk' system, and recognise that there
both federal and state agencies, and expedite adoption of anti- is a lot more work to be done.
its primary purpose is to create a corruption reforms that have been For example, the channel for
culture of transparency, honesty, proposed by the Government whistleblowing is currently under
and integrity within the civil since 2010. Our current ranking review for improvement ensuring
service. The integrity units were is not one that we are proud of, strict compliance to accountability
established to monitor compliance and we must strive harder to and confidentiality.
to integrity standards by high- improve our standing especially In the end, one of the strongest
value projects and border control when foreign investors judge us weapons our country has against
security agencies. based on CPI. corruption is the rakyat standing
Furthermore, changes in One of the most significant up and speaking out about the
the way the AuGs Report is initiatives, improving the injustices seen. One has to decide
presented and used have directly political financing framework, to be neither a giver nor a taker to
resulted in the early detection and is now being undertaken by the make fighting corruption work.
subsequent reduction of blatant National Consultative Committee It is everyones business to stop the
corruption incidents. Auditors on Political Funding. In relation vicious cycle of corruption if we
conduct audits on a real time to the private sector, we are still want a better future for Malaysia.

Fighting Corruption
E
fforts to fight corruption are at public agencies can be seen as an
the forefront of national reform effort to curb corruption at the source. INSIDE THIS NKRA
agendas all over the world. Its core functions amongst others
They are among the highest national are to strengthen internal controls in 1 Institutionalsing Anti-Corruption
Measures
priorities in order to establish a good managing governance and integrity
and trust-worthy governance structure. issues within organisations, and
Curbing corruption in a holistic manner ensure that proper identification
requires systemic elimination of both and verification of offences are being 2 Private Sector Must Eliminate
Opportunities for Corruption
the givers and takers, which is why the conducted in a timely manner, and
NKRA initiatives target both the public also implement of follow-up actions
and private sector. including reporting to the relevant 3 Building the Foundation
for Integrity
The transformation of the enforcement agencies.
AuG Report tablines process in BITU, under the PMs Department,
Parliament has been one of the is headed by Minister Senator Datuk
biggest achievements in GTP 2.0, and it Paul Low Seng Kuan. It oversees
continues to produce positive outcomes and coordinates programmes across commencement of a new anti-
in reducing leakages and wastages in different ministries and agencies to corruption syllabus in primary
government procurement procedures. ensure successful implementation. and secondary school textbooks is
We have also seen an increase in private In 2015, the National Conference for underway after multi-stakeholders
sector participation, from signing the JITU was held three times (February, engagements started a few years
Corporate Identity Pledge (CIP) to May and December) as a platform to ago. In addition, effort to engage
implementing measures in conjunction gather inputs from Integrity Officers at with students has been renewed; for
with the Corporate Integrity Systems all levels and propose remedial actions. instance, BITU has been associating
Malaysia (CISM) framework. Realising the importance to with the Youth for Integrity movement
The establishment of Integrity sensitise young Malaysians towards under the Empowering Youth
Units (IUs) in all government and integrity and accountability, the Endeavours NGO.
1 Institutionalising Anti-Corruption Measures

Changes made in the frequency to the MyProcurement portal have transparency and accountability, each
of the AuG Report being tabled also increased transparency into tabling of AuGs Report was followed
at Parliament, coupled with the governmental procurement details. by a media briefing by the Chief
convening of the Report's Action Public Private Partnership Unit (UKAS) Secretary to the Government and
Committee, the AuG Online Dashboard has also issued circular to made signing related ministries' Secretary-Generals.
revamp, as well as the Putrajaya of Integrity Pacts mandatory for all In addition to highlighting remedial
Inquisition, are efforts to tackle the public-private partnership projects. actions taken, statistics on punitive
leakages and wastages in government Since 2014, in line with actions taken against corrupt officials
procurement. Enhancements made governments commitment to increase were also shared during these media

engagement sessions to raise overall of power, fraud, mismanagement Over the last three years, despite
awareness of the Governments effort of funds and negligence. exploring several possible options
to weed out corrupt practices. Initiatives were also put in place including a proposal to amend the
Version 2.0 of the AuGs Online to make government procurement Societies Act, this initiative has so
Dashboard was launched on 26 exercises more transparent. The far failed to gain traction due to
March 2015. The revamped Dashboard MyProcurement portal was upgraded entrenched political resistance. In
provides an enhanced online channel to allow for publishing the results of August 2015, against the backdrop
for the rakyat to access the AuGs direct negotiation deals and other of sensational issues on political
Report in a timely manner. It is government procurement details. financing, the PM announced
hoped that it would help promote Quotations and tender-related the formation of the National
transparency, add pressure to expedite documents were made available to the Consultative Committee on Political
taking effective action to resolve issues, public in the interest of transparency. Funding to propose a regulation
and also to improve public perception Since the inception of GTP 2.0, the structure for political financing
of actions resulting from the AuGs NKRA team has iterated on various within a year.
report. In addition, it serves as an occasions the need to institutionalise The committee is expected to
information-sharing platform with a more transparent political financing make some headway into building
Action Committee members (Auditor system to tackle the problem of grand momentum in addressing political
General's Office (AuGO), MACC, corruption head-on. The governance financing. The secretariat has been
Attorney General's Chamber (AGC), framework would have included three meeting local stakeholders, political
Royal Malaysian Police (PDRM), mandatory elements; donations to parties, civil society groups like Majlis
JPA and MoF) enabling them to be made in the partys name, all Belia Malaysia, Solidariti Anak Muda
take the appropriate actions against donations to be immediately receipted, Malaysia, and members of the Youth
wrongdoers quickly, for example to and records of all sources of funding Parliament to obtain their views and
expedite action for cases of abuse to be audited externally. support on the initiative.

Fighting Corruption
IMPROVING BUDGET
TRANSPARENCY SCORE
Datuk Juhari Haron
Director,
Follow-Up Audit
FOR MALAYSIA
Division (BSA)
T
he strengthened oversight as having issues in the AuG Report. Already, the BSA has seen a
of the AuGs Office, and the Firstly, the BSA manages the AuGs significant amount of progress in the
increased tabling of the AuG Dashboard, which displays the latest way audit issues are being handled.
Report to three times a year both major actions taken by auditees to the Most government bodies are now
initiatives under the Anti-Corruption major issues outlined in the Report. more proactive in providing regular
NKRA - were primary contributors to Every quarter, the BSA will monitor status updates, and to ensure that
Malaysias 7-point jump in the World all feedback from the auditees and if their KPIs in terms of resolving
Banks Open Budget Survey. The survey necessary, engage with them to resolve audit issues in the AuG Report are
measures how central governments issues that are still pending (with achieved, Datuk Juhari points out.
provide adequate public access to yellow or red statuses). He also said that these government
national budget information and Secondly, it acts as the secretariat bodies were more co-operative and
opportunities to participate in the for the AuG Reports Action Committee open to meet together with BSA to
budget process and is aimed at aimed (JTLKAN). The BSA identifies issues resolve any outstanding issues.
at assessing and promoting more open that require punitive action by the Nevertheless, BSA is preparing
and accountable budgeting, relevant enforcement authorities, so a proposal for the AuG to expand its
A total of 102 countries worldwide that the JTLKAN can deliberate over scope and allow it to conduct forensic
were ranked based on the degree of them and make the final decisions. audits. Various government bodies
their respective governments budget Thirdly, it also acts as the have formed Internal Audit units,
transparency, public participation and secretariat for the Putrajaya Inquisition, which monitor the feedback given
oversight. In 2015, Malaysia achieved if there are any audit issues that have by auditees and report them back to
a score of 46 out of 100 on the overall gone unresolved for more than a year. BSA to ensure checks-and-balances
Open Budget Index, an improvement Following a review and engaging with in status updates, Datuk Juhari says.
from 35 in 2008 and 39 in 2010 and the auditees to identify and resolve This proposal will allow us to directly
2012. This is slightly above the global the bottleneck, if the matters are still perform forensic audits on government
average of 45, aligned with the likes of unable to be resolved, the cases will be bodies that are red-flagged, based on
India and the Ukraine, and ahead of brought before the Inquisition. the analysis of JTLKAN issues.
Thailand, Vietnam and China.
The Follow-Up Audit Division (BSA)
of the AuGs Office is the main source
of that strengthened oversight, and is
tasked with handling issues that have
been brought up by the AuG Report.
Datuk Juhari Haron, the Director
of the BSA, explains that it plays three
major roles in overseeing government
departments that have been identified The AuG Dashboard is accessible online at https://agdashboard.audit.gov.my/#/

PROMOTING INTEGRITY
TO FOSTER PUBLIC
Dato' Sri Mustafar Haji Ali,
Deputy Chief Commissioner (Prevention),
Malaysian Anti-Corruption Commission
CONFIDENCE
A
ccording to Dato Sri result of negligence, or if they occurred
Mustafar Haji Ali, Deputy due to irresponsible management, the All sectors
Chief Commissioner corporation itself can be prosecuted
(Prevention) of MACC, the CISM is a and punished or sanctioned. It will benefit from the
best practice to nurture a framework be used to determine the extent to
of integrity in the private sector. By which a corporation as a legal person CISM, though
adopting the CISM, Dato Sri Mustafar
says, private-sector companies can
is liable for the acts and omissions of
the natural persons it employs, Dato
organisations that rely
proactively show their interest in
fostering a corporate culture that
Sri Mustafar explains.
With the CLP in place, MACC hopes
on investments from
shuns corruption. All sectors benefit to see a more competitive market the public in terms of
from the CISM, though organisations and more responsibility by private
that rely on investments from the companies towards their customers deposits or shares may
public in terms of deposits or shares and stakeholders. By having a
(i.e. listed companies and financial competitive market, we should benefit more, since the
institutions) may benefit more, since see government tenders providing
the implementation of CISM is a maximum benefits at optimal cost to implementation of CISM
confidence-builder, he added. the taxpayers, while the companies
At t h e m o m e n t , C I S M shareholders can look forward to more
is a confidence-builder.
implementation is based on the effective and efficient management of
good-will of the signatories and resources; hence, more profit, Dato
driven by their self-regulation. There Sri Mustafar points out.
are no statutes or other compliance He is also confident that the
measures that require CISM CLP will be beneficial to the public
signatories to abide to any proposal in general. Currently, the issue
or recommendation from MACC. This of integrity has been the focus of
is set to change with the inclusion of various debates among the rakyat;
the CLP into the MACC Act. thus, the successful implementation
CLP will examine the legal of CIP, CISM and CLP will increase
responsibility of a corporation for public confidence in the government
criminal actions (or inaction, in some and our economy as a whole. By
cases) performed by the company's taking this positive and proactive
employees. If such were done for the approach, investor confidence will
benefit of the company, or were the also be bolstered.

Fighting Corruption
2 Private Sector Must Eliminate

Opportunities for Corruption
The CIP and CISM have been voluntarily sign a CIP. In addition, the the MACC to prosecute companies
taken up by many private companies formation of the recently established engaged in corrupt practices and hold
interested in weeding out corrupt CISM Framework empowers them accountable as legal entities
practices within their organisations. companies who have signed the CIP in their own right. In 2015, a draft
While benchmarking exercise and to operationalise it as part of their was prepared by the MACC based
stakeholders engagements have been everyday routine. It is the only NKRA on benchmarking on both the USs
conducted, passing the Corporate initiative currently implemented Foreign Corrupt Practices Act and the
Liability Provision (CLP) into the MACC which relies solely on the private UKs Anti-Bribery Act 2010. The NKRA
Act is still in progress. sector. This initiative will complement will now move forward by engaging
For GTP 1.0 and in the wake of the CLP. with the new AuG on the next steps
various scandals, corporate entities The CLP itself is the stick that to be taken, and set a new target date
in the private sector were invited to suppose to explicitly empowers for CLP insertion.
3 Building the Foundation for Integrity

Much work has been done to school textbooks will take effect in been established in teachers training
establish greater communication on 2016 to instil moral responsibility at institutions since 2009.
the principles of integrity to combat an early age. This was an initiative In 2015, a total of 15,136 new
business-as-usual practices that may to combat the fact that 67 percent recruits into the PDRM undergone an
involve corruption without intent. of university students confessed integrity test before being accepted to
A total of 140 individual MPs have they would bribe in order to obtain first a round of interviews. Effectively,
participated in nine various engagement desired outcomes. Engagement with this has enforced a culture of
sessions over the course of two years. stakeholders in education institutions trustworthiness and honesty within
The insertion of an anti-corruption have also been guided by the 27 anti- PDRM to serve the public.
syllabus into primary and secondary corruption secretariats that have

MOVING FORWARD
M
oving forward, closer The Committee is slated to propose Act as soon as possible, engagement
working relationships said regulatory framework and draft with relevant stakeholders in this
with PDRM and AGC, as legislature by August 2016. matter is essential.
well as NGOs will drive continual In terms of the MACCs Fighting corruption remains at
implementation of this GTP initiative, incorporation of the CLP into the the forefront of the Governments
thereby bringing forth the transparency MACC Act, matters are progressing priorities, and the relevant parties are
of Government procurement as well as with the new AuG to cement the next continuing to work in a holistic and
institutionalising integrity measures steps to be taken to make this a reality, integrated fashion in order to see that
within the public service. New and to establish a proper timeline for Malaysians can live in a culture that
KPIs will be introduced to track the the private sector to prepare towards. embraces integrity in every sphere.
progress of draft legislation to regulate The mooting of the CLP in Parliament
political financing and reporting as a needs to be expedited, as legislation
follow up from the establishment of is key in institutionalising integrity
the National Consultative Committee within the private sector. In order to get
on Political Funding. the provision passed under the MACC

Public Service Delivery Transformation
TAN SRI DR. ALI HAMSA

CHIEF SECRETARY TO THE GOVERNMENT
Public Service Delivery

Transformation (PSDT) projects
benefit from the fact that they
begin as agile initiatives that are
rakyat-centric. The projects are
generally highly-focused, process-
driven improvements that are able
to yield big, fast results.
Many successes have been
achieved in the short time frame
since the PSDT NKRA commenced
CHAMPIONING
in late 2013. A total of 21 projects
have been completed; 10 having
been closed in 2015. These successes
PUBLIC SERVICE
serve as proofs-of-concept that
the successful implementation of
PSDT projects will see a marked
DELIVERY AS
improvement in the efficiency and
effectiveness of public services for
the rakyat. Following from these
EXEMPLARS OF
early successes the PSDT's primary
aim moving on is scalability.
There were 57 on-going projects
EXCELLENCE
throughout 2015, with 45 having
been initiated during the year
itself. Of the 16 ministries that have
participated in the PSDT NKRA so
far, 50 percent have opened more
PSDT projects upon completion
of their first pilot project.

KPIs were instituted so
that, progress was objectively
measurable and therefore we
could see the improvements.
For example, the Ministry of Health
is implementing a portfolio of PSDT
Datin Dr. Nor Akma binti Yusuf,
Deputy Director of Hospital Management Services Unit
projects across both primary and
secondary healthcare.
As we move into 2016, the
situation with the economy is
challenging, as the government is
being extra prudent. This presents
T
ample opportunity for the public he Public Service Delivery
service to look for avenues to Transformation (PSDT) INSIDE THIS NKRA
optimise costs while extending NKRA aims to accelerate
high quality services to the rakyat. the Governments efforts to become 1 Improving Efficiency, Expediting
Client-Oriented Services Delivery
more efficient and facilitative in
We look to continually
providing public services. It also aims
strengthen the delivery of
public services to the rakyat
to transform the countrys 1.3 million
civil servants into a motivated, high-
2 Continuous Innovation Key for Effective
Public Service Delivery
whilst addressing emerging performing workforce. This area of
needs resulting from Malaysias focus taps on individual projects
transformation into a high- within a particular ministrys public 3 Piloting Projects for Effectiveness
income economy. service to focus on process and

quality improvements.
A total of 21 small-scale initiatives
have yielded positive results
and emphasis is being placed to have driven leverages the vast
expand these process and quality expertise and experience of the civil
improvements on a larger and systemic service, thus increasing the likelihood
level. However, many successes have of their success on the nationwide
been achieved in this short time frame. level. Through the wide-scale adoption
Therefore, these pilot initiatives are of PSDT projects, the government
likely to expand beyond their original agencies involved will be better able to
trials and pilot status. meet the ever-increasing expectations
The expansion of these pilot of the rakyat in terms of both service
projects and the innovations they quality and quantity.

1 Improving Efficiency, Expediting Hospital Putrajaya, Hospital Sungai

Buloh and Hospital Selayang.
Client-Oriented Services Delivery Altogether, in 2015, the EDs of

these hospitals treated 44 percent
more patients due to improved patient
flow, thus saving an estimated RM5.3
Efficiency improvements in As part of the PSDT NKRA, MOH million per annum. The medical wards,
public service delivery aims to focused on improving service delivery, meanwhile, had increased their bed
eliminate waste, save time and cost, by thoroughly examining existing capacity by 5 percent through ward
and improve government services processes and eliminating redundancies levelling and an improved discharge
to the rakyat. Given the successful to improve work processes. process, avoided around RM235 million.
implementation of the Healthcare In 2015, a batch of 15 hospitals saw Under this initiative, processes
PSDT as a pioneering initiative in 2014 a transformation in patient flow and have been streamlined and made
at Hospital Tengku Ampuan Rahimah work processes at their Emergency more efficient. Issues which may
and Hospital Sultan Ismail, Johor, the Department (ED) and medical cause delays were identified and
Ministry of Health (MOH) decided to wards. These included the 12 General worked around or eliminated where
roll this out in all 133 government Hospitals from all states and federal possible. The target outcome was to
hospitals nationwide. territories excluding Perlis, as well as see more efficient and effective use
SUCCESSFULLY REDUCING The main impetus behind any PSDT

NKRA pilot project is to demonstrate its
MOH gave HSI full discretion to choose
the areas of improvement based on its
WAITING TIMES IN 16 proof of concept and iron out the bugs
before the implementing Ministries and/
prevailing patient demand and challenges.
HSI opted for the pilot to be implemented
HOSPITALS NATIONWIDE or government agencies go ahead with in the Orthopaedic Specialist Clinic
a larger-scale project. The Healthcare and Oncology Treatment Centre. The
PSDT programme, an effort to reduce improvement in waiting times for both
patient waiting times and improve patient areas had a significant impact, and all
experience in government hospitals under the stakeholders were happy with the
MOH, is a sterling example of how PSDT outcome. Following the success at HSI,
NKRA projects have transitioned from pilot the Minister of Health, Dato Sri Dr. S.
projects to nationwide implementation. Subramaniam, requested his Ministry
But initially, when deciding which and the PSDT NKRA team to see if
processes within MOH should be similar improvements can be made at the
transformed, hospital services were not Emergency Department (ED) in Hospital
the top items on the agenda. As Datin Dr. Tengku Ampuan Rahimah (HTAR), Klang.
Nor Akma binti Yusuf, Deputy Director of The ED of any hospital is its
Hospital Management Services Unit under frontline, and subsequently, the patients
MOHs Medical Development Division are mostly sent to the medical wards if
describes it, the decision to move forward their condition is deemed to warrant
with Healthcare PSDT was mutually arrived admission, Dr. Nor Akma explained.
at after a period of intense brainstorming Hence, the expanded pilot moved on to
and discussion with the PSDT NKRA team. deal with waiting times in the ED Green
The very first LEAN pilot project was Zone and medical wards at HTAR.
at Hospital Sultan Ismail (HSI) in JB. While Dr. Nor Akma explains that along
it was located quite far from Putrajaya, the with the LEAN principles, KPIs were
hospital director was very positive about also instituted; with that, progress was
it, and the consultants who were called in actually measurable it was objective,
were based in JB, Dr. Nor Akma recalls. not subjective and therefore you
Datin Dr. Nor Akma binti Yusuf, Deputy Director of
Hospital Management Services Unit under MOHs This pilot project in HSI became could see the improvements. There
Medical Development Division a learning experience for all involved. was nothing really massive or budget-

of resources to achieve the desired
or optimum quality of delivery while
meeting stakeholder expectations; in
this case, improving waiting times and
expediting patient flow.
Improving Bantuan Orang Tua
(BOT) application-to-notification
waiting times is a new 2015 pilot
initiative from the Ministry of Women,
Family and Community Development.
Administered by Jabatan Kebajikan
Masyarakat (JKM), BOT provides
RM300 per month to senior citizens age
60 and over who have no other sources
of income. The original waiting time
between applying for BOT and being
informed whether the application
Senior citizens are amongst those feeling a positive impact from PSDT projects. The BOT
went through was 30 working days. transformation project means their application is processed and approved within just 1 day
intensive happening; mostly it was small a form of knowledge transfer, in that the their respective states. Ophthalmology
improvements to existing processes, but teams who are already familiar with the and Orthopaedics specialist clinics are
they all added up, she adds. The results LEAN principles can go on and train other the next two areas earmarked to be rolled
were soon apparent and so were the teams, and spread the seed that way. out nationwide using the Agile approach.
benefits. Patients benefitted the most As these hospitals internalise LEAN The Healthcare PSDT concept focuses
waiting times had decreased, and they within their EDs and medical wards, on improving efficiency, and it is vital that
got beds faster but because the work it is hoped that when MOH deploys it everybody is on the same page. When we
became more efficient, medical staff were to all government hospitals, as it has first started, nobody knew what LEAN
also happier. begun to do, the initial 16 hospitals can meant; today, everybody understands the
MOHs approach in its nationwide be mentors to the other hospitals within tool, Dr. Nor Akma points out.
deployment is predicated upon using the
Agile method of deployment introduced by
the PSDT NKRA team, starting with HTAR.
With the lessons learnt and appropriate
THE AGILE APPROACH
procedures/guidelines formulated as a
result of LEAN implementation in HTARs Sequential Approach Agile Approach
ED and medical wards, the ministry then
went into 12 state hospitals and three major No. of hospitals No. of hospitals
hospitals within Klang Valley. The learnings 6 6 133 133
from these 16 hospitals, including HTAR, 5
will be subsequently used to rollout LEAN 4
to the remaining 117 hospitals in batches 3
of 20 hospitals. 15
2
LEAN, and the philosophy behind the
1 1
Agile approach, has seen tremendous Months Months
uptake in the hospitals involved. HSI, 6 12 18 24 30 36 6 12 18 24 30 36
for instance, on its own initiative, has
started training up other departments Going to 117 hospitals nationwide in 2 years.
to implement LEAN, and these other
Total 133 LEAN-led hospitals in 3 years.
departments are beginning to show
improvement. Its not just a project, but

The objective to reduce this to 5 and workshops, the project team office whenever the head was absent.
working days and this was achieved revisited the current BOT workflow The project further introduced a cut-
by the pilot project. using process mapping. It identified off window for certain work processes
The JKM Melaka Tengah office was bottlenecks and their root causes, and performed during day-to-day operations.
chosen as the pilot site. The project brainstormed potential solutions for Through these and other measures,
involved several government agencies the issues identified. the target was successfully met.
within the Ministry aside than JKM, A key opportunity for transformation This resulted in potential savings
such as Institut Sosial Malaysia (ISM), identified in this project included the of RM126,000 per annum from this
Department for Womens Development review of BOT applications only once pilot phase alone, and the increased
(JPW), National Population and Family every 24 months, upon which the availability of 26 staff (saving 14,976 man
Development Board (LPPKN), NAM continuation of the aid would only be hours per year, or RM112,320 per annum
Institute for the Empowerment of either approved or rejected. The roles of lost productivity). The savings from a
Women (NIEW), and representatives of staff and officers involved in the nationwide rollout to all JKM branches
from the Ministry as well as the Central BOT applications were restructured. would therefore be quite substantial.
Malacca District Social Welfare Office Authority to approve applications was Meanwhile, the shorter times led to
(PKMDMT). Over several discussions granted to the deputy head of the district increased customer satisfaction.
2 Continuous Innovation Key for Effective Efficiency is half the picture

when it comes to improving public
Public Service Delivery services delivery. Effectiveness is the

other half. Processes cannot simply
be fast and automatically efficient.
They also have to work and be seen
to work by the rakyat. Improving the
effectiveness of various government
initiatives is the key thrust of the
projects outlined below.
IMPROVING EFFECTIVENESS
OF KNOWLEDGE TRANSFER
PROGRAMMES
Under the auspices of MOHE, two
Knowledge Transfer Programme
(KTP) pilot projects were initiated.
These KTPs were, firstly, the use of eco-
friendly photo-catalyst technology to
produce good indoor air quality (IAQ)
in Malacca General Hospital, and
secondly, the recycling of municipal
organic waste via vermicomposting at
Melaka Sentral.
The first KTP project aimed
The IAQ level in Melaka Hospital (chosen as piloted site as a PSDT project) has improved with bacteria, fungus and
primarily at protecting IAQ; in this
volatile organic compounds having been eliminated after the spraying of TiO2 nano solution case, at the Malacca GH pilot site.

This was done via the use of nano
titanium dioxide (Nano-TiO2). Its
secondary objectives were to create
awareness regarding IAQ, monitor
and teach best practices to control
IAQ, formulate a model that can be
easily replicated in other states, and
facilitate the technology transfer of
Nano-TiO2 use.
Essentially, the Nano-TiO2
solution was sprayed on walls,
floors & ceilings. Through catalytic
oxidisation reactions, the compound
has been proven to kill bacteria &
inhibit viral infection, eliminate
volatile organic compounds (VOCs),
self-sanitise itself and prevent odours.
Measurements of IAQ at six different
locations in Malacca GH were made by
an expert. It was then discovered IAQ
in most of the locations were within
Gym 1Malaysia at the Youth and Sports Ministry building at Putrajaya. Photo sourced from
the acceptable range. This indicated Gymnasium Rakyat KBS Facebook page
Nano-TiO2s excellent photo-catalytic
efficacy against indoor pollutants. infrastructure was to put in place registration and appointment
The second KTP project was better gym management at the pilot processes, enable patients personal
the use of worms to speed up the site; namely, the Kompleks Rakan and medical records to be securely and
creation of compost (vermicompost) Muda Larut Matang & Selama in privately shared across all connected
from organic waste. This waste was Taiping, Perak. By redesigning the clinics, and empower patients to
collected from the Pasar Besar wet site layout and equipment based on self-monitor certain critical illnesses
market at Melaka Sentral. Based on user feedback, as well as developing like hypertension and diabetes.
this pilot project, it was estimated that improved policy and maintenance MOH can use the system for real-
70 percent of waste on average was guidelines, this initiative was able time data mining & intelligence
converted to mature compost in three to bring in over six times the original analysis during critical emergencies
rounds of harvesting. Each round number of visitors every month. This like dengue outbreaks.
lasted a month. Depending on the demonstrates the need to listen to the Through TPC-OHCIS, MOH stands
conversion yield, the economic value rakyat in order to optimise effective to gain major cost savings in terms of
created was calculated to be between delivery of public services. system development, deployment
RM168 and RM321 per tonne of waste. and maintenance. This is because the
EFFECTIVE DATA MANAGEMENT FOR system uses fully-local technology
EFFECTIVE USAGE OF PUBLIC GYMS PUBLIC HEALTHCARE SERVICES and is vendor-neutral. Average
Meanwhile, the Ministry of Services at dental and health administrative time per patient has
Youth & Sports (KBS) has been clinics will soon get a boost, thanks been shown to come down from 16
busy with its Gym1Malaysia to a collaborative effort between mins to less than three mins, an 81
transformation project. This initiative MOSTI & MOH. They are developing percent improvement. The system
sought to transform both hard a unified Teleprimary Care and Oral passed User Acceptance Testing (UAT)
and soft infrastructures. The hard Health Clinical Information System in August 2015. Its basic dental features
infrastructure transformation was (TPC-OHCIS) application using were successfully showcased at Klinik
of the gyms physical infrastructure MIMOSs Open Innovation Platforms. Pergigian Mantin (Mantin Dental
through renovation, whilst the soft The TPC-OHCIS will ease patients Clinic) in November.

TRANSFERING KNOWLEDGE
Dr. Azni highlights. As it is, this is
unsustainable over the long term.
FROM ACADEMIA TO IMPROVE

Separation of waste at source is
already a reality in various states;
PEOPLES' LIVES
however, reduction of waste at source
remains an issue for households due
to human habits. It is much easier to
change the way businesses manage
solid waste at source. Hence, we
targeted businesses, and wet markets
(and other grocery shops) generate
tonnes of waste every day, Dr. Azni
points out. In total, fruit and vegetable
waste comprise 20 percent of solid waste
heading to the landfill.
Hence, the use of vermicomposting
to reduce organic waste from fruits and
vegetables matter. Vermicomposting
is more convenient and cost-effective
compared to bacterial composting,
as it produces little to no odour, and
The KTP - Vermicomposting project at the Melaka Sentral wet market is one of the more successful pilots under the compost produced is very high in
PSDT NKRA. Not only has it resulted in reduced organic solid waste, it is also economically beneficial
fertiliser content. It is also a sustainable
T
activity, since the worms reproduce
he purpose of the Knowledge With vermicomposting, there is very themselves, and there is no shortage
Transfer Programme (KTP) is little needed in the way of facilities of inputs.
to take new research ideas and or infrastructure; the input is literally Ismail bin Che Din, Landscape
knowledge from institutions of higher rubbish (organic waste from fruits and Architect and Senior Assistant
learning (via MOHE) and use it to solve vegetables), and it can easily be scaled Agricultural Officer at MBMB, was
pressing national issues for the benefit up from a single bin. involved in implementing this initiative
of the Malaysian society. In other words, Vermicomposting has been at the Pasar Besar in Melaka Sentral.
KTP aims to put academic research used elsewhere as a form of solid Ive always had an interest in organic
ideas to work in the real world. Once waste management. According to technology, and I love nature. Also,
the initial ideas have been proven to Senior Professor Dr. Azni Idris of MBMB has already been producing
be of practical value, the next step the Department of Chemical and our own compost from tree-pruning
would be to commercialise them for Environmental Engineering in University waste, having won the Malacca State
the benefit of the rakyat. In the case of Putra Malaysia, the lead implementer of Government Innovation Award (Non-
the KTP Vermicomposting project, the this KTP project, solid waste is a much- ICT Category) in 2013.
pilot beneficiary was the Malacca City discussed issue to this day. Much of the challenge encountered
Council (MBMB). Traditionally, we the rakyat during the trial project was simply
KTP projects are selected based is used to letting the local councils coping with the vagaries of human
on their potential for success, their handle waste management issue; nature, and had very little to do with
positive impact to beneficiaries and this is to be expected, but as waste the technical aspects of it. It was quite
their surroundings, and their alignment generators, we must do our part difficult to educate the public at the
to national interests. These projects as well. The government recently market not to simply throw away their
usually last about two years, with initial announced that RM2 billion is spent organic waste. Separation of organic
funding provided by the Government. every year on waste management, and non-organic waste also remains an

PORTAL REVAMP IMPROVING THE RELIABILITY
FOR JOBSMALAYSIA OF LIFTS IN PUBLIC HOUSING
issue; people tended to throw everything The Ministry of Human Resources DBKL continues its efforts to
in the one compartment, and we had (MOHR)s efforts to revamp the improve lift maintenance in its public
to segregate the organic waste out for JobsMalaysia 2.0 job portal are still housing developments. Last years
the worms. And then, when the waste ongoing. The current portal is outdated, successful pilot project at PPR Batu
was separated out, irresponsible people Muda managed to improve response
having been introduced more than 14
came and "stole" the organic waste times to within 30 minutes and reduce
years ago. The portals pages are too
to feed their chickens. In a way, its a customer complaints by half. DBKL has
cluttered & lengthy. It exhibits slow &
good problem, but it does mean that since decided to roll out to five of the top
erratic performance loading time per
occasionally, there is a shortage of food 10 public housing developments, which
page takes more than three seconds.
supply for the worms. Before this, people were chosen because half of DBKL's
The portal revamp would therefore
just didnt bother about the waste at all, total lift maintenance costs covering
deal with these issues and more. This 53 public housing development were
he recounts.
will make it more efficient for both spent on them. Despite the financial
Ismail agrees with Dr. Azni that
employers and employees to use. The and coordination challenges involved,
vermicomposting is a good project.
original plan called for it to be ready DBKL was still able to reduce the lift
It is very easy to do, a convenient
way of reducing organic waste and in 2015. However, the revamp will only breakdown time by 60 percent, easily
if very beneficial economically as complete in Q3 2016. meeting its KPI targets for 2015.
well as environmentally. I also find
it a very educative one, and I would
like to suggest this project be started
up in primary schools; and from
there, to every household or public
community. Since there are quite a
number of "garden communities"
under MBMB jurisdiction as a result
of the NBOS programme, this kind of
vermicomposting project should not
be a problem to start up at any time.
While the project is still around a
year away from its formal handover
to MBMB, Dr. Azni reiterates that
given its success to date, it is ready
to be expanded to other markets in
Malacca. From this one market alone,
our calculations suggest that if the full
amount of organic waste (five tonnes
a day) is turned into compost, MBMB
will realise up to RM800,000 a year in
economic benefits. Imagine what the
benefits would be like if it was taken
state- wide, he adds.
Ismail believes that the project has
also helped to educate the public to care
for the environment. I think people are
more sensitive to what they throw to the
rubbish bin; they are more aware now
that even waste has value, he explains. Photo courtesy of BERNAMA Images

3 Piloting Projects for Effectiveness 117 remaining hospitals have adopted

Healthcare PSDT.
Last years DBKL Road
Maintenance Transformation pilot
PSDT projects usually start out implement it in all 133 government involved improving turnaround
small. They are first tried out in one (or hospitals nationwide. The findings from times on road repairs to MRR1. For
at most a few) pilot test sites or cases. all 16 hospitals (including HTAR) have small potholes measuring three meter
Once they have been proven successful been collated and studied. From this, squared, they were repaired within two
to achieve their stated aims, they are MOH has designed ideal templates for hours. For larger potholes, the repair
then rolled out in stages. They will both ED and medical wards. time was within two days. Because of
gradually expand to cover the entire This template will be rolled out to the success it had with MRR1 repair
area under the responsible partys all the other hospitals in batches of times, DBKL decided to expand it in
jurisdiction. 20. As each batch adopts and adapts 2015 to over 20 main and protocol
We have seen this with Healthcare the templates, their experiences will roads. It used the same KPIs as before,
PSDT and such is also the case be used to update the templates. The and was able to achieve 100 percent
with the DBKL Road Maintenance next batch of 20 hospitals will in turn of its targets. This in turn benefitted
Transformation programme. adapt the updated templates. Their approximately 2.1 million motorists
Given the positive results from experiences will then be incorporated using those roads.
Healthcare PSDT, MOH will now into the templates, and so on, until all
PSDT projects
usually start out
small. They are first
tried out in one (or
at most a few) pilot
test sites or cases.
Once they have been
proven successful to
achieve their stated
aims, they are then
rolled out in stages.
They will gradually
expand to cover the
entire area under
the responsible
DBKL's Road Maintenance Transformation programme in 2015 saw it expand beyond the MRR1 to 20 main and partys jurisdiction.
protocol roads, while still achieving 100 percent of its repair time targets carried over from before

MOVING FORWARD
I
n 2016, Healthcare PSDT will By the end of 2016, DBKL will
focus on moving the EDs and have fully rolled out its improved lift
medical wards at more hospitals maintenance programme to 64,000
to be graded as efficient. The initiative residents in 14,494 units of the top 10
will also seek to shift hospitals already public housing developments. It will
considered efficient to have even also reapply for increased funding
better service management and people to ensure its 2016 road maintenance
engagement to meet the rakyats improvements targets are met.
perceptions and expectations. Additionally, it will reconsider the
The next step for the TPC-OHCIS scope of the project to fit within the
application is its full pilot introduction currently-approved funding levels.
at 12 clinics in Negri Sembilan. Eight
are combined health and dental
clinics; the other four are split evenly
between standalone health and dental
clinics. The datacentre will be located
at MAMPUs main office in Putrajaya.

THE NTP NATIONAL KEY ECONOMIC AREAS
Greater Kuala Lumpur / Klang Valley
MAKING DATUK SERI UTAMA TENGKU

ADNAN TENGKU MANSOR
GREATER
MINISTER OF FEDERAL TERRITORIES
KUALA
The Greater Kuala Lumpur
transformation journey towards
becoming a world class city has
LUMPUR/
just reached its midway point.
We are still very much on course
towards achieving our aspirations
KLANG
to transform Greater Kuala Lumpur
into a truly world class urban
setting that citizens can be proud
VALLEY
to call home by 2020.
Assessing the many
achievements and challenges from
WORLD
our current vantage point since
we began our journey in 2010, our
collective vision for Greater Kuala
CLASS
Lumpur is coming into clearer focus
with each passing year. We have
been resolute in implementing our
initiatives and I strongly believe we
are well on our way to achieve our
twin goals of becoming one of the
top economic and liveable cities by
the year 2020.
2015, on reflection, has indeed
been a successful year for the
Greater Kuala Lumpur/Klang
Valley (Greater KL/KV) NKEA.
Wi t h the i m p e n d i ng
completion of the first phase of
Malaysias first ever Mass Rapid

As the countrys main
growth centre, this region is
critical for the nation, and
requires a comprehensive and
Transit line in December 2016,
strong interest from around the sustainable development plan
globe for the launch of a High
Speed Rail connection between that can adequately address the
Kuala Lumpur and Singapore, and
our continuing efforts to transform
challenges of rapid urbanisation.
the Klang and Gombak rivers into
a glittering attraction for Kuala
Lumpur, we stand on the brink of
G
some of the biggest game changers
this city has seen. reater Kuala Lumpur/Klang
Valley (KL/KV) aspires to be INSIDE THIS NKEA
Enhancing liveability for all
a competitive world-class
citizens in the form of quality living,
well maintained recreational parks
metropolis, boasting top standards in 1 On Track Towards Game-Changing,
World-Class Infrastructure
business infrastructure and liveability.
and accessibility to amenities are NKEA Greater KL/KV initiatives
all part of our continued efforts to
make Greater Kuala Lumpur both an
are geared to ensure that identified
Entry Point Projects play an integral
2 Enhancing City Liveability
attractive hub for residence as well role in transforming Malaysia into a

high income nation by 2020, with a
as business and investment within
the burgeoning ASEAN region.
targeted GNI impact of RM391.6 billion 3 Greater KL: Business and
Investment Hub of the Region
and creation of 553,000 jobs.
The tremendous momentum Efforts have reaped results, as
gained so far is a result of Kuala Lumpur is ranked 73rd amongst
collective efforts between various 140 cities in the Economist Intelligence
Government agencies and private Unit (EIU)s 2015 Global Liveability 10 municipalities, including the city of
Ranking. The city is up five places Kuala Lumpur itself.
sector companies working hand
from its 2010 ranking. In the World As the countrys main growth
in hand to deliver targets. I look
Bank Groups Ease of Doing Business centre, this region is critical for the
forward to working with you to Report, Kuala Lumpur also moved up nation, and requires a comprehensive
achieve all that we can in taking five spots from 2010 to rank 18th in 2015. and sustainable development plan that
our capital city and her citizens The Greater Kuala Lumpur can adequately address the challenges
towards greater heights. metropolitan area encompasses of rapid urbanisation.

1 On Track Towards Game Changing, Contractor was regularly reviewed.

The works required to ensure timely
World-Class Infrastructure completion were constantly discussed

and agreed with the contractor.
There were some challenges in
meeting the completion of structural
work for 12 stations and tracks laid
for Phase 1 of the project. As some
sections of the viaduct and station
were experiencing delays, labour and
resources were increased on site to
mitigate this. This has resulted in all
train tracks for Phase 1 to be successfully
laid out in good time.
In terms of the Accident Frequency
Rate, the Project Delivery Partner has
increased site supervision teams,
carrying out weekly site safety and
environment inspections. Work Package
Contractors (WPCs) have also been more
responsive to safety initiatives.
The first phase of the MRT Line 1
(Sungai Buloh Semantan) is expected
to be operational by end December
2016, while the full line (Sungai Buloh
Kajang) is expected to be operational
by July 2017.
Seven stations will be constructed along the 9.5km underground allignment of the MRT Sungai Buloh-Kajang Trains along the 51km of MRT Line
line, starting from KL Sentral. Above is the last underground MRT station at Maluri. Photo courtesy of Mass Rapid
Transit Corporation Sdn Bhd 1 with 31 stations, are expected to run at
an interval of 3.5 minutes during peak
In 2015, the combined population INTEGRATED URBAN MASS hours. Each train will have four coaches,
of Kuala Lumpur and Selangor was RAPID TRANSIT SYSTEM with a capacity of 1,200 passengers, and
7.87 million, entailing 25 percent The Mass Rapid Transit (MRT) the daily ridership is projected to reach
of the countrys population of 31.1 system is a game-changer in the 400,000 passengers. The line will also
million residents. ongoing effort to increase mobility, be integrated with the existing KTM
This, along with the concentration productivity and quality of life. It Komuter, LRT and ERL rail systems at
of businesses and commercial activities was proposed to ease congestion and various locations e.g. Sungai Buloh, KL
in the city, presents the need to improve provide commuters to the city centre Sentral, Kajang, Pasar Seni and Maluri.
connectivity on a large scale to ensure with an efficient and environmentally As for the MRT Line 2 (Sungai Buloh
the city does not end up grinding to a sustainable mode of transportation. - Serdang - Putrajaya), announced by
halt as a result of overcrowding and For 2015, KPIs under the MRT the Prime Minister during the tabling
poor connectivity. construction are on track, within of the 2015 Budget, Government
Living pressures due to the timeline and without cost overrun. approval was obtained in October
high cost of urban living must be At the Sungai Buloh Depot, 24 trains 2015 to proceed and the first call for
alleviated, and there needs to be good were delivered and tested on schedule, tenders will begin in January 2016.
recreational facilities within the city. At exceeding its original target of delivering MRT Line 2 (Sungai Buloh - Serdang
the same time, these solutions must merely 15 trains. Besides that, progress - Putrajaya) will further transform
be sustainable and help to improve for the handing over of tunnels and the public transportation network in
long-term city livability. station trackway to the System Works Greater KL/KV.

REVITALISING KLS RIVERS Drainage (DID) and are targeted Cathedral, Panggung Bandaraya,
The River of Life (ROL) project is at lifting water quality of the Masjid Jamek, Leboh Pasar Besar,
aimed at revitalising the Klang and Klang and Gombak rivers from Bangunan Sultan Abdul Samad,
Gombak rivers to open up economic the current Class III V (unfit Central Market, Dayabumi
opportunities leveraging on our for contact) to Class IIb (safe for and Pasar Seni LRT. (see River
heritage and culture, whilst enhancing recreational activities) by 2020. Beautification Progress for 2015)
liveability in the heart of Greater Kuala These projects range from water The third component of the
Lumpur. The river water will have to treatment plants and sewage River of Life project involves
be safe for recreational use, whilst treatment plants to the installation recouping returns from the
the river banks will undergo a major of devices that trap rubbish and RM4.4 billion investment into
transformation. The year 2015 has not waste flowing into our rivers (see the River of Life project through
only seen the completion of various River Cleaning Progress for 2015). land development projects in the
infrastructure as several pivotal vicinity of these rivers. (See Land
River Beautification works along
projects kicked-off bringing us closer Development Progress for 2015)
the Klang and Gombak rivers will
to the projects goal.
take place along a 10.7km stretch Upon completion of the ROL project
River cleaning initiatives are that flows through the city centre in 2020, Kuala Lumpur will be on par
divided into 67 packages (45 are from Gombak to Brickfields. This with other global cities like Singapore
completed and 22 are on-going) is led by Kuala Lumpur City Hall. and Seoul that have also undertaken
which are pioneered by the In the year 2015, works can be similar projects to clean their rivers and
Department of Irrigation and seen in the vicinity of St Mary's develop their water fronts.
RIVER CLEANING PROGRESS FOR 2015

Completion of the Waste Water Treatment Plant (WWTP) at the Pasar sewerage outlets (CSOs). This is to ensure water quality of the Klang
Borong Selayang the largest for Kuala Lumpur, with a capacity of River that flows through the city centre maintains Class IIb standard
1,300 cubic meters per day that is safe for recreational use. Construction is at 40 percent and
will be completed in the second quarter of 2016
Commencement of construction for the Bunus and Jinjang Kepong
regional sewage treatment plants, expected to be completed by Another component of the River Cleaning initiative entails the public
2018 with the capacity to treat 750,000 population equivalent (PE)1 outreach program to create awareness on river conservation. In
of sewage respectively 2015, two programmes were held at Keramat and Chow Kit Areas.
Spearheaded by DID, the outreach programme is expected to impact
A flood mitigation pond and other treatment facilities have been
thousands of residents along the Bunus and Upper Klang River basins
built and installed at Kolam Seri Segambut and Kolam Kampung
Benteng with 46 gross pollutant traps2, two automatic trash rakes
and two static screens3
Under the Drainage and Stormwater Management Master Plan, the

DID installed 52 gross pollutant traps2, one trash rake, one log boom
and one river water treatment plant to mitigate water quality and
flow issues for Gombak River. A total of 32 gross pollutant traps2,
two trash rakes, and one automatic trash rake were installed at the
Kerayong River that flows from Pandan Indah to Pantai Baru
To prevent food waste from ending up in the river, DBKL installed Pasar Borong Kuala Lumpur WWTP cleans water discharge from the wet market
44 communal grease traps4 in 10 public food courts around into class IIB
Kuala Lumpur 1
Population equivalent (PE) refers to the equivalent in terms of a fixed population
of a varying or transient population or other activity, for example industrial or
The first phase of the interceptor drainage system began construction commercial contributing to flow to the sewerage treatment system
in 2015 along the Klang River that flows through Kuala Lumpurs A total of 528 gross pollutant traps have been installed since 2011
2
Heritage Quarter that is in the Masjid Jamek vicinity. The interceptor 3

Key Initiative 5 Package 1 and 2: Benteng Flood Retention Pond (Kolam
system has four plants and will be able to clean 200 litres/second Takungan Banjir Benteng)
(treatment capacity) volume of water and will manage 24 combined A total of 98 communal grease traps have been installed since 2012 by DBKL
4

HIGH SPEED RAIL

The next big milestone for the Kuala
Lumpur-Singapore High Speed Rail
Project (HSR) is the signing of a Bilateral
Agreement between the Governments
of Malaysia and Singapore. The
signing of the agreement continues
to reinforce the strong commitment
by both Governments, and is to seek views on project viability, MyHSR, working closely with the
expected to capture key decisions of commercial structure, procurement relevant State Governments, has since
the project, as it advances into the approach and regulatory support confirmed and finalised almost 50% of
construction phase. considerations. The exercise received the projects alignment on the 330km
Both Governments have continued overwhelming interest and the corridor along the west coast of the
to work on identifying and defining feedback has been incorporated into Peninsular Malaysia between Kuala
the technical, commercial, security the bilateral discussions. Lumpur and Nusajaya. This enabled the
and regulatory characteristics Domestically, the Malaysian commencement of the subsequent set of
of the project, leveraging on the Government established a special activities namely detailed environmental
experiences of HSR projects globally purpose vehicle, MyHSR Corporation impact assessment and social impact
while adapting to the Malaysian and Sdn Bhd (MyHSR) to be responsible assessment. These assessments are
Singaporean requirements. for project delivery. Its scope of important to ensure that the social and
The Governments had in 2015, work entails project development environmental impact arising from
consulted the market through a from the current design stage up the project are properly monitored
Request for Information (RFI) exercise to project operations. and managed.
RIVER BEAUTIFICATION LAND DEVELOPMENT

PROGRESS FOR 2015 PROGRESS FOR 2015
Phase 1 of construction had commenced in 2014 and is focused in Precinct 7
or the Heritage Quarter - a location which encompasses important historical
landmarks of Kuala Lumpur. Though construction work is expected to be fully
completed at the end of 2016, progress has been slower than expected as
construction was hampered by utility infrastructure. Construction progress
was 36.5 percent versus the targeted 50 percent
Additionally, there were also interface issues with the Light Rail Transit (LRT)
lines that run along one side of the river as well as unanticipated interface
risk in the construction site of the Countdown Clock. Significant delays in
the construction and completion of the Countdown Clock have also caused
Artist impression of Putra World Trade Centre and its
a five month delay in the river beautification works at the Pitcher Plant area surrounding areas at night
near St. Mary's Cathedral
In 2012, the Government had frozen many parcels
of land situated along the Klang River that flows
through the Federal Territory of Kuala Lumpur
with the plan to recoup project development cost
through the future development of these land parcels
at higher expected valuations
In 2015, DBKL concluded a Market Study to seek

the most feasible development model to generate
capital from the 108 parcels of Government-owned
A community wall stensiled with The River Of Life land along the 10.7km riverfront corridor

2 Enhancing City Liveability LAND
DEVELOPMENT
PROGRESS
FOR 2015
Trees planted have been tagged
using global positioning system (GPS)
technology which will enable DBKL
to easily identify the location of these
trees for future maintenance. A total
of 84,9385 trees were tagged since
2014 and the aim is to ensure the
trees that are planted survive beyond
2020, contributing towards improving
the citys long-term environmental
climate and beautification efforts.
Volunteers doing their bit by planting

trees at the parks of Kuala Lumpur
5
NKEA Trees = 45,566
Non-NKEA Trees = 39,372
Initiatives under this NKEA A GREENER KUALA LUMPUR ranks Kuala Lumpur at number 26 out
adopt a holistic approach towards DBKLs Department of Landscape of 50 cities. This points to a need for
urban development by factoring in and Recreation Development aims to more efforts to be geared at improving
environmental impact and the well- increase green space in the city to soften scores in the areas of people and planet
being of KL-ites to improve liveability. the city-scape and improve liveability. in enhancing city liveability.
These efforts include the revitalisation As of 31 December 2015, 171,097
For 2016 to 2020, the Greener KL EPP
of iconic landmarks, such as the trees have been planted in the past four
is leaning towards mobilising the private
Gombak and Klang Rivers that run years by the local authority, public and
through the city, to increase community private sector under this initiative6. sector and NGOs to drive greening
interest in heritage sites as well as to Arcadiss Sustainable Cities initiatives in the city by adopting more
ensure public amenities are able to cope Index 2015 - which benchmarks cities idle spaces as green parks as well as
with the increase in population. according to people, planet and profit - planting and maintaining more trees.
6 EPP 6 Greener KL

SHOWCASING KLS
RICH HERITAGE SITES
In a bid to modernise Kuala Lumpur
and bringing it up to par with other
global cities, there is a need to preserve
historical and iconic landmarks. Under
the Greater Kuala Lumpur/Klang Valley
NKEA of EPP7: Iconic Places, a network
of heritage trails were developed along
the corridors of famous landmarks and
walkways of KL.
Three heritage trails have been
developed since 2011. Heritage Trail 1
starts at Masjid Negara passing through
Jalan Hishammuddin and Dataran
Merdeka, and ends at Medan Pasar.
Heritage Trail 2 begins at the
junction of Jalan Tun Perak and Jalan
Melaka heading towards Jalan Gereja
to arrive at Bukit Nenas.
Finally Heritage Trail 3 starts from
Medan Pasar through a portion of Jalan
Hang Kasturi then turning into Jalan
Petaling and Lebuh Pudu. The bus stop
in front of Bangkok Bank has been
closed and the area has been upgraded
with a caf in the center of the square.
Infrastructure and roads along
these routes have been upgraded or
refurbished to feature the significance Medan Pasar has been extensively renovated
of these buildings and roads that have
stood through years of development. two new businesses for 2015 to achieve is located at the junction of Jalan Raja
Extensive renovations had been seven by end year. Laut and Jalan Parlimen. The project
made in the Medan Pasar area to With the Heritage Trail 5 phase 1 was scheduled for launch on 31st
make it another centre of urban plan approved, a contractor has been August 2015 but missed the deadline
activity in the heritage core of the appointed in December 2015 and civil due to several technical hurdles on site.
city centre. Several events including works are scheduled to be carried The projects progress as 31 December
a Raja Band Competition, KL out in 2016. Heritage Trail 5 starts 2015 was at 87 percent and members
Street Jam, Buy Nothing Day and from Bulatan Dato Onn and connects of the public can look forward to the
a Malam Wayang have been staged to Jalan Parlimen heading to the CDC finally being completed in 2016.
at the venue, making it a centre of Parliament building. Moving forward, a pipeline
attraction for tourists and citizens Some areas with room for of new heritage trails have been
alike. Businesses have responded well improvement include the 2020 proposed and plans are underway to
to these developments, taking a keen Countdown Clock (CDC). The CDC, increase the visibility of these trails to
interest to be based at the area, driving which will feature a digital clock encourage the public to discover and
Medan Pasar to surpass its target of projected onto a water curtain, explore them.

A COMPREHENSIVE NETWORK the functional performance and and another 31 STPs were upgraded to
OF PEDESTRIAN WALKWAYS effectiveness of sewage treatment ensure effluent compliance to Standard
The upgrading and improving processes and related facilities. Once A as stipulated in the Environmental
of 48.87km of pedestrian walkways completed, the five regional STPs in Quality (Sewage) Regulations 2009.
in Kuala Lumpur has enhanced city Kajang, Southern Klang, Langat, and At the same time 99 km of new
connectivity. Upper Kerayong7 will be equipped with pipelines have been constructed to
Over 80 percent of pedestrian future capacity to serve up to 1,369,000 divert sewage to regional STPs. For
walkway users who participated in a population equivalent (PE)8 - in line the year 2015, Jabatan Pengurusan
survey by the Malaysian Institute of with projected population growth. Sisa Pepejal Negara (JPSPN), the
Transport (MITRANS) reported high The Sewerage Services Department agency responsible for solid waste
satisfaction levels. Key contributing has been successful in managing the management in this country was
factors include the installation of implementation and delivery of the tasked to design a Leachate Treatment
anti-climb fences across a majority packages under the Sewerage Non- System in Taman Beringin. The system
of the pedestrian walkways and the River Programme. As of 2015, two will address the issue of leachate
levelling of uneven walkways that out of five regional STPs have been outbreak from a nearby closed landfill
were unsafe. Pedestrians felt a sense completed while a total of 43 STPs by preventing it from flowing into the
of increased comfort level and agreed were successfully decommissioned nearby water body.
that this could lead to KL becoming a
walkable city.
The second phase of pedestrian
walkway upgrades in Kuala Lumpur
is planned to start after the completion
of KL's Pedestrian walkway Master Plan
in 2018.
SANITATION AND SOLID

WASTE MANAGEMENT
As the economic hub for the nation,
Greater KL will continue to experience
rapid urbanisation and population
growth. This phenomenally increases
public demand for basic services and
amenities, including sanitation and
solid waste management.
Under the Greater KL / KV
Sewerage Non-River programme, a total
of RM 3.3 billion has been approved to
improve the sewerage infrastructure.
This funding is to provide necessary
capital for the construction of
regional sewage treatment plants
(STPs), sewer networks and
refurbishment / upgrading of the
existing sewerage facilities.
These programmes are deemed
vital to make good and enhance A dedicated wastewater treatment plant at Jalan Kelang Lama wet market
7 There will be two STPs for Upper Kerayong

8 Population equivalent (PE) refers to the equivalent in terms of a fixed population of a varying or transient population or other activity, for example
industrial or commercial contributing to flow to the sewerage treatment system

As the economic
hub for the nation,
Greater KL will
continue to
experience rapid
urbanisation and
population growth.
This will increase
public demand
for basic services
and amenities,
including sanitation
and solid waste
Leachate holding pond, part of the Taman Beringin Leachate Treatment Plant. (Inset) Leachate sump management.
Additionally, in ensuring a Recommending options to In the pipeline, a Delivery Management
holistic approach in managing solid alleviate the Governments Office (DMO) will be set up to monitor
waste issues in the country, a lab was financial burden in ensuring and implement lab outcomes. More
held from 27 May till 17 June 2015 sustainable solid waste emphasis will be given towards the
focusing on: management and public inclusion of industry players into the
cleansing activities solid waste management framework
Improving the execution
such as the establishment of the
and implementation of The lab outcomes will be
National Food Waste Plan and a
waste management (3R, implemented nationwide and
framework for the Catchment Area
Recovery, Treatment and with a clear intent of achieving
Needs Statement (CANS), which will
Disposal) in Malaysia the national target of 40 percent
assist efforts to facilitate more private
waste diversion from landfills, as
Addressing governance sector investments in the solid waste
well as 22 percent recycling rate by
issues in relation to solid management industry.
the year 2020. Following the lab,
waste management
a Separation At Source programme
Proposing structural and to promote the separation of garbage
policy adjustments including from households was launched in
enablers that will ensure September 2015 in all states adopting
longer term viability of solid Act 672 including Kuala Lumpur,
waste management and Putrajaya, Pahang, Negeri Sembilan,
public cleansing initiatives Melaka, Johor, Kedah and Perlis.

3 Greater KL: Business and For 2015, InvestKL was successful
in attracting 10 multinational
Investment Hub of the Region corporations (MNC) to Greater KL,

meeting its set target. These MNCs will
be setting up regional headquarters,
regional centres of excellences and
Sitting in the heart of the fast- global city in Southeast Asia. Greater principal hub operations.
growing ASEAN region, with access KL is also ranked second in the With a total of 51 MNCs that have
to a 630 million population and a emerging Market Cities and fourth in set up regional offices in Greater
rapidly growing regional economy its Business Friendliness according KL since inception in 2011, 24 are
makes Greater KL a strategic business to the Financial Times (UK)s Foreign European, 16 are from the Americas
and investment hub. Its ongoing Direct Investment report 2014. and the remaining 11 are from the Asia-
transformation into a world class city Greater KL has clearly emerged as Pacific region.
provides for an even more compelling a favorite to multinational companies; Main sectors include engineering
case to market the city as a hub within with an increasingly mature support services, business services, oil and gas
the region. ecosystem, an efficient cost structure, services, global commodities trading and
large pool of high skill talent and an the supply chains of aerospace, logistics
INVESTMENTS CONTINUE ever increasing ease of doing business. and industrial products multinationals.
TO BE CHANNELED INTO THE
GREATER KL/KV REGION
According to the Economist
Intelligence Units (EIU) report, Hot
spots 2025: Benchmarking the Future
Competitiveness of Cities, Greater Kuala
Lumpur is ranked against 120 other
cities as the second most competitive

GETTING OUR TALENT top foreign talent, particularly & Retention (STAR) initiative, 1,019
STRATEGY RIGHT in areas of skill shortages and Government-funded scholars,
In order for Malaysia to maintain optimise on home-grown Malaysian including engineering, science and
its attractiveness as a regional professionals including promoting accounting students, graduating from
business and investment hub, Talent diversity and inclusion. both local and overseas universities
Corporation Malaysia (TalentCorp) has To enhance graduate such as from the UK, US, Germany and
been partnering leading companies to employability, TalentCorp continued Japan served their bond of service by
address the issue of talent availability to provide tax incentives on expenses working with private sector employers.
in key sectors driving Malaysias incurred by companies in hosting The World Bank in a June
economic growth. Towards this 17,967 undergraduates for structured 2015 report concluded that the
end, a wide-range of initiatives have internships; and co-funded training Returning Expert Programme
been introduced to enhance the programmes with the industry to (REP) has succeeded in attracting
employability of Malaysian graduates, upskill 7,153 fresh graduates to meet overseas Malaysians with the skills
engage global Malaysians to return industry requirements in 2015. Under that Malaysia needs. In 2015, 616
or contribute from abroad, facilitate the Scholarship Talent Attraction experienced Malaysian professionals
working abroad were approved for the
REP incentives. In line with the World
INVESTKL SPOTLIGHT Banks report recommendations,
TalentCorp has increasingly
Between 2011 and 2015, InvestKL square feet of office space, and generating worked with employers to connect
has attracted 51 MNCs with approved / an annual rental of RM40 million. This experienced Malaysians abroad with
committed investments totalling more than initiative is on track to reach its target of job opportunities in Malaysia.
RM5.9 billion and regional jobs totalling attracting top 100 MNCs by 2020. TalentCorp continues to enhance
more than 7,100. Out of this, RM 1.9 billion Also encouraging is increased
the ease of entry for highly skilled
of investment has been realised and more investments by MNCs who have already
than 4,700 regional jobs are on payroll. made Greater KL their regional base such expatriates, particularly in areas of skill
These investments have also generated as Schlumberger, International SOS, Service shortages in Malaysia. The Immigration
a multiplier effect in the office space rental Source and Linde as they experienced the Department and TalentCorps newly
sector with the MNCs taking up over 570,000 advantages of operating from Malaysia. opened Malaysia Expatriate Talent
Service Centre (MYXpats Centre)
achieved a 71.5 percent success rate in
2015 of processing employment passes
within its five-day client charter.
The Residence Pass-Talent (RP-T),
an initiative by TalentCorp and
the Immigration Department, was
assessed by the World Bank in 2015
to be an effective tool in retaining top
foreign talent in areas of skills gaps. In
2015, 1,113 expatriates were approved
the RP-T.
In 2015, TalentCorp also worked
closely with 20 leading employers
to adopt flexible work arrangement
as a key strategy to retain women
in the workforce and helped 256
women return to the workforce under
KL Mayor with Ambassadors the Career Comeback programme
launched last year.

MOVING FORWARD
T
aking stock of the progress project, with both Prime Ministers along the Gombak and Klang Rivers
recorded last year, 2016 is being fully committed in ensuring that flow through Kuala Lumpur will
set to be both an exciting and that the project will come to fruition. be awarded in 2016, with construction
challenging one for the Greater KL/ SPAD is spearheading this project on expected to reach an overall target of
KV NKEA, as several major projects the Malaysian end and will be the lead 20 percent within that year.
record important milestones this year in formulating the Terms of Reference With the establishment of a DMO
in realising our vision of becoming a for the Bilateral Committee to be set to monitor and ensure implementation
world class city. Even so, more needs up by end 2016. of measures to move the Solid Waste
to be done to assure momentum The river cleaning component of Management lab outcomes forward, it
amidst the backdrop of global the River of Life initiative will continue is expected that the Taman Beringin
economic headwinds. to progress. Some highlights are the pre-treatment system and upgrading
All trackwork installation works commencement of construction of of the Leachate Treatment System will
for the Sungai Buloh Kajang MRT the Jinjang-Kepong Regional Sewage be completed. This would prevent
Line will be completed, and the first Treatment Plant in 2016. 11 percent leachate outbreak into nearby water
phase of the MRT Line 1 (Sungai Buloh of construction is expected to be bodies and prevent the foul smell of
Semantan), will be operational by completed in the same year. The leachate from affecting the residents
end 2016. construction of the Bunus Regional living close to the landfill.
For the High Speed Rail, project Sewage Treatment Plant that is Overall, the Government is
structure discussions are still currently progressing ahead of confident that with initiatives yielding
ongoing. Both governments are schedule will be 60 percent completed delivery being implemented according
still in the process of negotiating a by end of 2016. to plan, Greater KL/KV is well on track
bilateral agreement to govern the The remaining seven beautification towards achieving its world-class city
construction and operations of the work packages for the 10.7km stretch aspirations by 2020, if not sooner.

Marcus Karakashian Dato Haji Haris

Project Director, Fadzilah Hassan
MRT Sungai Buloh-Kajang Line, Commercial and Land
MRT Corp Management Director,
MRT Corp
ALL SET TO GO
completed according to schedule, and
the reasons for this include its efficient
working relationship with the Project
Delivery Partner (PDP) MMC-Gamuda
First Phase of MRT Line 1 on

KVMRT Sdn Bhd, both extensive
and consistent engagement with
its stakeholders as well as the strict
schedule for commencement governance system executed by the
MRT Executive Committee, chaired by
of service end 2016 the Chief Secretary to the Government,

Tan Sri Dr Ali Hamsa.
W
MMC-Gamuda is entrusted to
hen the first phase of the predictability with trains arriving every ensure the delivery is on time and
Klang Valley MRT Sungai 3.5 minutes during peak hours people within cost, failing which a penalty will
Buloh Kajang (SBK) to plan their travels more effectively. be imposed. Hence, it is in the PDPs
line begins operation at the end of According to Mass Rapid interest to push for timely delivery
2016, residents of Klang Valley who Transit Corporation Sdn Bhd (MRT within cost.
are constantly at the mercy of traffic Corp)s Project Director for the MRT The MRT Exco, which comprises
jams can expect a game-changing Sungai Buloh-Kajang Line Marcus representatives from ministries,
transportation experience in the Greater Karakashian, this efficient train system government agencies including
Kuala Lumpur/Klang Valley area. will be supported by a regular feeder State Governments is a platform
The public can look forward to a bus service that plies residential and where all inter-agency issues are
clean, modern, fast and comfortable commercial areas, providing first to last discussed. Since it is chaired by the
transportation system that allows them mile connectivity to commuters. Chief Secretary to the Government
to travel from Sungai Buloh to Kajang The Klang Valley MRT is one of the of Malaysia, Tan Sri Dr Ali Hamsa
in 88 minutes. Also, the luxury of very few mega projects that is being and represented by senior officials,

most issues are resolved quickly, wanted us to reduce the noise during According to MRTs Commercial
Karakashian said, adding that the welding works as she had a wedding and Land Management Director, Dato
mandate from the top to support function at home that day, and we did Haji Haris Fadzilah Hassan, many are
the project has also helped expedite it. In cases where we had the right to beginning to see the bounty that MRT
project delivery. acquire the land, the company instead brings including the increase in real
Stakeholder engagement, an opted for a mutual agreement to estate value, new businesses and
initiative that has been a priority since develop the land." development projects.
the beginning of the project in 2011, is He added that with the help We have witnessed the economic
another reason why the MRT project, of the PDP, contractors are held to rejuvenation of a number of areas
which had faced quite a bit of public high standards. They are expected like Balakong, Sungai Buloh, Sungai
opposition in the beginning, managed to respond to complaints within 48 Buloh's Kampung Selamat, which
to garner considerable support. hours and with these complaints are attracting the new investments
According to Karakashian, MRT being copied to the senior management via development projects and new
Corps philosophy is anchored on from MRT Corp, compliance was not businesses, he said, adding that
the fact that MRT work should not an issue. though the project is within Klang
inconvenience others and there The extensive stakeholder Valley, the multiplier effects extends
was a need for a strong stakeholder engagement efforts as well as the beyond city boundaries.
engagement team. The team constantly complaint and response mechanism
meets residents and residents has to a large extent helped MRT
associations to build relations Corp win over its detractors. In the
by creating awareness, seeking beginning, we had strong opposition
compromises and finding solutions. from many who refused to have the
We take into account all MRT lines in their neighbourhood
complaints and whenever possible we and now we have lots more people
accommodate requests by residents. wanting the MRT near their homes,
For example, we had an individual who Karakashian said.

Doreen Ho
Manager Planning
and Design,
MRT Corp
ENGINEER RETURNS
into a vibrant and liveable water front
with high economic value, which also
contributes to elevating Kuala Lumpur
HOME TO SUPPORT
into one of the top liveable cities in the
world, like Melbourne and Singapore,
by the year 2020.
NATIONAL It was also a project which

initially drew quite a bit of scepticism
TRANSFORMATION
and negativity; to some the idea of
turning what they thought was a
huge monsoon drain into something
beautiful was incredulous.
A
She, however, pointed out that
fter more than 10 years of the River of Life Project, said Doreen, as the project progressed, people
living and working as an who started working with US-based began to see the big picture, that it
engineer in Auckland, Kuala consultancy firm AECOM as a Senior was indeed possible to transform
Lumpur-born Doreen Ho decided that Engineer in 2012. the once forgotten river into a space
it was time to head back to Asia where AECOM was the consultancy worthy of celebration.
the tempo was picking up in terms of engaged to spearhead the RM1 billion The engineering graduate
infrastructure development. River Beautification project and who worked in two international
I came to know about a job transformation of 10.7km of the Klang consultancies in Auckland and
opportunity in Kuala Lumpur via and Gombak Rivers. came back home under TalentCorps
a friend and applied for it. After a I was even more excited to Returning Expert Programme, found
telephone interview, I was offered a discover that the River of Life project the transition from working life in New
position in an international consultancy, was part of the Greater KL/KV put in Zealand to Malaysia much harder than
which I later found out was working on place to transform the Klang River she had anticipated.

I would say that the first six River of Life works to beautify and MRT development is currently the
months were really tough - having reactivate the Heritage Quarter of country's largest infrastructure project
to adjust with a new working culture Kuala Lumpur, whilst conserving the and the biggest work package tendered
and lifestyle, whilst being a part of heritage values of the area. "It was a out for Line 2 is for the underground
a high profile project with a short challenging project as being in the portion. The excitement of delivering
delivery deadline. oldest part of the city, we were working an MRT project that is going to further
"I may have been born here but with numerous stakeholders and improve the traffic congestion of Kuala
being away for years and with the public landowners on land matters and Lumpur keeps the team on our toes in
big changes that had taken place in utility providers on managing works achieving this EPP project.
Kuala Lumpur, it was no longer the around a web of old and unknown Doreen takes great pride in the
place I once related to. Hence, for underground utilities and drainage work she is doing to support national
me the transition was not a smooth systems. Additionally, the projects transformation and has no regrets
ride. However, it was good to have KPI also included raising the bar of coming back to Malaysia for it was a
support in the form of friends and current standards to produce a high move that provided her opportunities
work colleagues who had similar quality design and specifications in an to work on large scale projects
experiences of returning home to industry that is only currently catching of great impact.
work. A word of advice to all returning up with international standards.
Malaysians is that you have to set a After three and a half years
realistic expectation about what at AECOM, Doreen took up a new
youre going to be walking back into, challenge at Mass Rapid Transit
before moving home." Corporation Sdn. Bhd. (MRT Corp).
Doreen was part of the pioneering She is presently Manager of Planning
team in AECOM for the River of Life and Design (Civil and Structural) for
project and was involved in the the Line 2 underground team.
beautification work in Precinct 7, the As our CEO mentioned in the New
first of eleven Precincts of the overall Straits Times on 23 February 2016, the

RIVER OF
LIFE PUBLIC
OUTREACH
PROGRAMME
(ROL-POP)
A
s part of the key initiatives for POP programme is heavily geared participation so they can have a better
Entry Point Project 5 (EPP5) towards the active participation of the understanding of the programme and
River of Life, the River of local communities. its aims. Via indirect methods, there
Life Public Outreach Programme As a civil science programme, at is media coverage to allow for a wider
(ROL-POP) aims to address river water the initial stage, it consists of creating audience to be reached.
pollution through non-structural awareness. At the implementation stage, The second stream, training and
measures by educating the public on it focuses on imparting knowledge and workshops is carried at different
the need to collectively care for the river skills to the community. Finally, the community levels to enhance their
and its water quality. The initiative also actions of the community are driven skills and knowledge in managing
promotes a sense of ownership towards in line with basin community needs. river water quality.
the river, and creates a long-term and The ROL-POP achieves its objective The third stream maintains
sustainable behavioural change in the via three streams. The ROL-POP momentum for on-going
public towards preserving the rivers. campaign and talks which make programmes and activities to sustain
The Department of Irrigation and up the first stream, brings the local stakeholder commitment via ROL
Drainage (DID) initiated this project community closer through direct outreach programmes.
with the involvement of 26 government
agencies and departments across
four Ministries, two states and three
municipalities which are the Ministry
of Federal Territories, Ministry of
Natural Resources and Environment
(MoNRE), Ministry of Urban Well-being,
Housing and Local Government (KPKT)
followed by the states of Selangor and
the Federal Territory of Kuala Lumpur
and finally, the municipalities Dewan
Bandaraya Kuala Lumpur (DBKL),
Majlis Perbandaran Selayang (MPS)
and Majlis Perbandaran Ampang
Jaya (MPAJ). Despite this, the ROL-

Dr K Kalithasan
RIVER Care
Programme Coordinator,
Global Environment Centre
CONNECTING PEOPLE TO THE RIVER OF LIFE

Working hand in hand with DID on one of the ROL-POP initiatives
is Dr K Kalithasan, coordinator of the RIVER Care Programme for the
Global Environment Centre (GEC) who affirms that river rehabilitation
will not work if the human factor is not addressed effectively.
"People are both the source of the problem as well as the solution,
and unless there is a change in mind set and behaviour, a permanent
solution remains elusive."
Dr. Kali asserts that the first move in mobilising people to care for
the river is to reconnect people with the river and make them realise
that they are both part of the river basin and the beneficiaries of the
river, especially those who are living within its immediate vicinity.
Once they are connected to the river, ownership and responsibility
come naturally. This bottom-up or/and heart approach (soft approach)
works more effectively in changing behaviours and mind-sets than the
hard approach or/and top-down instructions to take care of the river.
In 20 years of doing outreach programmes, our greatest All photos courtesy of Dr K Kalithasan and the Global Environment Centre
achievement is the shift in the way people looked at river and river
basin and re-connect, which I term as adopting the right picture of
the river and river basin.
Via ROL-POP, he shares that communities have started adopting
People are both the source
river reserves and monitoring water quality. Some have transformed
river reserves into vegetable and herb gardens as seen in AU2 with the
of the problem as well as
support of the Department of Irrigation and Drainage (DID) Malaysia,
and community river centres in the Melawati Area and Taman AU3
the solution and unless
community are planning to set up parks.
Overall, the ROL-POP shows that public participation is vital and
there is a change in mindset
should be the key element in future efforts for sustainable river basin
management in Malaysia, he says.
and behaviour, a permanent
solution remains elusive.

Oil, Gas & Energy
ACCELERATING DATUK SERI PANGLIMA

DR. MAXIMUS ONGKILI
INDUSTRY
MINISTER OF ENERGY, GREEN TECHNOLOGY AND WATER
RESILIENCE
The Oil, Gas & Energy (OGE)
National Key Economic Area
(NKEA) is designed to be robust
over various business cycles. The
current low oil price scenario
creates an opportunity for industry
rebalancing and evolution to
ensure best possible returns on
capital invested, as opposed to
merely surviving the downturn.
With oil majors adjusting to
this new normal and a shrinking
pie in terms of work within
the industry, competition has
naturally intensified.
Thus, Malaysian Oil & Gas
Services and Equipment (OGSE)
companies must consider exploring
consolidation opportunities within
the fraternity to increase their
competitiveness and place the
industry in good stead when the
global oil market recovers.
I believe that local OGSE
companies must increase their
competitive advantage by
investing and working to become
owners of technologies, rather
than agents of technologies.
Photo courtesy of UMW Oil & Gas Corp Bhd

...the industry
and the players are
better positioned to face
uncertainties, having
In the energy sector, the
Government continues to introduce built competency and
policies geared towards ensuring
energy security, efficiency and capacity over the years.
accessibility whilst encouraging
the use of cleaner energy sources.
However, the current low oil and
M
coal price might be a challenge to alaysias push towards
these efforts. high income status by 2020 INSIDE THIS NKEA
Nonetheless, in our efforts to continues to place the Oil,
mitigate climate change and global Gas and Energy (OGE) sectors in critical 1 Maintaining the Sustainability
of Domestic O&G Production
light to propel the economy forward.
warming, we must continue to
As a net energy producer, the Oil
decarbonise our economic growth
by shifting away from conventional
& Gas (O&G) industry has consistently
contributed about one third of
2 Malaysia: Asian Hub
for Oilfield Services
fossil fuel and increasing our use Government revenue. Although the
of renewable resources. Government continues to reduce its
income dependence on this sector 3 Oil Price Contango
Spurs Storage Demand
by developing other economic
areas, world class competency and
capabilities developed over the 4 The Road to
Energy-Efficiency
years through national oil company
Petroliam Nasional Bhd (PETRONAS)
should not be dismissed. There
remains much value to be gained in
maintaining competitive advantage as For upstream ventures, this is a
we forge ahead. time for correction. With oil prices
In 2015, OGE sectors contributed predicted to drop to a record low in 2016
17 percent to the countrys Gross on the back of a global supply glut,
Domestic Product (GDP). Revenue now is a time for deep introspection
contribution to Government was at 21.5 and action to set right excesses and
percent (MOF Budget Estimate-2015). prepare for the upcycle once it occurs.

Oil, Gas & Energy
It is also important that we diversify An equally encouraging started to introduce the Euro 5 diesel
Malaysias energy mix to mitigate development in the energy policy in selected stations in the Klang Valley
dependence on non-renewables space has been the adoption of the as well as in Southern Johor.
such as oil and gas, and coal among fuel standard in the form of Euro 4M Fuelled by the need to ensure
others. The Governments move to RON97 nationwide in September. This relevance of the OGE sectors against
implement Net Energy Metering and kick-starts a series of game-changing the backdrop of shifting industry
Large Scale Solar as announced in reforms in fuel-standards to reduce the dynamics, we highlight below the key
2015 this year, will be good catalysts in negative impact of low standard fuel areas where OGE NKEAs efforts were
encouraging the take-up of renewables on the environment. Seeding from this directed in 2015.
in the country. development, oil companies had also
1 Maintaining the Sustainability

of Domestic O&G Production
Continuous volatility in crude
oil price impacted the industry in
different forms and led to changes in
the landscape in many ways. As part
of good business and commercial
practice, PETRONAS and other
International Oil Companies (IOCs)
operating in Malaysia increased
scrutiny on their projects and
staffing levels.
It appears that the era of easy oil
is now over. With dipping oil prices,
some O&G projects ceased to be
lucrative, or even commercially viable.
Higher technologies and investments
are required to extract oil from less-
than-favourable field conditions.
The prolonged low oil price
environment inevitably caused some
projects to be shelved while those that
do go through are expected to rake in
lower margins.
In anticipation, oil majors in and
outside Malaysia have announced
various measures to trim their capital
expenditure and jobs.

2015 IN REFLECTION: landscape namely Bank Negara and technology development in
Malaysia, RHB Bank, SME Bank the following areas: Subsurface
MPRC, along with Malaysia
and Societe Generale, among Technology (UM), Marine
External Trade Development
others to explore financing Systems (UTM), and Topside
Corp (MATRADE), intensified
for the OGSE firms as well Process Engineering (UTP).
efforts to bridge business
as to raise awareness on the
opportunities in key ASEAN Moving forward, as the pie in this
OGSE landscape in Malaysia
markets in the run up to the industry shrinks and domestic jobs
ASEAN Economic Community As part of the technology plateau, domestic competition will
(AEC) which took effect at end- development agenda for local intensify. Malaysian OGSE companies
2015. A total of 33 Malaysian OGSE companies in the 11th should start exploring opportunities
OGSE companies were led on Malaysia Plan, MPRC has to enhance competitiveness and
three Specialised Marketing entered three memorandums of prepare for the next upcycle upon
Missions (SMMs) to Indonesia, understanding with Universiti recovery.
Myanmar and Vietnam Malaya, Universiti Teknologi The current changing landscape
Malaysia and Universiti Teknologi and challenges have the potential to
MPRC also actively assisted
Petronas. These collaborations act as a catalyst for OGSE companies
MATRADE on five other
pave the way to the to explore opportunities for
SMMs to Azerbaijan and
establishment of three research consolidation within the fraternity
Kazakhstan, Kuwait, Brazil,
and development clusters to form and step up on investing and
Abu Dhabi, and Saudi Arabia
industry-academia partnerships working towards becoming owners
MPRC hosted its second Oil & of technologies, rather than merely
that will support the growth
Gas Financial Forum (OGFF) agents of technologies, to increase
of Malaysian technologies
in June 2015 to improve local their competitive advantage.
and talents in OGSE sector
OGSE firms access to funds. Current trends focus on three
The OGFF connected oil and gas The three clusters, also known technology clusters namely
services and equipment (OGSE) as Oil & Gas Innovation and subsurface, marine and topside. Apart
companies with key players in Technology Clusters (OGITeC) from these are system integration and
Malaysias financial services will be advancing innovations challenges in extending the life of
existing assets which cut across all
three clusters. These areas provide
high technical content and high value
added work, skills and competence.
Nudging local players to become
competent in these areas will also
bode well in shaping Malaysia to
become a regional O&G hub capable
of meeting the needs of investors.
There are many existing facilities
Dato Sri Idris Jala delivering a to encourage technology development.
keynote address at MPRC Oil & MPRC advocates and facilitates
Gas Financial Forum 2015 (OGFF
2015). The OGFF convened increased participation in oil and gas
influential leaders from the technology development between
financial and O&G sectors for a
day of networking and exciting Government agencies and industry
conversation on trends and players and will continue to work with
development in the Oil and
Gas Services and Equipment PETRONAS to identify incentives to
(OGSE) industry, and financing
encourage consolidation among OGSE
strategies for OGSE companies
in the current market downturn companies in the market.

Oil, Gas & Energy
2 Malaysia: Asian Hub for Oilfield Services There was increased interest
among MNCs in 2015 to set up a
regional base in Malaysia. These
included companies like engineering
Since 2011, Malaysia has set out To address this, MPRC, along procurement firm McDermott, oil
on a journey to become the hub for with relevant Government agencies, services firm Hilong Holdings and
Oil and Gas Services and Equipment have been toiling to ensure the O&G exploration and production
(OGSE) activities. implementation of initiatives that will (E&P) training firm Harness Energy.
With our extensive experience in help local OGSE companies compete These investors are primarily
the O&G market compared with other and survive in this tough environment. guided by long-term considerations
countries in Asia-Pacific, we are well- MPRC actively promotes the on the global O&G landscape.
placed to achieve this vision. development of O&G focused training Establishing a base at the heart of
However, in order for Malaysia to and development centres within the the worlds fastest growing economic
become a thriving hub, OGSE firms in country. Internationally recognised region Asia, will put them in a well-
Malaysia need to be more competitive. institutions such as Aberdeen Drilling positioned spot to take advantage
OGSE firms in Malaysia are also School, UMW-INSTEP Drilling Academy, of the future rebound in oil prices
now competing in a smaller and Harness Energy, The Welding Institute and resulting OGSE activities. It is
more challenging market due to low and OPITO BOSIET Training centres necessary for Malaysia to develop the
oil prices and market liberalisation. have been established in Malaysia. right environment for this to thrive.
(Top) MPRC team at the Aberdeen Drillings Malaysian Well Control Training Centre launch. (Bottom ) MPRC team with key players at the grand opening
of the new Hi-Force Malaysia premise on 29 October 2015

3 Oil Price Contango facilities in Malaysia. The committed
capacity for both oil and LNG
Spurs Storage Demand reached 1.25 million cubic metres,

far exceeding the 2015 target of 0.83
million cubic metres. Dialog Group
Bhd, the lead joint venture partner
In 2015, the glut in oil supply purchase oil today and sell futures at in the Pengerang Independent
pushed oil prices into a contango, a higher price. Deepwater Petroleum Terminal
where front-month contracts were In turn, the contango spurred (PIDPT), also saw a surge in demand
at a discount to longer-dated futures storage demand globally. Similar for storage. Total planned storage
contracts. The wide price discount trends were seen at the oil and capacity at PIDPT is for five million
enabled customers and traders to liquefied natural gas (LNG) storage cubic metres by 2020.
4 The Road to Energy-Efficiency

RENEWABLE ENERGY
To diversify and increase the
nations Renewable Energy (RE)
INCREASING SHARE OF RENEWABLES IN THE
capacity, the Government aims to ENERGY MIX
implement Net Energy Metering (NEM)
and Large Scale Solar (LSS). The Government has announced
Additional initiatives will be plans to implement Net Energy
implemented to complement existing Metering (NEM) and Large Scale
Solar (LSS) in Malaysia.
initiatives, such as the Feed-In
The Sustainable Energy
Tariff (FiT) mechanism, to improve Development Authority Malaysia
utilisation of indigenous RE resources. (SEDA Malaysia) working in
The goal of these initiatives is to ensure collaboration with various agencies
national electricity supply security including KeTTHA, the Energy
Commission (ST) and power utilities
and sustainable socio-economic
such as Tenaga Nasional Bhd (TNB) and Sabah Electricity Sdn Bhd (SESB) as
development. well as, the photovoltaic (PV) industry are presently developing frameworks to
Malaysias FiT mechanism, facilitate the implementation of these initiatives.
introduced in 2011, has to date resulted NEM allows electricity generated from solar PV systems to be consumed in
approximately 350MW additional situ (self-consumption) thus reducing the purchase of electricity from the grid.
installed RE capacity connected to In Malaysia, where peak electricity demand coincides with the electricity
generated by solar PV systems, the widespread deployment of net energy metering
the grid, falling below the original
for residential and commercial buildings will help utilities to reduce generating
target of 985MW by 2015. The lag peak electricity which is expensive.
is brought about by the inability to Additionally, the LSS will also provide a formidable alternative for power
kick-off non-PV resources due to generation. Traditionally confined to smaller capacities, the trend of LSS continue
issues concerning feedstock, grid- to gain traction.
Over the long term, introducing more renewables into the energy mix is
connection, permitting and finance.
expected to reduce reliance on imported fuels and boost energy security in the
Although PV is by far the most easily country. Additionally, given that these are clean energy generators, the NEM and
executable mechanism, further quota LSS will also bode well in mitigating climate change concerns.
expansion is impeded by high FiT rates
for PV which would be likely to drain
the RE Fund.

Oil, Gas & Energy
On target, the Euro 4M

RON97 standard was successfully
implemented in September 2015 by
all oil companies in Malaysia.
Preparations to implement the
Euro4M RON95 has started, with key
stakeholders such as the Economic
Planning Unit (EPU), Ministry of
Finance (MOF), Ministry of Natural
Resources and Environment (NRE),
and Ministry of Domestic Trade,
Co-operatives and Consumerism
(KPDNKK) looking at different
areas of readiness such as standards
and pricing.
On 1 December 2015, the NRE
approved and gazetted the new Euro
5 fuel standards in the Environmental
Quality (Control of Petrol and Diesel
Properties) (Amendment) Regulations
Kumpulan Melaka Berhad's 5 Mw solar farm 2015 to be implemented in Malaysia.
With the regulation now in place, oil
Funding source for the FiT is limited Adoption of these global standards companies are obliged to supply fuel in
to the surcharge imposed on the bills will ensure that fuel sold in Malaysia the Malaysian market by using standards
of electricity end-users, currently at contain lower benzene and sulphur imposed by NRE as a guideline, moving
1.6 percent. The quota cap is essential in short, greener fuel producing towards the implementation of Euro 5
to ensure adequate RE Funds for FiT less emissions and pollutants into fuel standards starting with Diesel
payments to RE generators. the environment. in September 2020, as scheduled.
The introduction of both NEM
and LSS will help improve the overall
contribution of RE to the energy industry
moving forward. The Ministry of Energy,
Green Technology and Water (KeTTHA)
had announced the implementation of
NEM and LSS in 2015.
HIGHER FUEL STANDARDS

In 2014, the Government
announced the roadmap for the
implementation of higher retail
fuel standards nationwide the
Euro 4M RON97 is to be introduced
in September 2015, Euro 4M RON95
in October 2018, Euro 5 Diesel in
September 2020, and Euro 5 RON95
and RON97 in September 2025.

MOVING FORWARD
L
ooking ahead, it is clear that Amidst various challenges, in stronger foundations for the countrys
2016 will be one marked 2016, the Government, in partnership energy security fostering greater
with challenges for the O&G with the private sector must ensure economic security, prosperity and
industry, with a slower progress in the Malaysias energy infrastructure well-being.
upstream sector. And yet, this industry remains robust. At the COP 15 in Copenhagen,
is no stranger to trying conditions, Efforts to diversify the countrys our Prime Minister announced that
having gone through a similar cycle sources of energy and the move Malaysia would voluntarily reduce its
when oil prices went down below USD10 towards a market-based pricing greenhouse gas emissions intensity
per barrel back in 1998. The difference for energy continues to shape the of Gross Domestic Product (GDP) by
this time around is that the industry and agenda of what we want to achieve up to 40 percent based on 2005 levels,
the players are better positioned to face in this space. by 2020, conditional on technology
uncertainties, having built competency The Government will be focusing transfer and financial assistance by
and capacity over the years. on getting the necessary framework developed countries. Energy efficiency
As an upside, the current situation in place for Third Party Access (TPA) and green technology will also be focus
creates a stronger impetus for O&G as well as pushing for rationalisation areas for 2016.
players to take measures that will and subsequently deregulation of gas
inevitably strengthen their operations prices. TPA will pave the way for the
and help them create resilience liberalisation of the gas market in
against volatilities and unexpected Peninsular Malaysia. The advent of
industry developments. We must market liberalisation will facilitate
remember never to downplay the the entry of new industry players,
breadth and experiences of our local encourage more efficient utilisation,
firms and leverage on all these to and benefit consumers by enabling
create competitive differentiation competitive gas pricing. At the same
in the industry. time the TPA will contribute towards

Oil, Gas & Energy
PROMOTING T
here are currently 3,613
local Oil and Gas Services
and Equipment (OGSE)
INFORMATION
companies operating in Malaysia
registered with state oil company
PETRONAS. Thus, when the Malaysian
TRANSPARENCY
Petroleum Resources Corporation
(MPRC) introduced the MPRC100
in June last year, the report was
THROUGH MPRC100 TO
very much welcomed by investors,
bankers and industry players alike,
says MPRC's executive director Dr
SPUR OGSE INDUSTRY

Shahreen Madros.
The MPRC100 is a list of the
Top 100 Oil and Gas Services and
DEVELOPMENT
Equipment (OGSE) companies in
Malaysia ranked based on their
revenue. It maps industry segments
where the MPRC100 companies are
operating in, and provides industry
commentary featuring an aggregated
view of the OGSE industry in Malaysia,
and supplemental analysis.

Syed Azlan Syed Ibrahim Ir Dr Shahreen Madros
Senior Vice President, Executive Director, MPRC
Industry and Market Enabler, MPRC
Madros adds that the report was companies abroad, and industry MPRC recognises the need for
produced in line with MPRCs stance players in their strategic alliance. more thought leadership documents
to promote information transparency In preparing the report, he explains to help the industry grow and achieve
as part of its mandate to develop that MPRC started with the database of as well as maintain its position as a
and promote Malaysias O&G companies registered with PETRONAS regional OGSE hub and foresees
services industry. and procured financial information publishing more such documents in
We see information transparency (based on audited accounts) from the the near future.
as a market enabler and believe Registrar of Companies (ROC). The 2012
in maintaining a very transparent and 2013 data were published in the
and systematic process so that all first half of 2015 and with 2014 data
information can be verified. published in January 2016. We see information
Having such information and Other than the MPRC100, MPRC
value-added analysis neatly packaged published two other documents - transparency as a
is undeniably useful to many Malaysia OGSE Catalogue (the 2016
stakeholders, given that information edition features 154 companies) and
market enabler and
on non-listed companies can be Malaysia Oil and Gas R&D Catalogue. believe in maintaining
notoriously hard to uncover, he says. Essentially, through these reports,
MPRC100 has proven to be useful to the agency aims to generate more a very transparent and
investors in identifying the industrys interest, analysis and discussions
potential and risks of the companies to build capacity and further uplift
systematic process
featured, bankers in gauging how the Malaysia's OGSE sector, in line with so that all information
industry is performing overall, trade the Governments goal to see Malaysia
agencies in promoting Malaysian become the OGSE hub of Asia Pacific. can be verified.

Financial Services
ROBUST DATO SERI AHMAD HUSNI

MOHAMAD HANADZLAH
FINANCIAL
MINISTER OF FINANCE II
SERVICES
The global economy faced
numerous challenges in 2015.
Among the main challenges were
CRITICAL FOR
uncertainties from the impending
monetary policy normalisation
in the United States, the ripple
GROWTH
effects of Chinas economic
rebalancing, sharp and prolonged
decline in commodity prices
and shaky investor confidence
owing to an uncertain domestic
political climate.
Despite the challenges, I am
pleased to report that the Financial
Services National Key Economic
Area (NKEA)s KPIs for the year
have been met, thanks to the
collective efforts across the various
agencies involved.
With the ASEAN Economic
Community (AEC) gaining headway
in facilitating trade between
member nations, the ASEAN
banking integration framework
was concluded and announced by
the region's Central Bankers and
Finance Ministers in 2015. This
brings us closer towards realising
the goal of becoming a formidable
economic block trading with the
rest of the world once the AEC picks
up full momentum.

Funding remains a significant
challenge holding smaller
businesses back from realising
Moving into 2016, the
their full growth potential. As
part of efforts to offer alternative
focus of the Financial Services
sources of funding for small
businesses and entrepreneurs,
NKEA will be to further enhance
Securities Commission Malaysia the resilience of our financial
launched the Equity Crowdfunding
(MyECF) framework in 2015 and systems, domestic economy and
eventually approved six equity
crowdfunding operators out of ensuring continuous sustainability
27 applications for the year.
In improving and strengthening
of financial services industry.
the Islamic financial market, several
Islamic Finance industry players
2
jointly established the Investment
Account Platform (IAP) which was 015 was a daunting year for
launched in February 2016. IAP is the global financial industry INSIDE THIS NKEA
a centralised multi-bank platform and Malaysia was not spared.
that aims to facilitate investors Bracing against a series of external 1 Islamic Finance Remains
on Solid Footing
investing in viable ventures or and internal challenges, our countrys
macroeconomic management in 2015
projects including SMEs.
With oil prices hitting record
focused on strengthening the resilience
of the economy, managing the impact of
2 Strengthening Development
Financial Institutions
lows in January and prompting external vulnerabilities and safeguarding
the Prime Minister to announce a the well-being of the rakyat.
Budget Recalibration to adjust, it is The shifting dynamics of global 3 Creating Sustainable Funding
Platforms to Support Growth
to be expected that some sectors will economic conditions have given rise to
be affected, creating a ripple effect increased uncertainty for economies,
4
particularly in two aspects - growth The Private Retirement Scheme
on the financial services sector.
and financial stability. (PRS) as a Wealth Creation Platform
Nevertheless, with the sound Gains Encouraging Traction
Given that the Malaysian economy
fundamentals put in place by the and financial system are highly open,
Government to strengthen the
resilience of our economy and
uncertainties from the impending
monetary policy normalisation
5 Supporting Regional Economic
Integration Through the ASEAN
Banking Integration Framework
banking system over the last few in the United States, faster than
expected slowdown in some emerging
years, I am confident we will face
economies, sharp and prolonged
these challenges from a position
decline in commodity prices, as well
of strength and continue to put in as increasing volatility in financial
place safeguards that can take us markets were the main near-term
through these challenging times. downside risks.

Financial Services
Some emerging economies expectations of an interest rate hike. 2015, foreign funds have pulled a net
including Malaysia experienced slower This led to significant portfolio outflows 11.7 billion ringgit (USD3 billion) of the
growth as advanced economies began from emerging and regional financial nations shares.
recovery. This is in addition to the markets, impacting the performance In spite of heightened volatility in
global oil supply glut coupled with the of regional bourses including Bursa global financial markets, the domestic
overall weakening of global demand Malaysia. financial system remains resilient and
that took its toll on commodity prices. Internally, the economy was tested continues to have ample liquidity to
During the first eight months of by a barrage of negative investor support real sector activities. The
2015, regional currencies including sentiments primarily caused by tensions banking system remains sound
the ringgit had depreciated by 16.5 in Malaysian politics prompting an and well capitalized with the key
percent as the US dollar strengthened exit of hot-funds investors reacting capital ratios well above the required
on improving economic activities and to short-term concerns. As of August regulatory minimum levels.
1 Islamic Finance Remains on Solid Footing

Malaysia has remained a key
marketplace for global sukuk issuance
with 52.6 percent market share (USD34.8
billion issued by Malaysia out of total
USD66.1 billion). Malaysia's market
share of global sukuk outstanding
stood at 54.3 percent (USD174.41
billion out of total USD321.15 billion).
With its fourth issuance of a US dollar
denominated sovereign global sukuk
amounting to USD1.5 billion in April
2015, Malaysia reinforced its position
as a global leader.
Established expertise in the
sukuk market offers opportunities
for domestic financial players and
professional service firms to profile
and enhance their global capabilities
in providing Islamic financial advisory
and services at the international level.
Leveraging its role as the lead issuer in
sukuk, Malaysia remains well placed to Bursa Malaysia won Best Islamic Exchange 2015 for Bursa Suq Al-Sila performance at The Global
make further strides in Islamic Finance. Islamic Finance Awards in Bahrain

2 Strengthening Development Financial Institutions
Amendments to the Development As of 31 December 2015 the following achievements were recorded by the six
Financial Institutions Act 2002 (DFIA), DFIs under BNM's purview:
aimed at enhancing the regulatory
and supervisory framework for the Of the total financing outstanding above, lending to businesses
prescribed Development Financial accounted for 41 percent or RM55.74 million of which 26.6 percent
Institutions (DFIs) was successfully or RM14.8 million were given to approximately 93,000 SMEs, with
completed in 2015. almost 80 percent benefitting 80 percent micro entrepreneurs
The review was essential to ensure
that DFIs will be well positioned and
able to withstand challenges given
the changing financial and operating
environment, with focus to further
enhance capacity and capability
in providing continued financial
services to strategic economic sectors. Overall financing outstanding stood at The total deposits amounted
The review not only focused on RM135.58 million to RM117.25 million
comprehensiveness of the regulatory (representing 2.73 million accounts)
and supervisory framework but also the
distinctive and unique characteristics
and mandated roles of each DFI.
The draft Bill was tabled and As of 31 December 2015, three DFIs (namely Bank Simpanan, Agrobank and
approved by Dewan Rakyat and Dewan Bank Rakyat) offer agent banking services and recorded the following outcomes
Negara on 17 June 2015 and 1 July 2015, since the introduction of the services in 2012:
respectively. The smooth progression
of the amended Act was attributed to
the strong support and commitment The current total of
given by all key stakeholders and
backbenchers of the Parliament during
6,452
the engagement sessions held. This DFI Agents
includes supportive feedback during make up 93.5
public consultation with various levels percent of total agents
of key stakeholders in finalising the
draft Bill.
Transaction volume:
62 million or 98.7 percent of total
transactions conducted via agents
RM4.55 million or 79 percent of
total agent banking transactions
(RM5.7 million)

Financial Services
3 Creating Sustainable Funding operators board of directors to be fit and

proper and have the ability to operate
Platforms to Support Growth an orderly, fair and transparent market.

The Guidelines on the Regulation of
Market has since been superceded
with the release of Guidelines on
Malaysian businesses are the cogs LAUNCH OF THE EQUITY Recognised Markets Operator issued
that keep the wheels of the economy CROWDFUNDING PLATFORM BY on 11 December 2015 and effective
well-oiled and turning. When the SECURITIES COMMISSION MALAYSIA 15 December 2015 to operationalise
economy is in turmoil, depending on Following the development of their platforms by the first
the assets and reserves accumulated a conceptual regulatory framework quarter of 2016.
many businesses get cut at the knees for Equity Crowdfunding (ECF) and Consequently, on 10 April 2015,
and struggle to survive. the issuance of a public consultation SC invited prospective operators
Amid current challenging paper in 2014, Securities Commission interested in establishing and
economic scenarios, the Government Malaysia (SC) had on 10 February 2015 operating ECF platforms to submit
is committed to ensure that businesses published Guidelines on Regulation of their application by 11 May 2015. A total
with sound plans have continued Markets under Section 34 of the Capital of 27 applications were received. On 11
access to funding options so they are Markets and Services Act 2007 (CMSA) June 2015, SC announced and granted
able to pursue growth. to introduce requirements for the six equity crowdfunding platform
A centralised multi-bank platform registration of ECF platform operators operators Recognised Market Operator
has been established to operate IAP and and the governance arrangements for (RMO) status to operationalise their
and was launched on 17 February 2016. such operators, including requiring the platforms by the first quarter 2016.

INTRODUCING ALTERNATIVE FUNDING PLATFORMS TO SUPPORT
ENTREPRENEURSHIP AND GROWTH OF MALAYSIAN BUSINESSES
SC Chairman Dato' Seri Ranjit Ajit Singh (third from left) with the six ECF operators
Malaysia became the first ASEAN country to legislate Equity FinTech in the country.
Crowdfunding (ECF) when the Capital Market and Services Act With the aFINity@SC, the regulator seeks to drive a network
2007 legislative amendments to facilitate ECF came into force on of FinTech stakeholders to accelerate growth and innovation in this
15 September 2015. industry. In September 2015, the SC released a call for participation
Two ECF platforms have officially launched to date: CrowdPlus. to generate response and expressions of interest from relevant
Asia platform was launched by Propellar Crowd+ on 13 November stakeholders, including innovators, entrepreneurs, established
2015 and Crowdo was launched on 11 January 2016. businesses, investors and other authorities to chart the FinTech
Besides ECF, Securities Commission Malaysia (SC) is keen to agenda together for Malaysia.
facilitate development of Financial technology (FinTech) within the aFINity@SC aims to provide regulatory clarity by facilitating
Malaysian capital market. discussions between FinTech businesses and relevant authorities to
FinTech has significant potential to disrupt the business model ensure that potential regulatory and risk concerns are appropriately
of incumbents and appeal to a wider audience by promising user- taken into consideration.
friendly services that transcend demographic, geographical and The SC has indicated that it will introduce a framework for Peer-
infrastructure barriers. Recognising this, and the crucial need to to-Peer (P2P) lending in 2016, in line with growing interest in this
guard against the potential risks, the SC launched the Alliance of area. P2P lending has grown significantly in big markets such as
FinTech Community or aFINity@SC at the World Capital Markets the United States, China, the United Kingdom and India.
Symposium 2015 in September, to catalyse the development of

Financial Services
4 The Private Retirement Scheme as a Wealth

Creation Platform Gains Encouraging Traction
The SC has created a safeguarded The PRS was first introduced in As at 31 December 2015, it has 180,651
environment to ensure that the November 2012 under the leadership of members (40.1 percent growth from 2014)
interests of Private Retirement Scheme Securities Commission Malaysia (SC). and RM1,171.97 million AUM (63.7 percent
(PRS) members remain at the fore. Though still at its nascent stage of growth, growth from 2014).
In implementing the private retirement the PRS has in the past two and a half There are currently a total of 11
framework, the SC has applied years shown a promising and strong start Schemes with 50 retirement funds under
internationally renowned principles both in terms of Asset Under Management eight PRS providers. Islamic PRS funds
to uphold the quality of PRS providers. (AUM) and number of members. account for 32 percent of the total AUM.
PRIVATE RETIREMENT SCHEME INDUSTRYS AUM HIT THE RM1 BILLION LANDMARK
Malaysians to supplement their retirement savings in order to ensure
a level of sustainability and security for their future.
As the PRS embodies inclusiveness, individuals are given sufficient
8 PRS Providers
RM mil
1,400
,000
200 opportunities to share in wealth creation through an additional avenue
11
180 provided by the capital market. The PRS has been designed to be
PRS Schemes
180 accessible, affordable and sustainable whilst empowering all members
50
1,200
of the Malaysian public to achieve financial security based on what they
160
Retirement Funds
can afford. In this regard, one of the key features of the PRS is its flexibility.
30 Conventional Funds
1,000
128
140
20
TOTAL ASSET UNDER MANAGEMENT (AUM)
120
Islamic Funds 800 AND NUMBER OF MEMBERS SINCE INCEPTION
The increased participation in PRS can be attributable to early efforts
74% All
100
focused on investor education. Since the launch of PRS, the SC and PRS
600 1,172.0
Participation from States in Malaysia
80 administrator, Private Pension Administrator Malaysia (PPA) have been
Employed Segment are Reached 64 proactively embarking on a series of education and public engagement
13% 49%
60
400 campaigns to embed a higher level of awareness on the need for secure
716.1
40
retirement planning.
Self-Employed Female Members
200 22 Specifically, the PPA together with all PRS Providers contributed
299.8 towards the RM5 million Industry Development Fund (IDF) to launch the
13% 51%
20
64.4 PRS awareness campaign. The IDF is a three year commitment by PPA and
0 0
Students, Homemakers Male Members the PRS Providers to raise awareness for PRS. The IDF will also be used to
& Retirees AUM No. of Accounts
intensify education and public engagement campaigns across the country.
The role of tax incentives has been critical in driving the development
As Malaysia transforms from an emerging economy into a developed of PRS. In the 2012 Budget, the Government announced a tax relief of
nation, the need for a comprehensive multi-pillar pension system RM3,000 for contributions made by individuals to PRS approved by the
becomes increasingly essential. Global institutions like the World Bank SC. This tax relief will be provided for a period of 10 years, from 2012 to
acknowledges the importance of a multi-pillar pension system which 2021. Employers will also be given tax deductions on contributions to PRS
serves to support the retirement needs of a countrys population. In this made on behalf of their employees up to 19 percent of the employees
context, the PRS complements Malaysias mandatory pillar. remuneration. To cultivate a retirement savings culture amongst the
The function of the PRS is one of utmost importance at a time younger demographic, the Government in the 2014 Budget announced
where the adequacy of retirement savings is neither sufficient nor a one-off PRS incentive of RM500 to contributors aged between 20 and
sustainable in an environment where rising living standards and higher 30 who participate in the PRS scheme with a minimum cumulative
age expectancies continue to prevail. Keeping the nations needs and investment of RM1,000 within a year. This incentive is valid from
aspirations in mind, this voluntary pillar is a critical platform for all 1 January 2014 for a period of five years.

5 Supporting Regional Economic greater market access, and operational
flexibilities consistent with those
Integration Through the Asean of domestic banks in the respective

host countries. The implementation of
Banking Integration Framework the Framework will be accompanied

by the strengthening of home-
host regulatory and supervisory
cooperation arrangements to
As the ASEAN Economic the potential for a meaningful presence support the effective surveillance
Committee (AEC) comes into fruition, across ASEAN countries. The ABIF and supervision of QABs. As ASEAN
the conclusion of the ASEAN Banking accords priority to the outcome of moves closer to the realisation of the
Integration Framework (ABIF) which promoting financial development AEC, ABIF will strengthen the other
was endorsed by the ASEAN Central and higher regional economic growth, initiatives under the ASEAN Financial
Bank Governors represents a critical and is anchored in principles that Integration Framework to provide an
milestone for ASEAN towards emphasise inclusiveness, transparency important enabling mechanism for
achieving greater financial and and reciprocity. ASEAN countries to accelerate the
economic integration. With the finalisation of the pace of regional financial integration,
The immediate objective of ABIF is Framework by all ASEAN central bank increase cross border trade and
to achieve a more integrated banking governors, any two ASEAN countries investment flows and thus harness
market, spearheaded by Qualified may enter into reciprocal bilateral the growth potential of the region.
ASEAN Banks (QABs) that now have agreements to provide QABs with
The ASEAN CAP 10 CEO Summit provided CEOs with actionable parts to prosperity as ASEAN moves to becoming a single market place

Financial Services
MARKET INDICATORS
MALAYSIA MARKET GROWTH FROM JANUARY 2009 THROUGH 31 DECEMBER 2015
Market Foreign Foreign Outflow 2014
FBM KLCI Market Capitalisation ADV
Shareholdings - to date
RM26.0 bil
+93% +155% +76% +1.4 2010 to 2013
Percentage Points Total Foreign Net Inflow:
RM34.2 bil
MALAYSIA MARKET GROWTH FROM YTD 31 DECEMBER 2015

Market Foreign Foreign Outflow 2014
FBM KLCI Market Capitalisation ADV
Shareholdings - to date
-4% +3% -3% -2.0 RM19.7 bil

Percentage Points
2015 BURSA MALAYSIAS MARKET PERFORMANCE

SECURITIES MARKET ground was lost in the second RM1,651.17 billion at the end of DERIVATIVES MARKET
Apart from the increase in half of the year as sentiments 2014. The year saw a total net In 2015, higher volatility
geopolitical tensions of Russia- were dampened by the external foreign outflow of RM19.7 billion, in commodity prices and the
Ukraine, the Islamic State crisis in and domestic concerns. Market however this was supported by FBMKLCI continued to benefit
the Middle East and more recently downtrends were somewhat the net inflow of RM23.8 billion the Derivatives Market. During
North Koreas nuclear push mitigated by Malaysias continued from domestic institutions. the year, the total volume of
and the Turkey-Russia political strong economic fundamentals In the more volatile market, contracts traded registered a 12.8
tension, the overall 2015 market and diversification of the there was a reduction in the total percent growth from 2014 volume
condition was challenging due to economic sectors represented funds raised which decreased with an average daily contract
other external factors. Global and on the Exchange. from RM24 billion in 2014 traded of 57,157 contracts in
regional factors including Chinas The FBM KLCI started at to RM21 billion in 2015. The 2015 compared to 50,654 in 2014.
economy slowdown, depressed 1,761.25, reached its highest number of IPOs were 14 in 2014 Notably, the growth in volume
global oil and commodity prices closing level for 2015 at 1,862.80 as compared to 10 in 2015 which was attributed by the increased in
and uncertainty surrounding on 21 April 2015 and finished corresponded in a lower level of FCPO and FKLI contracts due to
the USD interest rate have the year at 1,692.51 points, funds raised at RM3.9 billion in higher volatility in Crude Palm Oil
contributed to the challenging posting a marginal erosion of 2015 compared to RM5.9 billion (CPO) prices and the FBMKLCI.
market condition. On the 3.9 percent year-on-year. In in 2014. Meanwhile, fund raising
domestic front, the weakening terms of trading activity, average activity in the secondary market ISLAMIC MARKET
Ringgit and implementation of daily market transacted volume remained robust with a total of For the Islamic Capital Market,
the GST have also shaped market and average market transacted RM17.1 billion raised in 2015, a the average daily value of Bursa
conditions. value decreased by 4.8 percent slightly lower level than in 2014 Suq Al-Sila (BSAS) rose 120.8
Against this landscape, and 2.9 percent year-on-year, at RM18.4 billion. The robust percent to RM15.2 billion in 2015
the local securities market has respectively. Market capitalisation secondary market was driven compared to RM6.9 billion in 2014.
remained resilient for the year. saw positive movement with by major corporate exercises, Strong growth in BSAS trading
The FBM KLCI saw a steady RM1,695.17 billion posted as at including rights issues, special was driven by the conversion of
upward trend which began at the 31 December 2015, an increase issues and private placement by Murabaha deposits and growing
start of the year, however some of 2.7 percent compared to our PLCs. interest in tenor based pricing.

MOVING FORWARD
C
hallenges confronting the time improving their banking participants against contagion risks
economy in 2015 are expected system in compliance with the latest and excessive leverage. This initiative
to persist in 2016. In particular, BASEL requirements. will be completed by 30 June 2018.
heightened volatility in financial On the regulatory front, in 2016, The SC is currently also developing a
markets, declining commodity prices, BNM will continue to facilitate comprehensive Blueprint for Malaysia's
strengthening of the US dollars, and transitional arrangements to allow Islamic Fund and Wealth Management
the slowdown in China, are anticipated for an orderly conversion of convert industry. The Blueprint, targeted to be
to have direct and indirect impact on Composite Insurance and Takaful ready by end 2016 will chart the medium
the Malaysian economy, primarily Licenses into a single licence under and long-term strategic direction for the
through trade and financial channels. pursuant to the Financial Services Act industry as well as map out strategies
A strong impetus will have to be forged 2013 and Islamic Financial Services and recommendations to strengthen the
to safeguard the Malaysian financial Finance Act 2013. This will be done country's competitive edge.
services industry which forms a in a course of three years up to 2018. The Financial Services NKEA is also
backbone supporting the nations Under this initiative, life and general dedicated to exploring and pushing for
economic growth. businesses of insurers, and family and more innovative and creative solutions
Moving into 2016, the focus of the general business of Takaful operators for the financial sector to enhance and
Financial Services NKEA will be to will have to be carried out under improve consumers experience in the
further enhance the resilience of our separate entities due to the different long term.
financial systems, domestic economy risk characteristics and nature of these 2016 is not going to be any less
and ensuring continuous sustainability businesses. The exercise is being carried challenging for the Malaysian financial
of financial services industry. out to strengthen the institutional services industry compared to last year.
This will include working with structure of financial institutions Our financial system will be stress-
DFIs to ensure they continue serving to ensure adequate safeguards for tested against the full brunt of an
their mandates whilst at the same insurance policyholders and Takaful unfolding global economic uncertainty.

Wholesale & Retail
REVOLUTIONISING DATO SERI

HAMZAH ZAINUDIN
MALAYSIAS
MINISTRY OF DOMESTIC TRADE, CO-OPERATIVES
AND CONSUMERISM
CONSUMER
For the past five years we
have been breaking new grounds
EXPERIENCE
in retail concepts to enhance
Malaysias consumer experience
through several initiatives in the
wholesale and retail sector. The
sector has grown 5.9 percent in 2015
compared to 2014, contributing
close to 13.8 percent to the overall
countrys GDP.
Malaysia's rank in the AT
Kearney Global Retail Development
Index rose from 17 in 2010 to 9 in
2015 proves steady ground for retail
investment in the country.
Whilst working at modernising,
globalising and revolutionising
this sector, we strive to ensure
that no one gets left behind, by
providing even small retailers
the competitive edge through
assistance and training.
Apart from determining
opportunities to amplify the
programme moving forward,
we will also clarify sporadic
criticisms towards the TUKAR
programme. Some participants

T
he retail landscape in Malaysia
has undergone tremendous
transformation over the past
few years. Retailers are increasingly
positioning shopping as an intrinsic
part of a desired consumer lifestyle
and as such, have been aligning
their businesses to match consumer
expectations. There has also been a
have complained of significant significant rise in the presence of online
stores with the same lifestyle appeal.
losses and inability to settle their
With a focus on pushing mall
loans, with these stories being
retailers up the value chain, making
sensationalised in the media. virtual malls the new high street,
Regardless, the programme has and breaking new grounds through
seen many success stories, with innovative retail concepts, the
participants having reported a rise wholesale and retail sector has
continued to grow through the support
in income and growth in business
of the National Key Economic Areas
post-transformation.
(NKEA) initiatives. INSIDE THIS NKEA
Wholesale and retail is an As a result, over the course of the
important contributor to the
1
last six years, the wholesale and retail Meeting Consumer Needs by
nations economy. Capitalising sector has reversed a slump and turned Striking a Balance Between Large
around to achieve RM1007 bil of sales Format Stores and Small Retailers
on rising purchasing power in the
Asian region, the more players are value in 2015, a significant rise from
equipped to compete in meeting the

RM622 billion in 2009. 2 Making Virtual Malls
the New High Street
The baseline volume index of
demands of this sector, the closer
wholesale trade from 99.8 points at
we get to provide a heightened
consumer experience.
the end of 2009 had risen to 146.2
points at the end of 2015, while
3 Breaking New Grounds Through
Innovative Retail Concepts
Malaysia sits in a region that retail trade grew from 103.6 points
is a hotbed of retail activity and to 133.6 points over the same period.
This growth, albeit pressured by its highest ranking since 2007, before
competes with other cities such as
neighbouring competition, as well as the NTP. The Malaysian market was
Singapore, Jakarta, Bangkok and
the challenging global and domestic also described as strong and stable
Hong Kong to become one of the economic landscape, which saw a due to its high income per capita
preferred shopping experiences. decline in the number of tourists and young population. The countrys
We must run this race to rise above and the tightening of household ranking puts it among the 10 most
and shine in this space to capture lending credits, is attributed to the attractive countries for retailers
consumers imaginations and focused initiatives in the wholesale and makes it the only other country
and retail sector. in Asia Pacific, apart from China,
encourage greater spending.
Further demonstrating resilience, in the top 10.
the sector rose above weakened This sector is expected to
consumer sentiment in 2015 and continue contributing significantly
contributed 13.8 percent to the to the Malaysian economy in serving
countrys GDP in 2015. domestic demand, whilst also
AT Kearney ranked Malaysia 9thin encouraging tourist spend with the
its 2014 Global Retail Development country recognised as a top shopping
Index, up four places from 2013 and destination globally.

Wholesale & Retail
1 Meeting Consumer Needs by 2015. These include stores such as Giant,

Mydin, Econsave and The Store run by
Striking a Balance Between Large local players, as well as Tesco, Carrefour

and AEON from the foreign front.
Format Stores and Small Retailers Abu Dhabi based retailer Lulu
Group is scheduled to set up 10
hypermarkets across Malaysia with
an initial investment of RM885 million
(US$200 million) in the first five years
from 2016. The group will be partnering
with FELDA and aims to capture 20
percent of the retail market share.
PUSHING SMALL RETAILERS

UP THE VALUE CHAIN
TUKAR or the Small Retailer
Tr a n s f o r m a t i o n P rog r a m m e
(Transformasi Kedai Runcit) initiative
under EPP 2 was formulated to help
smaller retailers modernise and
turn around their businesses by
implementing critical changes in areas
such as human capital, equipment,
expertise, standard operating
procedures, product display and
inventory tracking.
The transformative effect of TUKAR
A refurbished interior of a small format store under the TUKAR initiative not only provided store owners a lease
of life but also a fighting chance against
The Malaysian retail market Large format stores need large superstores and hypermarkets, by
has seen significant growth of consumer bases to sustain their helping them to evolve in order meet
hypermarkets, superstores and business and as such cannot operate current consumer needs.
departmental stores since the large everywhere. They are further limited by Retail advisors for this programme
format retail sub-sector was liberalised the need for heavy infrastructure and include big players like Mydin,
in 1995. The presence of these large large funding. This creates a need for Carrefour, Malaysian Cooperative
format stores bring quality, product smaller stores to service the gaps left Commission, Tesco, Giant (GCH
availability, choice, cost reduction, by hypermarkets. Retail Sdn Bhd), Aeon, Econsave and
new retailing technology and skills to Cash & Carry.
the sector. LARGE FORMAT STORES 302 small time retailers have
However, even with the rise of ON GROWTH TREND been transformed, bringing the total
hypermarkets and superstores, the Six new hypermarkets and nine number of stores transformed by the
NKEA works at striking a balance superstores were set up throughout TUKAR programme to 2016 since it was
between promoting large format Malaysia by foreign and local players launched in 2011.
stores and equipping small format as a result of efforts under Entry Point A sum of RM30 million has been
stores with the skills and technology Project (EPP) 1. There are now 36 allocated under this programme and
necessary to compete. hypermarkets and 44 superstores as of for those who take up the TUKAR

offer, Bank Kerjasama Rakyat The TUKAR programme remains at of 188 automotive workshops all over
Malaysia Berhad (Bank Rakyat) heart an entrepreneurship programme Malaysia in 2015. This brought the total
provides loans between RM20,000 that requires participants themselves number of stores transformed by the
and RM80,000, with an annual to take an active role in ensuring the ATOM programme to 764 since it was
interest of three percent based on a viability and success of their own launched in 2011.
reducing balance. businesses. Innovation plays a key The programme provides funding
In the past year, the Steering role in ensuring the sustainability of for tools and equipment to enable
Committee has also agreed to allow TUKAR participants. It is therefore vital workshops to improve the quality of
further financing for successful TUKAR that shopkeepers remain savvy and their services as well as expand their
participants to either expand their responsive to consumer needs to achieve range of expertise and services in
existing stores or open new branches. business growth. repair and maintenance.
With the introduction of GST in Another transformation programme
2015, various efforts were put in place to which has made a positive impact on
ensure that the sustainability of a TUKAR small time players is the Transforming
participant - including GST-focused Automotive Workshop (ATOM) under
training and business refresher courses. EPP4 which aided in the transformation
A transformed sundry shop under the TUKAR initiative

Wholesale & Retail
2 Making Virtual Malls products to be carried. Virtual malls

such as AmaxMall are an online
the New High Street replication of brick and mortar

hypermarkets, primarily serving as
an online presence for local small-
and medium-sized retailers and to
The online shopping segment the largest e-commerce markets in draw in customers. In its inaugural
is growing at an exponential rate in Southeast Asia, generating almost year of operation, AmaxMall has
Malaysia, with almost all products and half of total online retail sales in this attracted 212 small and medium online
services ranging from travel, apparels, region. Retail E-commerce has been retailers on its e-commerce platform to
books to grocery shopping being acknowledged as the fastest growing offer their goods and services. There
sold virtually. segment in this sector, with traditional is growth to be had in this segment,
This segment has produced hyper-marts such as Tesco by having with total internet sales projected to
successful Malaysian based an online shopping platform. The reach RM12 billion by 2020, enhancing
e-commerce platforms like Lazada, e-commerce market size in Malaysia this sectors appeal to attract more
Zalora and Lelong, and has also drawn is estimated to be at RM7 billion for online entrepreneurs.
in traditional retailers like Tesco, Presto both products and services. With the While encouraging the setting up
and MPH. With the ongoing rollout of increasing penetration of smartphones of virtual malls, the Government is
high speed broadband as well as the and other mobile devices, this number exploring ways to ensure that consumer
extreme popularity of smartphones is expected to rise at an exponential interest, such as e-transaction safety is
and other mobile devices, this number rate. protected so as to not impede on the
is expected to increase further. The setting up of a virtual malls growth of online retail.
According to Euromonitor, under EPP 7 of the wholesale and retail
Malaysia and Singapore represent NKEA will allow for a wide range of
AmaxMall has attracted 212 small and medium online retailers on its e-commerce platform to offer their goods and services

3 Breaking New Grounds through Bazaar and a Tesco hypermarket.
Construction of other components
Innovative Retail Concepts such as the Auto City, (a large shopping

area for automobiles) remain on track,
with an LRT extension to service the
area underway.
Failure to innovate is fatal in the anchored by numerous category stores Also in the pipeline, are linkages
retail industry. Innovation very often including hypermarkets, furniture from the LRT to various components
results in concepts that enthral and superstores, digital products and of the development and surrounding
draw consumers who are always on electronics equipment malls as well areas. Covered walkways and walking
the lookout for new experiences. as toy and sporting goods stores, large bridges are designed to provide comfort
The Oasis Damansara Big Box automotive showrooms, textile centres, and accessibility.
Boulevard developed by Sime Darby garden and hardware superstores. The Makan Bazaar is a innovative
- Brunsfield, is an example of an The retail areas spanning 26 concept, leveraging upon the how we
innovative retail space promising hectares - will also feature food and enjoy the diverse choices of Malaysian
a novel shopping experience. The beverage outlets, convenience stores, food. The mission is to create iconic
integrated retail development located and liquor and tobacco retailers. food outlets that combine the best
in Ara-Damansara is fashioned after As of 2015, the partly completed Big hawkers at one large premium food
similar outlets that have been successful Box Boulevard comprises the already centre supported by other established
in Europe and United States. It will be operational Oasis Square Makan eateries such as family restaurants,
quick-service restaurants, cafes, bars
and fine dining restaurants.
The food centre will also provide
attractions like sensory gardens,
games and an arena for events and
playgrounds, as well as retail outlets
like convenience stores and news
agents.
The Makan Bazaar is designed to be
approximately 9,000 square metres in
size, catering for 3,500 people.
Apart from Oasis Square, another
operational Makan Baazars is located
at the Medini Mall in Nusajaya.
A total of 10 Makan Bazaar outlets
will be built by 2020 in major cities in
Malaysia.
The Oasis Square Makan Bazaar
has proven to be a successful idea. It
has expanded past the dedicated space
of 9,104 sq metres to more than 27,871
sq metres of F&B space, offering a wide
array of food from famous local cuisine
to international cuisine.
(Top) Oasis Square Makan Baazar at Ara-Damansara (Bottom) Tesco is one of the players under the
Large Format Stores initiative

Wholesale & Retail
OASIS PIAZZA: MAKAN BAZAAR GOES PREMIUM
S
mack in the middle of Oasis attract not only locals but also to draw in and employment opportunities to all
Damansara, the Oasis Piazza multinationals and expatriates to set up Malaysians. As Oasis Square is also
is indeed a little food oasis offices and homes in Oasis Square. We beginning to become a tourist hot spot
developed with the Makan Bazaar wanted to create a commercial hub which and we are committed to doing more
concept, which is aimed at creating cohesively integrates a safe and healthy to support tourism and retail industry
iconic food and beverage (F&B) living environment, a bustling business growth. Oasis Square is increasingly
destinations. It has become a defining centre, a lively entertainment hub and a also attracting tourists and we are
feature of Oasis Square, as an integrated place of leisure - where people feel safe committed to further encourage this
commercial campus which is co-created to congregate and enjoy themselves with trend in supporting tourism and retail
by Sime Darby Property & Brunsfield family and friends. industry growth.
International Group. According to Mohamad Hassan, the Moving forward, Sime Darby
Offering a wide array of Malaysian existence of an attractive and exciting Brunsfield Group is also expanding
and international cuisine, the 27,900 food hub in Oasis Damansara has not this F&B retail hub to include a food
sq metres enclave has created a buzz only brought in the crowd but also court, which offers hawker fares in a
in Kuala Lumpurs food and beverage doubled property value. All units of comfortable and hygienic environment.
(F&B) scene, not only because of the serviced apartments are sold out Besides that, while attracting a multiple
its food but also the attractive cozy and office spaces are occupied by local range of premier tenants both locally and
ambience, featuring the water fountains, and multinational companies such as internationally and providing a greater
shimmering pools and lights, making it PR1MA Corporation, Hilti (America), BDA opportunity to small medium enterprises
a visually attractive dining destination, Architect (Australia), Malindo Airways (SMEs), it will generate healthy returns
especially in the evenings after sunset. and many other organisations. to the community and the stakeholders
Brunsfield International Group, The Oasis Piazza has huge potential towards establishing quality standard
Executive Director, Mohamad Hassan in becoming a revenue generator hub to of living and contemporary lifestyles,
Zakaria says that Oasis Piazza is a both the Selangor State and the Federal he explained.
premium F&B destination developed to Government while providing business
(Left) Mohamad Hassan Zakaria, Executive Director of Brunsfield International Group

(Right) The Oasis Piazza at Oasis Damansara, surrounded by residential and commercial high-rise buildings

MOVING FORWARD
W
ith five years to go before Also in the pipeline is a plan to foreign companies preferring instead
2020, an impact study consolidate the Unified Malaysia Sales to choose licensing agreements, which
will be conducted to with Malaysian Mega Sale by Ministry have lesser risks and lower cost. Since
ascertain the effectiveness of the of Tourism and Culture (MoTAC) for 2011, only three foreign brands have
TUKAR and ATOM programmes and even greater retail impact. In light of been acquired by local companies
what can be done to further improve increasing diversity within Malaysia's Parksons acquisition of PT Tozy
on outcomes. This will enable us to retail market, The Ministry of Domestic Sentosa and Odel Plc as well as Bonias
review effectiveness of the programme, Trade Cooperative and Consumerism acquisition of JECO Pte Ltd prompting
retailers, changing trends of consumers will also be working closely with for an internal review and subsequent
and to safeguard possible contractions Ministry of Tourism and Culture to termination of this initiative.
within the marketplace. All these provide additional marketing value The wholesale and retail sector
components will assure sustainability to the consolidated sales event. treads into 2016 being cognisant of
of these programmes. The 1Malaysia Mall initiative under challenges presented by a slowing
Renewed emphasis will be placed EPP6 and EPP8, which was aimed at economy on the back external
on awareness and education on the assisting local businesses to acquire headwinds. Domestic consumption
TUKAR programme to ensure retailers stakes in foreign retail businesses is expected to moderate amid a rise in
are aware of requirements. Outreach have stalled due to external factors cost of living and a more challenging
initiatives to create greater awareness such as the soft economic climate and operating environment for businesses.
and understanding will also be aimed the weakening ringgit, companies are Regardless, the government will work
at youth entrepreneurs to encourage less inclined to venture overseas to with the wholesale and retail industry
participation in TUKAR programme. establish such projects. Additionally, to continue featuring innovative
To further develop internet due to the locale abroad, facilitation and attractive value propositions to
based retail marketing, work under efforts and intervention by the spur domestic consumption given
this EPP7 will also be focused on Government will be severely limited. the integral role it plays in driving
expanding the current seller base For EPP8, local companies have economic growth.
for existing Virtual Malls. been less inclined to acquire interest in

Palm Oil & Rubber
PRIORITISING
DATO SRI AMAR
DOUGLAS UGGAH EMBAS
MINISTER OF PLANTATION INDUSTRIES
PEOPLE,
AND COMMODITIES
PLANET,
In 2015, we continued the
strategic measures introduced
to further develop downstream
PROFITS
activities and also boost
productivity upstream. Our
mission here is to strengthen the
earning power of these sectors
by creating long-term recurring
income for both the nation and
bottom 40 percent involved in
these sectors.
By developing a strong chain
of downstream activities and a
sustainable supply upstream,
we also strengthen these
sectors resilience to the current
economic upheaval.
All our measures to increase
resilience and revenue are
anchored on sustainability. This
is to ensure that at all times, profit
does not override the interest of the
society and the environment.
The Palm Oil and Rubber
has been key in maintaining the
sustainability of the upstream
sector while accelerating the

A more robust
downstream integration has
helped the sectors weathered
through the ongoing volatility of
move towards downstream since
its inception. It ensures a smoother palm oil prices and low natural
transfer in economic focus from
upstream to the downstream sector rubber prices that would have
via the strategic and deliberate
allocation of resources coupled
otherwise caused major setbacks
with other forms of necessary
assistance extended towards
in the plantation industry.
downstream players.
T
he Palm Oil & Rubber NKEA
aims to hit the triple bottom INSIDE THIS NKEA
line which encapsulates the
theme of People, Planet and Profit. It 1 PEOPLE: Creating Recurring Revenue
Streams to Uplift Communities and
is underscored by the need to balance Industry Players as a Whole
progressive growth and sustainability
in pursuing people-centric initiatives.
Bright sparks have emerged
2 PLANET: Pushing for Sustainability
Through Innovative Solutions and
Meaningful Investments
despite the ongoing challenges in the
palm oil and rubber sectors. These
challenges prompted both sectors to 3 PROFITS: Going Downstream
Improves Sectoral Resilience
begin unlocking new value dimensions and Sustains Growth
through intensifying downstream
efforts as well as improving upstream
production efficiency.
Malaysian palm oil has experienced while that of prices and export revenue
a high degree of instability of late, declined. Average CPO price was down
ranging from its peak of approximately by 9.6 percent to RM2,153.50 compared
RM3,800 in 2011 to its trough of around to RM2,383.50 in 2014. Major price
RM1,800 in August 2015 (BEPI website). swings were caused by lower demand
The year 2015 saw a mixed performance from its major importers which resulted
of the Malaysian oil palm industry. in higher inventory, reaching a peak of
Compared to 2014, oil palm planted area, 2.7 million MT in August 2015, due to
crude palm oil (CPO) production, import, weaker demand coupled with higher
export and closing stocks increased, levels of production.

Palm Oil & Rubber
Total exports of oil palm products China. This spurred the invention volatility of palm oil prices and low
increased marginally in volume by of specialty rubber such as the natural rubber prices that would have
1.0 percent to 25.33 million MT but epoxidised natural rubber (Ekoprena) otherwise caused major setbacks in
declined by 5.5 percent in terms of and deproteinised natural rubber the plantation industry.
export revenue in 2015. In 2015, among (Pureprena) that can be used in This is one of the steps taken by
the top three importers of palm oil, green tyres and high-performance both the palm oil and rubber sectors
China recorded a decline of 16.2 engineering product respectively. in diversifying their respective
percent from 2.8 million MT. However, Such innovation and impetus activities, strengthening resilience by
India and European Union recorded to move downstream has also been departing from a deep reliance on the
an increase in volume of 13.6 percent seen in the palm oil sector. Value- commodity market. The shift in focus
and 0.9 percent respectively. added products including oleo towards the downstream sector, along
Natural rubber prices, similar derivatives and phytonutrients for with the various public and private
to palm oil, have also been drifting foods and supplements, continued initiatives which were introduced
lower amidst the fear of slowing into 2015. A more robust downstream to smoothen the transition process,
economy and lower demand from integration has helped the sectors continue to be built upon the Triple Ps
major consumer markets such as weathered through the ongoing as the underlying foundation.
1 PEOPLE: Creating Recurring Revenue independent small holders. The

scheme which also includes replanting
Streams to Uplift Communities and of oil palm in private land ensures a

sustainable supply of the commodity to
Industry Players as a Whole downstream palm oil operators within

and outside the region.
A sum of RM1b has been allocated
under the scheme via RMK-10 and
The Palm Oil and Rubber NKEA Planting of Oil Palm, was achieved will be continuously disbursed to
involves a number of Entry Point Projects despite Malaysian Palm Oil Board applicants until 2017 when the final
(EPPs), which includes replanting and having only 300 field staff to implement batch of 2015 completes its three-year
new planting programmes for the this EPP. New processes were phase. Monetary assistance is provided
smallholders, the development of new introduced, such as mobilising the staff for the clearing of land, the supply of
and high value phytonutrients, and of Sarawak Agricultural Department high quality seedlings as well as farm
efforts to improve upstream productivity. to assist MPOB with land verification, maintenance for two years.
Efforts are focused to support the which made a marked difference in As part of an ongoing effort
replanting of palm oil and rubber trees the implementation of this scheme in to increase revenue stream of
to revitalise the upstream production Sarawak. With this, MPOB is on track smallholders in the palm oil sector,
pipeline through replanting and to achieve its original 2020 target of efforts under EPP1 will be extended to
new planting. planting 115,000 ha despite facing include non-palm oil revenue through
In the last five years a total major challenges such as land issues, crop integration which includes
of 97,421 hectares of palm oil has primarily in Sarawak. more than eight types of crops such
been newly planted or replanted by The government-led scheme as pepper and banana, whereas for
independent smallholders, which under this EPP is a proactive initiative livestock integration, cattle and goats
is 85 percent of the total 2020 target pushing for optimum production are covered. Although both methods
of 115,000ha. by replacing aged palms that are of integration are not new concepts,
This effort initiated under EPP1: 25 years and older with younger they are being introduced as a palm
Accelerating the Replanting and New high yielding palms by farmers and oil sector KPI for the first time.

IDENTIFYING
HEALTHY
SEEDLINGS
To further boost productivity and
strengthen revenue of smallholder,
Suresawit kits were distributed to
assist with the efforts to filter out of
low yielding clones, so that production
targets are met.
A plantation worker collecting Fresh Fruit Bunch (FFB) at an oil palm plantation
The underlying aim is to provide Continuous efforts under the EPP tonnes of rubber to support domestic
smallholders with early income in includes identifying initiatives for downstream activities.
the first three years of replanting/ these cooperatives to remain relevant The government has encouraged
new planting while they are waiting and boost business performances. the replanting and new planting efforts
for their palm oil plants to fully mature. Targeted total FFB sold to mills by by farmers through implementing
Among the efforts under EPP2: all coops in 2015 was 26,800MT, agencies such as Rubber Industry
Improving Fresh Fruit Bunch Yield with achievement of 39,330.38MT Smallholders Development Authority
is to create clusters of independent (146.8 percent). Targeted number (RISDA), Lembaga Industri Getah
smallholders, which allow them of new coops to commence selling Sabah (LIGS), Department of
to achieve economy of scale, of FFB to mills in 2015 is five, which Agriculture Sarawak (DoA), Federal
strengthening their bargaining power was achieved. Land Development Authority (FELDA)
in terms of pricing for their produce. For rubber, the aim of EPP9.1: and Federal Land Consolidation and
This is done through cooperatives, Ensuring Sustainability of the Rehabilitation Authority (FELCRA).
which have become an efficient Upstream Rubber Industry, is to reverse In 2015, the Government continued
platform to raise awareness on better the declining rubber plantation area to provide grants for the replanting
farming methods and harvesting in Malaysia to ensure that there is of old and unproductive trees by
technologies to raise national sufficient production upstream that is smallholders. For the period to 2012-
average yields. able to support domestic downstream 2015, a total allocation of RM830.5
Since the start of this NKEA, 30 activities. In 2000, the total rubber million has been provided for
cooperatives with a membership plantation area in Malaysia was 1.4 replanting and new planting of 196,891
of 29,000 smallholders have been million hectares, which reduced hectares of rubber planted area.
established with the help of MPOB drastically to 1.02 hectares in 2010. Efforts under this EPP also includes
and this has allowed smallholders Efforts under this EPP is aimed at the use of high yielding clones in
to enjoy a bulk discount in procuring maintaining planted areas at 1.2 million the replanting and new planting
agricultural inputs and receive better hectares, of which one million hectares programme, with the potential to
pricing for their produce sold to palm are harvested. With yields expected increase production to 2,000kg a year
oil mills. Fifteen of these cooperatives to reach 2,000kg/ha, Malaysia is per hectare, also increasing the income
are currently operating nationwide. likely to produce two million metric of smallholders.

Palm Oil & Rubber
2 PLANET: Pushing for Sustainability A by-product of palm oil

production is Methane and EPP5:
Through Innovative Solutions and Developing Biogas Facilities at Palm

Oil Mills is seeking to utilise the gas
Meaningful Investments as an alternative source of energy, with

the potential to create RM3.3 billion in
yearly revenue on a sustainable basis
(assuming the bioCNG is valued at
RM40/MMBTU (one million British
Thermal Units) and about 2,000 jobs
by 2020.
Palm oil mill effluent (POME)
is the waste water discharged from
the sterilization process, crude oil
clarification process and cracked
mixture separation process. POME
produced huge amount of methane gas
from its anaerobic process and has 21
times Global Warming Potential (GWP)
compared to the other gases. However,
there is a solution to this.
This by-product can be utilized
as fuel for power generation and
cogeneration and presents a value-
adding opportunity, as methane is a
EFB Mulching to control weeds, maintain moisture and prevent soil erosion huge source of renewable energy. This
has the potential to create a viable
The NKEAs approach to the In August 2015, RM53 million revenue stream for the mills through
development of both palm oil and was allocated to assist oil palm energy production, while addressing
natural rubber sector is a holistic one smallholders in obtaining the newly environmental and regulatory concerns.
with sustainability at its core. implemented Malaysian Sustainable Compressed biogas would enable
Responsibly cultivated palm oil not Palm Oil (MSPO) certification within mill owners to fully monetise the
only benefits the planet but also has the next five years. The MPSO provides potential of biogas as every single flow
the power to push past the numerous small holders a fighting change of biogas will be quantified and scaled
allegations of environmental in the highly competitive palm oil to price per MMBTU basis. End users of
destruction that clouds over the market as well as the opportunity bio-Compressed Natural Gas (bioCNG)
abundant benefits of palm oil. to increase revenue. not only benefit in terms of cost when
Currently, one of greatest challenge Efforts under EPP2: Improving compared with fuels such as diesel,
in the upstream segment of this sector Fresh Fruit Bunch Yield has resulted medium fuel oil, light fuel oil and liquid
is to push for sustainability especially in the growing certification of the 5.6 petroleum gas but can also leverage on
among small holders, many whom do million hectares of palm oil plantation the sustainability labelling of green fuel
not have the financial means to meet the land in Malaysia, of which about 1.4 when marketing products overseas.
sustainability criteria for certification. million hectares of plantation land The original 2020 target under
The growing demand for sustainability owned by smallholder farms and EPP5 was to have 500 mills with
when sourcing for supplies especially plantation companies have been biogas facilities. However, following
among major palm oil users such as certified. In 2015 alone, 486,775 a feasibility test, it was discovered
Unilever, P&G, Starbucks and Dunkin hectares were certified against that this was not possible due to
Donuts creates a greater need for the target of 220,000 hectares, structural challenges and the need
certified sustainable palm oil (CSPO). achieving 194.7 percent. to set in place a proper incentive

scheme to encourage mills to take Commodities (MPIC) Datuk Amar For the natural rubber
up the initiative. Following this Douglas Uggah Embas officiated the sector, initiatives under EPP11.1:
discovery, a bucketing exercise was launch of the worlds first Bio-CNG Commercialising Ekoprena and
done between MPOB-TNB for mills in commercial production plant at FELDA Pureprena in working towards a
Peninsular Malaysia whereby different Sungai Tengi palm oil mill in Selangor - preferential shift among consumers
action steps would be tailored for a joint venture effort between Malaysia from synthetics to renewable natural
each depending on their capacity, Palm Oil Board (MPOB), Felda Palm rubber also presents commercial
progress and geographical location. Industries Sdn Bhd and Sime Darby potentials worth capitalizing on.
Action steps include installing Offshore Engineering Sdn Bhd. This The emphasis on sustainability
biogas facilities, connecting mills commercial Bio-CNG plant is expected has helped the Malaysia to
with existing biogas facilities to the to produce 80,000m3/year of CNG for capitalise on the growing number
grid, installing a pilot Bio-CNG plant, industrial users, with some off-take of environmentally conscious
applying gas for internal use and the agreements already signed. consumers who have moved
biogas avoidance route, with trapping The development and promotion from synthetic to natural and
and flaring as the minimum option. of bio-gas as an alternative fuel renewable material by pioneering
As of 2015, 83 bio gas facilities source will also be an emphasis the development on specialty green
have been constructed, nine are under moving forward. This includes efforts rubber Ekoprena (epoxidised natural
construction and 145 more are under to facilitate the connection to the rubber) and Pureprena (deproteinised
the planning stage. power grid. This will be done through natural rubber). Both can be used in
In October 2015, Minister of targeting specific mills in Malaysia, green tyre and high performance
Ministry of Plantation Industries and following a prioritization exercise. engineering products.
A pilot biogas plant capable of supplying compressed natural gas to commercial entities began at the Sungai Tengi mill, which belongs to Felda Global Group, in Q4 2015.
This mill is the pioneer in Malaysia to install a commercial scale bioCnG facility. BioCNG is a more viable and lucrative alternative to feeding the electricity converted from
methane to the national grid, which proves to be a challenge for mills located further away from power stations

Palm Oil & Rubber
Though Ekoprena was developed Among the efforts which started 80 buses. Eight hundred Ekoprena types
some years ago, commercialisation has in 2014 is initiating a trial project will be used in the project. Following the
yet to take place in a big way. with Prasarana Bhd to test the trial project with Prasarana Bhd to test
To accelerate the journey towards Ekoprena tyres on Rapid buses in the the Ekoprena Tyres, 10 RapidKL buses
commercialisation, at the initial Klang Valley. on the Cheras Selatan route have begun
stages, collaborative trials with In August 2015, Prasarana using these tyres since August 2015.
private and public sector parties will Malaysia Bhd (Prasarana) signed a Felda is planning to use them for
be conducted, with the Malaysian memorandum of understanding with their fleet of transport from January
Rubber Board acting as the facilitator. Malaysian Rubber Board (LGM) to use 2016. For the commercial trial with
The purpose of these trials is to ensure Ekoprena tyres on its RapidKL buses in Felda Transport Services Sdn Bhd
that sufficient data is collected which a RM 1.7 million trial project, funded (FTSB), 16 vehicles will be used
can then be translated into a strong by the Ministry of Plantation Industries across a total of four trials, covering
value proposition for the product. and Commodities. the Pahang and Johor areas.
Collaborative research activities Ekoprena tyres will be used on the There is also the intention to
will cover products such as tyres, buses plying six regional routes within promote Ekoprena via other creative
retreads, shoe soles for boots, auto Klang Valley. In the first phase, tyres means such as collaborations with
parts, industrial hoses and other non- will be used on 10 buses, in the second renowned car makers or through
automotive products. phase - 30 buses, and the final phase - sponsorship platforms.
3 PROFITS: Going Downstream Malaysia's palm oil and rubber

sector is working to realise the full
Improves Sectoral Resilience potential of existing downstream

opportunities. The future of these
and Sustains Growth sectors lie in the strengthening of

downstream activities, thus reducing
its vulnerability to uncertain market
and fluctuating prices.
Downstream production provides
a more lucrative per unit revenue at
about 50 percent higher than the
output from the upstream sector.
The move downstream is part of the
Eleventh Malaysia Plan (11th MP) from
2016 to 2020, as a follow-on from the
Tenth Malaysia Plan (10th MP).
During the 10th MP, RM504 million
worth of grants was committed in the
downstream sector, with RM3.16 billion
worth investment committed by local
palm oil players in the production of
high-value oleo-chemicals and palm-
based phyto-nutrients. Under the 11th
MP, a further RM280 million is allocated
Research on downstream processing has intensified in Malaysia since the launch of the ETP to continue supporting the initiative.

From the laboratory to commercialisation, downstream processing requires significant capital input. Towards this end, EPP8 commercialisation grants are available for
the private sector to promote more downstream ventures
Efforts under the NKEA to promote EPP6 Developing Oleo-derivatives RRM179 million, which is 23 percent
downstream are two Entry Point project fund. It will be setting up of total investment valued at RM789
Projects (EPPs): its plant in Masai, Johor to produce million.
Firstly, the development of Oleo medium chain triglyceride (MCT) EPP8 has a two-prong focus. First,
Derivatives, efforts under EPP6: powder and powdered stearic acid, to push for commercialisation projects
Developing High Value Oleo Derivatives which are used in functional foods, and at the same time provide support
and Bio-Based Chemicals have been supplements and pharmaceutical towards R&D work via providing
successful in spurring high-value products. Its processes will comply grants towards clinical trials. The
downstream activities which continued with Current Good Manufacturing commercialisation arm allows for
through 2015. This resulted in continued Practice (CGMP), which will enable it commercialising of palm-based
diversification and growing sphere of to export to more countries with stricter phytonutrients by providing financial
value addition through both Government regulations such as Europe and Japan. support to companies for the acquisition
grants and investments by plantation In order to boost activities in the of technology and plant construction.
companies. RM2.5 billion worth of downstream segment of palm oil- A successful recipient of the EPP8
investments has been committed by based food and health-products, the commercialisation grant includes
EPP6 grant recipients, with 55 percent government has committed RM157.2 Carotino, which completed building
realised to date. million worth of grants under EPP8: its plant at Pasir Gudang, Johor in
In 2015, Lipidchem Sdn Bhd Expediting Growth in Food and Health- early 2013 and had since then started
became the first SME company to Based Segment. To date, this has commercialising its products, carotene
receive a grant from the NKEA POR brought in realised investment worth and tocotrienols.

Palm Oil & Rubber
Also, 11 out of 14 clinical trial

projects are ongoing and at the analysis
percent by 2020, by ensuring an annual
growth rate of 13 percent to maintain
In order to boost
stage. Recently approved 2015 projects dominance as the worlds leading rubber activities in the
includes a study on Age-Related gloves producer.
Macular Degeneration which will be Malaysia is home to the worlds downstream
conducted at Harvard Medical School,
and a study investigating the effects
leading rubber glove producers who
collectively are a key employer and
segment of
of mixed tocotrienols which will be revenue generator in the country. palm oil-based
conducted at University Sains Malaysia The Ringgit has depreciated by 22.8
(USM). At the close of year 2015, grants percent in 2015 as compared to 2014 food and health-
drawn down stood at 36.5 percent of on an annualised basis, contributing
the RM52 million committed. positively towards increased revenue products, the
The push to develop value-added
product downstream in the rubber
and profit for latex product exporting
companies. Total export revenue of
government
sector is an effort under EPP9.2: Increase Malaysian latex products, of which has committed
World Market Share of Latex Gloves to 65 latex gloves is a major contributor,
percent by 2020. Among its key effort is was recorded at RM14.5 billion for the RM157.2m worth
scaling up Malaysias market share of the
global natural rubber gloves market to 65
year, exceeding the annual target of
RM13 billion.
of grants under
EPP8: Expediting
THE TOCOTRIENOL ADVANTAGE Growth in Food
and Health-Based
Palm oil is also one of the
most abundant natural sources of Segment. To date,
tocotrienol, which has unique neuro
protective properties. It is also one this has brought
of the richest sources of natural
carotenoids, which is converted into in realised
vitamin A in our bodies. Other nutrients
include palm phenolics, phytosterols, investment worth
squalene andCoenzyme Q.
A growing number of researches RM179m, which
are pointing towards to the role of
palm oils naturally-occurring tocotrienolin protecting brain cells during stroke. Tocotrienol is 23 percent of
is anantioxidant. In the case ofischemic stroke, tocotrienol protects the neurons from dying
by modulating the chemical signals, making a marked difference in the outcome and recovery total investment
process.
These findings have intensified the commercialisation effort especially in developing valued at RM789
high value nutraceutical products as well as fortifying existing products with palm oil derived
nutrients. million.
Efforts to create widespread awareness of tocotrienol and its significant pharmaceutical
and nutraceutical benefits are being done to break the perception barrier created by palm oil
detractors. There are increasing studies being published on the advantages of consuming
tocotrienol, ranging from its skin-enhancing properties, anti-aging properties, anti-cancer
and anti-diabetes abilities, to liver protection from drug-induced injury.

MOVING FORWARD
W
ith the projection of an El show incremental improvements
Nino phenomenon on the on an increase in demand for tyres
way and reduction in the from Japan, the United States and
stockpile, there is a lot of optimism Europe. There has also been a
over the local palm oil industry. growing diversification of activities
According to Minister of MPIC, in the industry, moving from rubber
Dato Sri Amar Douglas Uggah product manufacturing such as gloves
Embas, Malaysia must continue towards the production of Ekoprena
to have an effective mechanism to and Pureprena.
reduce the stockpile domestically Moving forward, the initiatives
with measures within its own control. under this NKEA which encompasses
The best mechanism for this lies with the entire value chains of palm oil and
the Palm Oil NKEA initiatives through rubber will remain holistically centred
the downstream diversification. on People, Planet and Profits.
For the rubber sector, the
Malaysian Rubber Board has expressed
confidence that rubber prices may
Ripirian buffer zones (pic, left of river) are important for conserving
freshwater ecosystems and provide habitat for land-based animals

Palm Oil & Rubber
THE COOPERATIVE
WAY TO GREATER Haji Sharif Azib
Chairman,
Koperasi Penanam Sawit
INCOME Mampan Termeloh (KPSMT)
People need to see that we are different from previous cooperatives and I believe
that we are already making inroads because we have an increasing number
of non-members selling their produce to our palm oil collection centre.
H
aji Sharif Azibs greatest The numbers may be small but members as dividends and incentives.
challenge is to prove to these are dedicated members who truly We also ensure that everything is above
smallholders in Termeloh, believe that we can make a difference, board and transparent.
that collective actions through said Haji Sharif, who pointed out KPSMT also encourages small
cooperatives have greater potential in that transparency and effective holders to adopt better farming
increasing income than working in silos. management are very important when methods and harvesting technology to
The 57-year-old chairman of the running a cooperative. raise yield and produce better quality
Koperasi Penanam Sawit Mampan People need to see that we are fruits with higher oil extraction rate.
Termeloh (KPSMT), has been facing an different from previous cooperatives According to Haji Sharif, unlike older
uphill battle to win over smallholders and I believe that we are already cooperatives dominated by much older
who are disillusioned by numerous making inroads because we have an members, KPSMT embraces young
failed cooperatives in the past. increasing number of non-members farmers who are more open to new
Nevertheless, he is unfazed as he selling their produce to our palm oil ideas in farming and management.
believes that the eventual success of collection centre. Apart from having young blood
KPSMT will dispel the apprehension He said the KPSMT cooperative on board, we are also supervised by
over cooperatives. collection centre not only allows MPOB who constantly advises us on
KPSMT, which was established smallholder to save transportations the best methods, he said.
in September 2011, is open to all costs to the mills but also buys their
smallholders with palm oil plantation produce at market rate. "As opposed to
of 100 acres and below in the district of other independent collection centres,
Termeloh. It currently has 64 members we only take 18 percent for cooperative
owning a total of 400 acres. profit, which will be channelled back to

MOVING
TOWARDS Lia Ah Kau
Smallholder
GREATER YIELD
It would have taken It has been a year now since

replanting and there is another year to
countless challenges and my siblings
preferred more comfortable jobs in
us a much longer to replant go before he can expect a harvest of at bigger towns.
least 30 percent more than previously. Due to the demand for palm oil,
without such assistance, and It would have taken us a much it is a job that provides good income
cost us more than RM7,500 per longer to replant without such

assistance, and cost us more than
said Lia, however, he is concerned that
that his children may not be interested
hectare including seedlings, RM7,500 per hectare including in taking over from him. Despite the
seedlings, fertiliser, pesticides, the assistance and encouragement from
fertiliser, pesticides, the rental for tractor and labour, said Lia the government, it is not a vocation
who owns a total of 20 hectares of oil many young people are interested
rental for tractor and labour. palm plantation. in pursuing.
L
He said the older the trees According to him, the biggest
ia Ah Kau 39, would have produces lesser fruits and because challenge facing plantation owners
needed to save for more than these trees are very much taller both big and small are skilled workers
two years to replace his 40- than younger ones, harvesting especially fruit harvesters. "Harvesting
year- old oil palm trees if it were not becomes a problem. We need skilled is a highly skilled job, you must know
for the government assistance, which harvesters to do this and there arent how to harvest without damaging the
included the provision of high yielding many around. fruits. The local young labour force is
seeds and financial assistance for He also pointed out that not interested in learning this skill as
clearing and replanting efforts. government assistance enabled him to they prefer to leave to bigger towns for
This assistance is part of the mechanise his clearing and replanting other jobs."
Government scheme under EPP1 efforts which took him a month for Unlike what is commonly
pushing for the replacement of aged two plantations of 10 hectares each. perceived, working in the oil palm
palms that are 25 years and older Without mechanisation, this labour plantation is not so hard; most times
with younger high yielding trees by intensive effort would have taken him I work half a day only and I make a
farmers and independent smallholders almost a year to complete. decent living. Young people prefer
to ensure a sustainable supply of the Of all his siblings, Lia was the only bigger town because there is more
commodity to downstream palm oil one who was willing to take over his entertainment there. Here in Termeloh,
operators within and outside the region. fathers plantations. It is a job with there is nothing to do at night.

Tourism
TOURISMS DATO' SERI MOHAMED

NAZRI BIN ABDUL AZIZ
RESILIENCE
MINISTER OF TOURISM AND CULTURE
A WELCOME
The year 2015 was Malaysias
Year of Festivals and the Ministry
of Tourism & Culture (MOTAC)
STRENGTH
worked with its many partners to
create a calendar full of festivities
to celebrate Malaysias unique and
diverse offerings. The year also saw
continued international recognition
of Malaysia in the tourism sector
with various industry accolades
such as Best Golf Destination in
Asia for a second year running by
the World Golf Awards 2015, Worlds
Top 10 Food Destinations by CNN
and Georgetown, Penang one of the
Top 10 Best Travel Destinations for
2016 in the Lonely Planet.
Despite various challenges,
tourism remains a resilient sector,
and it is one of the economic
pillars that can assist Malaysias
economic recovery. We will take
this opportunity to promote
affordable travel to international
and domestic tourists.
The initiatives under the
Economic Transformation
Programme (ETP) and also the

Despite various
challenges, tourism remains
a resilient sector, and it is
one of the economic pillars
Malaysia Tourism Transformation
Plan (MTTP) have been instrumental that can assist Malaysias
in driving towards our ambitious
targets of achieving 36 million economic recovery.
tourists and RM168 billion tourism
receipts by 2020. Given that we are
T
now at the halfway mark of the ourism is an important
programme, it is timely to review economic sector in Malaysia INSIDE THIS NKEA
and enhance the implementation and remains pivotal to the
of some of the existing initiatives, nations economic transformation. 1 Malaysias Tourism Grows via
Private Sector Endeavours and
Despite global economic and sectoral
and encompass any new ideas Collaborations
challenges, the tourism sector
and potential game-changers.
With these ongoing efforts, I am
improved its position from fifth in
2014 to third highest Gross National
2 Tourism Industry Growth Supported
by Strategic Government Initiatives
confident that the tourism sector Income (GNI) contributor for 2015. In
will continue to achieve greater terms of tourist receipts, it decreased
heights going forward. by 4.0 percent from RM72 billion to
RM69.1 billion in 2015. Tourist arrivals Malaysias competitiveness as a
recorded a decline of 6.3 percent from leading tourism destination in the
27.4 million in 2014 to 25.7 million in region was recognised via numerous
2015. The drop in tourist arrivals and awards in 2015 with Indias leading
receipts can be attributed to the global luxury and travel magazine Travel
economic slowdown and challenges + Leisure crowning Malaysia as the
such as the worst floods in 30 years Best International Destination Food
which affected several states in and Drinks 2014 in April 2015. The
Malaysia in early 2015 and earthquakes countrys attractiveness as a shopping
in Ranau, Sabah in June 2015, regional haven continued to increase and it
travel advisory for the coastal areas of was ranked the second most popular
Southeastern Coast of Sabah as well as shopping city in the world for Muslim
the lingering effects of the MH370 and tourists by the Muslim Travel Shopping
MH17 incidents. Index (MTSI) 2015.

Tourism
Malaysia became the ever to win in June 2015, a total of 755,399 visitors Asia in May 2015, namely the Mitsui
the Best Golf Destination in Asia visited the Malaysia Mega Biodiversity Outlet Park KLIA Sepang housing 127
two years in a row at the World Golf Hub (MMBH) sites in 2015. This brands. It managed to attract over one
Awards. The country also continued to achievement is highly commendable million visitors since its opening up to
gain momentum in the high-yielding given that full repair and recovery of the end of 2015. Malaysia undoubtedly
Meetings, Incentives, Conventions and the infrastructure at the sites concerned remains poised to identify further
Exhibitions (MICE) category, moving up has yet to be completed, particularly at initiatives and improvements in its
five places to 30th in the world in the 2015 Kinabalu Park where only part of the efforts to stay ahead of the game to
International Congress and Convention trek was reopened in September 2015. attract more tourists.
Association (ICCA) rankings for the full The industry remained resilient
year of 2014. with notable developments,
In spite of the negative impact particularly from the private sector.
due to the year-end floods in 2014 , One significant highlight is the opening
and Sabahs devastating earthquake of the largest outlet mall in Southeast
1 Malaysias Tourism Grows via Private Tourist spend on shopping

picked up momentum in 2015, with
Sector Endeavours and Collaborations total spend on shopping rising by

0.2 percent to RM21.63 million and
shopping representing 31.3 percent
of the total tourist spend in Malaysia.
The Shopping Secretariat Malaysia
(SSM) also stepped up efforts to
engage with the retail industry and
held multiple sessions during the
year. The Government promoted
smart partnerships via collaboration
with various private sector players,
including shopping malls, shopping
associations and retailers.
Outlet centres for premium items
continue to grow in popularity.
Malaysia became the first country to
have a Mitsui outlet outside of Japan
in 2015 and home to the largest Mitsui
outlet to-date. Mitsui Outlet Park KLIA
Sepang (MOP KLIA) is unique in that
it offers amenities tailored to transit
travelers such as free shuttle buses
to KLIA and KLIA2, baggage storage
Minister of Tourism and Culture YB Dato Seri Mohamed Nazri giving the welcome address at facilities and flight information
the Malaysia 19th Tourism Awards 2014/2015 which serves to acknowledge industry and media
boards. The strategic location and
partners for their efforts throughout 2014 and 2015 in enhancing Malaysias image as a premier
destination in the world customer-friendly services have

Quantum of the Seas during its maiden call on 14 June 2015 alongside two other concurrent cruise calls at Bousted Cruise Center (BCC), Port Klang. This Royal
Carribean International vessel is the largest cruise ship to call at any Malaysian port, berthing at both BCC and Swettenham Pier, Penang in 2015
appealed to shoppers as evidenced on land amalgamation. The Malaysia Schiff by Tui ships also gave BCC its
by the encouraging footfalls with sales Eye is expected to be completed in 2016, first overnight call. Growth looks set
exceeding expectations. and the International Cruise Jetty is on to continue in 2016 with a focus on
In 2016, SSM will work to ensure its track for completion by end 2017. improving destination coordination,
efforts abroad will yield the targeted The Malaysian cruise industry particularly for high-value calls.
Return on Investment (ROI), which continued its upward growth trajectory A major new Dedicated
may be a combination of the value from in 2015 with a marked 50 percent Entertainment Zone (DEZ) TREC
packages sold and also any PR value increase in total cruise passengers KL - opened in 2015 in Kuala Lumpur
from the campaigns. From a tactical to 523,272 passengers from 352,322 with Zouk KL, Asias largest super
perspective, campaigns will also put passengers in 2014. A total of 487 club, as its anchor tenant. Zouk offers
more emphasis on the experiential calls were made in 2015 compared 10 new rooms across 106,000 sq. ft.
element of shopping in Malaysia. to 356 in 2014. Almost all the key call and was named one of the worlds
SSM will also be looking to spread ports in Malaysia saw growth, in spite Top 100 Clubs by the international
the BBKLCC Tourism Association of Star Cruisess commercial decision DJ Magazine publication. The club
model by encouraging other shopping to capitalize on the rapidly growing continues to offer free entry to tourists
precincts in the country to form their Chinese market and reposition the via its special designated lane and this
own associations. 1,480 passenger Superstar Libra, which is expected to be a boost to Malaysias
Following the endorsement of previously home berthed in Penang to tourism landscape. Apart from Zouk,
two new integrated developments the Chinese market. TREC also has the Electric Boulevard,
in Melaka and Rawang in the form The cruise industry saw a number an eclectic international selection
of the Melaka Gateway and Project of prominent developments in 2015. of lifestyle outlets which is aimed at
TWO, efforts in 2015 were focused One key highlight is the maiden attracting both locals and foreigners.
on facilitating the progress of these calls of the Quantum of the Seas The successful opening of TREC
projects. The first phase of the Melaka at Swettenham Pier, Penang, and is a culmination of both private
Gateway project experienced some Boustead Cruise Center (BCC), Port sector investment and Government
delays as the developer KAJ Sdn. Bhd. Klang. This 4,180 passenger vessel is facilitation. It was endorsed as an
opted to postpone the completion of the the largest Royal Caribbean Vessel to be EPP project in 2014 involving private
Malaysia Eye by several months to focus deployed in Southeast Asia. The Mein investments of about RM130 million.

Tourism
2 Tourism Industry Growth Supported students at spa establishments upon

graduation. They are required to have
by Strategic Government Initiatives student placement pre-arrangements

with potential employers.
MOTAC has also continued efforts to
regulate the spa industry and as part of
Government incentives and were stepped up to rebrand the spa these efforts, 240 spas nationwide have
programmes continue to play a industry. With these efforts, 255 been rated. Up to end 2015, 91 of these
major role in developing the tourism local spa therapists were trained in spas were rated 3-star, 66 spas rated
industry. Coupled with the relevant 2015 by the COEs. The total number 4-star, and 32 spas were rated 5-star.
supporting policies and facilitation, of spa therapists trained since the As part of efforts to create a more
the Government has endeavoured to commencement of the Spa Therapist structured and systematic aviation
ensure a conducive environment for Training Programme in 2011 is 820. industry, the Government established a
the industry to grow. Following the successful completion Malaysian Aviation Commission in July
The Investment Tax Allowance of the course, these therapists 2015. The Commission will undertake
encouraged the opening of more 4- will be placed in 3-5 star rated spa policy and planning functions to manage
and 5-star hotels in 2015, including the establishments for 18 months. capacity and competition via licensing,
luxury Kempinski-branded 5-star hotel Two new COEs - Geomatika route allocation and streamlining of
by the KSK Group in Kuala Lumpur University College and YTL Academy airports according to hierarchy.
which will commence construction in were added to the existing four The Malaysia Convention &
2016. Notable completed new hotels COEs further boosting capacity to Exhibition Bureau (MyCEB) continued
include The Light Hotel and G-Hotel meet industry demand. The COEs to serve as an effective platform for
Kelawai in Penang, The Waterfront are carefully selected and must be growth in the hosting of world-class
Hotel in Kuching and Sipadan Mangrove registered with the Skills Development events. MyCEBs Malaysia Major
Resort in Sabah. The total number of Department to conduct the National Events (MME) unit and the Business
new completed 4- and 5-star hotel rooms Occupational Skills Standard (NOSS) Events (BE) unit contributed towards a
in 2015 was 4,597 rooms, bringing the Level 3 for Spa Therapists using the vibrant events calendar with 245 events
total to 19,823 new 4- and 5- star hotel National Dual Training System. COEs supported throughout the year.
rooms since the start of the Economic are required to submit reports to MOTAC Highlights in terms of major events
Transformation Programme in 2010. on a regular basis pertaining to training include Ironman 70.3 Putrajaya 2015
Efforts by the Government together schedules, the progress of students, with 2,272 participants and the Jon Bon
with the Centers of Excellence (COEs) curriculum updates and placement of Jovi Because We Can: The Tour concert
which attracted 18,168 attendees. These
efforts enabled MME to record a total
number of 67,400 international tourists
at supported events.
On the MICE front, Malaysia hosted
the Congress of the Asia Pacific Society
of Respirology 2015, and the 18th ASEAN
Federation of Endocrine Societies (AFES
2015), both of which had more than
2,000 delegates in attendance. Major
bids secured in 2015 include the ISI
World Statistics Congress (ISI) 2019,
General Assembly of the International
Co-operative Alliance (ICA 2017) and
the Congress of the Asian-Australian
Malaysia Convention & Exhibition Bureau (MyCEB) and the Malaysian Association of Convention &
Association of Animal Production
Exhibition Organisers & Suppliers (MACEOS) held the 2nd edition of the rAWr Awards, in an effort to
provide recognition to excellence within the Business Events Industry. Societies (AAAP) 2018.

MOVING FORWARD
T
he Government remains was timely to review the existing
steadfast in achieving its initiatives and identify new product
ambitious targets of 36 offerings including incorporating
million tourists and RM168 billion the recommendations of the recent
tourist receipts by 2020. Given that studies embarked by the Ministry.
2015 represents a halfway mark This would be done by way of an
for the Economic Transformation NKEA Tourism and Culture Lab. The
Programme and to take on board the recommendations of the Lab will be
dynamic landscape of the tourism geared towards propelling the tourism
sector, MOTAC has decided that it sector towards greater heights.

Tourism
REDEFINING THE W
ith an estimated 250 Mitsui Fudosan is a major real
outlets by year 2021, estate developer in Japan and holds
Mitsui Outlet Park KLIA a 70 percent stake in MOP KLIA with
FACTORY Sepang (MOP KLIA) has the potential

to be the largest factory outlet in
South East Asia. For the first seven
Malaysia Airports holding the rest.
The airport operator helped in terms
of facilitation and communication
OUTLET months of 2015 that the outlet mall

has been in operation, MOP KLIA has
with local authorities as well as
providing market intelligence on
SHOPPING MALL
also managed to exceed its projected local expectations.
sales targets. While Mitsui Fudosan fuels
MOP KLIA is part of The KLIA the Mitsui Outlet Park KLIA Sepang
BUSINESS
Aeropolis development which aims with global operational expertise,
to transform the KLIA area into a Malaysia Airports is the backbone
multimodal and multifunctional that facilitates with the local needs.
IN MALAYSIA enterprise and which will eventually

become a diversified Airport City
promoting employment, shopping,
Together, we intend to redefine the
factory outlet shopping mall business
in Malaysia, said Cheah.
trading, exhibition, logistics facilities, Several other government agencies
business and leisure. were also instrumental in making MOP
Malaysia and Kuala Lumpur has KLIA Sepang a success said Cheah,
been recognised globally as a shoppers such as the Ministry of Culture and
haven hence, the factory outlet concept Tourism, Ministry of Domestic Trade,
will further strengthen and provide a Co-operatives and Consumerism
larger spectrum of choices for locals Malaysia, PEMANDU and the Ministry
as well as foreigners alike while of Works. Local authorities such as
complementing the development of an the Sepang Municipal Council and
airport city, said MOP KLIA Deputy BOMBA were also involved in the
Managing Director TJ Cheah. success of MOP KLIA.

Malaysia and Kuala Lumpur
has been recognised globally
T.J. Cheah,
as a shoppers haven hence,
Deputy Managing Director,
Mitsui Outlet Park KLIA
the factory outlet concept will
further strengthen and provide
a larger spectrum of choices
for locals as well as foreigners
alike while complementing the
development of an airport city.
These agencies and authority

bodies supported in terms of rendering
business advice, facilitation and
providing tax incentives, said Cheah.
The authorities had internalised
our business model and rendered
the necessary support to ensure
our aspirations were delivered
as scheduled.
MOP KLIA boasts many facilities
for airline transit passengers such
as airline check-in kiosks and free
baggage storage facilities. Cheah said
that while numbers for passengers on
transit are increasing steadily, most
patrons to MOP KLIA are shoppers
from within Klang Valley.
There were 128 outlets in MOP
KLIA at the end of 2015, spanning
across a commercial space of 24,000
sq m. Future expansion of the outlet
park has been planned for Phase 2
and Phase 3, which are scheduled
to start operations by 2018 and 2021
respectively. By year 2021, commercial
space in MOP KLIA will increase to
over 44,000 sq m.

Electrical & Electronics
MOVING DATO SRI

MUSTAPA MOHAMED
TO HIGHER
MINISTER OF INTERNATIONAL TRADE AND INDUSTRY
VALUE-ADDED
The Electric and Electronics
(E&E) industry continues to be a
key driver of Malaysias industrial
ACTIVITIES
development and contributes
significantly to GDP growth,
export earnings, investment, and
employment. In 2015, 93 E&E
projects with investments worth
RM8.9 billion were approved,
exceeding our annual target of
RM6.0 billion. Of this, 26 projects
were new projects with investments
of RM2.1 billion while 67 were
expansion/diversification projects
with investments amounting to
RM6.8 billion. Foreign investments
continued to dominate overall
investment, accounting for
RM8.2 billion (92 percent) of total
investments as compared to RM0.7
billion (8 percent) of domestic
investments. Overall, a total of
455 projects, valued at RM45 billion
have been approved for the period
of 2011 to 2014, where 78 percent or
356 projects valued at RM35 billion
have been realised thus far.
Exports of E&E products rose
by 8.5 percent to RM277.92 billion

YB DATUK SERI
PANGLIMA MADIUS TANGAU
MINISTER OF SCIENCE, TECHNOLOGY AND INNOVATION
in 2015 versus RM256.14 billion The E&E industry has remained N a n o M a l a y s i a s

in 2014, the highest export value as Malaysias economic mainstay commercialisation frameworks,
since 2007 and accounted for since the 1970s . The Ministry, namely iNanovation and
35.6 percent of total exports. together with its agencies such as National Graphene Action Plan
This was driven by continued MIMOS, SIRIM and NanoMalaysia 2020, leverage on and maximise
demand for new applications of Bhd have been playing an active utilisation of existing infrastructure
internet of things (IoT) for wireless role in re-energising this sector. and talent, further strengthening
communications and wearable In 2015, MIMOS undertook the the public private partnerships.
devices. Major E&E export task to train more than 500 E&E During the year, we also
destinations with significant engineers and students. As a result, launched the National Internet of
increase (exceeding RM1 billion) more than 150 companies directly Things (IoT) Strategic Roadmap.
for 2015 include Singapore, USA, benefited from the programmes The main objective of this roadmap
Thailand, Republic of Korea, offered through its Advanced is to create a national ecosystem
Germany, Japan and India. Shared Facilities. that enables the proliferation of use
Since inception, the NKEA The Nanotechnology and the industrialisation of IoT as
E&E has achieved 78 percent of Semiconductor Technology Centre a new source of economic growth.
its Roadmaps target at end-2015, (NSTC) at MIMOS, launched in In 2015, Malaysias total export
and is on track to meet its overall July 2015, provides complete E&E for E&E products was RM277.92
targets by 2020. ecosystem support in the areas of billion. With new breakthrough
The signing of the Trans Pacific nanoelectronics, graphene and discoveries in nanotechnology
Partnership Agreement (TPPA) semiconductor microelectronics. and the rise of IoT, we have the
on 4th February 2016 is expected The Ministry is fully committed potential to increase our export
to benefit the E&E industry as a in supporting the adoption of by 2020.
whole, as it will provide Malaysian nanotechnology in Malaysia, as
companies, particularly SMEs, it is a game-changing innovative
the opportunities to export their technology with amazing potential to
products to TPPA member countries, energise the growth of our industries
which collectively account for 40 through the creation of more high-
percent of global GDP. value local products and solutions.

E
lectrical and electronics ecosystems of semiconductors,
(E&E) is the leading and the solar and Light emitting diode (LED) INSIDE THIS NKEA
most liberalised industry technologies.
in Malaysia's manufacturing Semiconductors are expected to 1 Delving into Downstream Industries
sector.Since the establishment of the continue spearheading the growth

first semiconductor plant in Penang of the E&E industry in Malaysia and
in 1972, Malaysia has become a major
global manufacturing hub for the E&E
will continue to benefit from growing
global demand in the usage of mobile
2 Turning on LEDs
industry. Four decades on, Malaysia devices (smartphones, tablets),

continues to be a preferred E&E storage devices (cloud computing,
investment destination. data centres, personal data drives), 3 Harnessing the Power of the Sun
E&E products have been the largest optoelectronics (photonics, fibre

traded items for Malaysia for several optics, LEDs) and embedded
4
decades since the industry inception technology (integrated circuits, Expanding the Electrical
in the 1960s. The industry evolution PCBs, LEDs). & Electronics Industry
until today has turned Malaysia as one The growth trends achieved
of the leading points in the global E&E during the year reflect a concerted,
value chain. industry-wide effort to shift from low
As Malaysia moves forward, the value-added activities to high-value
E&E segment is focused on deepening operations to remain competitive in a
and strengthening the three major globalised economy.
1 Delving into Downstream Industries

Strong expansion in downstream American company to manufacture
industries boosted the E&E Gross multi-sensor and heat-assisted
National Income (GNI) to RM53 billion magnetic recording devices; a new
in 2015 versus RM46.5 billion in 2014. project by a wholly Malaysian-
In 2015, the Malaysia Investment owned company with investment
Development Authority (MIDA) of RM71 million to undertake the
has already approved total E&E activities of die preparation at
investments of RM8.9 billion, wafer level for photonics integrated
exceeding the full-year target of RM6.0 circuits (IC); and two new solar cell
billion. The bulk of investment was and module manufacturing plants
from foreign investors. They include owned by Chinese firms worth
a RM2 billion investment by an RM600 million.

Of the cumulative RM45 billion EPP14: Transmission and The timing of introducing the
worth of investments approved in distribution (T&D) equipment EESC could not be better as it will
2011-2014, RM35.2 billion or 78 percent manufacturers (1) identify the gaps in the E&E ecosystem
was realised. This exceeded the target and establish sub-working groups
EPP17: Mobile devices
of 65 percent. to address specific needs for the
companies (1)
In 2015, MIDA approved 11 high industry to move forward in the
impact projects in the NKEA, under Business opportunity (BO) 5: next five years. Over the years, local
Network storage solution companies have been impacted by the
EPP1: Semiconductor
technology hub (1). rising cost of doing business, such as
fabrication plant (1)
the implementation of the goods and
EPP2: Advanced packaging (2) On 25 June 2015, the Electrical services tax (GST), impact of a weak
and Electronics Strategic Council ringgit on import costs, lack of local
EPP3: Integrated circuit (EESC) was set up with the aim of talent and stiff competition from
(IC) design firms (1) providing strategies to raise the lower-cost competitors in China. All
EPP4: Substrates manufacturer (2) nations E&E industry to the next level these have further capped the growth
of capabilities and competitiveness. of local E&E companies.
EPP6: Wafer and cell
The EESC, chaired by the Minister of
producers (1)
International Trade and Industry, will
EPP7: Solar module act as an advisory platform for the E&E
manufacturers (1) industry over the next five years.

2 Turning on LEDs chain of other local players in the

LED industry. In addition, it will
complete the LED ecosystem in
Malaysia, and make the country
Malaysia is now gaining to construct a new LED chip plant in more conducive for the deployment
prominence as a production Kulim, Kedah. Construction will likely of high-technology projects.
hub for LED manufacturers. The kick off in the first quarter of 2016. Whilst the industry has had a
development and production of The plant is set to be the largest and good run in 2015, there are some new
LED clusters in the country cover latest six-inch LED chip production challenges especially for the local LED
semiconductor devices for LED, site in the world. It is part of the manufacturers. LED lamp testing is
wafer fabrication, lighting products groups 3 billion new investment costly and takes a long time (6,000
and solutions. LED applications that will transform it into a global hours) due to new standards (MS
include vehicle lighting, backlights semiconductor player. 62722-2-1) imposed by Europe and the
and displays. This project will be beneficial to US. This has delayed the penetration
Osram Opto Semiconductors is Malaysia in terms of jobs creation of newly certified LED products into
investing 1 billion (RM4.67 billion) and further strengthens the value international markets.
P-Plus Sdn. Bhd., a company under the Green LED/SSL Programme showcasing Malaysian made LED/SSL products at SME Corp Malaysia's closed door
business linkages event

3 Harnessing the Power of the Sun
First Solar launched its TetraSun technology-based production line at its PV manufacturing complex in Kulim Hi-Tech Park, Malaysia
As at December 2015, Malaysia Meanwhile, JinkoSolars solar cell Anti-circumvention duties of 53.4
is home to a total of 16 solar and module manufacturing facility percent and anti-subsidy duties of 11.5
manufacturing plants, with a commenced production of highly- percent now apply to Chinese solar PV
production capacity of 2.6GW of cells efficient cells and multi-crystalline panels and cells shipped from Taiwan
and 5GW of modules per year. modules in May 2015, providing the and Malaysia to the EU. To mitigate the
During the year, the Northern company with an additional capacity impact of this on the local industry,
Corridor Economic Region (NCER) of 500MW for solar PV cells and 500MW the Ministry of International Trade
welcomed two new solar panel players, for modules annually. and Industry (MITI) is putting in place
JA Solar Holdings Co Ltd and JinkoSolar While the growth of the solar panel measures in the approval of Chinese
Holdings, to Penang. JA Solar Holdings industry is evident, it is not without its companies setting up manufacturing
Co Ltd, one of the worlds largest challenges. In May 2015, the European facilities in Malaysia to ensure high
manufacturer of high performance Union (EU) launched an investigation value activities are conducted in
solar power products, invested RM300 into Taiwanese and Malaysian solar Malaysia and local companies are part
million in October 2015, to establish its panel manufacturers after Chinese of the supply chain.
first manufacturing facility outside exporters were accused of evading
China. This factorys output would anti-dumping levies by shipping
represent 10 percent of the companys solar panels to the EU respectively
total production capacity globally. through Taiwan and Malaysia.

4 Expanding the Electrical Valley, Malacca, Pahang, Penang and

Sarawak. Among the parties GreenTech
& Electronics Industry Malaysia is working with is Eclimo

Sdn Bhd, a Malaysian-owned electric
vehicle company manufacturing electric
motorcycles and lithium ion battery
High value Research and The prototyping of an electric bus and packs. Eclimo has supplied 450 electric
Development activities are crucial as lithium-ion (Li-ion) batteries for electric scooters to the Women Peace Police
the nation moves up the value chain and hybrid vehicles a collaboration Squad (Amanita), KFC, Penang council,
within the E&E industry. between the Malaysia Automotive Institute Penang Island City Council, Penang
During the year, Penchem (MAI), University of Wollongong and Botanic Gardens and the state of Melaka.
Technologies Sdn Bhd developed University Technology Sydney, AutoCRC In addition, Universiti Teknologi
graphene conductive inks that have Ltd and Swinburne University were also PETRONAS (UTP), in collaboration
conductivity levels suitable for printed completed during the year. The prototype with local LED/ Solid State Lighting
electronic applications. This is significant e-bus was revealed at the ASEAN Auto (SSL) designer Hans System Design
as printed electronics is crucial in Show 2015. Commercialisation and mass Sdn Bhd, developed a copper-carbon
many downstream applications such production are expected to start in the nanotube (Cu-CNT) nanocomposite
as wearable devices and flexible second half of 2016. substrate for thermal management in
electronics, as well as key enablers of The Malaysian Green Technology LED applications that improves lighting
various Internet of Nano-Things (IoNT) Corp (GreenTech Malaysia), a government performance. During the year, the
solutions. To date, Penchem has signed agency under the purview of the Energy, company upscaled and commercialised
agreements with various partners to Green Technology and Water Ministry, the technology in LED lighting
use the developed graphene inks for is pushing for electric-powered mobility. application. This technology has various
application development, namely in They aim to install 300 charging other electronics applications that can
radio-frequency identification (RFID), stations nationwide by 2016 with more be adapted and licensed to players in
sensors and printed electronics. than 70 already installed in the Klang various industries.
MIMOS'S SHARED SERVICES FACILITIES USEFUL FOR MARKET PLAYERS

MIMOS Nano-Semiconductor Technologies Sdn Bhd, for example, relies years of experience in providing technical
Technology (NST) provides analytical on these shared services and facilities services to manufacturers in a wide
shared services and facilities, with the they have become part of its processes, range of industries, including consumer
aim of becoming a major catalyst for the and a channel to market its products, electronics and information technology
development of electrical and electronics provide demonstrations and introduce new equipment. Prior to the setting up of
(E&E) sectors in Malaysia and the region technologies. The facilities also enable its MIMOS shared services and facilities,
by offering a flexible engagement model, engineers to acquire hands-on experience Fintexs had sometimes used some of its
short turnaround time and integrated and develop new techniques. The facilities customers facilities but these came with
value-added services at competitive prices. had indeed helped Fintexs innovate and many constraints. Using MIMOS facilities
Among the services offered are failure evolve to meet its customer demands. had helped Fintexs save time and costs by
analysis/material analysis, reliability Fintexs is a trading company that up to 30 to 40 percent, on average.
testing, wafer and integrated circuit (IC) provide sales as well as after-sales support Having benefited from MIMOS shared
testing, IC design, wafer prototyping, and including installation, training, application services and facilities, Fintexs now actively
hands-on industrial upskilling programme. support, and commissioning. Over the markets them to its customers as well.
Software and testing tools are years, it has also specialised in turnkey
expensive. As such, MIMOS facilities had projects for Infineon China, Silterra, X-FAB,
become invaluable to companies that do etc to set up failure analysis and reliability
not have their own facilities or tools. Fintexs testing. The people behind Fintexs have 20

MOVING FORWARD
I
nnovation is the key in achieving rebrand the country as the hub for high It is believed that once the Trans-
the national agenda of moving technology activities, particularly in Pacific Partnership Agreement (TPPA)
up the value chain as the research and development (R&D) and comes into effect, Malaysian exporters
nation progresses from a middle- design and development (D&D), and will gain competitive advantage over
income economy to a high-income is encouraging the setting up of more regional competitors in exporting
one. In sustaining Malaysias technical support centres and Centres products, such as our electrical
economic growth and enhancing its of Excellence (COEs). and electronics sector. This will be
competitiveness, it is crucial that the In the 11th Malaysia Plan (2016- advantageous to the entire E&E value
Government focuses not just on the 2020), MIMOS will champion a chain from the aspect of GNI, jobs as
investments absolute value but also common integrated circuit (IC) design well as investments by giving us better
the quality. platform to enable both local IC design access as it eliminates or reduces tariff
The Government has adopted an firms and universities realise as well and non-tariff barriers between its
ecosystem approach to attract and as commercialised their ICs designs member countries.
generate quality investments that into various E&E applications. What is
are of high technology, high value- required now is a sustainability model
add, knowledge- and skills-intensive, to ensure that local IC design firms,
export oriented, capital-intensive, and and indeed all local E&E firms, can
design- and R&D-intensive. The goal is stand up on their own feet without full
to have projects with high GNI impact funding from Government agencies.
and strong linkages with domestic Further studies need to be done on
industries. MIDA is also striving to what it takes to move into that phase.

Business Services
BUSINESS DATO' SRI RICHARD

RIOT ANAK JAEM
SERVICES
MINISTER OF HUMAN RESOURCE
SECTOR
I am very pleased to see the
continued growth of the Business
Services NKEA, as it is a critical
TAKES OFF
component of our transformation
journey. The NKEA helps Malaysia
move up the services value
chain by attracting higher value
investments that enhance the
knowledge economy, have a
global outlook, and create skilled
jobs for Malaysians.
The continued growth of
business services means that more
and more high skilled employees
will be required. Witnessing the
shared services and outsourcing
industry creating over 16,000 jobs
this year is indeed assuring and
illustrates that the programme is
on the right track.
We will continue to work
with companies and educational
institutions to ensure Malaysia
produces the best industry-
ready graduates.

T
he business services sector
continued its expansion in
2015, generating RM46.2
billion in GNI. This represents a 9.7
percent growth over 2014, and Business
Services remains one of the fastest
growing NKEAs. This also means that
Business Services is on track to achieve
the 2020 target of RM78.7 billion in GNI.
The governance of the Malaysia is a regional leader in the
business services sector and is well
Business Services NKEA will
positioned to move up the value chain
transition from the Ministry of
and increase its export of services. The
Human Resources (MOHR) to the aim is to be globally competitive and
Ministry of International Trade and ultimately transition Malaysia to a
Industry (MITI) in 2016. I strongly knowledge-based economy supported
believe that this move aligns by a deep and diverse range of high-
value services. The country is now
very well with MITIs agenda to
a key global player in the fields of
develop the services industry. I
shared services and outsourcing
am confident that through close (SSO) and aviation maintenance,
collaboration between various repair and overhaul (MRO), and is
government ministries and INSIDE THIS NKEA
also experiencing significant growth
agencies, the industry will achieve in the data centre, green technology
its 2020 target Gross National and pure-play engineering fields. 1 Sustained Growth Acceleration
of Strategic Services Sectors
Notable developments this year
Income (GNI) of RM78.7 billion
include the opening of another global
and creating 43,000 jobs.
support centre by Schlumberger, a
landmark deal for UMW to manufacture
2 Developing Future Growth Segments
aero-engine fan cases for Rolls-Royce

and the creation of a one-stop solution
centre for engineering design and
prototyping by Malaysian engineering since 2010 to MITI, leveraging on
firm DreamEDGE. existing governance platforms such
Competition for investment, as the Malaysia Services Development
however, remains stiff and the Council (MSDC) and the newly revived
uncertain global economic climate Malaysian Aerospace Council (MAC).
has given cause for many potential The implementation of individual
business outsourcing clients to hold Entry Point Projects (EPPs) however
back. Technology also continues will continue to be led by their
to evolve, necessitating the need to respective agencies and ministries such
constantly review policies to ensure as Ministry of Energy Green Technology
the country can take advantage of the and Water (KeTTHA), Multimedia
latest developments. Development Corporation (MDeC) and
In 2016, this NKEA will move Malaysian Industry-Government Group
from under the purview of MOHR for High Technology (MIGHT).

Business Services
1 Sustained Growth Acceleration

of Strategic Services Sectors
The launch of the Malaysia Aerospace Industry Blueprint 2030 by YAB Prime Minister
MAKING MALAYSIA signed between Rolls-Royce and in October 2015. The centre has
AN AEROSPACE HUB UMW. Under the deal, UMW will employed 70 people and is one of
The aerospace industry, which manufacture and assemble aero- only five such Airbus locations around
is one of the priority sectors in the engine fan cases for Rolls-Royces the world, providing major aircraft
11th Malaysian Plan, hit several Trent 1000 engines which power engineering and repair design services
notable milestones this year. There the Boeing 787 Dreamliner. This to customers globally.
was the launch of the Malaysian agreement signifies the confidence A new EPP8 was also launched to
Aerospace Industry Blueprint 2030, that world-renowned companies have develop SMEs in the global aerospace
the revival of the Malaysian Aerospace in Malaysias capabilities, and opens manufacturing industry. This project,
Council, and the establishment of the door for even more opportunities led by SME Corp, will further enhance
a dedicated National Aerospace to be realised in technology transfer, Malaysias attractiveness as an
Industry Coordinating Office (NAICO) human capital development and investment destination for leading
under MITI. SME development. aerospace multinationals, as well
In terms of investments, a In addition, Airbus officially as help upskill the talent pool
landmark RM830 million deal was launched its customer service centre within Malaysia.

POSITIONING MALAYSIA AS A sourcing decisions due to economic an increasingly larger share of the
WORLD CLASS DATA CENTRE HUB uncertainty. countrys Gross Domestic Product
The new state-of-the-art Sedenak Challenges in the cost of doing (GDP).
Iskandar Data Hub was officially business were even more pronounced Shifting technology trends are also
announced during the year. The 700- this year. Connectivity costs remain straining current regulatory structures,
acre site in the Iskandar Region will be uncompetitive, and while power rates particularly involving cloud-based
equipped with advanced infrastructure, are still low relative to the rest of the services and data analytics. To cater
high-capacity power and reliable region, they face upward pressures for these shifts, regulators will need
connectivity, and has been earmarked for from impending tariff revisions. A to review old policies, while service
local and global data centre companies. more strategic review must be done providers will have to strengthen
This hub, together with key to further catalyse Malaysias digital data security measures to retain
data centre investments by leading economy, particularly as it generates customer confidence.
companies such as Huawei and
VADS Bhd (a TM subsidiary), further
establishes Johor as Malaysias
second location for data centres
after Cyberjaya.
Nevertheless, the slowdown
in the global market impacted
the confidence of buyers towards
outsourcing their data centre
activities. This led to EPP3 revenues
falling just short of the 2015 target,
and this trend is expected to continue
into 2016, as customers delay their VADS's new US$130 million data centre in Iskandar Puteri, Johor
2 Developing Future Growth Segments

JUMP-STARTING THE GREEN In line with this, the Green Tech
TECHNOLOGY INDUSTRY Financing Scheme (GTFS) has been
In the green technology space, extended to 31 December 2017 with a
solid waste management remains a fund of RM1.2 billion. It allows eligible
national challenge, particularly when companies to obtain a two percent
it comes to the current over-reliance on government subsidy on the loan
landfills. More must be done to build interest and a 60 percent guarantee
sustainable ecosystems. Nevertheless, on the risk of the loan via Credit
KPI achievement for 2015 was at Guarantee Corporation.
106 percent of the target, reflecting
the continued growth of the green
technology industry.

Business Services
DEVELOPING SMEs IN THE GLOBAL AEROSPACE MANUFACTURING INDUSTRY

The aerospace industry in Malaysia began with the establishment will receive business and technical advisory services aimed at
of MRO operations in the 1970s, and has progressed into the enhancing their business potential.
manufacture of aerospace parts and components and assembly To further support this EPP, the state of Perak announced the
of light aircrafts. 81-hectare Green Asia Aerospace Technology Park in Seri Iskandar,
As the Asia Pacific region is set to be the largest market for as part of the states five year Perak Development Plan. The project
new commercial aircraft, with orders expected to reach almost will be led by local aircraft composite parts company Admanco,
13,000 units by 2032, demand for MRO services and manufacturing and will also house US-based materials firm Hexcel, Singapore
of aerospace parts and components is also expected to increase. Aerospace Manufacturing and Malaysian precision tooling company
To map out Malaysias aspirations for this industry, the All Star Fortress. Upon full maturity, the park is targeted to house
Malaysian Aerospace Industry Blueprint 2015-2030 was up to 135 companies and create 10,000 new jobs.
launched at the Langkawi International Maritime and Aerospace The aerospace industry requires high upfront capital investment,
Exhibition (LIMA). In conjunction with this launch, a new EPP8 as well as numerous certifications and approvals. Therefore, SMEs
was also launched to develop small and medium enterprises require constant support and assistance in building capabilities and
(SMEs) in the global aerospace manufacturing industry. capacity, especially at the early stages.
This project, led by SME Corp, is targeted to contribute RM258 million It is clear that for these aerospace SMEs to thrive, collaborations
in GNI, 4,108 jobs and RM88 million in investments by 2020. with those commanding industry expertise must be enhanced to develop
In 2015, five SMEs were assessed and approved within SME a more holistic SME development programme, one that includes
Corps Business Accelerator Programme. This programme enables benchmarking, training, consultation, marketing and business matching
SMEs to be assisted through an integrated approach with guidance, activities. This will be done by leveraging on NAICO's governance
including strengthening their core business, building capacity platforms (e.g. Malaysian Aerospace Council, Technical Working Groups)
and capability, and facilitating access to financing. Applicants to ensure continuous integration with all levels of the supply chain.

MOVING FORWARD
M
oving into 2016, within The coming year will also see the
all the aerospace related continued implementation of the
EPPs, there will be Sedenak Iskandar Data Hub, and an
increased coordination between all increased focus on developing Sarawak
these EPPs and initiatives through as a data centre location, as the state
NAICO. This office looks to consolidate contains some natural advantages
representation of all private-and public- such as its large available land mass,
sector stakeholders. Ultimately, inter- abundant hydroelectric supply and low
agency alignment and public-private risk of natural disasters.
collaboration is crucial, as Malaysia
remains a relatively small player on
the global stage. It is imperative that
the industry tap the broader base of
expertise available in the country.

Business Services
Dato Yasmin Mahmood,

MDeC CEO
BUILDING GLOBALLY T
he Shared Services and
Outsourcing (SSO) sector has
been one of the standouts of
COMPETITIVE
Malaysias economic story over the years.
Not only has Malaysia been consistently
ranked as one of the top three most
attractive destinations for business
SHARED SERVICES
shared services and outsourcing by
global management consulting firm AT
Kearney, but the sector has outperformed
AND OUTSOURCERS
job creation targets as well.
Describing this sector as
Malaysias jewel in the crown, MDeC
CEO Dato Yasmin Mahmood reflected
that the cluster formerly known as
SSO has recently been renamed Global
Business Services (GBS) to better reflect
the changing nature of the global
outsourcing market, and the strengths
Malaysia can play to.
A key highlight, Yasmin said, was
that the target for new job creations for
2020 was met in 2015. And these are
high income jobs too, Yasmin noted.
Its not just about the number of jobs,
its also about the value of the jobs.

The industry veteran said that
while the ICT industry's average
She stressed that this commitment
at the highest level was of enormous
By elevating this
monthly salary in Malaysia is value to global investors. specific EPP2 to
about RM3,500 per month, the GBS It builds mega trust banks, said
industry average salary in Malaysia the MDeC CEO. a national ETP
is about RM6,400. And salaries at the
higher end of the GBS value chain,
She added that an agency like
MDeC was also important for investor
level, we have
i.e. Knowledge Process Outsourcing confidence. told the world
(KPO), are even higher at about Investors appreciate that there
RM8,400 per month. is an agency to support them so that that the whole
Yasmin said a major factor in the their businesses are successful and can
success of the sector was government thrive in Malaysia, said Yasmin. of Malaysia is
commitment. This commitment
helped gain the trust of investors in
Moving forward, new policies
and amendments to existing policies,
committed to
Malaysia as a top GBS location. as well as regulatory reforms, may delivering this
By elevating this specific EPP2 be needed to ensure Malaysias
to a national ETP level, we have told competitiveness. trust to the world.
the world that the whole of Malaysia There are global changes
is committed to delivering this trust happening, specifically in the legal,
to the world, said Yasmin. That healthcare, and Islamic financial areas,
we have access to the very highest which may call for some changes,
powers in the country, that we have said Yasmin. MDeC looks forward to
the mandates to help them grow, working with the relevant authorities
and that we will make the required to make these changes when required.
changes at a national level to support
them when required.

Business Services
TALENT DRIVES M
alaysias emergence as a
regional aerospace hub
is crucial for the nations
GROWTH IN
ambitions to be a high-income
economy by 2020. Zulfikri Osman, Chief
Operating Officer (COO) of M-AeroTech
AEROSPACE
said that the growth of the aerospace
sector represents our transition as a
country to a high-income economy.
VENTURE
As an industry, aerospace is high-
value and focuses heavily on human
capital development, he said. It is
important to diversify the nations
economy, making it less reliant on
traditional sectors such as the oil and
gas sector, especially in the current
economic climate.
Zulfikri added that Malaysia must
recognise the importance of developing
its most important resource: its people.
M-AeroTech was set up by Majlis
Amanah Rakyat (MARA) in 2014 to lead
its ventures into aerospace. It is also

Zulfikri Osman,
COO, M-AeroTech As an industry, aerospace is
high value and focuses heavily
on human capital development.
It is important to diversify the
nations economy, making
it less reliant on traditional
sectors such as the oil and
gas sector, especially in the
current economic climate.
championing the Business Services said Zulfikri. With a unified plan,

EPP7 - Making Malaysia a Hub for and unified goals under the ETP, we
Aerospace OEMs in Southeast Asia. are able to synergise better, and have
Zulfikri said that the push into better connectivity and coordination
aerospace has yielded great benefits with other stakeholders in the
and innovations in human capital Government.
development to MARA, which supplies Moving forward, Zulfikri said that
30 percent of the nations workforce. there needs to be enhanced human
This will pave the way to a capital development led by the
Malaysian workforce which is ready for industry itself. He said M-AeroTech will
the challenges of modern high-value continue to play a pivotal role in this
industry, he said. area, by engaging industry to enhance
The COO noted that M-AeroTechs the human capital development
involvement in the aerospace capabilities in MARA.
industry, and its working together He added that SMEs need to be
with PEMANDU to implement the further developed so that they are
Economic Transformation Programme, capable of entering the aerospace
have given it invaluable experience industry.
on how to participate in a high-value This is important for completing
industry and in high-quality human the supply chain, and to ensure the
capital development. country gains the maximum benefits
This helps us fulfill ETP goals from the growth of aerospace, said
such as high-value job creation, Zulfikri.

Communication Content & Infrastructure
ENHANCING DATUK SERI PANGLIMA DR.

MOHD SALLEH TUN SAID KERUAK
CONTENT AND
MINISTER OF COMMUNICATIONS AND MULTIMEDIA
CONNECTIVITY
2015 was another exciting
year for the Communication
Content & Infrastructure NKEA,
as it continued to build on the
momentum of existing projects
and refine initiatives.
One such initiative, The Film
In Malaysia Incentive or FIMI
experienced a phenomenal growth
in 2015. We saw a 40 percent
increase in terms of production
investment worth over RM457
million. Of this amount, 98 percent
was foreign led, and this means
we should continue to promote
Malaysia as a global film location
and to faciliate the ease of making
films here.
Another initiative, the Content
Malaysia Pitching Centre launched
in 2015 provides the creative
industry a platform to produce
world class content to compete in
the global market. It was a missing
cog in the industry wheel, as well as
a game changer at large, as it caters
to both budding movie making
entrepreneurs such as producers
and seasoned script writers, hair
and make up stylists, visual effects
teams, directors amongst others.

The Film In Malaysia
Incentive experienced a
phenomenal growth in 2015,
seeing a 40% increase in terms
We also made continued
progress in high impact projects of production investment worth
to deliver high speed broadband
and expand coverage to rural areas. over RM457 million.
This is part of our promise of better
Datuk Seri Panglima Dr. Mohd Salleh Tun Said Keruak,
service delivery and seamless
Minister of Communications and Multimedia
connectivity for all in a bid to make
broadband access inclusive.
I remain optimistic of 2016
T
and will ensure that we continue he Communications Content
to grow this sector, with focus and Infrastructure (CCI) INSIDE THIS NKEA
on developing the creative sector spans a wide ecosystem
industry human capital , creative covering creative content, network 1 Catalysing Growth in the
Content Industry
applications, services and devices.
content, as well as to enhance our
The growth of the CCI industry is
marketing and communications
infrastructure.
key to other National Key Economic
Areas (NKEAs) such as Electrical and
2 Pushing Boundaries
in e-Government
Electronics (E&E), Financial Services,
Tourism, Healthcare, Business Services
and even Education, which rely on 3 Enhancing the Foundation
and Access to Connectivity
communication infrastructure to
further boost economic potential.
As we head towards 2020, the
sector is undergoing a paradigm shift up to become a core function and it
from providing infrastructure and is expected to become a significant
access for Malaysians to providing economic contributor, with continued
applications and content that will support and participation. Malaysia
enable a knowledge-based economy. is making a name for herself as a
This is the critical and catalytic quality destination for filming. This
role the CCI NKEA will play in the confidence is mirrored by interest from
development and sustainability of a global and established film producers
high-income economy. such as Marco Polo Productions Asia
Within this sector, Malaysias Sdn Bhd, Netflix, The Weinstein
creative content ecosystem is shaping Company and production companies.

Additionally, it is evidenced with the technology into Government services. has been declared by the Human
opening of the renowned Pinewood This is to improve the various services Rights Council of the United Nations
studios in Iskandar Johor which is the accessed by the general public. as a basic human right to enable people
location of productions by Fremantle Successful implementation will to exercise and enjoy their rights to
Asia, Turner Broadcasting System Asia result in 90 percent of transactions freedom of expression as well as to
Pacific amongst others. being completed online with only 10 facilitate economic development. In
In addition, attractive financial percent completed with face to face addition, with the advancement of
incentives drew nearly half a billion engagements. Within the government technology, there is a bigger data in
ringgit in film spending just last year, system, there has been an ongoing the system and with that comes the
with 98 percent of it from abroad. This effort to go paperless by 2020 and need for better connectivity. This is
in turn also stimulated local demand this will ensure less incidents of because businesses are accessing
for supporting goods and services such documents going astray, easy retrieval data and information, consumers are
as catering, transportation, clothing, of documents and proper records using apps, online portals and social
construction and carpentry. being kept media. Essentially with more and more
A critical piece of this NKEA looks The right to Internet, otherwise Malaysians going online, ubiquitous
at expanding the adoption of the latest referred to as the right to broadband, connectivity is a necessity.
1 Catalysing Growth The Content Malaysia Pitching

Centre launched in 2015 will connect
in the Content Industry the creative industry to funding and

buyers. Its main purview is to review
commercial viability, vet pipelines
of eligible content and to maintain
accountability of funds. Additionally,
the centre provides the industry
with a physical facility where they
can gather to attend workshops and
master classes, participate in industry
and community events, and interact
with the right buyers and distributors
of their content. Since April 2015, 72
projects have been approved to receive
funding from various pitches during
the year.
Currently, both local and foreign
productions in Malaysia enjoy a
30 percent rebate on production
spending in Malaysia through the
Film In Malaysia Incentive (FIMI). As
a result of FIMI, a total of 16 companies,
comprising of 13 foreign and 3 local
companies qualified for this policy over
The Licensing Expo 2015 in Las Vegas - the meeting place for the global licensing industry where
companies will be able spot trends, build strategic partnerships or secure promotional tie-ins
the course of 2015. Collectively, these
through finding the right partners or opportunities to expand their businesses have contributed the sum of RM457

March du Film de Cannes attracts an estimated 10,000 participants who uses this event to debut and discover almost 4,000 films and projects in 34
screening rooms. Creative Content Association Malaysia, an industry-led and government-supported association of leading content creators in Malaysia
participated in March du Film 2015 to assist in promoting various local films
million in production investments. into Malaysia which translates to a and extras. This increase in demand
Amongst these productions are Indian Return on Investment (ROI) of 3.27 has enabled good scriptwriters to earn
Summer Series 2, Asias Got Talent, times. In addition, the total spending in excess of RM15,000 per month,
Lost in the Pacific and the animated on Malaysian good and services while an extra could command a fee
feature, Supa Strikas. by these companies on rental & of RM4,500. All this simply augurs
In addition to competitive leasing; construction and carpentry; well for the industry and the people
incentives (FIMI) and production accommodation; food and beverage, that work within. In addition, there
facilitation, the opening of Pinewood etc. was RM406.2 million. is the Creative Industry Lifelong
Iskandar Malaysia Studio with its state FIMI-supported production Progamme (CILLP) that aims to
of the art facilities also reinforced has also generated RM156.2 million develop and up skill creative talents
Malaysias position as an attractive in employee compensation in from script writers to directors to
destination for filming. The top two Malaysia, including MYR82.8m any Malaysian with an interest in
highest production investments at of direct employee compensation the creative industry. They would
Pinewood Iskandar were Marco Polo (i.e., Malaysian cast and crew) and have to be accepted to a recognised
Season 2 estimated at RM194 million RM73.4 million of multiplier effects programme in an institution and
followed by Indian Summers Season on employee compensation in apply for funding through the CMPC.
2 estimated at RM47 million. supplier industries. Finally, FIMI- To-date, 310 Malaysians have received
Apart from encouraging skills and supported production has generated funds and are undergoing courses in
knowledge transfer to locals working 5,679 Full-time Equivalent (FTEs) of local or international institutions.
within a production crew, FIMI also employment in Malaysia, including
stimulates local economies by creating 2,542 FTEs of direct employment of
a demand for goods and services Malaysian cast and crew and 3,137
such as catering services to prop FTEs of multiplier effect employment
making services to car rental services in supplier industries.
in order to fulfill the production With a thriving and growing
requirements. FIMI brought in RM893 creative industry, there is now a
million of production investment greater demand for production talents

2 Pushing Boundaries in e-Government DDMS is seen by the agencies to

improve the convenience, efficiency
and transparency of their services to
the rakyat and is also convenient for
E-Government is the use of CCI target number of 18. The encouraging trade facilitation.
technology to enhance the access to and adoption rate by the Government was The DDMS fulfils the objective of
delivery of Government services to the prompted by the need for a solution getting the Malaysian government to
rakyat and businesses. E-Government based approach towards minimising go paperless. Spearheaded by MAMPU,
will foster a better business environment, waste and to operationalize the DDMS also aims to increase the
strengthen good governance, broaden governments stance of reducing the accessibility, speed, and transparency
public participation and improve countrys carbon footprint. In turn, of Government services.
the productivity and efficiency of
Government agencies.
One of the main initiatives in
pushing the e-Government agenda
in Malaysia is the Digital Document
Management System. This is a cloud-
based system that is designed to
manage the creation and maintenance
of electronically created documents of
the Malaysian public sector agencies.
Some 31 ministries and agencies
adopted the Digital Document
Management System (DDMS) as of last School children utilising the Pusat Internet 1 Malaysia facilities after school hours for information
year, a number which far exceeds the seeking and educational purposes
3 Enhancing the Foundation and Access to Connectivity

An ideal nationwide premise to in 2015 to allow local communities (HSBB 2) and the Sub-Urban Broadband
provide connectivity to all Malaysians is in underserved areas to attain basic Project (SUBB). Both projects will see
on-going. To deliver this ambitious plan, Internet access and ICT training. TM roll out a last mile access network
a focused approach is deployed to ensure Furthermore, 51 Communications to homes and businesses utilising fibre-
that both accessibility and connectivity Towers were also established and to-the-home (FTTH), Ethernet-to-the-
meets the expectations of the users. this allows communities mobile home (ETTH) and VDSL2 technologies.
To enable that and cater for these phone coverage in their local area. Under this project, 95 additional
demands, there is a committed budget These towers are built by the various exchanges will be made HSBB ready,
and clear priority on infrastructure telecommunication companies in providing access to 390,000 premises
development. In 2015, 611 villages Malaysia to ensure their customers have in priority economic areas including
around Malaysia were able to access access anytime, anywhere in Malaysia. state capitals and selected major towns
the internet through the Kampung In December 2015, Telekom by 2017. In addition, some 420,000
Tanpa Wayar 1Malaysia initiative. Malaysia also announced the signing premises in sub urban and rural areas
This initiative provides free wireless of two public private partnership (PPP) will benefit from the SUBB project by
access to selected villages across agreements with the Government of 2019. Ultimately more Malaysians
the country. In addition, 99 Pusat Malaysia for the implementation of the will have better and greater access to
Internet 1Malaysia were established High Speed Broadband Project Phase 2 broadband, come 2020.

MOVING FORWARD
I
n 2016, the focus of this NKEA savvy stakeholders to enhance
will be to review and challenge knowledge and understanding on
the KPIs of projects that were technical projects to ensure faster
significantly overachieved in 2015. turnaround time in problem solving
This is to encourage effort by project and delivery.
owners to go above and beyond and Finally, in the coming year, we
realise purposeful results. In addition, will work to ensure that there is a
we intend to work closely with continuity of government policies
stakeholders and project owners on and implementation such as the High
their budget expenditure. This close Speed Broadband 2 and Suburban
monitoring of spending will ensure Broadband Film in Malaysia Incentive
optimal use of funds available in a (FIMI). This is to ensure that everything
challenging economic climate. that has been set out in the roadmap
We will also work towards is managed effectively, implemented
increased engagement with technical- and achieved come 2020.

CHECKING IN WITH LAGISATU

T
he Malaysia-based app his team could succeed. We worked Being part of such initiatives
LagiSatu aims to tap into during the day on our own platform brings a certain structure to your
the Muslim travel market by and technology and during the night business, which helps especially in
offering a search engine for hotels on freelance jobs to fund our business the beginning stages of starting a
that cater to those looking for Muslim- in the early stages, said Faeez. company, said Faeez.
friendly hotels. Support from various parties and The apps users have so far
We love travelling, but at the same stakeholders including hotel chains, consisted of both Malaysians and non-
time we do not want to compromise national tourism organizations Malaysians, with the majority coming
our beliefs and customs while doing and government institutions was from Southeast Asia, the MENA (Middle
so, said LagiSatus Co-Founder Faeez also crucial. Faeez noted that the East and North Africa) and Europe.
Fadhillah. LagiSatu differentiates itself Malaysian government currently To our surprise we also receive
from other solutions in the market in has many initiatives for start-ups many bookings from non-Muslims,
that its hotels have a Muslim-friendly and business owners. LagiSatu which shows that it does not have to
rating and all of its tours and activities also benefits from being an MSC be an exclusivity criteria to offer Muslim-
are suitable for Muslim travellers. status company which gives it friendly products, said Faeez.
Faeez said that at the beginning, access to education programmes LagiSatus revenue has increased
not many people thought that he and and funding initiatives. rapidly since the launch of the app

Faeez Fadhillah
Co-founder Lagisatu
To sell travel products to people is

a privilege, since it is usually the
best time and most longed for in a
year for every person and we take
this promise to offer the best holiday
products to our users very seriously.
and it also enjoys a high month-on-

month growth. Faeez said that it was
also even more important that LagiSatu
continues to improve its services to its
users on a regular basis and to measure
its success on the quality of products
and services.
To sell travel products to people is
a privilege, since it is usually the best
time and most longed for in a year for
every person and we take this promise
to offer the best holiday products to our
users very seriously, he said.
LagiSatu was founded in 2013
and currently has over 350,000 hotels
in its database. Their website can be
accessed at www.tripfez.com.

Education
NURTURING DATO SERI

IDRIS JUSOH
OUR TALENT
MINISTER OF HIGHER EDUCATION
POOL
Public-Private Partnerships
(PPP) have become a crucial
tool in helping to increase the
employability of graduates.
Leveraging on the private sectors
expertise, the Government is
able to inject new experiences,
methodologies and resources into
the Malaysian education system,
creating a highly marketable pool
of talents in line with the Malaysia
Education Blueprint 2015-2025
(Higher Education). Excellent
talent within higher education will
also enable Malaysia to continue
improving its education offerings
and strengthen its position as a
regional education hub and an
attractive education destination.

The main driver of the
DATO SERI
MAHDZIR KHALID Education NKEA is undoubtedly
MINISTER OF EDUCATION
(PPPs) as both the Government
The private sector remains
the key contributor to the quality and the private sector are
and accessibility of pre-school
education for our children. The natural partners in human
Ministry will strengthen its
collaborative efforts with the
capital development.
private sector in developing high
T
quality pre-school education that
he quality and capacity
lays a strong foundation for the of talent pool is a critical INSIDE THIS NKEA
creation of a highly capable talent component in Malaysias
pool. This includes enhancing transformation effort, more so when 1 Malaysia Continues to Focus
Efforts on Becoming an
the skills and qualification of the economy shifts towards high value- Education Hub of Choice
educators in this sector. added manufacturing and services, in
which technology and innovation play
a huge part.
2 Public-Private Partnerships
for Capacity Building
will also be used to push for Hence, efforts to create a pool of
support for initiatives like the quality talent to match the demand
promotion of the English language generated by economic transformation 3 Focusing on Clusters to Elevate
the Quality of Malaysian
and Special Education Needs continue to be the focus in 2015 Education Offerings
(SEN). For SEN initiatives, private and beyond.
For this purpose, the Ministry of
higher learning institutions,
Higher Education (MoHE) has been
industry players and the
working closely with the Ministry of industry as well as ensuring that our
government have come together Education (MoE) and other ministries education offerings meet the needs of
to provide more opportunities for to improve the quality and enhance a high-income and globally competitive
youths with special needs. the national human capital pool. economy. It is also the enabler that
The Ministry is also working closely feeds talent into the rest of the NKEAs
with the private sector to reduce the to ensure that we have sufficient human
mismatch between talent and jobs. capital in place to sustain the growth
The Education NKEA will continue and development of our Malaysian
driving the growth of our education economy.

Education
1 Malaysia Continues to EduCity, an initiative under EPP11,

is a unique concept of a self-contained,
Focus Efforts on Becoming multi-varsity education hub that

enables students to study, live and play
an Education Hub of Choice within a single geographical location.

In 2015, the student enrolment in
EduCity institutions saw 43 percent
increase, from 2,822 students in 2014
The Education NKEA covers the managing applications, processing to 4,022 students in 2015.
entire spectrum of education in the and renewals of international There are ongoing efforts by EduCity
country ranging from early childhood student visas to HLIs, skills training to continuously improve service delivery
care and education (ECCE) to institutions, language centres and through multiparty-partnerships.
professional skills training. Leveraging eventually to private and international A taskforce was set up in the first
on Malaysias strategic location and schools. quarter of 2015, comprising EduCity
accessibility throughout Southeast Asia, EMGS, an initiative under (Entry management and the institutions
initiatives under the NKEA also seek Point Project) EPP12, continues its within EduCity with the MoHE as a
to position the country as a regional enhancements as a one-stop centre facilitator. This taskforce ensures that
education hub, to optimise revenue for international students in order shortcomings and challenges that arise
generation potential for this sector. to create a pleasant and welcoming within EduCity are addressed as a
The International Student experience for the students and has collective responsibility by its members.
Taskforce chaired by the Minister of stepped up its marketing efforts to This was also a move to strengthen the
Higher Education is one of the many attract more international students to partnership among the stakeholders in
platforms that promotes consultative study in Malaysia. the effort to drive and fully maximise
process with relevant parties in the In 2015, there were over 140,420 EduCitys growth potential as an
public and private sectors in a move international students, of which 113,711 international education hub. The
to strengthen Malaysias position as a were in higher learning institutions, education institutions continuously
successful education hub. 26,709 in private and international problem solve and collaborate to ensure
Ongoing efforts in creating a hub schools. ETPs target is to achieve an that students get top quality education
has resulted in more international enrolment of 200,000 international and an excellent student experience
students coming to Malaysia not students by 2020. during their time at EduCity.
only for tertiary education but also
for basic education and programs on
technical and vocational training. In
2015, a total of 140,420 international
students were admitted into the
country for numerous courses in
public and private higher learning
institutions (HLI), skills training
institutions as well as private and
international schools, surpassing the
target set for the year by 3.1 percent.
Education Malaysia Global
Services (EMGS), a company
incorporated under MoHE, is the
key entity in not only marketing the
More international students are coming to Malaysia for basic and tertiary education and programs on
Malaysian Education Brand but also technical, vocational education and training
Based on data verified by PwC in the Agreed Upon Procedures (AUP). Refer to the "Agreed Upon Procedures by PwC" chapter on the AUP process.

of study, and 15 Malaysia students
transferred to Edinburgh for one to
two years of studies. The Malaysian
government will continue to encourage
student mobility and transfers between
the main campus and its branch. To
this end, the government has relaxed
the medical screening requirements
for mobility/transfer students coming
from the main campus to study in the
branch campus in Malaysia.
HWUM is highly regarded for the
professional relevance of its degrees and
the employability of its graduates. From
2014 to 2015, the university launched 24
new courses in its Malaysian campus
for the undergraduate and postgraduate
degrees in fields such as Engineering,
Actuarial Science, Construction,
Accounting and Business Management.
These are key areas of importance
to the Malaysian economy and supports
Heriot-Watt University is a new state-of-the-art campus strategically located in the modern city of Putrajaya the ETPs initiative to transform
Malaysia to be a high-income nation.
This EPP aims to be a human Malaysia (USMC). In addition, Xiamen With these new additions, HWUM
capital feeder to Malaysias industries University from China has also set up now has 25 courses and is looking at
as well as becoming a key contributor its branch campus in Malaysia, with its increasing the number to 28 by 2020.
to Iskandar Malaysia and the national first intake expected in February 2016. Its student population is targeted to
economys growth. Some of the programmes to be offered grow to 4,000 by 2020, with a staff
As a result of efforts under EPP15, by Xiamen University Malaysia include force of 300. As of 2015, HWUM has
Malaysia now has the largest number Bachelor of Arts in Chinese Studies and 1,010 students, of which 20 percent
of branch campuses in the world. Traditional Chinese Medicine. are international students and a staff
This EPP capitalises Malaysias These branch campuses have been force of 150.
attractiveness as a destination for working endlessly to offer new courses HWUM also works with industry
business and education to draw the and programmes for students as well partners to produce graduates with
establishment of branch campuses of as ramping up its marketing efforts to well-developed career related skills
foreign universities. recruit students not only from Malaysia and a real competitive edge; optimising
In the past couple of years, but from all over the globe. their employability in their chosen
four world-class branch campuses In the case of HWUM, with the same field, be it in Malaysia or abroad. The
have set up in Malaysia under the programmes offered at the Edinburgh, universitys current industry partners
Education NKEA initiative, namely Dubai and Malaysia campuses, include Shell, Schlumberger, Loh
Heriot-Watt University Malaysia students have the opportunity to & Loh, YTL Corporation, MNRB
(HWUM), Newcastle University of transfer between campuses and benefit Holdings, Malaysian Rubber Export
Medicine Malaysia (NUMed), the from the international experience. Promotion Council and Great Eastern,
University of Reading Malaysia (UoRM) In 2015, 30 Edinburgh students thus creating potential employment
and the University of Southampton transferred to Malaysia for one year opportunities for graduates.

Education
The establishment of these branch as compared to 57 in 2010, surpassing neighbouring Association of Southeast
campuses would allow students to the Governments initial target of Asian Nations (ASEAN) nations and
receive the same quality education in 87 schools by 2020. The number of attract multinational companies to
Malaysia as in the main campus at a students enrolled in international establish and grow their regional
lower fee. This would assist Malaysian schools for 2015 is 50,581. Of this base in Malaysia. This new campus
students that want to attain world- number, 28,797 are local students is expected to create a GNI impact of
class education at a fraction of the cost and 21,784 are international students. RM14.2 million by 2020.
and furthermore increase Malaysias Enrolment for international The National Association of
attractiveness as an education hub due schools are expected to increase to Private Educational Institutions
to the lower cost to study in Malaysia. 75,000 in 2020, and to cater to this rise, (NAPEI) together with the Private
MoHE regularly receives a number the initiatives under EPP3, include the Education Division in MoE have held
of applications for the establishment up-grading and expansion of existing marketing and promotional activities
of branch campuses, however with international schools and attracting in key targeted countries, including
the existing moratorium on the new international school operators Vietnam and Indonesia, to attract more
establishment of new private higher to Malaysia. international students to Malaysia.
education institutions (PHEI), this The International School of Kuala The establishment of these schools
EPP will see little traction for the Lumpur soon to be constructed RM350 are usually done via partnership with
next couple of years. The purpose million state-of-the-art campus, is local property developers. Examples
of the moratorium is to prevent an aimed at attracting 2,500 international include Tropicana Group Berhad and
oversupply of seats and programmes and returning Malaysian students. St Josephs Institution International
and at the same time, allow PHEIs The new campus in Ampang Hilir, School, SP Setia Berhad Group and
to focus on rationalization and Kuala Lumpur, will incorporate Tenby Schools Group, Perdana
consolidation of the private education environmentally sustainable concepts, ParkCity Sdn Bhd and Brighton
sector. This will also enable PHEIs to cutting-edge technology and world- Education Group as well as the
improve the delivery and quality of class science, language, humanities, recently announced collaboration
programmes offered. sports, theatre, music and art facilities. between YTL Berhad and the British
There are a total of 140 international Schools such as this will enable Council to set up a new international
schools in the country as of 2015, Malaysia to compete successfully with school in Sentul West.
The International School of Kuala Lumpur soon to be constructed RM350 million state-of-the-art campus will incorporate environmentally sustainable
concepts, cutting-edge technology, world-class science, language, humanities, sports, theatre, music and art facilities
Based on data verified by PwC in the Agreed Upon Procedures (AUP). Refer to the "Agreed Upon Procedures by PwC" chapter on the AUP process.

Mohd Yazid Abd Hamid
Chief Executive Officer,
Education Malaysia Global
Services (EMGS)
CREATING A GLOBAL
EDUCATION HUB IN MALAYSIA
M
alaysia currently ranks as the 12th preferred of 151,979 international students, in both institutions of
higher education destination, by international higher learning (IHL) and international schools. This marks
students and Kuala Lumpur ranks as the number a 12 percent increase from 135,502 students enrolled in 2014.
one most affordable city in the world for students. Despite Out of the 151,979 students, 80.3 percent of them enrolled
the favourable rankings, due to the growing competition in in IHL with 41 percent in degree programmes, 40 percent
the region, it is critical for Malaysia to enhance her presence in diploma programmes and nine percent in postgraduate
and relevance as an international education hub, said Mohd programmes. The ratio of international to local students in
Yazid Abd Hamid, Chief Executive Officer, Education Malaysia 2015 is 12:100 as opposed to 5:100 in 2002.
Global Services (EMGS). Towards enhancing international student safety and
EMGS, is not only entrusted to create a global presence security, EMGS together with the Ministry of Home Affairs
for the Malaysian Education brand but also provide holistic and the Immigration Department introduced the i-kad, an
international students services. identity card for international students in 2014. With this,
Malaysia needs to constantly stay ahead of her regional students no longer needed to carry their passports around,
competitors and for this purpose, we have intensified our reducing the risks of passports getting misplaced, lost or
international marketing and promotional initiatives, as well stolen. In 2015, EMGS introduced a mobile app, making it
as global industry engagements. easy for law enforcement officers in the field to verify the
In 2015, EMGS ran 34 international promotional events validity of the students i-kad, via a smartphone.
across 22 countries. Events included international education According to Yazid, moving forward, EMGS is looking
exhibitions, Education Malaysia solo roadshows as well as at building greater presence in the Middle East, Asia, South
cluster engagement initiatives with student recruitment America, South Korea and Japan.
agents and international student sponsors. EMGS also We will continue our efforts on B2B platform, and G2G
collaborated with higher education institutions to initiate initiatives for government-sponsored students, as well as focus
and promote student mobility programmes. on greater international student engagements in Malaysia, be it
In 2015, we had advertising campaigns run across 12 through social or Corporate Social Responsibility (CSR) projects.
countries to support our marketing initiatives, and apart from This would invoke a sense of belonging and help international
expanding presence in our key markets such as Asia, South students assimilate with the local multicultural society.
East Asia, Middle East and Africa, we have also reached out In 2016, EMGS hopes to open International Student Centres at
to new markets, namely, Brazil, Turkey, Morocco, said Yazid. entry points, namely Kuala Lumpur International Airport (KLIA)
He added that aggressive campaigns by EMGS have and KLIA2. Through these centres, we would be able to welcome
resulted in a steady year on year increase in the number of students more effectively as well as provide first timers relevant
international student enrolment. 2015 saw the total enrolment briefings to help them navigate their stay and studies in Malaysia.
Final international students enrolment obtained only after AuP exercise by PwC was completed

Education
Professor Bob Craik
CREATING TALENTS
Provost and Chief Executive
Officer of Heriot-Watt
University Malaysia (HWUM)
TO MATCH DEMAND
E
mployers these days are knowledge to analyse and solve establish Malaysia as an international
looking beyond academic problems which are skills required hub for higher education." said Craik
qualifications for graduates by employers. HWUM currently offers foundation,
with good communication, analytical The Higher Education sector is well undergraduate and postgraduate
and problem-solving skills as well as developed in Malaysia and there is a courses in Engineering (Chemical,
the ability to work in teams. wide range of good universities, said Petroleum, Mechanical, Electrical and
"Employers come with all sorts Craik. However, many institutions still Civil Engineering), Quantity Surveying
of different needs. Some are only tend to focus on traditional learning, Construction, Business, Accounting,
interested in graduates who can which values facts and knowledge, Actuarial Science and Psychology. The
be productive on day one without so not all graduates are prepared for university, which started operations
considering the skills necessary to global employment. in 2013, presently has approximately
adapt as business needs change. Other As information becomes freely 1,000 students and plans to grow to
companies, particularly multi-national available on the internet, the focus is some 6,000 students in the longer term
companies, focus more on skills that now moving towards helping students under Phase 2.
are useful in the long term and provide to apply knowledge and skills when HWUM recently launched Go
support for graduates at the start of solving a problem. All universities Global which is a new initiative
their career. are moving in this direction but to encourage students to transfer
A university education that does some are slower than others. These between campuses. There are
not impart these general skills along changes take time and benefit from currently 15 Malaysian students who
with sound technical knowledge will similar changes to be taking place in are spending 2015 in the UK and 30
not create talented graduates who schools, Craik added. UK students who are currently at the
are successful in the global market, The presence of well-ranked Malaysian campus. These numbers
said Professor Bob Craik, Provost and foreign universities in Malaysia, are expected to grow as students
Chief Executive Officer of Heriot-Watt such as HWUM, allows Malaysian spread the word about the exciting
University Malaysia (HWUM). students to experience high quality opportunities of studying overseas
HWUM, which was established UK education without leaving the without the problems associated with
in Putrajaya in September 2012, is a country. As a university that operates changing institutions.
branch campus of the almost 200- year- globally, HWUM produces graduates Ongoing improvement
old Heriot-Watt University based in with the same knowledge and skills include the review of curriculum to
Edinburgh in the United Kingdom (UK). irrespective of the location in the world. incorporate new teaching methods
According to Craik, the UK and Employers who tend to be large multi- and the use of technology to support
Australian universities in Malaysia national companies know and trust the learning. In Phase 2 of our expansion,
have adopted a style of learning that graduates from Heriot-Watt. we will be building extensive research
has less emphasis on the learning of "Foreign universities are also facilities as well as extending the
facts and more emphasis on using attractive to foreign students and help portfolio of programmes.

2 Public-Private Partnerships the 97 percent national enrolment
target for pre-school and 25 percent
for Capacity Building national enrolment target for childcare

for 2020 can be achieved.
417 new private pre-schools and
222 new private childcare centres
The main driver of the Education partnership with industry players. 85 were established in 2015, bringing the
NKEA is undoubtedly Public-Private students from the first cohort, since the total number of private preschools to
Partnerships (PPPs) as both the PPP was initiated, had graduated in 7,157 and private child care centres to
Government and the private sector October 2015. To continue this initiative, 3,286. The year also saw the rollout of
are natural partners in human RM80 million has been committed to the enhanced online self-assessment
capital development. Leveraging establish a Tourism Academy in Kota system for public and private pre-
on the expertise of private sector, Kinabalu. The initiative under the schoolers by tailoring its scoring
the Government is able to inject Tourism Blueprint is aimed at building system to be relevant and balanced
new experiences, methodologies as a world-class workforce for the tourism for both public and private pre-schools.
well as resources into the Malaysian industry in Sabah. The emphasis for the year has
public school system, therefore, Getting a head-start in education been on improving the quality of pre-
increasing access to quality education has been proven to have a significant schools, through the development of
for students nationwide. long term impact on students, leading a more robust self-assessment tool
Towards bolstering the countrys to higher achievements in school, and increasing the participation of
global reputation as an education better quality human capital, and pre-schools in the self-assessment
hub, the Ministry continues with its earning power. Hence, ramping up programmes. It is hoped that these
effort to push for PPPs in improving ECCE under EPP1 would benefit improved tools and training will
education offerings and drawing Malaysia socially and economically, sufficiently guide under-performing
in more investments, both locally while providing an opportunity to schools to meet the necessary standards.
and internationally. attract private sector participation. To ensure that all children have
PPPs have been an on-going effort There is a huge business access to quality preschool education,
since 2011 and examples include fee opportunity in Malaysia for high the government will continue the fee
assistance for pre-school children from quality ECCE due to the rapidly assistance programme for children
lower income group and the training for growing demand for high quality from low to middle income families.
21,000 private pre-school teachers from preschools. 426,246 students aged The Government is also pushing for the
2010 to 2011, to upgrade the quality of four and five have enrolled in regulation of unregistered pre-schools
pre-school teachers. In 2015, MoE rolled private pre-schools thus far, which by urging them to register with MoE
out a revised PPP framework to guide contributes to 50.75 percent of total and contribute towards the growth of
private sector players in establishing pre-school enrolment in the country. the sector.
partnerships with the Government. It is a market with opportunities, with PPPs are also being used to boost
Under the Langkawi Tourism the national enrolment rate currently the quality of the educators who
Blueprint launched in 2011, a at 84.63 percent against a target of specialise in ECCE - an initiative under
successful PPP collaboration between 97 percent by 2020 and ECCE has the EPP2. A lack of accredited teachers in
the Langkawi Community College and potential of creating a GNI impact of private ECCE institutions remains a
Taylors University was forged where RM 2.4 billion and 78,000 jobs by 2020. concern. The absence of a regulatory
the Community College underwent a The public sectors role in further requirement for formal qualifications
transformation in terms of curriculum developing ECCE is capped by limited is one of the major causes for ECCE
development, lecturers upskilling, resources, hence the private sector has educators not to pursue the higher
upgrading of infrastructure and been urged to play a greater role so that Diploma certification.

Education
In an effort to address this issue, the that there is industry training to equip this would increase the employability
MoE studied extensively the possibility these TVET students with the skills and of graduates, allowing them to receive
of introducing a new policy on the competency demanded by the industry. better employment options, higher
minimum qualifications requirement Vocational training, which was compensation and improve their
for preschool teachers. This involves once considered an option of last career mobility.
engagement sessions with various resort, is now highly sought after. A As for local students, the target is
Ministries, agencies and the private strong TVET workforce with high- to increase participation from 39,153
sector. A Cabinet decision is expected value and specialised skills will in 2015 to 70,000 by 2020 especially
to be reached in 2016. improve innovation and productivity in the Malaysia Skills Certificate
In an effort to increase the number of industries and this is integral to (Sijil Kemahiran Malaysia, SKM) 1
of qualified ECCE professionals, an Malaysias transformation into a high- and 2, capturing larger proportion of
ECCE hub, a PPP initiative with the income nation by 2020. underserved segments and increasing
SEGi Education Group is currently There has been considerable proportion of students taking higher
being developed. When completed, the growth in the TVET sector in the past level SKM. For this purpose, the
integrated ECCE hub in Kota Kemuning, years. As of 2015, there are a total of Government has allocated more
Selangor will house all the necessary 102,045 students enrolled in the skill- than RM1.17 billion from 2011 to 2015
facilities to provide necessary education based programs, of which, 2,539 are to the Skills Development Fund or
and training for ECCE professionals. international students. The 2020 target Perbadanan Tabung Pembangunan
Among the more significant for international student enrolment in Kemahiran (PTPK).
achievement in the PPP initiatives TVET is 16,000, through efforts of the In the efforts to develop students
is the effort to develop and promote Government, the private skills training with SEN, 40 seats were secured at the
Technical and Vocational Education institutions and EMGS. Berjaya University College of Hospitality
and Training (TVET) for students who There are also ongoing efforts to in KL and Asian Tourism International
are less inclined towards academic strengthen linkages between public (ATI) College in Sabah, to conduct
education as well as for students with and private TVET institutions with training programmes in Hospitality.
special needs. companies to promote industry These programmes have been lauded
The participation of the private oriented workplace training under by both parents and industry partners
sector in TVET is not only to the National Dual Training System. as a positive move that have resulted
complement the Governments effort This would involve work-based in placement of students with SEN in
to enhance the quality and quantity of learning programmes in actual employment with Starbucks, Krispy
TVET programs offered but to ensure industry setting and efforts such as Kreme, Deli France, KFC among others.
(Left) Under EPP5, the Government has allocated more than RM1.17 billion from 2011 to 2015 to the Skills Development Fund (Right) Technical and Vocational Education
and Training students learning basic skills that meet industry needs and are able to contribute effectively to society

3 Focusing On Clusters
to Elevate the Quality of
Malaysian Education Offerings
International Islamic University Malaysia (IIUM) President, Tan Sri Dr Rais Yatim (left) sharing a light moment with participants after officiating the International Council
of Islamic Finance Educators (ICIFE) 2nd Annual General Meeting. Also present were IIUM Rector, Prof Datuk Seri Dr Zaleha Kamaruddin (second, right) and ICIFE
Founding President, Professor Dr Khaliq Ahmad (right). Photo courtesy of BERNAMA Images
The Education NKEA is also the International Council of Islamic education, primarily due to the lack
developed around discipline clusters Finance Educators (ICIFE), a globally- of consensus on standard education
which shape the ETPs human capital recognised professional association for curriculum for Islamic finance.
needs in accordance with global Islamic finance educators. Launched This EPP also aims to increase
industry requirements and trends. a year ago, ICIFEs objective is to student enrolment in Islamic finance
These clusters include Islamic finance standardise the quality of Islamic education to 54,000 students by
and business (EPP7), health sciences finance education worldwide 2020. In 2015, 16,293 Islamic finance
(EPP8), hospitality and tourism (EPP9), and is supported by Bank Negara students were enrolled, an increase
game development (EPP15) and Malaysia, MoHE and all local higher of approximately 19 percent from the
accounting (EPP17). The development education institutions. previous year. GNI impact targeted by
of these clusters is also part of an on- EPP7s main aim was to develop 2020 is RM1.2 billion, along with the
going ETP effort to create regional Malaysia into one of worlds leading creation of 4,300 jobs.
and global education hubs in these Islamic finance and business education EPP8s Health Science Education
specialised areas. hubs. Despite being positioned as a Discipline Cluster is gaining traction
A notable achievement in the leading centre for Islamic finance, again with the construction of the
Islamic finance and business education Malaysia lags behind as a provider UCSI University Teaching Hospital
clusters was the establishment of of Islamic finance and business in Bandar Springhill, Port Dickson.

Education
Dato' P. Kamalanathan, Deputy Education Minister I (left) officiating the launch of Politeknik Merlimau as MyCenTHE and fifth cluster leader while Dato'
Peter Ng, founder of UCSI University and champion of EPP10 (most right) and YB Datuk Wira Hj. Yunos bin Husin, State Exco for Education, Higher
Education, Science and Technology, Green Technology and Innovation (middle) look on
The 1,000-bed teaching hospital will Blood Pressure Control research Led by the Malaysia Centre for
push new paradigms in the training with London School of Hygiene Tourism and Hospitality Education
and practice of medicine, elevating the and Tropical Medicine funded by (MyCenTHE) working in partnership
quality of healthcare in Malaysia. It will the Newton Ungku Omar Fund with the Malaysian Association of
be the first private teaching hospital in Hotels (MAH), this EPP focuses on
The Effects of the Haze on
Malaysia, with a public wing. the growth of hospitality and tourism
Human Health research project
The UCSI University Teaching education. The aim is to increase the
with several leading Universities
Hospital is exploring collaborations share of graduates with diplomas and
with some of the worlds best in Indigenous Health Matters degrees from 13 percent of the number
medicine. These partnerships will also research project with a of people employed in the industry as
act as a catalyst in the development of consortium involving Australia, of 2010 to 50 percent by 2020.
the health science education cluster. New Zealand, Canada and The aspiration of this EPP is to
The UCSI hospital is expected to lead Malaysia governments. support the elevation of service levels
many ground breaking initiatives within the tourism industry. This
The total planned investment
including the establishment of a will do more in retaining existing
for Phase 1 (130 beds) is RM285.9
hospital-linked retirement village. customers and attracting new ones
million and the total investment for
Apart from the discussions to set as opposed to resorting to price war of
the whole project is expected to be
up a centre for precision medicine,
RM773.9 million. hotels and organisations (employers)
there are also cross border global
The focus of EPP10s Hospitality at the expense of wages and salaries of
research initiatives in the pipeline in
and Tourism Cluster is to accelerate employees. The move in this direction
the following areas:
the development in the Tourism NKEA is more in line with the nations
Epidemiologic Transition by addressing matters pertaining to aspiration of becoming a premier
in low and middle income human capital development, such as tourism destination.
countries to be supported low wages, low skills and the influx of There is a positive spill-over effect
by research funding low-skilled foreign labour. from tourist spending from both new

and returning tourists to Malaysia that This mindset is what MyGameDev, private and public HLIs, government
will benefit businesses in the country an initiative under EPP14, seeks agencies and the private sector, aims
and therefore, Malaysia must be at to change. Launched in 2012, to produce top-calibre video game
the forefront of the service industry MyGameDev's main mission is to creators by creating a sustainable
to ensure the growth of the tourism nurture talent for this fast growing eco-system for the industry to thrive.
sector. With better qualified graduates field among students in public MyGameDev has intensified efforts
in the industry, there are more upward secondary schools, universities post- on its outreach programme in schools,
opportunities for talent which will graduates student, while creating following the success of events such as
also improve the job attractiveness awareness on Malaysias own game TableTop2014, which promoted board
in this industry. development industry, which is on par game design among students aged 15 to
The work-based-learning (WBL) with global standards. The EPP, with a 17 years, as well as other initiatives to
model promoted by MyCenTHE group of cluster members consisting of win over educators and parents.
involves industry placements and real-
time industry learning experience, to
enhance student education and the
graduates employability. Efforts under
the EPP are expected to be intensified
to ensure that the annual output of
tourism graduates would hit the 50,000
per annum target by 2020 as compared
to 20,000 in 2009.
The global games market is
estimated to jump from US$$83.6
(RM367.74) billion in 2014 to US$$91.5
(RM402.44)billion in 2015, according to
the 2015 Global Games Market Report
released by research firm Newzoo.
While South East Asia video games
market represents only approximately
4 percent of global consumption, it
is the fastest growing market of any
geographical region and expected to
grow at a CAGR of 30 percent between
2015 and 2018.
The growth here is also driven by
the rapid rise in internet access and
ownership of ICT devices. Malaysia,
sitting in the heart of South East Asia, has
a potential to grow its involvement in the
game development industry but there
is a need to overcome the perception
barrier regarding this industry. Game
development, despite it being a lucrative
source of income is perceived more as
a hobby than a career path, especially (Top) 3D Character Modeling by Andrejo Chong Carreon (Bottom) MyGameDev Table Top Board
Game Competition with students from various High Schools in Melaka posing with the Industry
among educators, school guidance
judges and teachers. This event was hosted at University Teknikal Melaka (UTeM) in collaboration
counsellors and parents. with MyGameDev and KDU
4 Based on exchange rate of US$$1 = RM 4.39

Education
The newly launched MyGameDevs In an effort to increase the

Game Development Online portal, number of professional accountants,
has created a platform that brings a collaboration between Sunway TES
together investors, game developers, Sdn Bhd and local universities has
universities and enthusiasts. This created an avenue for students to
portal is expected to play an important pursue professional qualifications
role in establishing Malaysia as a while completing their degree - a
regional provider of game development much quicker way to becoming a
talent to international studios, while qualified accountant.
creating a much-needed visibility for To increase the number of
its future initiatives. bumiputra accountants, scholarships
Under this EPP, efforts to are also being offered by Yayasan
encourage private investments were Peneraju Pendidikan Bumiputera
also intensified in 2015. Drawing (Peneraju) to encourage and support
in investments into this cluster is bumiputera students in pursuit
crucial, as it has the potential to of professional qualifications
create numerous revenue streams as for accountancy.
well as high value job opportunities in In 2015, 480 graduates with
line with the Malaysias aspiration of professional accounting qualifications
becoming a high income nation. were produced by Sunway TES, which
Target for 2020 is RM500 million in is leading this EPP. By 2020, this EPP
revenue generation, RM150 million in is expected to produce 7,000 new
intellectual property, and 4,000 game professional accountants via several
related new job opportunities. professional education providers in
Creating an accountancy hub this cluster.
under EPP17 is one of the vital measures
in the effort to boost foreign direct
investment and lure multinationals
to use Malaysia as a base to expand
regionally. The availability of a strong
ecosystem of professional support
services like accountancy will provide
a much needed value to the countrys
position as a regional operational hub.
Furthermore, market deregulation
and the convergence in financial
reporting standards worldwide
have created opportunities in which
accountancy has become a service that
can be exported. Therefore, creating
an urgent need to increase the number
of qualified accountants and quality
of accountants, as well as to the
development of specialised skill sets
in areas such as international taxation,
forensic accounting and carbon
Creating an accountancy hub under EPP17 is one of the vital measures in the effort to boost foreign
accounting to tap future growth areas. direct investment and lure multinationals to use Malaysia as a base to expand regionally

MOVING FORWARD
A
s the nations transformation of TVET institutions and streamlining this would increase the employability
goals approach a crucial the sector to achieve focused growth. of graduates, allowing them to receive
midway point, it is imperative The branding and promotion of better employment options, higher
that the Education NKEA continues to TVET will be stepped up, including compensation and improve their
deliver on its targets and contributes advocating for skills training and skills- career mobility.
to the overall objective of the National based careers to be accepted by society Both MoE and MoHE will be
Transformation Programme. as the career of choice, which promises working closely in addressing issues
Moving forward, TVET, identified brighter prospects. with project owners to ensure strong
as a key growth area and integral to Efforts for TVET is not only aimed economic growth and development
the countrys aspiration to become at producing both quantitative and within Malaysias Education sector.
a high-income nation, continues qualitative results. To create quality Both MoE and MoHE are now holding
being the focus of the NKEA. Under graduates, efforts under EPP13, will joint Steering Committee (SC) meetings
the 11MP, TVET has been recognised also include the promotion of work- to ensure proper management of
as the most important avenue for based learning programmes in actual stakeholders and to prevent silos in
increasing Malaysia's skilled human industry setting via strong linkages the implementation and management
capital base and much emphasis has between skills training institutions, of initiatives.
been placed on supporting the growth HLIs and companies. Efforts such as

Agriculture
TRANSFORMING DATO' SRI

AHMAD SHABERY CHEEK
AGRICULTURE TO
MINISTER OF AGRICULTURE & AGRO-BASED
INDUSTRY (MOA)
AGRIBUSINESS
The agrofood sector plays
an important role in Malaysias
economic development, providing
employment and uplifting
incomes. Because of the large
number of people dependent
on it, the sector also has a social
importance.
The growing global demand
for agricultural products provides
great potential to expand the
sectors contribution to GNI. Our
aim is to transform agriculture
into agribusiness, moving towards
a model which is inclusive but
simultaneously anchored on
market-centricity, economies of
scale, and value chain integration.
Beyond that, the sector
contributes to the security and
sovereignty of the nation by
ensuring self-sufficiency of one
of the most strategic resources,
namely food. History has proven,
in times of war or peace, the
sovereignty of a nation could
be easily crippled by its over-
dependency on foreign or imported
sources of food.

T
he Agriculture NKEA focuses
on transforming the nations INSIDE THIS NKEA
traditionally small-scale
production-based sector into a large- 1 Capitalising Malaysias
Competitive Advantages
scale agribusiness industry that
contributes to economic growth and
sustainability. Under the 11th Malaysia
Plan, agro-food gross domestic
2 Tapping Premium Markets
product (GDP) is projected to achieve

RM36.2 billion in 2015 and the figure
This is especially true in times
of economic uncertainties which
is estimated to reach RM46 billion in 3 Ensuring Food Security Objectives
are Consistent with Increasing GNI
the year 2020, which translates to 42.4
affect the value of ringgit and our
percent of total Malaysian GDP in 2020.
buying power. The increasing 16 Entry Point Projects (EPPs) have four key sectors chosen to pilot the
deficit in Malaysias balance of been identified to spur growth in this use of sensors.
trade in the agro-food sector, from sector and help achieve the National Various stakeholders have come
RM11 billion in 2009 to RM17 billion Agro Food Policys targets such as together to develop IoT pilot projects
food security, high value agricultural and there are ongoing R&D efforts by
in 2014, is of concern.
development, and private investment the research institutions that work
Moving forward, the Ministry
as a catalyst for the transformation closely with the private sector and
will look into institutionalising of modern agriculture. To date, the government agencies to bring products
the export-centric mind-set in its NKEA has recorded RM9.224 billion and services to market within Malaysia
policy and strategy to improve our in committed GNI, 28,645 additional and to other countries.
trade balance. This will put the jobs and RM7.7 billion in committed MIMOS has created several solutions
sector in a more strategic position investment. that cater to agricultural development.
To further boost the sectors For example, its Mi-MSCAN TpH sensor
to contribute to the diversification
productivity and rise up the value has multisensory capabilities to collect
of Malaysian economy and ensure
chain, Malaysia has been exploring environmental data, such as soil
stability of Ringgit. the use of Internet of Things (IoT) nutrient. MIMOS has also developed
technologies within the industry. In an agricultural framework that links
fact, Malaysia is leading the region in agricultural producers, traders and
the use of IoT in agriculture. suppliers together in a unified system
The Government has identified IoT powered by IoT.
as one of the key technology areas to MIMOS believes that when IoT
enhance productivity in key sectors is fully integrated in the agriculture
under the 11th Malaysia Plan (2016- sector, production could rise to US$319
2020) and agriculture is among the million by 2020.

Agriculture
1 Capitalising Malaysias
Competitive Advantages
High-value herbal products unlock a tremendous value dimension in the agricultural sector. The Herbal Cluster Programme, like the one pictured above in Negeri Sembilan,
is one of the initiatives championed by the Department of Agriculture and Herbal Development Division to encourage more players to get involved and capitalise on this
growing market
The high-value herbal products RM3.85 million in sales. The sales for now, given that the nutraceutical
EPP is on track to meet its end-2020 CAGR for herbal products rose to 6 products are still in the development
target of producing 10 nutraceuticals percent during the period of 2012-2013, process, there is little demand for
and cosmeceuticals products derived compared to 5.4 percent over 2008-2012. these premium herbs. Therefore, the
from 18 identified herbs, amongst Since the inception of this EPP, farmers are not motivated to plant all
which are Tongkat Ali, Kacip Fatimah, prices of herbal materials have these 18 herbs but are more inclined to
Misai Kucing, Dukung Anak, and increased, benefiting the local farmers. only plant herbs that are in demand,
Hempedu Bumi. As at December 2015, For instance, fresh tongkat ali was sold including several lower-value herbs.
there were 27 such herbal products in for as low as RM 2/kg in 2014. In 2015. Moving forward, the DoA will
the product development stage 10 in it increased to RM 5/kg. streamline the planting of the
clinical trials, 17 in pre-clinical trials. This EPP has the potential to identified herbs, once the products
During the year, the herbal cluster produce better results focusing on the have completed clinical trials and
projects accumulatively generated 18 identified high-value herbs. But as are ready for the market.

FIRST MALAYSIAN HERBAL PRODUCT
HEPAR-P UNDERGOES CLINICAL TRIAL
Nova Laboratories Sdn Bhds Hepar-P market value by a whooping tenfold! Having
Capsule is the first Malaysian herbal product valid scientific claims backing the product will
to undergo clinical trials under EPP1. The also make it more marketable globally.
first clinical trial was completed in January Clinical trials are very expensive and can
2015, involving 50 subjects (25 on Hepar-P sometimes be beyond the means of the local
and 25 on a placebo). The trial was a companies. The first trial for Hepar-P, for
multi-centre (eight hospitals nationwide), example, came up to around RM2.2 million.
randomised, double-bind, placebo- With the EPP providing dedicated funding
controlled trial to determine the efficacy for R&D and clinical trials, Nova hopes that
and safety of Hepar-P for the treatment of many of the challenges facing the local
non-alcoholic fatty liver disease (NAFLD). herbal industry today would eventually be
Nova now awaits the green light from the overcome, allowing Malaysia to manufacture
NKEA to start the second clinical trial. and export high-quality nutraceuticals and
The Hepar-P contains standardised botanical drugs.
extract derived from a local plant known as Nova, established on 17 March 1989, is
Phyllanthus niruri or dukung anak, mainly a research-based company that discovers,
used as a liver protection agent. It is approved develops, manufactures, and markets novel
as a traditional product by the Ministry of phytopharmaceuticals derived from local
Health and has been in the market since 2005. botanical plants for the prevention and
Successful clinical trials proving the efficacy treatment of human diseases. It has more than
and safety of Hepar-P would enable Nova to 45 types of products ranging from functional
market it as a botanical drug with therapeutic foods, herbal products, and health supplements
claims rather than an herbal or traditional mainly distributed in pharmacies, clinics and
product. This would boost the products its own retail outlets under the Nova brand.
Nova Natural Supplements & Skin Care Retail Outlet

Agriculture
2 Tapping Premium Markets adverse weather conditions affected the

highland vegetable production areas in
Cameron Highlands and Kundasang,
Sabah. The earthquake in Sabah
During the year, total production However, the year was not affected the construction of the Masilau
of premium fruits and vegetables without challenges. This outstanding TKPM in Kundasang. Similarly, heavy
under EPP7 (i.e. papaya, starfruit, rock achievement would have been stronger flooding in the east coast of Peninsular
melon, jackfruit, banana, pineapple, had it not been for a series of natural Malaysia early in the year affected the
capsicum, lettuce and tomato) was disasters during the year. For example, production of fruit and vegetables there.
54,489 mt, valued at RM70.8 million.
It has been reported that the
monthly net income of the 278 NKEA
Permanent Food Production Zones
(Taman Kekal Pengeluaran Makanan,
TKPM) participants exceeded RM3,000
while 194 others achieved net income of
RM1,000-RM2,999. As a comparison, in
2014, 171 TKPM participants generated
monthly net income of RM3,000 and
above. This is very encouraging for
the farmers and motivates them for
the coming year too. Traders selling fresh fruits at PAKAR Jengka
3 Ensuring Food Security Objectives

are Consistent with Increasing GNI
The Ministry of Agriculture In line with this, the country is
and Agro-based Industry (MOA) making strong strides in reducing its
is very committed to address the dependency on imported rice.
trade balance deficit of RM17 billion The nations self-sufficiency level
recorded and lessen the countrys (SSL) for rice jumped from 63.1 percent
dependency on food imports. The in 2010 to 71.4 percent in 2015. During
ministry is developing various plans the same period, its milk SSL also rose
to increase the export of premium from 8.5 percent (2010) to 13 percent
agricultural products and also (2015). The nation is on track to meet
increase local production to tip the its SSL targets of 85 percent for rice and
scale and reduce our trade deficit. 13.6 percent for milk by 2020. Farm operations in MUDA granaries

During the year, total paddy participants and to ensure that the training programmes by the anchor
production was at 230,793 mt in Muda, current participants will stay involved companies, has improved local milk
Kedah under EPP10 and 103,604 in the EPP after the end of their contract production, and the safety and quality
mt in other granaries under EPP11. period (10 planting seasons). of milk and dairy products. Following
A total of 14,214 farmers benefitted Meanwhile, the domestic the introduction of new machineries
from the MADA Land Amalgamation supply chain for dairy products at the dairy processing plants, locally-
programme under EPP10 over the has strengthened, with the layers produced dairy products now have
period of 2011 to 2015. of middle man reduced, and the longer shelf lives.
Muda Agricultural Development delivery time from milk producer In 2015, total high-quality fresh
Authority (MADA), the EPP owner for to processing plant (numbers of milk production from the three anchor
EPP10, will continue its promotional days) shortened. The use of modern companies and EPP13 clusters farms
programmes to attract more technology, coupled with effective was 19 million litres.
(Top left) Dairy cattle feeding at Evergreen Livestock Sdn. Bhd Dairy farm in Keningau, Sabah (Right) Milk Packaging Facility at Evergreen Livestock Sdn Bhd processing
plant in Sabah under EPP13 (Bottom left) Mr. Loi of The Holstein Milk Company at Mawai Dairy Farm, Kota Tinggi, Johor under the Dairy Cluster EPP

Agriculture
HOLSTEIN'S
SUCCESS STORY
T
he fast-track rise of Farm Fresh The EPP, led by Department While Holstein has two farms of its
to the top of the nations fresh of Veterinary Services (DVS), gave own, some 40 percent of its raw milk
milk category is nothing short RM11 million worth of grants that needs are sourced by Allied Dairy from
of spectacular. A new kid on the block went to the purchase of pregnant about 40 contract farmers, located
only four years ago, the local brand cows, milking equipment, and chiller in Johor and Negeri Sembilan. These
now leads this competitive market with tanks these were given to farmers farmers are paid RM2.50 per litre, a
38.3 percent share (source: Nielson, selected by Allied Dairy, which in turn big jump from the RM1.50 they used
September 2015). purchases raw milk from them at a to get, significantly boosting their
Farm Fresh producer, The Holstein fair price. income and sustainability.
Milk Company Sdn Bhd, attributed its
rather unexpected success to the Dairy
Clusters EPP (EPP13). A member of the
Holstein group, Allied Dairy Sdn Bhd,
was appointed an anchor company of
the EPP13 in 2012 and Holstein itself
was appointed an anchor company to
EPP13 in 2014.
The success of Holstein, the
countrys only integrated fresh milk
producer, in penetrating and now
leading the market hitherto dominated
by foreign companies for the past 20
years is a testament of a good business
plan and solid execution of an EPP in
creating a local champion.
The Malaysian dairy industry had
prior to the EPP languished for over two
decades. The foreign players have little
reason to help develop local farmers
as imported milk powder cost only
50 percent the price of fresh milk.
What little fresh milk they sourced
locally, they paid based on the world
commodity price of milk powder.
As such, local farmers had found it hard
to maintain a sustainable business. Farm Fresh products that is available in major supermarkets

MOVING FORWARD
2 016 will see a renewed focus on
implementation and monitoring.
This is because the overarching
issues and challenges surrounding
the performance of the Agriculture
working relationships with the
various State EXCO for Agriculture.
This will definitely help during any
implementation issues within the states.
In addition, it would be imperative to take
NKEA revolves around the discipline into account weather-induced delays
of implementation and monitoring. A into the 2016 implementation plan,
more targeted and purposeful approach budget requests and KPI trajectory as
needs to be institutionalised. contingency planning during execution.
This would include establishing Ultimately, in Malaysia, agriculture
technical standard operating is still a key factor for economic growth,
procedures for each EPP that will with rising demands for local and
address issues of implementation, export market particularly in the agro-
monitoring and technical evaluation food sector. There is a lucrative export
that is outside of the current scope. market for a wide range of agricultural
This will help close the gap in products for ASEAN and halal market.
implementation and delivery. With its huge potential and prospects,
Moving forward and towards 2020, the outlook looks positive for business
it would be important to strengthen in agriculture.

Healthcare
FAST DATUK SERI DR.

S. SUBRAMANIAM
FORWARDING
MINISTER OF HEALTH
MALAYSIAS
A countrys healthcare system
has significant social impact, both
direct and indirect. Malaysias
HEALTHCARE
healthcare sector has seen robust
growth in the past decade, and
continues to be one of the nations
INDUSTRY
highest economic multiplier.
Implementation of the
healthcare EPPs has catalysed
new growth areas. Since its
inception in 2011, the NKEA has
attracted some RM2.44 billion of
investment into the country, and
created some 8,100 higher-value
jobs. Infrastructure has either
been built or upgraded, and both
specialist skill-sets and technology
have been harnessed to improve
the quality of care for patients.
The Private Aged Healthcare
Facilities and Services Bill is
targeted to be tabled in Parliament
second quarter of 2016. While we
are excited in anticipation for
the flourishment of the aged care
industry, we are fully aware that this
industry is still in its infancy state
in Malaysia. The challenge now is
to provide a favourable ecosystem
for the stakeholders and industrial
players. To achieve on that, the
Government is working hard not
only on the legislation part as

mentioned, but also working hard
to ensure that the physical planning
guideline for Senior Living facilities
In the interest of creating
will be available for usage by the
local council.
the necessary conditions for the
2016 will not be without
challenges for the NKEA Healthcare.
private healthcare industry to
The volatility of the local and thrive as a key economic sector,
global economy is likely to impact
somewhat growth in the medical the government has been lending
tourism industry, investments by
various EPP owners as well as the its weight to expedite growth.
exports of the pharmaceuticals and
medical devices. The Ministry of
Health (MoH) remains resolute and
F
will work closely with the Malaysian
rom the onset of the Economic
Healthcare Travel Council (MHTC), Transformation Programme INSIDE THIS NKEA
the Malaysian Investment (ETP), the healthcare sector
Development Authority (MIDA) and has been deemed as a high-potential 1 Promoting and Positioning
Malaysia's Healthcare Services
the Ministry of International Trade wealth creator. Leveraging on organic
and Industry (MITI) to counter the growth in services, pharmaceuticals
effect of the economic slowdown.

and medical devices, new horizons have
begun to be explored in services, clinical
2 Manufacturing at the Core
of Healthcare Industry
The liberalisation of the travel visa
research, health travel, and generics
for Chinese visitors will be look as a pharmaceuticals manufacturing.
booster for us to open up the Chinas Two new projects were 3 Facilitating Local
Manufacturing Export
market for medical tourism. announced during the year under
The healthcare industry in the pharmaceutical exports EPP to be
Malaysia is in a vibrant growth championed by Pharmaniaga Sdn Bhd 4 Upholding Quality of Medical
Devices Through Regulation
and Auscustom Pharma. Both projects and Standards
phase which makes the constant re-
are expected to generate RM13.1 million
assessment of the EPPs a necessity.
To ensure that the NKEA remains
in GNI, RM50.8 million in investment,
and 116 jobs.
5 Developing the Senior
Living Market
dynamic and relevant, the list of Collectively, the 40 healthcare
EPPS will be streamlined in 2016 projects announced under Healthcare
and new EPPs will be introduced NKEA to date are projected to create
following syndication with major 26,966 jobs and generate an income
players. Challenges faced in 2015 of RM6.59 billion, as well as RM4.96
billion in new investments by 2020.
requires the Ministry to relook into
two EPPs and work on possible
modifications to ensure they will
continue to play the role of game
changers in this industry.

Healthcare
Through 2015, Malaysia generated Malaysian pharmaceutical exports products for the year was revised from
RM588.6 million in healthcare travel as of October amounted to RM516.09 RM671.78 million to RM641.24 million.
revenue for the period January to million in 2015, lower than the RM505 While the local healthcare
September 2015 at an average response million during the same period in 2014. industry has long been dominated
rate of 79 percent, while the target set Challenges this sector faced during the by the public sector, growth in
for the full year is RM854 million (Re- year included depreciation of the ringgit private healthcare services has been
baseline 2014: RM777 million). Health against the US$, increased cost of exponential over the past decade. In
tourist revenue for the three quarters Active Pharmaceutical Ingredient (API) the interest of creating the necessary
reached RM353.2 million of the full year and packaging materials, non-tariff conditions for the private healthcare
target of RM516 million (Re-baseline barriers imposed by other countries industry to thrive as a key economic
2014: RM449 million). Year-to-date (e.g. Indonesia and Thailand), and sector, the government has been
results forecast total healthcare travel competition from ASEAN state lending its weight to expedite growth.
numbers for 2015 to achieve above 90 members. Consequently, the export
percent of full year targets. growth target for pharmaceutical
1 Promoting and Positioning There are over 250 private

hospitals in Malaysia. However, only
Malaysia's Healthcare Services hospitals that are well-equipped and

catered to receive and handle medical
tourism are approved and registered
to be a participating medical tourism
provider in Malaysia. In July, the
Malaysian Healthcare Travel Council
(MHTC) introduced the Elite Partners
programme to highlight and effectively
promote healthcare institutions of
excellence that also cater to the needs
of international patients. There are
currently 22 selected hospitals and
ambulatory care service providers
on this list.
During the year, MHTC established
two additional representative offices,
in Ho Chi Minh City and Yangon
to supplement operations of its
existing offices in Jakarta, Dhaka
and Hong Kong. These five offices
function as MHTCs promotional and
Malaysia Healthcare Week 2015 by MHTC in Bangladesh intelligence centres, and provide end-

(Top) Official launching of MHTC Representative Office in Yangon, Myanmar. (Bottom) MHTC Representative Office in Ho Chi Minh City, Vietnam
to-end services to potential healthcare visiting specialists programmes and to expand promotional activities into
travellers to Malaysia from treatment training support. Indonesias second and third tiers
enquiry and quotation to visa Malaysia Healthcares strongest cities, as well as to develop Malaysia
arrangements and logistics. markets are Indonesia, constituting Healthcares overseas presence and
To facilitate greater healthcare 62 percent of total healthcare revenue brand positioning in the other focus
mobility and in the effort to foster numbers, followed by the Middle East countries, working closely with
collaborations in MHTCs key markets, (7.4 percent), India (3 percent), China Tourism Malaysia, Malaysia External
MHTC ventured into health insurance (2.6 percent), Japan (2.6 percent), Trade Development Corp (MATRADE)
portability agreements with insurance Australia and New Zealand (2.5 and the Ministry of Foreign Affairs.
and third-party administrator percent) and the UK (2.5 percent). In addition to Malaysias medical
partners in Bangladesh, Vietnam and Emerging markets such as China, excellence in cardiology, orthopaedics,
Indonesia, and several key hospitals Central Asia and the greater ASEAN oncology, neurology and dentistry,
in Malaysia throughout 2015. These region will continue to be an active there have been growing demands for
agreements allow policyholders contributor to our Healthcare sector. its superiority in infertility treatments,
to seek healthcare treatments in Projected growth in terms of healthcare particularly for IVF treatments, with
partnering hospitals in Malaysia under traveller arrivals in 2016 is expected to Malaysias leading fertility hospital
their existing insurance schemes. come from the Middle East, Australia, reporting IVF success rates of 66
Together with the private hospitals, New Zealand, Bangladesh, Vietnam percent in 2013 against the global
MHTC is leading government-to- and Myanmar. The weaker ringgit average of 50 percent, alongside
government cooperation between also presents renewed opportunities increasing demands for treatments in
Malaysia and the rest of the world, from Singapore. cosmetics surgery and rehabilitation.
especially Middle Eastern and Indonesia remains Malaysia
Commonwealth of Independent States Healthcares leading market (61.7
(CIS) countries, with patient referrals, percent in 2015). MHTC will continue

Healthcare
2 Manufacturing at the Core aim of becoming Malaysias first fully

accredited vaccine manufacturing
of Healthcare Industry facility. Site works related to

the construction of its vaccine
manufacturing facility commenced on
31 July 2015. Concurrently, the company
expanded its senior management team
and signed a partnership agreement
with a European vaccine manufacturer.
AJ Biologics is also in detailed
discussions, nearing finalisation,
on a number of other partnership
agreements with several reputed
vaccine manufacturers globally.
Two new projects were announced
during the year under EPP3:
First, Auscustom Pharma Sdn

Bhds integrated GMP research
and manufacturing facility. The
company plans to establish
an R&D and manufacturing
facility to produce small batches
of orphan drugs and unmet
medications needs for Malaysia
and the region. The products
include sterile injectables,
non-sterile medications, and
solutions for diabetic retinopathy,
chronic diseases and integrative
oncology. The project is
estimated to generate RM10.7
million in GNI, RM14.4 million
in investment, and 95 jobs.
Surgical sutures manufactured by Vigilenz Medical Devices Sdn. Bhd
Second, Pharmaniaga Bhds
At the core of Malaysias healthcare Pharmaceuticals, Biocons US$250 manufacturing of high-value
industry is an up-and-coming million biopharmaceutical R&D freeze dried pharmaceutical
manufacturing sector with a focus and manufacturing facility, became products. Pharmaniaga proposed
on pharmaceuticals and medical operational in mid-2015. The an extension and modification of
devices. These are high-tech high-value manufacturing and scaling up of its existing manufacturing facility
ventures that will bring in top dollar activities for two products recombinant to establish a lyophilisation
investments and quality jobs. This is human insulin and insulin analog manufacturing suite to enable the
done through building capacity and are slated for completion in early 2016. production of high-value freeze-
capability in the pharmaceutical sub- This facility, located in Nusajaya Johor, dried pharmaceutical products.
sector and supporting the growth of employs more than 300 Malaysian The project is expected to generate
medical devices sector. Science/Engineering graduates. RM2.4 million in GNI, RM20.9
One of the project champions Meanwhile, AJ Biologics Sdn Bhd million in Investment, and 21 jobs.
under EPP3: Malaysian continues to make strides towards its Tapping an already developed

manufacturing ecosystem, medical the foundation for the upscaling of Four EPP champions under
devices is a promising new growth Malaysias IVD industry and help to EPP9: Become the hub for high-
sector which has seen fresh and raise the countrys IVD profile globally, value medical devices contract
fruitful strides taken by players in starting with developing countries. It manufacturing ABio Orthapaedics
the eight Medical Devices EPPs over was recently identified as one of the Sdn Bhd, SteriPack Asia Sdn Bhd,
the year. leading companies in the upcoming Medical Devices Corporation Sdn Bhd
Bionexus-status company Olipro 2016 Malaysia Best Practice Award by (MDC) and Straits Orthopaedics (Mfg)
Biotechnology is manufacturing Frost & Sullivan. To date, MEDIVEN CE- Sdn Bhd are leading developments
World Health Organisation (WHO) marked products have gained local and in this field by expanding their
standard test kits in Malaysia under international recognition. MEDIVEN manufacturing activities to spur
EPP7: Upscale Malaysias in-vitro has sold its products to major hospitals greater participation from Malaysian
diagnostic (IVD) industry. The two in Malaysia. entrepreneurs.
test kits are the Olipro HIV Rapid Surgical products manufacturer ABio plans to expand contract
Test Kit which screens and detects Vigilenz Medical Devices Sdn Bhd manufacturing of orthopaedic
HIV 1 & 2 and the Olipro BloodChek and Karl Mueller Scientific are to lead devices in Malaysia by including
LF Kit which detects transfusion local medical device manufacturers advanced machining, titanium
transmissible infection (TTI) during under EPP8: Build a Malaysian anodising, forging, coating and
blood donation or screening. showcase on next generation of core casting. Meanwhile, Malaysia will
Meanwhile, Medical Innovation single-use device (SUD) products in be the sole manufacturer for Smith
Ventures Sdn Bhd (Mediven), was positioning Malaysia as the preferred & Nephews severe burns wound
to spearhead this EPP through its supplier of high-quality contract dressing when SteriPack begins
IVD project. The project will provide manufacturing for SUDs. operations in the country.
Vigilenz Medical Devices Sdn. Bhd., Bukit Minyak, Penang

Healthcare
In its initial stage, EPP10:

Malaysian clinical device champions
is focused on preparing three potential
project owners to launch projects
related to the orthopaedic implant
manufacturing industry.
Manufacturer UWC Holdings,
which caters to the medical and
healthcare industry among others,
leads EPP11: Medical equipment
supply chain orchestration through
Examination tables manufactured by LKL Advance Metaltech Sdn. Bhd
its investment in a medical equipment
manufacturing facility in Bukit Minyak, specialising in medical equipment 2015 saw the completion of clinical
Penang. The 80,000 square feet facility including hospital beds, patient trials on Lucenxia (M) Sdn Bhds
will manufacture equipment including transport trolleys, birth-care tables, INTELLIS, an intelligent automated
hospital beds, trolleys, stretchers, medical treatment carts and peripheral peritoneal dialysis (APD) cycler
immobilisers and prefilled humidifiers. support equipment, and the fabrication designed for chronic kidney disease
Toshiba Medical System Malaysia of steel and wooden products. patients. The pilot study concluded that
manufactures ultrasound systems, EPP14: Renal products covers both the system was safe and efficacious. As
transducers and printed wire boards the provision of services as well as the such, Lucenxias INTELLIS APD system
other medical devices in Malaysia manufacturing of medical products is now ready for commercialisation.
for export under EPP12: High-value involved in the treatment of end-stage The product was officially launched
medical devices manufacturing. Its renal disease (ESRD). These services by YB Minister of Health, Datuk Seri
Pulau Pinang facility spanning a total include innovative treatment methods S. Subramaniam in January 2016.
of 7,800 m2 floor space commenced such as home treatment modality with Fresenius Medical Care, a global
production in December 2014. integrated telemedicine systems. supplier of renal solutions and a
EPP13: Building a medical Products manufactured include major player in hemodialysis (HD)
hardware and furniture cluster is led automated PD cyclers, HD machines, and peritoneal dialysis (PD) products,
by LKL Advance Metaltech Sdn Bhd, dialysis solutions, and bags and filters successfully increased the production
a medical furniture manufacturer for HD machines. output of HD concentrates in 2014 and
added a new production line for PD
concentrates in its manufacturing facility
in Bandar Enstek, Nilai, Negeri Sembilan.
With SuisseMed Technologies of
France as technology partner, Proligen
has been given exclusive rights to
represent SuisseMed Technologies SA
in ASEAN to product high grade blood
filtration filters in Malaysia.
The dialyser manufactured will
not only cater for local demands but
for export market as well. This will
help reduce the cost of treatment for
patients and create job opportunities
for Malaysians. Commercial production
Official launching of Intellis of Lucenxia (M) Sdn Bhd by Health Minister Datuk Seri Dr. S Subramaniam is expected to start in 2017.

3 Facilitating Local Manufacturing Export
MOH signed two OTAs in 2015 with local drug manufacturer Kotra Pharma (M) Sdn Bhd for the supply of Diamicron MR 60mg (left) and Vastarel MR 35mg (right)
The introduction of the OTA the provision of OTAs and by Subsequently, Servier obtained
scheme under EPP3, part of an effort expediting the registration of locally regulatory approval for the registration
to position Malaysia as a regional manufactured generics. The OTA of its Malaysian-manufactured Vasterel
export hub for generics, has generated initiative provides market access MR 35mg in Brunei, Singapore,
much interest from both MNCs and for the products via public sector Philippines, Myanmar, Hong Kong
local pharmaceutical companies. purchase and in doing so, attests and Thailand.
OTAs are a direct negotiation to the products safety and efficacy,
between the government and a local thereby providing confidence to
manufacturer for three years. A two potential export markets as well.
year extension may be given should MOH signed two OTAs in 2015
a local manufacturer able to export with local drug manufacturer
their products overseas. Kotra Pharma (M) Sdn Bhd in joint
Given the highly competitive venture with French multinational
global pharmaceutical landscape, pharmaceutical company Servier
the government aims to act as a for the manufacturing of the latter's
springboard to boost the marketability patented drugs Vasterel MR 35mg and
of Malaysian-made generics through Diamicron MR 60mg.

Healthcare
4 Upholding Quality of Medical Devices Laboratory Practice (GLP) certified.

Malaysia has accredited testing facilities
Through Regulation and Standards but none are GLP-compliant. Most of

Malaysian manufactured products are
tested in Singapore, US, Australia and
Europe. This expensive but necessary
The Medical Device Authority meant to assure quality control and activity, costing at about RM300,000
(MDA) is a statutory body under the the safety of the medical devices per product, has hindered local
Ministry of Health Malaysia established produced, and that these devices are in manufacturers from exporting.
under the Medical Device Authority accordance with the global standard. MDA has given out a grant worth
Act 2012 (Act 738) to control, regulate The extension of the deadline is to RM22 million to MyBioScienceLab
medical device, its industry and ensure all the involved companies have Sdn Bhd, formed with the purpose to
activities as well as to enforce medical adequate amount of time to complete establish a comprehensive-integrated
device law under the Medical Device the necessary preparations for the one-stop-centre public-private owned
Act 2012 (Act 737). registration of their products. OECD-GLP certified non-clinical CRO
In order to better regulate and In July, additional post-marketing Test Facility for pharmaceuticals,
address industry concerns, the guidelines were introduced in cosmetics, nutraceuticals,
authority has decided to alleviate Malaysia, covering complaint handling agrochemicals and medical device to
and remove all obstacles in the and field corrective action (FCA). These support local and global industries.
implementation of the Medical Device documents are designed to guide the Construction of the lab is more than
Act 2012 (Act 737). industry in complying with the Medical 90 percent completed and is expected
All medical devices used in the Device Act and related laws. to receive GLP certification by 2016.
country are to be registered by July The US, Europe and Australian Grant applications for another GLP lab
2016, an extension from the previous markets require that the medical devices is currently being processed. Decision is
deadline in July. The registration is used within their borders are Good expected to be made this year.
Menara Prisma MDA

5 Developing the Senior Living Market
Aged care services provided by Econ Healthcare Group
Malaysias aged care industry is planning principles, general planning, Secondly, legislation were
still in its infancy with a fledgling specific planning, and design established and regulations were
ecosystem. But with the awareness guidelines for the development of new strengthened. Two existing Acts
raised in recent years, interest in the and existing houses that adopt ageing- Care Centre Act 1993 (Act 506), and
industry is rising. Various parties in-place concept, retirement villages, Private Healthcare Facilities and
including hospitals, property and care centres for the elderly. Services Act 1998 (Act 586) currently
developers, insurers and trade groups The guideline was approved by the govern the care of an older person
have indicated strong interest in this Cabinet on 1 July 2015 and is awaiting under the purview of two separate
field. To prepare for the growth of this tabling at the next meeting of the Ministries, MoH and Ministry of
industry, an ecosystem must be put National Council for Local Government Women, Family and Community
in place. (MNKT) scheduled in early 2016. Development (KPWKM). KPWKMs
Firstly, a physical planning After the MNKT, the guideline will Social Welfare Department governs
guideline for Senior Living facilities be presented at the State Planning the old folk homes, which target
were set up. In 2012, the Town and Committee (SPC) meeting of all the those in the lower income group with
Council Planning Department (JPBD) states in Peninsular Malaysia. Once no next of kin, while those who can
started developing a seniors living approved by the SPCs, the guideline afford it go to private nursing homes
facilities guideline for adoption by will be adopted and used by the local governed by MoH.
the local councils. The guideline covers councils in the respective states.

Healthcare
There are currently only 16 private re q u i r e m e n t s . M o r e o ve r, t h e country involving 112 care centre
nursing homes registered with MoH, current old folks homes need to be operators (registered under KPWKM)
which is grossly insufficient. The transformed into proper aged care and about 450 participants.
Department of Statistics estimates that facilities. The Private Aged Healthcare In the meantime, the ministry has
in 2015, the proportion of the Malaysian Facilities and Services Bill combines started to draft the regulations for
population aged 60 years and older the relevant sections from both Acts the Bill. Five workshops and seven
is 9.1 percent. Based on the current and will better govern the provision of meetings/discussions were conducted
projections, Malaysia is expected to services and facilities for the aged care with the stakeholders to gather their
reach ageing population status by the industry in a progressive economy. views and opinions on the Regulations.
year 2035, at which point 15 percent of The Bill has been submitted to The first draft of the Regulations will be
the total population will be 60 years the Attorney General of Chambers ready upon the finalisation of the Bill
and older. (AGC) for vetting. Prior to that, various by the Cabinet. The Bill is scheduled to
The two existing legislations syndications and consultations were be tabled in Parliament in the second
will not be able to meet future conducted 11 sessions across the quarter of 2016.
EDEN-ON-THE-PARK BRINGS A GREATER DIMENSION

TO THE RETIREMENT VILLAGE INDUSTRY
One of the project champions h a s b e e n co m p le te d a n d The target date of completion is steady and its services continued
under the Retirement Village EPP, a temporary occupation permit December 2016. Construction to be popular.
Eden-on-the-Park is the first for it has been granted by the works on the villas have also Recruitment and training
Integrated Senior Lifestyle and council. The company will apply started and some units are is on track and the company
Care Residence Resort facility for a Care Licence from the already at roof beam level. is ready for opening as soon
in Malaysia. It features the "3R" Department of Social Welfare and In preparation for the opening as official licensing is granted
concept of Rest, Recreation and a licence from the MoH to operate of its Care Residence, Eden by the Department of Social
Rejuvenation, and is built around the facility as a Nursing Home. started its home care business as Welfare. As at December 2015,
the "5S" principles of Security, Construction of the projects part of its training and running-in the recruitment of caregivers
Safety, Support, Service and Active Living Apartment tower process, as well as to get some had reached some 26 excluding
Sustainability. is well underway 7 of the 14 marketing exposure. During maintenance and administration
The projects Care Residence storeys have been completed. the year, this business had held staff.
(Left) Current site progression of the Active Retirement Living area of Eden-on-the-Park. (Right) Nursing room at Eden-on-the-Park

MOVING FORWARD
E
PPs in the Healthcare NKEA campus site under the jurisdiction
are regularly evaluated on of the Kuala Lumpur City Hall.
their ability to remain as game Moving forward, emphasis will
changers in the healthcare industry. be allocated towards upbringing
In 2015, two EPPs were reassessed and EPPs 15, 16 and 17 in order to develop
their scope revised. the Seniors Living industry. The
The first, EPP5: Creating a Private Aged Healthcare Facilities
diagnostic services nexus. The Ministry and Services Bill is to be tabled in
of Health has decided not to continue Parliament in Q2 2016.
on the current business model of the Plans are also underway to
project which primarily relies on the integrate the Physical Planning
outsourcing of radiological services Guidelines for Senior Living Facilities
in MOH hospitals. The scope of this developed by the Town and Council
project will be revised and a new Planning Department (JPBD) into the
project champion will be identified. Regulations of Private Aged Healthcare
Secondly, EPP6: UM Health Facilities and Services Bill as well
Metropolis. As the consequential delay as the adoption of such guideline
of Planning Approval from the Petaling by various local councils.
Jaya City Council (MBPJ) affected the In addition to the continued
progress of the project, UM Holdings emphasis on the pharmaceutical and
decided to rescale the project scope. medical devices sub-sectors, new
The team will work closely with UM EPPs may be a possibility coming from
Holdings to explore the various options ongoing and upcoming discussions
available, which include the possibility and consultations with the major
of relocating the project site to the players in the industry.

THE NTP STRATEGIC REFORM INITIATIVES
Competition, Standards and Liberalisation
GETTING DATO SERI

HAMZAH ZAINUDIN
AHEAD IN A
MINISTER OF DOMESTIC TRADE, CO-OPERATIVES
AND CONSUMERISM
GLOBALISED
We have strived to promote a
competitive business environment
that encourages efficiency,
innovation and entrepreneurship
ECONOMY
through persistent enforcement
of the Competition Act 2010 (CA
2010) by Malaysia Competition
Commission (MyCC). Businesses
that are pushed to compete in their
home-ground would be equipped
to compete at a global level.
With the formation of the ASEAN
Economic Community (AEC) and
Malaysia becoming one of the
member countries under the Trans-
Pacific Partnership Agreement
(TPPA), liberalisation is at our
doorsteps and we must challenge
ourselves to compete. We cannot
aspire to become a high income and
developed nation without laying the
foundation to become competitive.
Businesses must shape up and
innovate in order to take advantage
of the vast market opportunity
liberalisation brings.

INSIDE THIS SRI
DATUK SERI DATO SRI 1 Competition Act 2010: Creating a

Level Playing Field
PANGLIMA MADIUS TANGAU MUSTAPA MOHAMED
MINISTER OF SCIENCE, TECHNOLOGY AND INNOVATION MINISTER OF INTERNATIONAL TRADE AND INDUSTRY
2 Rising Up the
Competitiveness Ranks
Standards can break barriers The Services Sector Blueprint

by guaranteeing the quality and launched in March 2015 provides 3 Accelerating Revenue, Improving
Market Access Through Standards
efficiency that is needed to improve valuable policy direction for the
market access and increase exports. development of Malaysias services
This is something businesses in sector. The recommendations 4 Pushing for Best Practices
in Agriculture
Malaysia especially, the SMEs outlined under the Blueprint have
need to understand. Although
been incorporated into the 11th
SMEs make up more than 98
percent of Malaysian businesses,
Malaysia Plan. As the secretariat to 5 Fortifying Systems for
Greater Data Security
the Malaysia Services Development
their contribution to the countrys
Council (MSDC), MITI assumes a
GDP was just 32 percent in the year
2012. Standards should be used as vital role in closely monitoring 6 Facilitating Greater Access
to Markets
catalyst to raise SMEs contribution the execution of the Blueprint

strategies and consistently
to the GDP to 41 percent by 2020.
The success stories of companies reporting on the progress made to 7 Liberalising Our Markets
for Greater Competitiveness
that comply with standards the Special Committee on Services
should be highlighted to inspire
more Malaysian manufacturers
Sector chaired by our own YAB
Prime Minister.
8 Strategic Policy Direction to Further
Develop the Services Sector
and consumers alike, to adopt
and embrace a culture of quality,
thus contributing to national
competitiveness. I strongly
believe that standards, which are
synonymous with quality are a
critical component for us to achieve
a developed nation status.
Having developed our own
standards are well and good, but we
must also be conscious that there
are some best practices or processes
deployed and utilised by many
other businesses or countries that
we can adopt. We must be nimble
to learn from others and to adapt as
that would make us more efficient.

W
ith globalisation, an In line with this, Competition, These reforms aim to position
efficient and conducive Standards and Liberalisation under the private sector as the core engine
business environment the Strategic Reform Initiatives (CSL- of the economy by modernising
has to be nurtured and sustained to SRI) play a vital role to develop an business regulation, liberalising
increase Malaysias competitiveness efficient and competitive business the services sector, removing
as a preferred investment destination. environment and culture that support market distortions, improving the
There is huge potential to be tapped Malaysias goal of becoming a high- interface between Government and
with the AEC and the various bilateral income nation by 2020. CSL-SRI also businesses, introducing competition
and regional trade agreements focuses on reinforcing economic legislation and increasing the quality
including the TPPA and the Regional reforms that were undertaken during of goods and services through
Comprehensive Economic Partnership the 10th Malaysia Plan. standards compliance.
Agreement (RCEP).
1 Competition Act 2010: the number of cases solved. During the

year, MyCC conducted 48 advocacy
Creating a Level Playing Field programmes throughout Malaysia. The

increase in the number of complaints
received by MyCC from 8 complaints
in 2012 to 232 complaints in 2015 is
The implementation of the CA 2010 encourages efficiency, innovation and testimony to an increased level of
and its enforcement by MyCC has helped entrepreneurship can flourish. This, awareness among consumers and
strengthen the regulatory framework to in turn, promotes competitive prices, business owners and bodes well for
promote a more competitive business improvement in the quality of products the efforts made by MyCC.
environment in Malaysia. and services; providing consumers a MyCC has also strived to increase
Established under the Ministry wider choice at fair prices. the number of cases resolved. In 2015,
of Domestic Trade, Co-operatives In 2015, MyCC continued its efforts the Commission made 6 findings of
and Consumerism, MyCC is an to engage with stakeholders from competition infringements under the
independent statutory body tasked both the public and private sector in CA 2010 and completed two proposed
with strengthening competition its advocacy work to raise awareness decisions. There were also two cases
in the local business landscape. It of CA 2010, while striving to increase pending appeal.
enforces, investigates and adjudicates
infringements under the CA 2010.
The implementation of the CA
2010 was identified as one of the SRIs
under the Economic Transformation
Programme (ETP), intended to foster
healthy and thriving competition in
the Malaysian economy.
The Act, which came into force in
2012, promotes economic development
by promoting and protecting the
process of competition. By doing
so, a business environment that An Advocacy Programme was held in October 2015 for SMEs on Competition Act: How can SMEs Benefit

2 Rising Up the According to the Report, Malaysias
distance to frontier score advanced
Competitiveness Ranks from 76.84 in 2014 to 78.83 in 2015, as

a result of improvements in five of the
indicators, namely starting a business,
dealing with construction permits,
Malaysias position as one of the competitive economies, the countrys getting electricity, registering property
top 18 most competitive countries highest ranking since 2005. and resolving insolvency.
among 140 economies globally, in Additionally, Malaysia also improved The Report noted that the
the World Economic Forums Global its ranking in the World Banks Ease of improvements in ranking reflected
Competitiveness Report 2014-2015 is a Doing Business Report 2015 to the 18th the initiatives undertaken by
validation of the effectiveness of the spot from the 20th spot in 2014, ahead of the Government through both
economic reforms being undertaken economies such as Taiwan, Switzerland, administrative and ETP as well as
by the country. It advanced two spots Thailand, the Netherlands and Japan. the efforts undertaken by the joint
from the previous year, consolidating In Asia, Malaysia ranked 4th after public-private sector task force
its position as the world's top 20 most Singapore, Hong Kong and South Korea. to facilitate business.
3 Accelerating Revenue, Improving Amanah Rakyat (MARA), Malaysian

Green Technology Corporation
Market Access Through Standards (MGTC), Malaysian External Trade

Development Corporation (MATRADE)
and the Ministry of Health (MoH) to
carry out several capacity building
Compliance to standards is key to by the various Government agencies, and awareness programmes on the
quality, a solution to push products and the National Standards Compliance importance of standards among
services beyond market boundaries as Programme (NSCP) was launched in industries to increase the demand for
well as to build customer loyalty. 2014 by Standards Malaysia. standards compliance.
To ensure the competitiveness NSCP was designed based on the Despite this, challenges remain
of Malaysian products and services, NSCP Study in 2013, benchmarked especially among SMEs who
measures have been put in place to on approaches of selected countries perceive standards compliance
improve the ecosystem of standards with greater standards compliance. and certification as cost instead of
development and utilisation. Steps These countries include Singapore, investment for future returns. As
have already been taken to streamline Germany, South Korea, Thailand, standards certification is voluntary,
and reduce the time taken for the Indonesia and the European Union. this remains a persistent issue.
development and adoption of standards. NSCP is crucial to address the lack of In order to gain a deeper perspective
As of 2015, a total of 6,204 Malaysian concerted effort among Government of current perception of standards
Standards were developed by Standards agencies and private sectors to compliance, Standards Malaysia
Development Agencies (SDAs) that have inculcate standards and compliance convened a study on the economic
been appointed by Standards Malaysia. in products and services. impact of standards compliance in the
Of these, 3,622 standards are aligned Standards Malaysia collaborated marketability of products and services.
with international standards. with a number of agencies including The study also looked into areas
In an effort to increase standards SME Corporation (SME Corp), regarding efficiency and productivity at
compliance and bridge initiatives offered CyberSecurity Malaysia (CSM), Majlis selected companies from the electrical

and electronics, food and beverages standards compliance among a credible testing and certification
and agriculture sectors. The findings the industries. process. Products will need to undergo
of this study will be used to intensify Standards Malaysia also signed a conformity assessment procedures
promotion on the use of standards and Memorandum of Understanding with which include laboratory testing to
will be shared with central agencies Steinbeis Foundation Malaysia (STMY) obtain certification. Towards this
and Ministries to formulate relevant in June 2015 to conduct a Technology end, existing test facilities may need
policies to increase use of standards. Audit and gap analysis on standards to be upgraded to improve the testing
Stakeholder engagements, compliance for 30 selected companies infrastructure for products in Malaysia.
including a mini-lab with Certification as an effort to handhold the companies This will not only help the
Bodies as well as dialogue sessions to obtain certification. manufacturing industry become more
with Government agencies, Trade In line with initiatives to increase competitive, but also promote the
Associations and Multinational standards utilisation, Standards countrys services industry and help
Companies (MNCs) were held Malaysia will accredit more Conformity make Malaysia a testing hub.
throughout the year to increase Assessment Bodies (CABs) to ensure
(Top) A Standards Utilisation Workshop was held in September 2015 with Ministries and Central Agencies
(Bottom) A Capacity Building Programme for MS 9001 Quality Management System was held in August 2015 for SMEs

4 Pushing for Best Practices DVS. Additionally, myGAP certification
is currently free for those who are able
in Agriculture to fulfil its requirements.

In 2015 a total of 41 capacity
building programmes were carried
out involving approximately 1,740
farmers during which information
on the requirements of myGAP was
disseminated, including consultation
on the certification process.
Promotional programmes for
myGAP also included reaching out to
consumers on the benefits of myGAP
certified products by collaborating
with farmers and traders participating
in the programme. In 2015, 14
awareness programmes were held
throughout the country during the
state-level and the national-level
Farmers, Breeders and Fishermens
Day (HPPNK) 2015.
MyGAP produce being sold at Pasar Tani Putrajaya Despite the strides made, a number
of challenges remain. For instance,
2015 saw a 21 percent increase in the MyGAP is benchmarked with the current myGAP certification is
number of farms being certified, pushing international GAP certification a lengthy process and coupled with
the total number of certified farms to schemes such as ASEAN GAP and the absence of price differentiation
4,414 farms. This increase in the number is now in the process of being for certified products in the domestic
of certified farms is largely attributed harmonised with Global GAP. MyGAP market, it has deterred many farms
to the outreach and capacity building certified products will thus benefit from obtaining the certification as
programmes by the implementing from this exercise by gaining better farmers seek immediate benefits from
agencies, namely Department of market recognition and acceptance. myGAP certification. Also, there is
Agriculture (DoA), Department of Since the inclusion of lack of awareness among consumers
Fisheries (DoF) and the Department of implementation of standards and on the health benefits of myGAP
Veterinary Services (DVS). certification as one of SRIs in 2010, products which are in line with its
The development and usage of the Departments under MoA namely tagline of Improving Lives.
standards for the Agriculture NKEA DoA, DoF and DVS have registered a Hence, there is a need to streamline
focus on benchmarking Malaysias compound annual growth rate (CAGR) and reduce the time required for the
agricultural practices against of 40 percent, 40 percent, and 37 certification process. Farmers also
international standards such as Good percent respectively in the number need to be encouraged to carry out self-
Agricultural Practice (GAP). of farm certifications. As of 2015, the assessment on their readiness prior to
MoA has consolidated a DoA has 1,600 farms certified, while submission for certification.
number of certification schemes for DoF has 173 farms certified and DVS While efforts to get all farms certified
agriculture under myGAP (with the has 2,251 of farms certified. should continue, emphasis will need
tagline Producing More, Improving The increase in the number of to be made on larger establishments,
Lives) which now represents a certified farms has largely been which are looking beyond the domestic
comprehensive certification scheme due to the ongoing outreach and market. Currently focus is on farms
for the fruit & vegetables, aquaculture capacity building programmes by the that come forward for audit, of which
and livestock sectors. implementing agencies DoA, DoF and a majority are small farms.

5 Fortifying Systems In 2010, Information Security

Management Systems (ISO/IEC 27001) or
for Greater Data Security better known as ISMS, was introduced

to manage sensitive information so
that it remained secure by applying
risk management processes.
Cyber risk is currently at the as banks, telecommunication, and The National Security Council
top of the international agenda as transportation services are constantly (NSC) was tasked to oversee the
high-profile breaches raise fears exposed to vulnerability that can lead implementation of ISMS standards
that hack attacks and other security to major disruptions. An attack on a and its compliance by CNIIs. Since
failures could endanger the global CNII can be devastating on both the NSC took helm, the number of CNIIs
economy. Cybercrime costs the nation and its citizens. certified increased from 20 in 2012 to
global economy over US$400 billion Cyber security has been identified 146 out of 201 CNIIs in 2015.
per year, according to estimates by the Government of Malaysia as a The increase in ISMS compliance
by the Center for Strategic and new source of growth for the Digital has also resulted in a spill over effect
International Studies. Economy. To date, 48 products has for other Information Security Industry
The Global Risks 2015 report by been evaluated and certified under the such as ISMS compliance services, cyber
the World Economic Forum (WEF) Malaysian Common Criteria Scheme, security consultancy services, increase
clearly points out that 90 percent of based on the ISO 15408 standard. in procurement of cyber security related
companies worldwide recognise they Continuous effort is being undertaken to hardware and software including
are insufficiently prepared to protect increase awareness among CNIIs on the enhanced interest in Common Criteria
themselves against cyber-attack. The importance of product certification to Certified Products and Vulnerability
ever increasing reliance on easily enhance security assurance within their Assessment Services to name a few.
hackable smart devices makes us even organisations. Programs undertaken in
more vulnerable. 2015 include Common Criteria training
In Malaysia, Critical National for Information and Communication
Information Infrastructure (CNIIs) such Technology (ICT) product developers.
Malaysia Cyber Security Awards Presentation Ceremony 2015

6 Facilitating Greater Access SRI in 2012, certification grew by 40
percent (CAGR growth), primarily due
to Markets to the capacity building programmes

for food establishments, resulting
in greater appreciation for the
value of MeSTI.
MeSTI compliance also serves as
a building block for micro and SMEs
in Malaysia to be a major producer
and exporter of food products via
food safety and quality compliance.
This programme also acts as a
stepping stone for companies to
obtain certification under Good
Manufacturing Practice (GMP) and
Hazard Analysis and Critical Control
Point (HACCP). For example, Fatihah
Frozen Sdn Bhd. was able to obtain
GMP within 7 months after MeSTI
certification, as opposed to the usual
time frame of 1-2 years.
One of the challenges being
faced in the MeSTI registration and
certification is the lack of auditors
which has resulted in a backlog. Whilst
temporary auditors have been hired,
they are under a short term contract.
The rehiring of temporary auditors
requires the need for constant training.
MeSTI certification awarded to Safiah Satay by the Ministry of Health in conjunction with World Health Day
in August 2015
GREEN TECHNOLOGY
Standards bear an intrinsic value certified under the Makanan Selamat The MyHIJAU Directory is a
in todays demand for quality and Tanggunjawab Industri (MeSTI) comprehensive guide to a wide
safe products. More so now, with programme. This constitutes 30.9 range of green products and services,
regulators and consumers being percent of all food establishments systematically categorised with
increasingly concerned about the that are registered with Food Safety detailed information and description
quality and safety of food. They are Information System of Malaysia for for consumer reference. Products or
taking unprecedented interest in the Domestic (FOSIM) under category P1 services that carry MyHIJAU Logo are
way food is produced, processed, and - Food premises that are involved in entitled to enjoy tariff schemes like the
marketed and demand greater quality food manufacturing. Green Income Tax Allowance (GITA)
and safety assurances. The objective of MeSTI is to put in and Green Income Tax Exemption
place a system for the maintenance (GITE) as announced in the National
FOOD STANDARDS of food hygiene and process control Budget 2014. MyHIJAU registered
In 2015, the Ministry of Health which includes food safety assurance products will also get the opportunity
certified 1,152 new food establishments and food traceability. Since the participate in the Government Green
bringing a total of 2,401 premises implementation of MeSTI under this Procurement (GGP).

A Government Green Procurement (GGP) Action Plan Workshop was held in December 2015
In 2015, a total of 1,439 products conducted 14 workshops nationwide an effort to counter that, KeTTHA through
and services obtained certification as part of the MyHIJAU SME & MGTC embarked on an awareness
under MyHIJAU, an increase of 307.6 Entrepreneur Development Programme campaign on GGP for all Ministries and
percent (353 products) from 2014. This in 2015. These workshops were aimed Agencies. The Ministry of Education,
was mainly spurred by the mandatory at encouraging SMEs to implement Ministry of Health, KeTTHA, Ministry
requirements of Minimum Energy green technology applications and of Home Affairs and the Economic
Performance Standards (MEPS) adopt green practices as well as Planning Unit have been selected as pilot
for 5 domestic electrical products facilitate the registration of MyHIJAU implementers in this project.
(Air Conditioners, Refrigerators, mark for businesses producing green KeTTHA targets to expand the
Televisions, Domestic Fans and products and services. GGP implementation in 2016 with
Lighting) under the Electricity In 2015, continuous development the expansion to 12 products that
Regulations 1994 (Electricity Supply of business structure and support have been identified under GGP i.e.
Act 1990) which came into force on activities for MyHIJAU has increased cleaning services, ICT equipment, paint/
3 May 2015. Under MEPS, appliances the total number of Certification coating, fibre cement and EE Lighting,
that satisfy the safety and performance Bodies for MyHIJAU from 3 to 8. The building facilities, green data centre,
requirements (Energy Efficiency 5 additional MyHIJAU Certification multipurpose printing device, air-
Factor) must be issued with a Bodies registered with MGTC are the conditioning, apparel and furniture.
Certificate of Approval (COA) by the Malaysian Timber Certification Council In 2016, GGP will also be expanded
Energy Commission Malaysia. Prior (MTCC), Global GreenTAG Sdn Bhd, to the Ministry of Works, Ministry of
to MEPS, a Voluntary Energy Efficient GREENBUILDINGINDEX Sdn Bhd, BSI National Resources and Environment,
Appliances and Equipment standards Services Malaysia Sdn Bhd and DQS Ministry of Federal Territories,
and labelling programme was in place. Certification (M) Sdn Bhd. Ministry of Transport, Ministry of
The Ministry of Energy, Green Despite the increase in registration, Urban Wellbeing, Housing and Local
Technology and Water (KeTTHA) demand and awareness of green products Government; and Ministry of Rural and
through its agency, MGTC also remains low in the domestic market. As Regional Development.

7 Liberalising Our Markets After more than five years of
intensive negotiations, on October
for Greater Competitiveness 5, 2015, Ministers of the 12 Trans-

Pacific Partnership (TPP) countries
Australia, Brunei Darussalam, Canada,
Chile, Japan, Malaysia, Mexico, New
Lifting market barriers to allow has services chapters. These five FTAs Zealand, Peru, Singapore, United
foreign investments and businesses are with Japan, Pakistan, Australia, States, and Vietnam announced
brings in new ideas and technologies New Zealand and India. At the regional conclusion of their negotiations. The
which may act as catalysts for greater level, services sectors have been fairly partnership is expected to support
and more sustainable growth; not liberalised through the implementation jobs, drive sustainable growth,
just in Malaysia but also within the of the ASEAN Framework Agreement on foster inclusive development, and
ASEAN region. In its efforts towards Services (AFAS) Agreement. promote innovation across the
creating a more liberalising and fair Currently, ASEAN has signed the Asia-Pacific region.
global trading environment, Malaysia 9th Package of AFAS with average offer To ensure effectiveness of the
continues to pursue regional and of 100 sub-sectors. In addition services initiatives and to reap the benefits
bilateral trading arrangements to liberalisation is also part of the ASEAN from liberalisation, trade facilitative
complement the multilateral approach + 1 Free Trade Agreements namely regulations and regulatory reforms
to trade liberalisation. The national with China, Korea, India, Australia have been put in place to create a
services liberalisation process is co- and New Zealand. Besides FTAs, to conducive business environment.
ordinated by MSDC chaired by Minister attract more foreign investment in Specific policy measures have been
of International Trade and Industry. services, Malaysia has also undertaken undertaken to reduce regulatory
As of 2015, Malaysia has concluded autonomous liberalisation for 45 costs of doing business to improve
and signed a total of seven bilateral Free services sub-sectors announced by the the business climate and support
Trade Agreements (FTAs) of which five Government in 2009 and 2011. economic growth.
Heads of States stand for a family photo before their East Asia Summit (EAS) meeting in Kuala Lumpur in November 2015

8 Strategic Policy Direction to Further Investment Incentives -

to enhance effectiveness
Develop the Services Sector of incentives

Human Capital Development
- to produce, attract and
retain skilled talent
The Government has formulated horizontal strategies and action plan Sector Governance Reform
the Services Sector Blueprint to items for implementation. - to cultivate an efficient,
strengthen the services sector. YAB A total of 29 action plan items were facilitative policy environment
Prime Minister launched the Services recommended for implementation and machinery
Sector Blueprint on 16 March 2015. under four policy levers:
The Blueprint identifies key Internationalisation - to The Services Blueprint will be
challenges in further developing the significantly increase the number implemented from 2015 to 2020 in
services sector and provides a set of of service providers in Malaysia tandem with the 11th Malaysian Plan.
Services Sector Blueprint Launch by YAB Prime Minister Dato Seri Mohd Najib Razak in March 2015. Photo courtesy of BERNAMA Images

MOVING FORWARD
I
n 2016, there will be continuous The focus on the services sector will
push to encourage the private be on the rigorous implementation of
sector to implement standards in the Services Sector Blueprint and to
their products and services. Standards ensure it its deliverables. There will
and certification are part of the be need to have effective monitoring
equation for companies to grow big of the progress and to ensure any
and emphasis should be made towards impediments are adequately addressed.
industry development to focus on the Overall, progress of this SRI has laid
requirements and needs across the the perspectives and policy initiatives
entire value chain. needed to face todays economic
Certification processes will be opportunities and challenges. On-
streamlined and testing facilities going movements towards a more
will be improved to encourage more open market necessitates a continuous
companies to obtain certification. strategic response to sustain and
Once certified, MATRADE will be able improve the competitive position
to assist the companies in improving of the Malaysian economy.
market access especially in the priority
sectors of LED and Medical Devices.

Public Finance Reform
FISCAL DATO SERI AHMAD HUSNI

MOHAMAD HANADZLAH
RESILIENCE FOR
MINISTER OF FINANCE II
SUSTAINABLE 2015 was in some ways a

watershed year for the Malaysian
ECONOMIC
economy. Battered at the tail end of
2015 by a series of challenges, both
from the external environment
GROWTH
as well as conservative investor
confidence, our ringgit like most
economies in this region, was in a
flux against the US dollar alongside
oil prices, which took a beating due
to a supply glut.
Having embarked on the
N a t i o n a l Tr a n s f o r m a t i o n
Programme in 2010, our economy is
in a more resilient shape to take the
challenges we were subjected to in
2015. With the target of reducing
our fiscal deficit at 6.5 percent in
2009 of the GDP and keeping a lid
on Central Government debt at
maximum amount of 55 percent
of annual Gross Domestic Product
(GDP), we had to embark on a
series of disciplined public finance
reforms to get government finance
in check.
Under this SRI in 2015, we saw
successful implementation of the
Goods and Services Tax (GST) after
almost 30 years of building the
case to introduce the broad-based

INSIDE THIS SRI
1 Enhancing Taxation Systems

for Better Revenue Collection
2 Implementation of Accrual Accounting

to Strengthen Fiscal Management
Efficiency and Effectiveness
consumption tax in the country. GST percent on the back of low oil prices 3 Goods and Services Tax
collection proved to be an important compared to 30 percent in 2014.

buffer against the challenges of Regardless, contributions from
lesser revenue contribution from other areas such as GST, and savings
2
the oil and gas industry. from subsidy rationalisation,
Additionally, the move to as well as the development of
remove subsidies for fuel at the other economic sectors under 015 was a year of challenges.
The rapidly declining crude oil
end of 2014, resulted in cost savings the Economic Transformation
prices along with the value of
of an estimated RM10.7 billion in programme have helped mitigate
the ringgit against the US dollar, came
2015, enabling this savings to this effect somewhat. in as an unexpected shock, placing
be channelled back as part of We head into 2016 knowing considerable strain on the economy
social safety net programmes for that it will be a rough year from and demonstrating what we had
deserving Malaysians. an economic standpoint, but always known the need to reduce
our reliance on oil-based revenue.
As part of the discipline in also taking comfort in the fact
The fact that Malaysia has been
transitioning towards a high that forward looking and prudent
able to reduce its dependency on
income nation, in 2015, the measures have been taken to oil and gas (O&G) revenue from 41
Government was able to reduce create buffers that will enable us percent in 2009 to 21.5 percent of total
our deficit to 3.2 percent of GDP as to face this situation with some Government revenue, places us in a
targeted. Malaysias borrowings as degree of confidence. It will be a much better position than countries
of end of 2015 was at 54.5 percent test of the resilience enhancing whose revenues crashed with the
plunge in crude oil prices.
to GDP, which is still below the 55 measures we have worked so hard
Our relatively more diversified
percent self-regulated debt ceiling. to put in place. sources of revenue, the implementation
Since 2010, the Government of Goods and Service Tax (GST),
has also been able to reduce and rationalisation of subsidies
dependence on oil revenue by have provided a certain amount of
driving contributions from other cushioning from the plunge in oil
prices. Additionally, the final private
sectors and areas. This is essential
consumption expenditure which
to ensure that other sectors are
registered a 4.9 percent growth in 2015,
able to buffer the impact of sharp coupled with increased investments by
volatilities oil prices. For example, the private sector had also helped us
in 2015, oil revenue dropped to 19.6 in weathering the storm.

The initiatives of SRI PFR mainly THESE INITIATIVES INCLUDE: Implementation of Accrual
focused on the taxation system with Accounting system
Enhancement of tax
the Ministry of Finance (MOF) being the
administration and Implementation of Goods
sole driver for this initiative, supported
compliance direct tax and Services Tax (GST)
by its agencies namely Inland Revenue
Board of Malaysia (IRBM), the Royal Enhancement of tax
Malaysian Customs Department administration and
(RMCD) and the Accountant Generals compliance indirect tax
Department (AGD).
1 Enhancing Taxation Systems

for Better Revenue Collection
Additional collection of revenue RMCD. There was a boost in numbers on the back of changes in their audit
from indirect taxes through specific of contract officers as well as changes approach which sees improvement in
audits made by RMCD significantly made in audit approach in 2015. taxpayers compliance as well. Both
exceeded targets from RM159.6 million The same applies for IRBM which initiatives contributes to the increase
in 2014 to RM222 million in 2015 (148 managed to achieve an additional in the overall government revenue.
percent of target) due to improved collection of RM2.04 billion in 2015
efficiency of auditing and collection by compared with RM1.99 billion in 2014
2 Implementation of Accrual Accounting

to Strengthen Fiscal Management
Efficiency and Effectiveness
The implementation of accrual essential to increase the effectiveness 2016 and the Government is confident
accounting is in-line with practices of Outcome Based Budgeting of achieving the launch and usage
of developed countries. Accrual in promoting the sustainability of the system in 2017 making the
accounting will add depth to the of fiscal policies. transition from cash based accounting
accountability and transparency of The delivery of the new system to the accrual based accounting system
the management of public sector was delayed due to common issues in in 6 years since it started in 2011.
resources and it will facilitate system development. The milestone of
the costing of resources, which is the delivery was stretched to December

SUMMARY OF COMPARATIVE USEFULNESS OF CASH AND ACCRUAL ACCOUNTING IN GOVERNMENT
Criteria Cash Accounting Accrual Accounting
Ease of understanding Simpler, but unfamiliar Greater complexity, but familiar to more people
Relatively easy to manipulate, but the issuance

Ease of manipulation depends upon
Ease of manipulation of the Cash Basis International Public Sector
accounting and auditing standards
Accounting Standards (IPSAS) is a step forward
Includes cash information together

Comprehensiveness Cash information only
with other information
Usefulness for Provides cash information and commitment

Provides only basic information
managing liquidity information (e.g., payment arrears)
Non-financial asset
No information provided Provides information on asset use
management
Countries use a range of cash accounting bases, Countries use different accrual accounting
Comparability
policies are generally not explained well standards. Seek compliance with IPSAS
Measuring sustainability Useful, but needs to be supplemented

of fiscal policy/considering Very limited usefulness with additional information (e.g.,
intergenerational equity demographic profiles)
Credit rating agencies, lenders and the media

Credibility Limited are more familiar with accrual financial
statements. Can lead to lower borrowing costs
Basis for determining

Limited Good, in conjunction with cash information
fiscal strategy
Provides information on accountability

Accountability Limited
for resources (e.g., fixed assets)
Basis for product/

Limited Good
service pricing
Disincentives for fraud Better than cash, but depends on the internal
Limited
and corruption control environment (among other things)
Although information system costs may be

Information system costs can be higher (because
Implementation lower, additional efforts are required to identify
of customization and limited availability)
and value assets (among other things)
Ongoing information system costs can be higher

Ongoing operation of systems is more sustainable
because the systems are generally customized.
because (i) it is easier to attract and retain skilled
Ongoing operation Cash accounting systems generally require
staff; and (ii) subsidiary records are integrated
more personnel to operate them. However,
(e.g., payables, receivables and asset registers)
fewer qualified accountants are necessary

3 Goods and Services Tax

GST, which was implemented in as food and controlled medicine to
April 2015, proved to be a forward ensure that the low and middle income
looking policy as revenue gained families are not overly burdened by
through its implementation has the tax, those who consume more,
helped cushion the shortfall in particularly the wealthy bear a heavier
revenue from the petroleum sector. tax burden through this system.
Total consumption taxes of Sales The Sales Tax and Service Tax
Tax, Service Tax and GST provided an (SST) is also a consumption tax but the
estimated revenue of RM34.6 billion main difference is that the coverage
as of December 2015 and collection is of GST is for the whole supply chain
set to increase to RM39 billion in 2016. whereas SST is limited to certain part
This is in contrast with the of supply chain. GST is also claimable
contributions from Petronas and oil- for input products and services
related sectors which are anticipated meaning it is separate from business
to decline to RM31.8 billion in 2016 cost while SST is treated as part of the
from RM43.6 billion in 2015 and the cost for businesses.
percentage of oil-related revenue to
government's overall revenue was
expected to decline further to 14.1
percent in 2016 from an estimated 19.6
percent in 2015. The reduction is due
to a decrease in Petronas's dividend
payout by RM10 billion apart from the
low crude oil price.
Although GST imposes a 6 percent
tax compared to the now abolised Sales
and Service Tax (SST) at 10 percent and
Service Tax at 6 percent, in the longer
term the former is envisaged to yield
a higher revenue collection.
Having been implemented in
more than 160 countries, GST is
acknowledged as a fairer, more efficient
tax system given its broad-based
approach, with taxation occurring
at the point of consumption. Having
zero-rated many of the essentials such

MOVING FORWARD
M
oving forward, the main It should also be noted that the goal
challenge is to ensure that of public finance reform is to utilise
the Governments target of Government funds more efficiently
achieving a balanced budget in 2020 in areas such as social safety nets for
is met. As part of the initiative, the the deserving, healthcare, education
Government will continue reducing and other critical infrastructure for
subsidies that distort the market and the rakyat.
implement efforts to tighten leakages We w i l l a l s o s e e t h e
of revenue with tax control elements implementation of the accrual
specifically in the areas of used car accounting system in 2017, replacing
imports, the shipping industry and the current cash based system.
SME corporate income tax incentives.

Narrowing Disparity
NARROWING DAT0' SRI

ABDUL WAHID OMAR
DISPARITY
MINISTER IN THE PRIME MINISTER'S DEPARTMENT
PROMOTES The Narrowing Disparity

Strategic Reform Initiative (SRI)
INCLUSIVENESS
has surpassed its Key Performance
Indicator (KPI) targets set for the
year and this encompasses the
AND
increase of RM3.69 billion in market
capitalisation by 11 Skim Jejak Jaya
Bumiputera (SJJB) companies, with
SUSTAINABILITY
two companies breaching the RM1
billion mark.
Various initiatives spearheaded
by TERAJU have resulted in RM63.4
billion of business opportunities
for Bumiputera companies via its
key programmes, notably the Carve
Out and Compete Programme,
High Performing Bumiputera
Companies Programme (TeraS),
Bumiputera Entrepreneurs Start-
up Scheme (SUPERB) and Skim
Jejak Jaya Bumiputera (SJJB).
Given the challenging
economic climate in 2015,
TERAJU has placed greater focus
on enhancing and broadening its
initiatives in order to build a more
resilient and competitive pool of
Bumiputera companies. This has
led to the development of strategic

TERAJUs most imminent
challenge would be to prepare
Bumiputera businesses for the
initiatives, new enablers, schemes forthcoming removal of trade
barriers under the Trans-Pacific
and collaborations to enhance
Bumiputera participation in the
(NKEA) Entry Point Projects (EPP).
The forthcoming market
Partnership Agreement (TPPA).
liberalisation and expansion
under the ASEAN Economic
Community (AEC) and Trans-
Pacific Partnership Agreement
(TPPA) presents both opportunities
and challenges for Bumiputera
T
companies. There is therefore he Narrowing Disparity
a greater need to enhance their Strategic Reform Initiative INSIDE THIS SRI
capacity to compete in an open (SRI) was devised to address
and liberalised economy. In order inequality between the Bumiputera 1 Facilitating Growth for High
Performing Companies
to ensure that the implemented share of the economy in relation to
efforts will not be derailed its population and other groups.
by liberalisation, effective
It is aimed at helping Bumiputera 2 Leveraging on Collaborative
Capacity-Building
companies to develop and enhance
new programmes focusing on capacity, and improve competitiveness
human capital development, and reduce reliance on Government
sustainable wealth ownership contracts, and improve Bumiputera under this SRI are built around the
and entrepreneurship will be representation in market equity, Bumiputera Economic Transformation
developed, as recommended in high value-added occupations and Roadmap which was launched in
management positions. November 2011. Five areas for a
the 11th Malaysia Plan.
These initiatives are spearheaded game-changing development of the
TERAJU will intensify its efforts
by Unit Peneraju Agenda Bumiputera Bumiputera economy were brought into
by forging effective collaborations (TERAJU) which has been mandated to focus education, employment, income
to upscale Bumiputera companies lead, coordinate and drive Bumiputera levels, wealth creation and the overall
to compete in the market. economic participation. The initiatives performance of Bumiputera companies.

Narrowing Disparity
1 Facilitating Growth into large projects like the Mass Rapid

Transit (MRT ) Line 1 and 2.
for High Performing Companies To further develop and support

the growth of Bumiputera companies,
the year also saw the continuance of
programmes that improved Bumiputera
TERAJU identifies high performing value for Bumiputera companies access to financing and markets, such as
Bumiputera companies and creates through the introduction of various the TeraS Fund, Facilitation Fund, Halal
programmes and initiatives to address programmes and initiatives from the Fund, Skim Jejak Jaya Bumiputera (SJJB)
economic challenges so that these start-up stage, up to potential listing and export programmes. These capacity
companies can thrive in a conducive in Bursa Malaysia. development and financing programmes
environment that levels the playing As of 2015, RM36.06 billion worth were created in collaboration with both
field. This is the cornerstone of the of business opportunities were created public and private financial and non-
TeraS programme, which currently for Bumiputera companies under its financial institutions.
comprising 991 Bumiputera Small- Carve-Out & Compete Programme, The year also saw collaborations
Medium Enterprises (SMEs) from through collaborations with various with Yayasan Waqaf Malaysia, which
various sectors and industries. The public and private institutions as the includes several areas under corporate
objective of this programme is to mega-project owners. This provides a waqaf such as the development of
allow Bumiputera SMEs to drive the platform for Bumiputera contractors Malay-reserve lands and endowment
SME sector and eventually contribute to compete among themselves with lands. The newly established
towards the economy by 2020. contracts awarded based on merits, Perbadanan Wakaf Nasional Berhad
Since 2011, TERAJU has continued with the aim to support and encourage (PWNB) is tasked to spearhead and
to create opportunities and enhance the entry of Bumiputera contractors implement these initiatives.
The newly established Perbadanan Wakaf Nasional Berhad (PWNB) is tasked to spearhead and implement corporate Waqaf initiatives

2 Leveraging on
Collaborative
Capacity-Building
DENTISTRY
WITH A
The cooperative sector is also one
of the focus areas as the majority of the
cooperatives in Malaysia are owned
DIFFERENCE
by Bumiputeras. In ensuring that the
Patang Saharing
capability of these cooperatives are
Dentist
enhanced and strengthened, TERAJU has
collaborated with Suruhanjaya Koperasi
F
Malaysia (SKM) in 2015 to scale up 20 high
or many of us, visits to the For Dental Spa itself, every day
performing Bumiputera cooperatives to
dentist often invoke feelings we are forced to turn away up to nine
move them to the next level.
of extreme anxiety. To make a patients because we are not just not
Towards the effort to empower
difference, Patang Saharing decided able to cope."
small, medium and micro-enterprises,
to establish a dental practice that Patang attributes his success
TERAJU also collaborates with
incorporates an atmosphere of to TERAJUs SUPERB programme,
the respective Economic Corridor
relaxation. Dental Spa was created which provided valuable experience
Authorities to provide Bumiputera
to push for a culture of dental care as and introduced him to like-minded
entrepreneurs within their region with
well as to remove the stigma of trauma innovative entrepreneurs, trainers and
specialized funding schemes, training
and fear associated with dental clinics. mentors who inspired him.
and other capacity building initiatives.
More often than not, this is due to the SUPERB not only helped me to
Institut Keusahawanan Negara
rather clinical atmosphere of most prepare for opportunities out there
(INSKEN), being a unit under TERAJU,
clinics and at times, the rudimentary but also to be more discerning. The
is tasked to identify and implement
setting of rural clinics. emphasis placed on quality in self,
capacity building initiatives with the
When patients are calmer, it service and products offered has
objective of equipping Bumiputera
becomes easier to administer treatment, helped create the extremely confident
entrepreneurs with tools and
making their visits to the dentist more entrepreneur that I am today.
knowledge relevant to the industry.
therapeutic. In 2015, as a result of increasing
This effort is aimed at developing
The positive image of dental demand and market prominence,
and identifying potential as well as
practice spearheaded by Dental Spa Patang moved Dental Spa to a
effective training mechanisms to
has been a resounding success, evident much bigger premise and upgraded
achieve the national entrepreneurship
in the increasing number of patients its equipment and machines, as
development aspirations.
in his clinic. Hence, Patang plans to part of his expansion plan. I am
At present, 7,871 underprivileged
develop a chain of Dental Spa in Sabah looking to creating a more conducive
students have benefited from the capacity
and eventually, the whole of Malaysia. environment for my staff to enable
building initiatives under Yayasan
Tawau currently has only eight them to face challenges that come with
Peneraju Pendidikan Bumiputera which
dental clinics including government the expansion of this business.
range from academic and technical as
clinics, servicing a population of more
well as professional education.
than 400,000 people and we are not
Institut Keusahawanan Negara
able to meet the growing demand for
(INSKEN) and Yayasan Peneraju
dental care.
Pendidikan Bumiputera are part of
Bumiputera Economic Transformation
Roadmap initiatives.

Narrowing Disparity
ALL GEARED
UP FOR
LIBERALISATION
Dato' Husni Salleh
TERAJU Chief Executive Officer
T
ERAJUs main agenda has market, relying heavily on government EMKAY Group and the construction of
always been to ensure that contacts and concessions. For a the Malaysia International Trade and
Bumiputera companies are majority of these companies, their Exhibition Centre (MITEC), all valued
able to compete and excel in a liberalised biggest clients compose of either the at a total of RM36.06 billion.
economy. In spearheading the National Government or Government-linked The early success of the TeraS
Bumiputera Empowerment Agenda, companies, seeing very few tap into programme is evident from the
most of TERAJUs initiatives focus on the international market. interim performance review of the MRT
upskilling and preparing Bumiputera While the battle to shift the project, which is the first project to be
businesses for both TPPA and AEC dependency mindset has been subjected to the Carve-Out & Compete
together with ensuring the objectives challenging, one of the institutions Programme.
of Bumiputera development as stated under TERAJU, INSKEN has played Firstly, as of 2015, 47 percent of the
in RMKe-11 are achieved, said its Chief a huge part in pushing companies to contracts awarded by MRT Corporation
Executive Officer Dato Husni Salleh. spread their wings and venture into were to Bumiputera contractors,
The Narrowing Disparity Labs new markets. which is higher than the minimum
began when Malaysia started According to Dato Husni, they have Carve-Out and Compete threshold
participating in the TPPA negotiations, been upfront with TeraS companies on of 42 percent. Secondly, the interim
and at the time, TERAJU was already the need to compete given that there review also revealed that out of the
receiving constant feedback on what are no guaranteed contracts from three top performing contractors in the
to expect once the agreement is signed. either the Government or TERAJU. MRT project, two of them were TeraS
As a result, liberalisation is While being recognised as a TeraS companies.
something that we take into serious company has numerous advantages, In 2015, TERAJU created more than
consideration when designing many of including the opportunities for funding RM60 billion worth in investments,
our programmes. We wanted to ensure and capacity development, it does not business, financing and human capital
that Bumiputera companies are able to preclude one from competing with development opportunities. Moving
compete in an intensely competitive other TeraS companies as well as non- on, TERAJU will continue to focus
environment, alongside being well- TeraS Bumiputera companies on upskilling and empowering more
equipped and poised to take advantage Through its Carve-Out and Compete Bumiputera companies to become
of the new market opportunities Initiative, Bumiputera companies are global players.
brought about by liberalisation. provided opportunities to participate
Furthermore, he felt that many in mega government projects such
Bumiputera companies were as KVMRT Line 1, Menara Warisan
extremely confined to the domestic Merdeka, development projects by

MOVING FORWARD
T
ERAJUs most imminent Empowering Bumiputera which includes pushing for trade
challenge would be to prepare human capital adjustment assistance. The 2015
Bumiputera businesses for the study commissioned by the Ministry
Increasing Bumiputera effective
upcoming removal of trade barriers of International Trade and Industry
control and sustainable
under the Trans-Pacific Partnership (MITI) and TERAJU also called for an
corporate ownership
Agreement (TPPA). This could affect increased engagement of Bumiputera
Bumiputera companies which tend to Enlarging the share of SMEs in global supply chains through
be domestically driven by Government Bumiputera wealth ownership the assistance of Government-linked
policies and assistance programmes. companies (GLCs), large companies
Empowering the Bumiputera
The growth of Bumiputera as well as Multinational Corporations
Economic Community
companies may be challenged by (MNCs). This would facilitate the
tougher competition especially with Strengthening the delivery scaling up of Bumiputera SMEs, which
free trade agreements such as the effectiveness of Bumiputera- would place them in a better position
ASEAN Free Trade Area, ASEAN oriented programmes to compete in open markets.
Economic Community and TPPA. Efforts are also being undertaken
Hence, to intensify the growth and The implementation of new to increase the value of Skim Jejak
competitiveness of Bumiputera programmes will include participation Jaya Bumiputera (SJJB) Public-Listed
companies to face the TPPA and towards from qualified companies under the Companies (PLCs) by an additional RM1
achieving RMK11 goals of creating TeraS programme. billion by the end of 2016. The target for
30 national Champions, 10 regional In view of this, TERAJU will the coming year would be to chart a 10
Champions and five international also be working on some of the key percent increase in Growth, Employment
Champions, new programmes will be recommendations made in the Study and Turnover (GET) for 60 percent of the
developed to enhance the Bumiputera on Potential Economic Impact of micro and small companies participating
Economic Community (BEC) which will TPPA on the Malaysian Economy in the INSKEN 500 programme.
focus on the following areas: and Selected Key Economic Sectors,

A HIGH-INCOME DATO' SRI RICHARD

RIOT ANAK JAEM
ECONOMY
MINISTER OF HUMAN RESOURCE
NEEDS A Human capital development

(HCD) is integral in ensuring
WORLD-CLASS
that Malaysia is able to achieve
its high-income aspirations by
2020. Additionally, an efficient
and effective labour market is
WORKFORCE
necessary to attract investments
into Malaysia and enable everyone
to participate in and enjoy the
benefits of economic growth.
In championing HCD, I wish
to highlight the emphasis the
Government has placed on skills
development in the 11th Malaysia
Plan (11MP) which comes into
force in 2016. This is necessary
because 60 percent of the 1.5
million newly created jobs under
11MP will require skills from
Technical Vocational Education
and Training (TVET). It is crucial
that the Malaysian workforce is
upskilled to compete in the more
liberalised economy of the future.
In terms of achievements for 2015,
the Human Capital Development
Strategic Reform Initiative (HCD-
SRI) successfully met most of its
KPIs on the back of enhanced
collaboration across numerous
ministries due to the wide scope of
human capital development.

One particularly game-
changing development is the green
light received from the Economic
Efforts under the HCD-
Council in November 2015 for the
setting up of the National Human
SRI initiative have been geared
Capital Development Council to
spearhead relevant policies and
towards creating more inclusive
initiatives in creating globally
competitive talent right here
and progressive labour policies,
in Malaysia.
In pushing for women
improving workers skills and
in leadership positions, it is
encouraging to note the increase
pushing for greater diversity
in the number of women decision- in the workforce.
makers in public companies in
2015. The year saw an increase of
15.6 percent in public companies
and 10.7 percent in public listed
T
companies, as reported by the
he HCDSRI, which oversees
Companies Commission of INSIDE THIS SRI
the wide area of human capital
Malaysia and BURSA respectively. development is tasked with
Capacity building and upskilling
programmes such as MyProcert
the upskilling of Malaysian workforce 1 Strengthening Leadership
and Policy Efficacy
to meet the demands of a nation in
and TVET were ongoing in 2015 transition towards high income status.
and expected to continue to gain
momentum as we move into 2016.
It is also meant to prepare
the Malaysian work force for a
2 Building Capabilities Through
Skills Training
more liberalised economy with
We stand today at a very
implementation of the Association
important juncture for human
capital development in this country.
of Southeast Asian Nations (ASEAN) 3 Inclusiveness in the Workplace
to Increase Productivity, Improve
Economic Community (AEC) and Motivation and Talent Retention
The foundation of our education Trans-Pacific Partnership Agreement
system is being improved through (TPPA). Liberalisation under AEC and
the Education NKRA and NKEA. As TPPA will increase competition in the Some of the notable achievements
we step up towards high-income workforce due to the greater mobility include the improvement to labour
status and with liberalisation of skilled workers from other ASEAN laws, the implementation of Minimum
knocking at our doors, the need countries and beyond. Wage and Minimum Retirement Age,
Since the inception of the National an increase in upskilling initiatives to
to upskill our current workforce
Transformation Programme (NTP) in move towards fulfilling the target of
and become globally relevant is
2010, efforts under HCD-SRI have been a 35 percent high skilled workforce
of utmost importance. geared towards creating more inclusive by 2020 and the creation of more
The Government is committed and progressive labour policies, facilitative environment within the
in fostering a conducive landscape improving workers skills and pushing Malaysian workforce to attract and
for the best talents to thrive. for greater diversity in the workforce. retain talent.

1 Strengthening Leadership
and Policy Efficacy
To drive the human capital facilitate accelerated industry-led 2013, with additional labour indicators
development agenda under the programme delivery and streamline from the Department of Statistics and
11MP, a high-powered National standards across Ministries. These data from research studies for selected
Human Capital Development Council efforts will be guided by the need to sectors and economic corridors. With
(NHCDC) has been established ensure that academic and Technical the enhancement of the Labour Market
to define overall human capital Vocational Education and Training Integrated Data Warehouse (LMIDW)
development policy direction and (TVET) institutions produce quality scheduled to be launched in the first
determine initiative priorities. graduates whose skills match half of 2016, ILMIA is able to provide
The set-up of the NHCDC industry requirements. labour and supply data according to
championed by the Economic In the management of labour sectors and competencies.
Planning Unit was endorsed by the market information and data, efforts The Labour Market portal will be
Economic Council in November to improve content and presentation beneficial for all stakeholders namely
2015. Comprising key representatives continued in 2015. Ministries and agencies for their policy
from relevant Government Ministries The Institute for Labour Market interventions and supply planning, and
and agencies, as well as major Information and Analysis (ILMIA) industry players to obtain information
private sector players and industry is now strengthening its portal and on labour data as well as provide inputs
representatives, the agency will dashboard which were developed in on workforce requirements.
2 Building Capabilities 2015 saw strengthened academia

industry linkages in certification delivery
Through Skills Training with the collaboration of more than 55

institutes of higher learning including
polytechnics. This collaboration helped
develop 707 faculty members as well
The priority initiatives under MYPROCERT AND INDUSTRY as trained 6,016 students in the various
the HCD-SRI are accelerating the ACADEMIC COLLABORATION knowledge areas.
development of skilled workforce, so The MyProCert programme was
that employees are able to keep up developed in collaboration with TECHNICAL VOCATIONAL
with the skills demands of a dynamic Multimedia Development Corp (MDeC) EDUCATION AND TRAINING
economy. Efforts here also prevent to produce more professionals with Given the crucial role of TVET as
skills gaps from widening to ensure internationally recognised technical a platform to upskill low and medium
that companies can be confident and ICT certifications. skilled workers, the Ministry of Youth
of having the pipeline of workers Through the programme, 3,169 and Sports struck up a partnership with
they need. employees are trained for upskilling ITE Singapore in 2015 (see Figure 1),
Malaysias skilled workers and reskilling in various knowledge to collaborate on a series of master
represent 28 percent of the total areas like project management, big trainers courses to equip Malaysian
workforce as of 2015, and the target is data analytics, embedded system, TVET trainers with skills essential
to reach 35 percent by 2020. enterprise architecture and others. to teach TVET courses more effectively.

There are currently seven
Ministry of Youths Collaboration with ITE Singapore on TVET Trainers ministries and agencies involved in
and Leaders Training providing TVET, including Ministries of
Education, Higher Education, Human
Key Training Components
Resources and Development, and
1. Enhancing leadership and Youth and Sports. In addition, there
management skills are a great number of state service
Temasek
Ministry of Youth
2. Upgrading pedagogical providers as well as public and private
and Sports,
Foundation
Malaysia competency to provide quality institutions in Malaysia.
Main Sponsor Co-Sponsor
delivery Also, under the 11MP there will be
3. Adopt student-centred learning a fundamental shift in how the TVET
Training strategies to promote greater system operates. The programme will
Training Grant expenses in
student engagement shift from being government-driven
Singapore &
Malaysia to one that enables industry-led
4. Promote self and peer
assessment through reflective programmes and interventions.
ITE Education
TVET Academic learning In line with this, EPU will work with
Leaders & Master
Services Malaysian Qualifications Agency (MQA)
Trainers
5. Design and develop video-based
Consultancy & Beneficiaries learning resources and Department of Skills Development
Training Services
(DSD) towards streamlining a single
qualification and rating system to
Figure 1: Ministry of Youth collaborates with ITE Singapore on TVET Trainers and Leaders Training enhance industry-based linkages and
ensure that there are more apprenticeship
The 11th Malaysia Plans (11MP) for the Vocational and Technical programmes, thus elevating TVET as a
recommendation on human capital Transformation Plan and RM30 pathway of choice for students.
development takes into account million to TalentCorp for the Industry TalentCorp focuses on enhancing
the urgent need to upskill the local Academia Collaboration Programme. local graduate employability by
workforce so that they will be able to There is also an urgent need providing industry exposure for 17,967
compete both locally and regionally. to coordinate TVET programmes undergraduates through structured
This is due to the fact that 60 percent across various Ministries to ensure internships; and collaborated
of the 1.5 million newly created jobs private and public TVET institutions with industry to upskill 7,153 fresh
under the 11MP will require TVET skills. produce quality graduates to meet graduates in line with industry
In view of this, Malaysia's TVET industry demands. requirements in 2015.
enrolment for the country has to be
increased from 164,000 in 2013 to
225,000 students by 2020 and ensure
that the graduates will meet employers
future requirements.
The allocation of RM1 billion for
the Skill Development Fund under the
11MP in the next five years reflects the
seriousness of the government in this
area. The fund is envisaged to benefit
the incoming younger workforce,
enabling them to receive skills and
vocational education.
Additionally, RM1.2 billion will be
allocated to the Ministry of Education Malaysian Contingent for the World Skills Competition before departing for Sao Paulo, Brazil

RETAINING WOMEN
Johan Mahmood Merican
TalentCorp Malaysias Chief
Executive Officer
IN THE WORKFORCE
A
ccording to the 2015 statistics that diversity has actually helped improve double-burden syndrome of taking on
by Towers Watsons Global the bottom line and 56 percent admitted the added responsibilities of managing
Norm Database, women that it has helped them compete in new their home, caring for their children
make up merely 27 percent of industries or geographies. or the elderly.
managers globally. In Malaysia, TalentCorp Malaysias Chief Once these women leave the
women consist of merely 31 percent Executive Officer Johan Mahmood workforce, they do not return to the
of the workforce in a managerial Merican said the continuous efforts workforce as compared to other South East
towards this at numerous levels have Asian countries such as Japan and Korea
capacity which is a small chunk,
shown results with female labour force which exhibits women returning to the
with 36 percent likely to leave their
participation rising from 46.8 percent in workforce in their late thirties onwards.
employer within the next two years.
2010 to 53.6 percent in 2014. The greatest challenge is to
The importance of gender diversity
We may rank below Vietnam persuade companies to adopt more
in the workplace and measures to
in terms of overall participation by flexible hiring and balanced work-
improve has been emphasised in the
women but with this increase, we life policies to ensure that valuable
10th Malaysia Plan and the most recent
are looking at an additional 600, 000 talents are not lost due to the lack
effort to promote diversity is the launch
women in the workforce as well as of work-life balance, said Johan.
of the 30% Club in Malaysia, which aims
an impact of 0.3 percent on the GDP "When approached on this matter,
to increase the representation of women according to the World Bank. the standard response by companies
on corporate boards. Key measures taken by the include why should we do it and can
Creating gender diversity in the Government to increase female we trust our employees.
workforce is more of an economic labour force participation rate include In July - August 2015, TalentCorp
imperative than a gender issue as it encouraging more employers to and PwC Malaysia conducted a
involves retaining and attracting talents adopt flexible work arrangements, Diversity in the Workplace Survey to
that are valuable to economic growth. promoting childcare facilities, career better understand the current diversity
McKinsey's Women Matter: An Asian comeback programme for women landscape in public listed companies,
Perspective, 2012 highlighted how the and supporting the development of with the support of Bursa Malaysia.
increasing participation of women women entrepreneurs. The survey obtained responses from
in the workforce could potentially According to Johan, though two- 130 listed companies, encompassing
increase Malaysias GDP between RM6 third of graduates are women, a 1,094 members of the board and
billion to RM9 billion. significant percentage of women tend 464,092 employees in Malaysian
According to PricewaterhouseCoopers' to drop off the workforce in their late public-listed companies.
(PwC) annual CEO survey for 2015, out of 20s or early 30s, mainly due to work-life The survey also included 67 of Top
the two-thirds of Chief Executives whose balance issues. 100 listed companies, representing
companies have a formal diversity and A 2012 World Bank report attributes 70 percent of Bursas total market
inclusiveness strategy, 85 percent believed this to many women being caught in a capitalisation.

According to the survey, 31 juggling act becomes impossible, On career comeback, examples
percent of companies surveyed have many leave the workplace. include companies like Petronas and
introduced flexi-work arrangements, Simple flexi-arrangement IHS that have implemented programmes
28 percent have staggered hours, 18 like staggered hours makes a lot of that promote the hiring of women
percent allowed telecommuting, 15 difference in retaining talents. professionals who took a career break
percent allowed for reduced or part- In the case of trusting employees, due to various reasons as well as facilitate
time work and 10 percent allowed for companies can introduce it gradually, their transition back to the workforce.
a compressed work week. said Johan who added that PwC International Business Machines
Johan pointed out that more introduced a flexi-hours arrangement Corporation (IBM) for example, allows
companies need to wake up to the based on merits, where priority was its employees to take a leave of absence
fact that unlike in the 80s, there given to a worker with above average without the fear of losing their job. In
are substantially more women in performance. fact, Chong Chye Neo, IBM Malaysias
universities and as a result, the female PwCs approach was successful first woman Managing Director, took two
workforce has increased exponentially. because it was not regarded as an leaves of absence during her career in
Hence, it makes good business sense entitlement but a privilege. EcoWorld, IBM and if that option were not available
to put in place the necessary support for example, piloted for flexi-work for her, IBM Malaysia would have lost a
for women talents to retain valuable arrangement during school holidays so female talent of Chongs calibre.
human capital. that parents can look after their children. Over the years, more companies in
Women today do not have It was discovered that even Malaysia have introduced flexi-work
the support of extended families employees who do not use the arrangement, Family Life Benefits and
and working mothers struggle to flexi-work arrangement are happy Work-life Benefits including Maybank,
juggle their roles as nurturers and because they know that the option Nestle, Kimberly-Clark, IBM, DHL and
workplace professionals. When the is available to them. Standard Chartered.
Women Labour Force Participation In Malaysia

Female Labour Force Participation Rate in Malaysia from 2010-2014 Gender Composition by Organisation Levels Female
Male
TARGET
+6.8% 13%
5%
22%
32%
39% 40%
52%
55%
53.6% 95%
52.4% 87%
49.5% 78%
68%
47.9% 61% 60%
46.8% 48%
2010 2011 2012 2013 2014 2015 Overall Board CEO Top Senior Executive Non-
Management and Mid Executive
Management
Source: Department of Statistics Malaysia, 2014 Source: Diversity in the Workplace Survey of Malaysian PLCs by TalentCorp
& PwC Malaysia, 2015

3 Inclusiveness in the Workplace grants for the setup of new childcare

centres, tax exemptions for childcare
Increases Productivity, Improves centres and double tax deductions for

employers who provide employees
Motivation And Talent Retention with childcare facilities.

On flexiwork initiatives,
TalentCorps flexWorkLife.my aims
to build a network of employers and
An inclusive workplace facilitates Arrangements (FWA) promoting talents to optimise work-life integration
the creation of an environment where Childcare Facilities, Career Comeback with the intent of retaining women at
everyone is treated with dignity Programme for women to return to work work and encourage women to return
and respect, where the talents and and supporting entrepreneurship. to work. In addition to the repository of
skills of different groups are valued, FWA, while promoting convenience best practices on FWA and guidelines,
resulting in higher productivity for employees, will require maturity the online portal also features case
because the workforce is happier and accountability to ensure efficacy studies from employers who have
and more motivated. within the organisation. Changes in in place FWA, work-life benefits and
the workplaces including flexiwork family friendly facilities.
ATTRACTING AND RETAINING arrangements and childcare facilities, In 2015, TalentCorp supported 20
WOMEN IN THE WORKFORCE were among the factor that drew an leading employers to implement and
THROUGH INNOVATIVE WORK increased number of women into the enhance FWA at their organisations
PLACE SOLUTIONS workforce. Provision for childcare is an as a key strategy to retain women in
Women dominate public university important factor as it allows women to the workforce. In addition, TalentCorp
intakes, making up 63 percent of work guilt free. helped 256 women return to the
enrolment, with most entering into Therefore, there is a need for more workforce after a career break under
the job market upon graduation. proactive measures such as funding in the Career Comeback programme
However, many end up having to leave the form of fee assistance for childcare, launched in March 2015.
the workforce in the midst of climbing
the corporate ladder, due to family
commitments.
Initiatives under this SRI aims to
increase the participation of women
in the labour market to 59 percent by
2019 and increase women participation
in decision making positions for
corporate sectors to 30 percent by 2016.
Efforts here have seen the
participation of Malaysian women in
the workforce rise to 53.6 percent in 2014
from 49.5 percent in 2012. Despite this,
the percentage of working age women
in the workforce is relatively low when
compared to other ASEAN countries.
Key measures taken by the
Government to increase the rate of
participation of the female labour
include encouraging employers
Panel discussion during Lead the Change event to encourage greater diversity in Malaysias
to implement Flexible Work workforce in 2015

and investors. In the UK, where the
30% Club was founded, tremendous
success has been recorded. The
number of women in UK Boards has
risen from 12.6 percent in 2010 to 26.1
percent by October 2015.
A total 197 of pledges were
signed by Chairmen and CEOs of
public-listed companies during the
launch of 30% Club Malaysias Lead
the Change event, paving a way to
increase the number of women in
decision making positions. This is
because gender diversity creates an
effective boardroom, therefore is good
for business.
Through these initiatives, an
additional 40 placements have been
made for women in the boardroom as
Over 700 attendees consisting of Chairmen, CEOs, Directors, and various distinguished guests in decision making of 2015 since the start of the Women
positions were present during the launch of Lead the Change event in 2015 Directors Programme in 2013.
Challenges remain in efforts
ADDRESSING THE GENDER GAP In pursuit of this goal, two new to change mind-sets of traditional
IN LEADERSHIP: WOMEN ON measures were announced by the business leaders and much of 2015
BOARD LEAD THE CHANGE Prime Minister: has been centred on educating
To encourage greater diversity in
Through policy requirements, business leaders on the growing global
Malaysias workforce, the government
GLCs will allow their executives significance of this agenda. There were
hopes to achieve 30 percent women
to serve on the boards of other also operational challenges in creating
in decision-making positions in
listed companies as long as vacancies for more women on board
the corporate sector by 2020. In
there is no conflict of interest such as finding mechanisms to refresh
conjunction with this, the Lead the
board composition and enabling the
Change event, held in May 2015, was Listed companies will be required matching of companies with available
launched by YAB Prime Minister and to disclose the composition and competencies and experience.
was well attended by Chairmen, Boards diversity of their boards and top It must be noted that this
and senior management of corporate management in terms of gender, endeavour extends beyond just being
Malaysia. This event was organised ethnicity and age moving forward inclusive, it is also about according
by Ministry of Women, Family and board seats based on merits.
Community Development together During the event, the Malaysian
with PEMANDU, in collaboration with chapter of the 30% Club was launched
BURSA and TalentCorp. with 3 Founding Chairs namely Tan
Noting that the goal of women Sri Megat Zaharuddin, Tan Sri Jeffrey
making up 30 percent of company Cheah and Tan Sri Zarinah Anwar.
boards was still some way off, the The 30% Club is a global network of
Prime Minister urged business leaders business advocates who champion
to take the next step, break those diversity on boards, most notably in
glass ceilings and install women the UK and the US, where the majority
on your boards. of advocates are top business leaders

Dato' Aziz Bakar

Former Chief Executive Officer
FIGHTING FOR DIVERSITY

of Malaysian Directors Academy
(MINDA) and Co-founder of the
30% Club Malaysia
IN THE BOARDROOM
B
y 2016, women are supposed to fill 2015, would lead the engagement with the of research showing that women in the
30 percent or more of the decision- corporate sector in an effort to accelerate boardroom help make more balanced
making positions in corporate the increase in women representation corporate decisions, said Dato' Aziz.
Malaysia. This was the aspirational target in the boardroom. The 30% Club was Nevertheless, there is a growing
announced by the government in 2011. started in the United Kingdom in 2010 number of progressive male directors who
In his Budget 2012 speech, YAB to encourage women representation on are open to having women as directors,
Prime Minister Dato Sri Najib Tun Razak company boards. The Malaysian chapter he added.
said that Government will organise is the seventh, after UK, Ireland, US, South In an effort to create a large pool of
advanced management programmes for Africa, Hong Kong, and Australia. professional women with boardroom
women with potential to become board Based on experiences in the UK, the experience, the 30% Club Malaysia, in
members, intensify advocacy activities move for diversity should be a voluntary collaboration with NAM Institute for the
for greater participation of women business-led decision to avoid tokenism Empowerment of Women (NIEW), an agency
in the corporate sector and develop merely to fulfil legislative or regulatory under the Ministry of Women, Family and
a database of potential women directors. requirements. Doing it this way would Community Development, is providing
The 30 percent aspiration is also lead to a more meaningful and sustainable comprehensive boardroom training for
emphasised in the 11th Malaysia Plan. change in the corporate sector, said Anne. women interested in board positions.
Creating diversity at the top would most Studies have shown that companies who Companies can also refer to our repository
definitely pave way for greater diversity in have a higher proportion of women in top of potential women directors for their board.
other parts of the organisation, said Anne management perform better than their The new government policy which
Abraham, the Chief Executive Officer of industry peers. allows for top executives in government-
LeadWomen Sdn Bhd and co-founder of In the UK, the Club has achieved linked companies (GLCs) to serve on
the 30% Club Malaysia. 26.1 percent women representation on the boards of other listed companies,
She however pointed out that gender FTSE-100 boards in October 2015, against will also increase the number of women
diversity in Corporate Malaysia cannot solely the goal of 30 percent by end-2015. With executives with boardroom experience.
be a government-driven agenda because, many CEOs of top FTSE companies among The government has urged all listed firms
without the involvement of the corporate their members, the Club has grown as an to adopt similar policy.
sector, there would not be much traction. international movement. A future move in this direction would
From 2008 to 2014, women Former Chief Executive Officer of be the Bursa Malaysia requirement for
representation in senior roles in companies Malaysian Directors Academy (MINDA) and listed companies to not only disclose the
grew just by 2.7 percent, to tip the scale at a Co-founder of the 30% Club Malaysia Dato' composition and diversity of their boards
mere 10.7 percent in 2015 despite vigorous Aziz Bakar said that the journey to change and top management in terms of gender,
campaigns by the government. For the top mindsets in corporate sector is a long and ethnicity and age but also to state their
100 public listed companies by market at times, frustrating journey. target and timeframes to achieve it.
capitalisation, the percentage of women There are a large number of The target by 31 December 2016 is to
company boards grew from 13 .2 percent corporations that are still very old school ensure that Malaysia achieves 30 percent
in 2014 to 14 percent in 2015. in thinking, where board members tend women representation on the Top 100
She added that the Kuala Lumpur to regard the boardroom as the boys-only companies, in order for Malaysia to be fairly
Chapter of the 30% Club launched in May club. This is despite the growing body benchmarked with the other countries.

MOVING FORWARD
I
n developing a Malaysian With regards to leveraging women
workforce that is capable of talent in the workforce, a cohesive,
coping with the demands of a overall action plan for childcare to
high-income economy, moving into increase enrolment and quality of
2016, operational aspects which need provision will be developed while
addressing include improving labour engagement sessions will be organised
market information, sustaining the through townhalls with various parties;
development of policies and initiatives chambers of commerce, developers
to enhance TVET as well as to leverage association, association of architects,
women talent in the workforce. local councils.
For the Labour Market Information Strategic initiatives will also
and Data Warehouse project, ILMIA continue, working towards increasing
will continue to enjoy commitment women in key decision making
across ministries to enable it to positions, by 30% Club Malaysia, NIEW
continue its on-going analysis, for and TalentCorp.
inputs into research, policy making The capabilities and skills of
and programme development. Malaysians is a key determinant of
In transforming TVET, the our economic success. With the right
government is constantly looking policies in place, human capital is
for opportunities to engage and a resource that can be effectively
encourage employers to be more leveraged to bring dividends not just
involved in dual vocational training. for the workforce but for the economy
Awareness campaigns will continue as a whole. The HCD-SRI will continue
to be carried out to promote and to steadfastly work towards creating
provide more information to parents a world-class workforce in meeting
and prospective students. demands of a high-income economy.

EXPENDITURE BUDGET 2015
EXPENDITURE
BUDGET 2015
T
he GTPs performance and expenditure budget is presented here in the
interests of transparency and accountability. Priding itself on emphasising
cost-effectiveness where possible, the GTP sets itself apart from other
projects, and thus allows for greater savings in areas where possible so long as it
does not impede the achievements of the NKPIs.
Meanwhile, budget expenditure is not reported for the Economic Transformation
Programme (ETP) as the ETP is private-sector driven and contains market sensitive data.
NKRA 2015 OE* SPENDING

GOVERNMENT TRANSFORMATION PROGRAMME (GTP)
KPI Achievement Total Carry Forward

No NKRA Total 2015 OE Total Spent (RM) % Spent
(%) (Previous Years) (RM)
1 Addressing the Cost of Living 98 15,000,000 - 15,000,000 100
2 Improving Rural Development 107 6,232,000 - 6,217,466 100
Raising Living Standards of

3 97 154,666,600 - 154,326,829 100
Low-Income Households
4 Assuring Quality Education 94 163,067,900 - 150,932,998 93
5 Reducing Crime 114 114,099,102 - 112,076,154 98
6 Fighting Corruption 93 2,644,890 - 2,542,026 96
Total 438,065,602 423,553,448
*OE refers to Operating Expenditure
NKRA 2015 DE* SPENDING

GOVERNMENT TRANSFORMATION PROGRAMME (GTP)
KPI Achievement Total Carry Forward

No NKRA Total 2015 DE Total Spent (RM) % Spent
(%) (Previous Years) (RM)
1 Improving Rural Development 107 2,247,692,900 - 2,154,638,309 96
Improving Urban Public

2 72 46,010,290 - 46,010,290 100
Transportation
3 Reducing Crime 114 40,000,000 69,083,600 10,000,000 25
Total 2,333,703,190 69,083,600 2,210,648,599
*DE refers to Development Expenditure

AGREED UPON
PROCEDURES
BY PwC
W
hat is the value that Agreed-Upon Procedures Where exceptions are noted, how does P wC
(AUP) bring to the National Transformation address this?
Programme (NTP)?
In the event there are exceptions, PWC will highlight
External validation is key to effectively evaluate the to PEMANDU these exceptions/issues in a weekly
efficacy of the NTP. Towards this end, it was important coordination meeting. Based on data and explanation
that an independent professional services firm were provided by the Ministries, the results are re-evaluated
to be appointed to meet this purpose. From the onset and adjusted, where appropriate, prior to inclusion in
of the NTP, PricewaterhouseCoopers Malaysia (PwC) the Annual Report.
conducted yearly AUP exercises on the NTP reporting
process. These are a set of specific tests and procedures
performed on the reported results of each National Does the Agreed-Upon Procedure process have
Key Result Area (NKRA), National Key Economic Area room for improvement? What are the steps being taken
(NKEA) and Strategic Reform Initiatives (SRI) against forward to improve the process?
National Key Performance Indicators (NKPIs).
In striving towards improving processes and the
quality of information, PwC has identified various
How does the AUP method of evaluation strive opportunities to achieve this objective. The AUP process
to ensure greater transparency and accuracy in the is constantly being reiterated. PEMANDU, together with
reporting process of the NTP ? the relevant Ministries and private sector stakeholders,
will be taking positive prescriptive actions to realise these
In endeavouring to make the scoring system improvements over the next 12 months.
as transparent as possible, the appointment of an
independent third party ensures greater consistency and
accuracy in methods of data collection and calculations How is market-sensitive data reported?
reported in the Annual Report. The AUP is applied to a
sample taken from each KPI as well as projects announced Exceptions are made where targets feature market-
during the Progress Updates. It is then checked against sensitive data to maintain confidentiality for the parties
guidelines and formulae developed in the initial involved. In such instances, involved parties will be
PEMANDU lab sessions. Where exceptions are noted by required to sign Non-Disclosure Agreements which
PwC, the processes and sources of data are re-evaluated then enable the data to be used for analysis without
prior to their incorporation in the Annual Report. compromising on confidentiality.

NTP PERFORMANCE 2015

A
ll three methods have been formulated to provide a pragmatic representation
of the actual KPI numbers in percentages. The overall NKRA/NKEA/SRI
composite scoring is the average of all scores.
Scoring Method Description

Method 1 Scoring is calculated by a simple comparison against set 2015 targets.
Scoring is calculated by dividing actual results against set 2015 targets with
an added rule:
Method 2
If the scoring is less than 100%, score #2 is taken as the actual percentage
If the scoring is equal or more than 100%, score #2 is taken as 100%
Scoring is calculated by dividing actual results against set 2015 targets with
an added rule:
If the scoring is equal and less than 50%, score #3 is indicated as 0
Method 3
If the scoring is more than 50% and less than 100%, score #3
is indicated as 0.5
If the scoring is equal or more than 100%, score #3 is indicated as 1
Methods 1 and 2 Methods 3

Achievement Traffic Lights Achievement Scoring Traffic Lights
90% and above 100% and above 1
51% 89% 51% 99% 0.5
50% and less 50% and less 0

Key Performance Indicators
NATIONAL KEY RESULT AREAS (NKRAS)
NKRA ADDRESSING THE RISING COST OF LIVING
Target Actual Method Method Method

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1 Setup of new KR1M 25 24 96 96 0.5
2 Handout of Back to School Incentive 100% 99.3% 99 99 0.5
3 Handout of BB1M 100% 100% 100 100 1.0
Direct handout to the Rakyat (BR1M)

i. RM950 for eligible household recipients with total earnings
less than RM3,000 per month + Family Bereavement Scheme;
4 ii. RM750 for eligible household recipients with total earnings between 100% 98.3% 98 98 0.5
RM3,000 and RM4,000 per month + Family Bereavement Scheme; and
iii. RM350 for eligible single Individuals recipients aged below 21 years old with income less than
RM2,000 per month
5 Number of new 1Malaysia Clinics providing services 34 27 79 79 0.5
TOTAL 98% 98% 63%
NKRA IMPROVING RURAL DEVELOPMENT

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1.1 Roads Delivery (km length) 697 732.22 105 100 1.0
Peninsular Malaysia 303 313.67 104 100 1.0
Sabah 198 214.85 109 100 1.0
Sarawak 196 203.7 104 100 1.0
1.2 Water Delivery: Number of Households 7,500 9,399 125 100 1.0
Peninsular Malaysia 2,500 2,536 101 100 1.0
Sabah 2,500 4,150 166 100 1.0
Sarawak 2,500 2,713 109 100 1.0
1.3 Electricity Delivery: Number of Households 13,319 14,430 108 100 1.0
Sabah 3,584 3,605 101 100 1.0
Sarawak 8,500 9,582 113 100 1.0
1.4 Housing: Number of Houses 8,500 9,080 107 100 1.0
Sabah 1,309 1,733 132 100 1.0
Sarawak 2,947 2,975 101 100 1.0
(More on next page)

(From previous page)
NKRA IMPROVING RURAL DEVELOPMENT (Continued)

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1.5 Road Maintenance (km length) 313 322.5 103 100 1.0
Peninsular Malaysia 213 222.5 104 100 1.0
Sabah 50 50 100 100 1.0
Sarawak 50 50 100 100 1.0
2.0 Rural Development : 21st Century Village
2.1 AGRI EPP7: Large Scale Premium Fruits or Vegetable Farm - Number of Farms 2 2 100 100 1.0
2.2 Desa Lestari Programme: Number of Villages 13 13 100 100 1.0
2.3 Percentage of 2013 Rural Business Challenge winners achieving 30% increase of income 80% 85% 106 100 1.0
TOTAL 107% 100% 100%
NKRA IMPROVING URBAN PUBLIC TRANSPORT

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1 Number of KL Budget Taxi Fleet - at par with ASEAN Best-in-Class 3,749 1,895 51 51 0.5
2 KL Monorail Expansion Project: Number of 4 car train sets delivered and commissioned 12 5 42 42 0.0
3 Bus Rapid Transit Corridor 1 (KL - Klang) project: Cabinet approval on funding model 100% 90% 90 90 0.5
4 Percentage of completion on the streamlining of Klang Valley Stage Bus Network according to Corridors 100% 100% 100 100 1.0
5 Percentage completion of design for the KTMB Ticketing System (AFC) 100% 54.9% 55 55 0.5
6 ITT Gombak project: Finalisation of the Supplementary Agreement (based on the latest decision) 100% 100% 100 100 1.0
7 Urban Public Transport Customer Satisfaction Level (GKL/KV) 75% 74% 99 99 0.5
8 AM Peak Urban Public Transport Ridership (GKL/KV) 500,000 447,195 89 89 0.5
9 KTM Komuter On-time Performance during AM Peak (within 10 minutes) 85% 95.14% 112 100 1.0
10 Number of additional parking bays at Klang Valley rail network 1,600 229 14 14 0.0
11 LRT Extension (Kelana Jaya): Construction progress 98% 93.57% 95 95 0.5
12 LRT Extension (Ampang): Construction progress 98% 91.24% 93 93 0.5
13 Number of Budget Taxis installed with Centralized Taxi Service System (TEKS1M) 1,500 0 0 0 0.0
Parkway Dropzone Facilities:

i. Kg Dato' Harun: Project complete and facilities operational
14 100% 78.49% 78 78 0.5
ii. Serdang: LOA issued and site possession
iii. Batu Tiga: LOA issued and site possession
15 KTMB Semi - Overhaul EMU Class 83 project 40% 15% 38 38 0.0
16 Percentage completion of the Journey Planner platform 100% 70% 70 70 0.5
Operationalisation of the Performance Monitoring Hub System (PMHS) for all Stage Buses in GKL/
17 100% 83.2% 83 83 0.5
KV by SPAD
18 Utilisation of Stage Bus in GKL/KV 70% 75.25% 108 100 1.0
TOTAL 72% 71% 50%

NKRA RAISING LIVING STANDARDS OF LOW-INCOME HOUSEHOLDS

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1.0 Number of new participants participate in 1AZAM programme 18,500 19,945 108 100 1.0
2.0 Number of new existing AZAM participants increased their income by RM300 for any 3 months 22,387 18,880 84 84 0.5
3.0 Number of 1AZAM participants in Financial Literacy Programme 18,500 13,960 75 75 0.5
4.0 Number of 1AZAM projects in colloboration with NGO and Corporate Sector 28 37 132 100 1.0
5.0 Number of 1AZAM community / group based programme 60 65 108 100 1.0
Beyond 1AZAM participants obtained minimum 50% increased in income from existing AZAM
6.0 2,100 1,511 72 72 0.5
project for a consecutive of 3 months
7.0 Percentage of updates recorded in eKasih 100 100 100 100 1.0
TOTAL 97% 90% 79%
NKRA ASSURING QUALITY EDUCATION

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1 Nationwide pre-school enrolment, including NGO (4+ and 5+ years only) 88% 84.63% 96 96 0.5
2 English literacy rate among Year 3 students 90% 94.1% 105 100 1.0
3 Percentage of Band 1 & 2 schools 35% 36.83% 105 100 1.0
4 Percentage of Band 6 & 7 schools 1.2% 0.95% 126 100 1.0
5 Number of High Performing Schools 130 132 102 100 1.0
6 Numeracy rate 100% 99.1% 99 99 0.5
7 Bahasa Melayu literacy rate 100% 98.6% 99 99 0.5
8 Percentage of primary school head masters receiving New Deals 5% 3.42% 68 68 0.5
9 Percentage of secondary school principals receiving New Deals 5% 4.22% 84 84 0.5
10 New English teacher trainees achieved A or A+ SPM in English before entering IPG 100% 100% 100 100 1.0
11 Percentage of PPD assessed to obtain baseline rating 100% 100% 100 100 1.0
12 IPG Strategic Plan is developed by December 2015 100% 100% 100 100 1.0
i. Percentage of teachers starting with B1 entry level proficiency increase by at least one band higher
13 100% 93.46% 93 93 0.5
ii. Percentage of teachers starting with B2 entry level proficiency increase by at least one band higher
Percentage progress of development of database of 13-17 year old enrolment

14 100% 100% 100 100 1.0
in Technical Vocational Education and Traning (TVET) across all agencies
15 New English teachers from IPG, IPTA and IPTS achieved C1 based on CEFR before posting 100% 66.2% 66 66 0.5
16 National childcare enrolment rate (0-4) 12.5% 8.02% 64 64 0.5
TOTAL 94% 92% 75%

NKRA REDUCING CRIME

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1 Percentage reduction in Reported Index Crime 5% 10.1% 202 100 1.0
2 Percentage reduciton in Reported House Break Ins 10% 6.3% 63 63 0.5
3 Percentage reduction in Reported Street Crime 15% 16.9% 113 100 1.0
4 Percentage development of Crime Perception Indicator 100% 100% 100 100 1.0
5 Number of PDRM Mobile Patrol Vehicles (MPVs) that are beyond lifespan to be replaced 25% 33.9% 136 100 1.0
Percentage of Orang Kena Pengawasan (OKP) who attended treatment programme in the
6 57% 36.7% 64 64 0.5
community to maintain recovery for a year
Upskilling of Inmates:
7 i. Number of inmates undergoing certified skill training 100% 117.1% 117 100 1.0
ii. Percentage completion of a training facility for prisoners to learn new skills
TOTAL 114% 90% 86%
NKRA FIGHTING CORRUPTION

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
3 Transparency International (TI) - Corruption Perception Index (CPI) score 55% 50% 91 91 0.5
4 Percentage of disposal of corruption cases within 1 year upon registration 85% 84.5% 99 99 0.5
5 Percentage of conviction rate for corruption cases 85% 77% 91 91 0.5
6 Tabling of AuG Report in every Parliament Session 100% 100% 100 100 1.0
Percentage of resolution of cases highlighted in AuG Report Series 1-3 2013 successfully dealt with
7 85% 80.6% 95 95 0.5
within 1 year after being tabled in Parliament
8 Percentage completion on insertion of corporate liability provision in MACC Act 100% 60% 60 60 0.5
9 Number of Corporate Integrity Pledge (CIP) signatories implementing prevention measures 40 41 103 100 1.0
Percentage of results of direct negotiation contracts published online, excluding Strategic and
10 100% 100% 100 100 1.0
Security contracts
11 Percentage of Public Private Partnership (PPP) projects to sign Integrity Pact 100% 100% 100 100 1.0
TOTAL 93% 93% 72%

NKRA PUBLIC SERVICE DELIVERY TRANSFORMATION

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
PSDT Index
i. Number of participating ministries
1.1 100% 155% 155 100 1.0
ii. Number of projects mobilised
iii. Number of projects closed in the reporting year
1.2 Number of Knowledge Transfer Programme (KTP) pilot projects 2 2 100 100 1.0
Roll out of the new maintenance model to main roads and protocol roads:
Percentage of road maintenance conducted within:
2.1 i. Below 3m2: 12 hours 100% 100% 100 100 1.0
ii. Above 3m2: 2 days
iii. Maintenance team to inspect sites for road repairs in 18 hours
2.2 Percentage of reduction on breakdown hours for lifts 60% 60% 100 100 1.0
3.1 Percentage implementation of new JobsMalaysia portal 100% 51.2% 51 51 0.5
TPC-Oral and Healthcare Clinical Information System (OHCIS) Development: Showcase VER 1.0
4.1 100% 100% 100 100 1.0
at one OHCIS clinic (showcase basic dental application features)
Percentage of rework cases on targeted recipients

5.1 50% 86% 172 100 1.0
for PBR upon endorsed by Focus Group Committee
6.1 Number of additional MOH Hospitals implementing LEAN Healthcare - reducing waiting time 10 16 160 100 1.0
TOTAL 120% 93% 93%

NATIONAL KEY ECONOMIC AREAS (NKEAS)
NKEA GREATER KUALA LUMPUR/KLANG VALLEY

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Number of Letter of Intent (LOI) or equivalent Incentive Offer concluded for

MNCs to set up Regional Headquarters/Regional Headquarters/Regional Hub 10 10 100 100 1.0
EPP1: Attracting activity in GKL
100 of the world's
1 most dynamic Number of new jobs created 400 560 140 100 1.0
firms within
priority sectors Amount spent by MNCs in 2015 (RM mil) 360 588.59 164 100 1.0
Realised Jobs for 2015 1,000 1,313 131 100 1.0
Number of approved application under Returning Expert Program 800 616 77 77 0.5
EPP2: Attracting
Percentage of issuance of Employment Pass Process within 5 working days 70% 71.5% 102 100 1.0
the right mix
2
of internal and
New JPA scholars under STAR Program 2,000 1,019 51 51 0.5
external talent
Number of approved application under Residence Pass-Talent Program 1,000 1,113 111 100 1.0
EPP3: Connecting Completion of SPADs draft bilateral agreement between MY and SG 100% 50% 50 50 0
KL to Singapore via
3
a High Speed Rail
Percentage completion of approval for MY portion of alignment 100% 60% 60 60 0.5
system
Percentage of Tunnels and Station Trackway handed over to System Works

80% 100% 125 100 1.0
Contractor (SWC)
Percentage of structural completion of 12 stations for Phase 1 (Sg. Buloh -

100% 100% 100 100 1.0
Semantan)
EPP4: Mass
4
Rapid Transit Percentage of track laid for Phase 1 (Sg. Buloh - Semantan) 100% 100% 100 100 1.0
Number of trains delivered and tested at Sg Buloh Depot 15 24 160 100 1.0
Accident Frequency Rate 2 1.18 100 100 1.0
Percentage of implementation of Bunus STP

5% 7.53% 151 100 1.0
to achieve 5% construction progress5
Percentage of implementation of Jinjang-Kepong STP to achieve 3%
100% 100% 100 100 1.0
construction progress
Percentage reduction of rubbish collected at SMART

80% 104.3% 130 100 1.0
( L1 & L2) log booms as compared to 2010 result (0%)
Water quality results from 3 selected water quality monitoring stations meet
EPP5: Revitalising WQI 60 (Class III)
the Klang River i. Sungai Gombak (Stn. Tun Razak) 100% 104.75% 105 100 1.0
5 into a heritage and ii. Sungai Klang (Stn. IFFRM - DUKE)
commercial centre iii. Sungai Klang (Stn. Dang Wangi)
for Greater KL/KV Water quality results from 5 selected River Water Treatment Plant meet
> 76.5 (Class II)
a. RWTP Sg. Gisir
b. RWTP Sg. Kemensah 100% 100% 100 100 1.0
c. RWTP Sg. Klang
d. RWTP Sg. Belongkong
**Drop RWTP Sg.Sering
Percentage construction progress for River Beautification works (Phase 1)

50% 36.5% 73 73 0.5
and interceptor system at Precinct 7
(More on next page)

NKEA GREATER KUALA LUMPUR/KLANG VALLEY (Continued)

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Compliance of wastewater discharge quality from all completed Waste Water

Treatment Plant (WWTP) to Water Quality Index 76.5 (Class II)
i. Pasar Harian Selayang
100% 100% 100 100 1.0
ii. Pasar Jln Kelang Lama
EPP5: Revitalising iii. Pasar Air Panas
the Klang River iv. Pasar Sentul Pasar
into a heritage and
5 Completion of Waste Water Treatment Plant (WWTP) construction in Pasar
commercial centre 100% 100% 100 100 1.0
for Greater KL/KV Borong Kuala Lumpur
(continued) Percentage of effluent from all 101 communal grease traps installed to
100% 93% 93 93% 0.5
comply with the National Water Quality Standards (fat, oil and grease)
Percentage completion of Policy Framework arising from the Market & Feasibility
100% 100% 100 100 1.0
Study of Freezed Government Land along River Beautification Corridor
Greening Greater Number trees tagged under Global Positioning Index (GPI) 30,000 35,043 117 100 1.0
KL to ensure
6 residents enjoy
sufficient green Number of trees sponsored 2,500 2,219 89 89 0.5
space
Heritage Trail 5: Percentage completion of the project 45% 45% 100 100 1.0
EPP7: Creating
7 iconic places and Countdown Clock 100% 87% 87 87 0.5
attractions
Heritage Trail 3: Number of suitable retail operators changed 2 7 350 100 1.0
EPP8: Creating a
comprehensive Percentage completion of the outcome evaluation report for walkways
8 100% 100% 100 100 1.0
pedestrian constructed between 2011 - 2014
network
Percentage completion of detailed Designing of Leachate Treatment System

100% 90% 90 90 0.5
in Taman Beringin
EPP9: Solid Waste Increase the recycling rate :Percentage completion of regulation
9 100% 70% 70 70 0.5
Management on separation at source to be amended by August
Percentage completion of Gazettement of regulation on Construction

100% 88% 88 88 0.5
& Demolition Plant to AG
Langat sewage treatment plant and network 100% 100% 100 100 1.0
Percentage of construction of Pipe Network in Petaling Jaya Utara (Package D47) 65% 72.2% 136 100 1.0
BO BO#3: Sewerage Percentage of construction of Pipe Network in Kajang 1 & 3 (Package D49) 12% 14.9% 124 100 1.0
#3 Non-River
Percentage of construction of Pipe Network Lot 130 Klang (Package D55) 75% 86% 137 100 1.0
Regionalisation of Sewerage Tratment Plants (STP)

100% 99.98% 100 100 1.0
in Kajang 2: Percentage of construction progress
TOTAL 111% 93% 86%

NKEA OIL, GAS AND ENERGY

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Total production from marginal fields (oil and gas) (kboe/d)

EPP2: Developing Small
2 Fields Through Innovative Production from marginal fields (oil) (kbd)
Solutions *Information kept confidential at the request of involved
Production from marginal fields (gas) (MMscfd) parties
EPP3: Intensifying
3 Number of new explored wells
Exploration Activities
Committed Oil Storage Capacity (Mil m3)(cumulative target of 10 Mil m3) 0.83 1.25 151 100 1.0
EPP4: Building a Regional
4
Oil Storage & Trading Hub
Number of oil trading companies based in Malaysia 6 6 100 100 1.0
EPP5: Unlocking Premium

5.1 Amendment of Gas Supply Act- Implementation of third party access 100% 97.5% 75 75 0.5
Gas Demand in Malaysia
EPP6: Encouraging Amount of committed investment by Oil & Gas Supplier and
1,500 1,231 82 82 0.5
Investments in the Oil and Services and Equipment companies (RM mil)
6
Gas Services Equipment Realised Investment by Oil & Gas Supplier and Services and
(OGSE) Industry 1,000 1,439 144 100 1.0
Equipment companies (RM mil)
EPP7: Taking Local Oil and

Number of first time bidders (companies) for international projects
Gas Services Equipment
7 in new markets segments (includes new countries or new segments 15 22 147 100 1.0
(OGSE) Companies to the
within the same country)
Global Stage
EPP8: Attracting MNCs to Set Number of new MNCs bringing their global operations to Malaysia
8 Up Preparations in Malaysia or mergers/JVs with local Oil Gas Services and Equipments (OGSE) 6 11 183 100 1.0
and Partner with Local Firms companies
9 EPP9: Energy Efficiency Percentage of completion on gazettement of Euro5 specifications 100% 100% 100 100 1.0
EPP10: Building Up Additional amount of grid connected renewable energy power

10 400 332.76 83 83 0.5
Renewable Power Capacity plants installed capacity (MW)
EPP11: Deploying Nuclear Percentage progress in obtaining Cabinet decsion on Nuclear Power
11 100% 0% 0 0 0
Energy for Power Generation Infrastructure Development Plan
Percentage completion of MOU signed for implementing integrated

100% 100% 100 100 100
EPP13: Increase in refinery and petrochemical investor
13
Petrochemical Output Percentage completion of activities for 2015 in relation to relocation
100% 97.83% 98 98 0.5
and building of infrastructure
TOTAL 107% 89% 78%

NKEA FINANCIAL SERVICES

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Launch of Islamic equity crowdfunding platform 100% 100% 100 100 1.0
Launch of equity crowdfunding platform 100% 100% 100 100 1.0

EPP1: Revitalising
1 Average Daily Value (ADV) - (RM Billion) 2 1.991 100 100 1.0
Malaysia's Equity Markets
Increase in value of new listings. Target Market Capitalization (RM bil) 14 12.613 90 90 0.5
Number of new products and offerings 5 6 120 100 1.0
EPP3: Transforming or
Percentage completion of Draft Bill to amend the Financial
3 Rationalising Development 100% 100% 100 100 1.0
Institutions Act 2002
of DFI
Conversion of Composite Insurance and Takaful Licences Under the

EPP5: Insuring Most, if Not
5 Financial Services Act 2013 (FSA) and Islamic Financial Services 100% 100% 100 100 1.0
All, of Our Population
Act 2013 (IFSA)
EPP6: Accelerating the

Investor education and awareness program on Private Retirement
6 Growth of the Private 100% 111.7% 112 100 1.0
Scheme (PRS)
Pension Industry
TOTAL 103% 99% 94%
NKEA WHOLESALE AND RETAIL

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Number of new hypermarkets 6 6 100 100 1.0

EPP1: Increasing number
1
of large format stores
Number of new superstores 5 9 180 100 1.0
EPP2: Modernising
2 via the Small Retailer Number of establishments modernized under the TUKAR programme 300 302 101 100 1.0
Transformation
EPP4: Transforming
4 automotive workshops Number of workshops modernized under the ATOM programme 180 188 104 100 1.0
(ATOM)
EPP5: Developing
5 Identify new Makan Bazaar site 1 1 100 100 1.0
makan bazaars
Number of virtual mall identified and operationalised in 2015 1 1 100 100 1.0
7 EPP7: Virtual Mall
Number of sellers subscribed to the Virtual Mall 75 212 283 100 1.0
EPP9: Making Malaysia Increase of Cost, Insurance and Freight (CIF) for
9 7.32 11.88 162 100 1.0
duty free 328 selected imported finished products (RM bil)
EPP11: Organising unified

11 Number of sub-sectors involved in 1Malaysia Unified Sale 60 60 100 100 1.0
Malaysia sales
EPP13: Developing big

13 Percentage of development on Oasis Autocity 60% 77.79% 130 100 1.0
box boulevards
TOTAL 122% 100% 100%

NKEA PALM OIL AND RUBBER

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
8,550
Area of replanting and new planting approved for smallholders (ha) (capped 100 100 100 1.0
EPP1: Accelerate the
1 at 100%)
replanting of oil palm
Area of replanting and new planting implemented by smallholders (ha) 15,000 15,798 105 100 1.0
Total FFB sold to mills by all cooperatives by year end (MT) 26,800 39,330.38 147 100 1.0
Number of new cooperatives that commence selling of FFB to mills 5 5 100 100 1.0
New area of plantations/smallholders complying with COP/MSGAP/

2 EPP2: Improving FFB Yield 250,000 486,775.38 195 100 1.0
RSPO/MSPO (ha)
National Average Yield (MT/ha/yr) 19.56 18.49 95 95 0.5
National FFB Production (million MT) 98 98.34 100 100 1.0
EPP3: Improving Workers'

3 Productivity in Plantations Number of ICOPM 2.0 entries 70 104 149 100 1.0
and Estates
Number of Palm Oil Mills certified by MPOB for Code of Practice

25 23 92 92 0.5
EPP4: Increasing the and other international certifications
4
Oil Extraction Rate
Oil Extraction Rate (%) 21.05 20.46 97 97 0.5
Progress of biogas plant construction for 8 new mills (%) 100 112.5 113 100 1.0
EPP5: Developing Biogas
5
facilities at Palm Oil Mills
Progress of 2 new mills with biogas plant connected to the grid (%) 100 250 250 100 1.0
EPP6: Developing Take up rate of the pre-commercialization and technology

6 100 74.309 74 74 0.5
Oleo-Derivatives acquisition funds (%)
EPP8: Expediting growth

8 of Food and Health-based Take up rate of funds for food and health-based products (%) 100 5.5 6 6 0.0
downstream
Rubber EPP1: Ensuring Area of replanting and new planting by rubber smallholders (ha) 44,641 45,921 103 100 1.0
9 sustainability of the
upstream rubber industry Malaysian Export of Natural Rubber and Compound Rubber (mil mt) 1.3 1.0 77 77 0.5
Rubber EPP2: Increasing

10 world market share of latex Malaysian Export Revenue from Latex Products (RM bil) 13 14.5 112 100 1.0
gloves to 65%
Rubber EPP3:
11 Commercialising Ekoprena Sales of Ekoprena and Pureprena (mt) 700 646 92 92 0.5
and Pureprena
TOTAL 111% 91% 78%

NKEA TOURISM

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
EPP1: Positioning Malaysia

1 as a duty free shopping Total tourist spend per arrival (RM per tourist) 1,016 842 83 83 0.5
destination for tourist goods
EPP2: Designating vibrant

2 shopping precincts in Retail revenue per sq ft (RM/sq ft) 1,650 1,522 92 92 0.5
Malaysia
EPP3: Establishing Premium Establishment of 2nd Outlet Center in Malaysia; Opening of Mitsui
3 100% 100% 100 100 1.0
Outlets in Malaysia Outlet Park KLIA Sepang
EPP4: Establishing Malaysia Number of visitors to MMBH Sites 625,000 755,399 121 100 1.0
4 as a Mega Biodiversity Hub
Percentage completion of upgrading of Sepang Environmental
(MMBH) 70% 70% 100 100 1.0
Interactive Centre (EIC)
Project TWO: Percentage completion of earthworks 50% 33.4% 67 67 0.5

EPP5: Developing
5
integrated resorts
Melaka Gateway: Percentage completion of the Malaysia Eye 50% 54% 108 100 1.0
Number of cruise passengers at Malaysian ports 500,000 523,272 105 100 1.0
EPP6: Developing
6
Cruise Tourism
Number of international cruise calls at Malaysian ports 404 487 121 100 1.0
EPP7: Targeting more Number of international attendees at International Events

7 95,000 67,400 71 71 0.5
international events supported by Malaysia Major Events, MyCEB
EPP8: Establishing
8 dedicated entertainment Number of approved designated entertainment & lifestyle premises 2 2 100 100 1.0
zones
EPP9A: Developing local

expertise and better Number of therapists trained/undergoing training 250 255 102 100 1.0
9 regulating the spa industry
EPP9B: Expanding sports

Revenue generated from golf tourism (RM Mil) 320 319.3 100 100 1.0
tourism offering in Malaysia
EPP10: Establishing
Malaysia as a leading
10 Number of delegate days for events secured/year by MyCEB 370,000 334,493 90 90 0.5
business tourism
destination
EPP11: Enhancing
Total weekly seats to identified priority countries
11 connectivity to priority 129,500 125,432 97 97 0.5
by all Malaysian carriers
medium-haul markets
EPP12: Improving rates,

12 Number of new 4-star & 5-star hotel rooms 4,500 4,597 102 100 1.0
mix and quality of hotels
TOTAL 97% 94% 81%

NKEA ELECTRICAL AND ELECTRONICS

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Number of Advance Analytical Services provided by local

30 67 223 100 1.0
consultants to the industry
Number of trained engineers and students in Failure Analysis (FA)

EPP1: Executing a smart 50 78 156 100 1.0
and Material Analysis
follower strategy for mature
1
technology semiconductor Number of classroom trained engineers and students in Wafer Testing 50 75 150 100 1.0
fabrication plants
Number of wafer testing services provided to local E&E companies 3 3 100 100 1.0
Number of projects utilizing Metrology Lab 15 15 100 100 1.0
EPP2: Developing assembly

2 and test using advanced Number of Advance Packaging companies in operation 3 5 167 100 1.0
packaging technology
EPP3: Developing Number of jobs created from new Integrated Circuit (IC) design firms 40 13 33 33 0.0
3 Integrated Circuit
Number of companies involved in Green Motion Controller (GMC)
Design Firms 2 3 150 100 1.0
chip in pre-commercialization validation and qualification
EPP4: Supporting the growth

4 of substrate manufacturers Number of wafer substrate manufacturers in operation 2 2 100 100 1.0
and related industries
EPP6: Growing wafer Additional MW local solar wafer and cell production
6 30 500 200* 100 1.0
and cell producers in Northern Corridor
EPP7: Increasing solar

7 Additional MW solar module production in Northern Corridor 100 500 200* 100 1.0
module producers
EPP8: Developing LED Number of high impact project approved for material substrate
7 1 1 100 100 1.0
front-end operations supplier or epitaxy manufacturer
Total annual sales of local LED companies under SMECorp capacity

EPP10: Creating local 110 116.98 106 100 1.0
building program (RM mil)
10 Solid State Lighting (SSL)
champions Number of new LED products internationally certified 30 35 117 100 1.0
Number of new products to enhance Test & Mesurement local ecosystem 10 10 100 100 1.0
Number of new Test & Measurement collaborations between local

5 5 100 100 1.0
EPP11: Building a test companies and MNCs
11
and measurement hub No. products tested utilising QAV test centre (both Penang
48 43 90 90 0.5
& Selangor)
Number of countries that QAV penetrates in international market 5 4 80 80 0.5
EPP12: Expanding wireless Number of projects on Wireless Sensor Network (WSN)

12 3 3 100 100 1.0
communication and RFID commercialised in the market
Number of high impact project in operation for Automation Equipment 1 1 100 100 1.0
Number of additional appointment of local Machinery & Equipment

EPP13: Growing automation 5 6 120 100 1.0
13 automation companies by AMD
equipment manufacturing
Number of new automation projects undertaken by SMEs in system
design, prototyping, proof-of-concept and system customisation at 30 29 97 97 0.5
National Instruments Academy and Innovation Nucleus (NI-AIN)
EPP14: Building
T&D manufacturer accepting MIDA's offer as
14 transmission and 1 1 100 100 1.0
to start the manufacturing the T&D equipment
distribution companies
(More on next page)
* Achievement is capped at 200%. JinkoSolar set up its first overseas solar cell and solar module fab in Penang in May 2015. This facility provided the company with
an additional capacity of 500MW for solar PV cells and 450MW for modules, which significantly exceeded target

NKEA ELECTRICAL AND ELECTRONICS (Continued)

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
EPP15: Building a home

appliance manufacturing Total annual sales of Pensonic being the main local home appliance
15 380 385.50 101 100 1.0
hub and international company (RM mil)
distribution network
EPP16: Development of
Number of high impact projects approved for Balance of Systems
16 Balance of Systems for 1 1 100 100 1.0
for Solar PV industry
Photovoltaic
Number of new embedded systems projects approved under

4 4 100 100 1.0
EPP17: Growing Embeded the Digital Malaysia Embedded Systems Funding Programme
17
Systems Industry Number of new ecosystem partners appointed to grow
2 2 100 100 1.0
the embedded systems industry under Digital Malaysia
Percentage completion the prototyping of Li-ion battery for electric

EPP18: Enabling Electric 100 100 100 100 1.0
and hybrid vehicles
18 Vehicle Component
Manufacturing Percentage completion the prototyping of EV bus 100 100 100 100 1.0
Percentage of pre-commercialisation of Cu-CNT nanocomposite

100 100 100 100 1.0
EPP20: Enabling for thermal management in LED industry
20 Nanotechnology Number of companies undertaking commercial prototypes
for E&E Industry (Lithium Battery & Conductive Inks) under National Graphene 2 2 100 100 1.0
Action Plan 2020 (NGAP2020)
Total number of new quality NKEA E&E projects approved by MIDA 11 11 100 100 1.0
Percentage realised investment of E&E sector projects since 2011 till 2014 65% 78% 120 100 1.0
Total approved investment for E&E sector (RM bil) 6.0 8.9 148 100 1.0
EPP1-20: Cross
1-20
cutting enablers Number of R&D projects collaborated with academia and private
20 16 80 80 0.5
sector where CREST grants approved
Number of Eco Design applications undertaken by companies/

organizations utilising Eco Industrial Design Centre (EIDC) 20 24 120 100 1.0
shared facilities
TOTAL 116% 97% 91%
NKEA BUSINESS SERVICES

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
EPP1: Growing aviation

1 maintenance, repair and Revenue from MRO services (RM Mil) 6,050 3,531 58 58 0.5
overhaul services
Overseas sales revenue (RM mil) 2,318 2,506 108 100 1.0
EPP2: Building globally-
2 Number of new jobs created 13,200 16,370 124 100 1.0
competitive outsourcers
Public Sector Data Centre Outsourced - Number of agencies 10 25 250 100 1.0
Percentage completion of site readiness for implementation

100% 100% 100 100 1.0
EPP3: Making Malaysia a of Iskandar Data Nexus Hub
3
Global Data Center Hub
Total DC services revenue (RM mil) 915 831 91 91 0.5
Revenue generated from green technology subsectors e.g. Energy/

EPP4: Jump-starting a 3,500 3,801 109 100 1.0
Building/Transport/Waste/Water/Services (RM mil)
4 vibrant green technology
industry New investment realised (RM mil) 2,500 2,540 102 100 1.0
(More on next page)

NKEA BUSINESS SERVICES (Continued)

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Number of newly appointed engineers 280 196 70 70 0.5

EPP5: Growing Large Pure-
5 Investment from pure play engineering services companies (RM mil) 37 12.35 33 33 0.0
Play Engineering Services
Revenue from pure play engineering services companies (RM mil) 80 66.29 83 83 0.5
Number of jobs created 350 1,053 301 100 1.0
EPP7: Making Malaysia The Total Revenue (RM Mil) 550 588.9 107 100 1.0
Hub For Aerospace OEMs In
7
South East Asia Leveraging Additional Investments from spin-off companies (RM Mil) 580 353 61 61 0.5
On Asia Aerospace City
Number of SMEs completed assessment and identification
5 5 100 100 1.0
of scope for purpose of certification of AS9100 or NADCAP
EPP6: Growing Shipbuilding

6 Number of jobs created 620 245 40 40 0.0
and Ship repair services
TOTAL 109% 84% 72%
NKEA COMMUNICATIONS CONTENT AND INFRASTRUCTURE

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Revenue of export from Creative Content (RM mil) 600 890.31 148 100 1.0
1 EPP1: My Creative Content
Total estimated production spending under the "Film in Malaysia
400 457 114 100 1.0
Incentive" (RM mil)
Number of schools with internet connection speeds

4 EPP4: e-Learning 6,690 6,695 100 100 1.0
of 4Mbps-10Mbps
Number of government health facilities implementing

5 EPP5: e-Healthcare 200 409 205 100 1.0
e-Healthcare Applications
Number of Agencies On-Board Digital Document Management

18 31 172 100 1.0
EPP6: Deepening System (DDMS)
6
e-Government Percentage of increase in number of online transactions
10% 7.28% 73 73 0.5
at Ministries and selected agencies
Number of ports providing high speed broadband

55,000 88,588 161 100 1.0
in sub-urban areas (SUBB)
7 EPP7: Broadband For All Percentage of access (coverage) to LTE wireless broadband 58% 53.5% 92 92 0.5
Number of ports providing high speed broadband with speed

76,000 106,854 141 100 1.0
up to 100Mbps in capital cities and major towns
8 EPP8: Extending Reach Number of Program Sites Commissioned 950 983 103 100 1.0
Percentage of implementation of submarine cables (linking Sabah,

45% 35% 67 67 0.5
Sarawak, and Peninsular Malaysia) rollout
10 EPP10: Regional Network
Percentage completion of Implementation of new international
50% 50% 100 100 1.0
submarine cable
TOTAL 123% 94% 88%

NKEA EDUCATION

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Private pre-school enrolment, including NGO (4+ and 5+ years only) 454,177 426,246 94 94 0.5
EPP1: Scaling up early child
1
care and education centres
Private childcare enrolment rate (0-4 years) 9.4% 6.07% 65 65 0.5
Scaling up private skills training provision 38,000 39,153 103 100 1.0
Number of students trained in industry based approach 6,500 8,451 130 100 1.0
EPP5: Scaling up private
5
skills training provision
Number of new TVET students studying in Malaysia 1,200 2,539 212 100 1.0
Percentage of graduates with competencies of Level 3,4,5 SKM 35% 41.3% 118 100 1.0
Number of students enrolled at HEIs in the Islamic finance

14,000 16,293 116 100 1.0
and business programme
EPP7: Building an Islamic
7 finance and business i. Number of members registered under the International
education discipline cluster Council of Islamic Finance Educators (ICIFE) - 150 individuals
100% 83% 83 83 0.5
& 10 institutions
ii. Number of accredited programmes under ICIFE
Number of students enroled in private HEI

EPP10: Building a
in the hospitality and tourism programme:
10 hospitality and tourism 100% 100% 100 100 1.0
i. cluster
discipline cluster
ii. nationwide
EPP11: Launching
11 Number of students enrolled in EduCity@Iskandar 3,000 4,022 134 100 1.0
EduCity@Iskandar
EPP12: Championing Number of international student enrolled 125,000 140,420 112 100 1.0
12 Malaysia's international
education brand Number of post-graduate international students enrolled in HEIs 30,000 26,538 88 88 0.5
EPP13: Introducing public

Number of internship places filled under Structured
13 private partnerships in 15,000 17,967 120 100 1.0
Internship Programme
education
EPP14: Building a games Number of students enrolled in private HEIs with games
14 500 458 92 92 0.5
development cluster cluster contact
Building an accounting cluster:

EPP17: Building an i. Number of students enrolled in Sunway TES collaboration
17 100% 67% 67 67 0.5
accounting cluster with public HEIs programme
ii. Number of new professionally qualified accounting graduates
TOTAL 109% 93% 80%
NKEA AGRICULTURE

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Number of pre-clinical and clinical trials to be

10 10 100 100 1.0
EPP1: Unlocking value from Malaysias conducted for nutraceutical and cosmeceuticals
1
biodiversity through herbal products
Total sale of herbal product (RM Million) 3.5 3.85 110 100 1.0
Total export of Edible Bird Nest product (MT) 200 262.79 131 100 1.0
EPP2: Expanding the production
2
of swiftlet nests
Total number of newly registered of EBN Premises 3,000 1,344 45 45 0.0
EPP3: Venturing into commercial scale Total production of Seaweed under Cluster and
3 1,500 1,235.53 82 82 0.5
seaweed farming in Sabah Mini Estate (MT)
EPP4: Farming through integrated cage Total production of farmed fish by anchor
4 11,500 8,627.86 75 75 0.5
aquaculture systems companies (MT)
5 EPP5: Rearing cattle in oil palm estates Total cattle population in oil palm estates 42,500 43,741 103 100 1.0
EPP 6: Replicating integrated aquaculture

6 Total production of shrimps (MT) 35,000 31,670 90 90 0.5
model (iZAQs)
(More on next page)

NKEA AGRICULTURE (Continued)

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
EPP7: Upgrading capabilities to produce Total production from Taman Kekal Pengelularan
7 55,000 54,489.14 99 99 0.5
premium fruit and vegetables Makanan (TKPM) and anchor companies (MT)
Total sales of Anchor Companies (AC) and Small

200 294.7 147 100 1.0
EPP8: Strengthening the export capability and Medium Enterprice (SME) (RM mil)
8
of the processed food industry Number of new Small and Medium Enterprice
21 50 238 100 1.0
(SME) under Anchor Companies (AC)
Total tonnage of fragrant rice produced. (MT) 2,500 2,719.58 109 100 1.0
Introducing fragrant rice variety for non-
9
irrigated areas
Total area planted (Ha) 1,000 1,027.46 103 100 1.0
Total production from amalgamated land (MT) 254,600 230,793 91 91 0.5
EPP10: Scaling up and strengthening paddy Total land area amalgamated (Ha) 5,000 5,029 101 100 1.0
10
farming in Muda area
Number of blocks on detailed design and
57 57 100 100 1.0
preparation of contract document of tertiary system
Total production from amalgamated land (MT) 83,570 103,603.971 124 100 1.0
EPP11: Scaling up and strengthening of
11
paddy farming in other irrigated areas
Total land area amalgamated (Ha) 7,700 8,079.29 105 100 1.0
EPP13: Establishing dairy clusters in

13 Total fresh milk produced (Mil litre) 23 19 83 83 0.5
Malaysia
Total number of Outgrowers developed 100 100 100 100 1.0

EPP14: Establishing a leadership position
14
in regional breeding services
Total seeds produced (MT) 150 94.769 63 63 0.5
17 EPP17: Developing pasar komuniti Total revenue generated from PAKAR (RM million) 75 76.608 102 100 1.0
TOTAL 104% 93% 80%
NKEA HEALTHCARE

No EPP KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
EPP2: Creating a supportive Number of new clinical trials 214 201 94 94 0.5
2 ecosystem to grow clinical
research Number of clinical trials performed in MOH facilities 120 128 107 100 1.0
Percentage of offtake proposal processed within 87 working days as

EPP3: Pursuing stipulated in SOP approved by MOF 100% 97.7% 98 98 0.5
3 pharmaceutical export (by processed means completion of price negotiations)
opportunities
Export growth of pharmaceutical products (RM mil) 641.244 627.80 98 98 0.5
EPP4: Reinvigorating Revenue generated from Healthcare Travellers (RM mil) 854 900.04 105 100 1.0
health travel through better
4 customer experience,
proactive alliances and niche Revenue generated from Healthcare Tourists (RM mil) 516 574.18 111 100 1.0
marketing
Percentage of time taken to process complete submission received

80% 100% 125 100 1.0
7- in 2015 for establishment license within 30 working days
EPP7-14: Medical device
14 Percentage completion of streamlining of data for medical device
100% 100% 100 100 1.0
export (RM million)
Private Aged Healthcare Facilities and Services Act: Submission of

15-
EPP15-17: Senior Living the final draft of the Regulations by International Centers for Law 100% 70% 70 70 0.5
17
and Legal Studies (ICeLLS) to PEMANDU
TOTAL 101% 96% 78%

STRATEGIC REFORM INITIATIVES (SRIS)
SRI COMPETITION, STANDARDS AND LIBERALISATION

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Number of fruit and vegetable farms certified under myGAP 750 692 92 92 0.5
1 Number of aquaculture farms certified under myGAP 106 105 99 99 0.5
Number of livestock farms/premises certified under myGAP 1,834 2,328 127 100 1.0
2 Number of new products under MyHIJAU Programme 1,100 1,439 131 100 1.0
3 Number of Food Production Establishments Certified for food safety assurance system (MeSTI) 1,078 1,152 107 100 1.0
4 Number of new certifications obtained by companies from Accredited Certification Bodies 1,000 1,052 105 100 1.0
TOTAL 110% 99% 83%
SRI PUBLIC FINANCE REFORM

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1 Enhancement of tax administration and compliance - Direct Tax (LHDNM), RM mil 2,000 2,043 102 100 1.0
2 Enhancement of tax administration and compliance - Indirect Tax (RMCD), RM mil 150 222.03 148 100 1.0
3 Percentage of Implementation of Accrual Accounting Activities in 2015 100% 36.1% 36 36 0.0
TOTAL 95% 79% 67%
SRI NARROWING DISPARITY

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
1 Total value of business opportunities created for Bumiputera companies (RM bil) 7.3 14.53 199 100 1.0
Achieve financing approval for Bumiputera companies at a minimum of 2.5 times against
2 2.5 3.07 100 100 1.0
respective government funds received
3 Increase in value of Bumiputera PLCs (RM bil) 2.5 1.5 60 60 0.5
TOTAL 120% 87% 83%

SRI HUMAN CAPITAL DEVELOPMENT

No KPI
(FY) (YTD) 1 (%) 2 (%) 3 (%)
Percentage completion of identification of critical skills gap report 100% 95% 95 95 0.5
Number of new companies offering flexible work arrangements 20 20 100 100 1.0
1
GEMS & Upskilling 7,000 7,137 102 100 1.0
Number of women placed under Flexworklife.my 200 256 128 100 1.0
Percentage of women on board - Public Companies only 16% 15.6% 98 98 0.5
Number of new childcare centres registered under Jabatan Kebajikan Masyarakat (JKM):
i. At the Workplace
ii. Institutions
100% 119% 119 100 1.0
iii. Government
iv. Registered Home Based
v. Notification for at-home care below 4 children
2
Data collection system to be extended to all registered childcare centres 100% 89% 89 89 0.5
Percentage of women on public listed board (BURSA) 11.50% 10.7% 93 93 0.5
Number of additional women placements under Women Directors Programme 15 14 93 93 0.5
Number of trained childcare minders through Kursus Asuhan PERMATA or Kursus Asas Asuhan
800 1,254 157 100 1.0
(for home-based childcare)
Percentage completion of ILMIA Research and Publication on:

i. HCD game changer for labour market transformation towards high income economy 100% 100% 100 100 1.0
ii. Sarawak Corridor Of Renewable Energy (SCORE) study
Percentage completion of Enhanced Content for ILMIA Portal and Dashboard :

i. Upgrade of information and analysis in labour market to provide updated information 100% 100% 100 100 1.0
for policy formulation
Percentage completion of Enhancement of Labour Market Datawarehouse (LMIDW) and Dashboard:

100% 100% 100 100 1.0
i. Provide comprehensive labour market data and analysis
3 Number of participants in HR Capability Programme for SME 22,000 29,302 133 100 1.0
Customer Satisfaction with National Human Resource Centre Portal :

i. Learning experience with NHRC Portal (navigational experience) 100% 106% 106 100 1.0
ii. Quality of the info provided by knowledge center is good
Number of employers inspected for Minimum Wages Statutory 34,100 41,009 120 100 1.0
Percentage completion of engagement sessions conducted with stakeholders and identification of areas
of amendment (including policy changes and process improvement) of the Review of the Employment Act 100% 100% 100 100 1.0
1955 & Industrial Relations Act
Number of approved applications for certification of MyProCert 3,000 3,169 106 100 1.0
4
Industry-Academia Collaboration (IAC):Number of Talent developed and Faculty Members (FM) 5,550 6,723 121 100 1.0
TOTAL 108% 98% 87%

(This page is intentionally left blank)
ACKNOWLEDGEMENT
The National Transformation Programme (NTP) is a bold push to
create a courageous, confident and globally-relevant Malaysia.
Aimed at transforming various aspects of public service delivery

and catalysing the economy to achieve sustainable and inclusive
socio-economic development for Malaysians from all walks of
life, the NTP is a colossal nation-building effort shouldered by
many stakeholders from the public and private sectors.
The Government of Malaysia expresses our deepest appreciation

and gratitude to participating civil servants, corporations,
non-governmental organisations and all individuals who have
graciously contributed time, effort and advice to the planning
and execution of various initiatives under the programme since
2010. It is your immense support that continues to give meaning
and fuel this endeavour.
2020 is a vision. The National Transformation Programme will

drive us towards realising it. Set targets must continue to be met
to enable and achieve our national ambition of attaining high-
income and developed nation status by 2020.
Copyright 2016
PERFORMANCE MANAGEMENT & DELIVERY UNIT (PEMANDU),

PRIME MINISTERS DEPARTMENT
All rights reserved. No part of this document may be reproduced, stored in a retrieval
system, transmitted in any means ( electronic, mechanical, photocopying, recording
or otherwise) without the permission of the copyright owner.
Disclaimer: While every reasonable care has been taken in preparing this document,
PEMANDU cannot be held responsible for any inaccuracies. All information and
specifications are current at the time of preparation and are subject to change as may
be required.
PERFORMANCE MANAGEMENT AND DELIVERY UNIT (PEMANDU)
Prime Ministers Department, 3rd Floor, East Block, Perdana Putra Building
Federal Government Administrative Centre, 62502 Putrajaya, Malaysia
Tel : +603 8872 7240

Fax : +603 8889 4428
www.pemandu.gov.my
Copyright 2016 First Edition, First Printing 2016 ISSN: 2180-0340

ETP Pemandu 2015 Annual Report

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2015

REPORT Transformation Programme Annual Report marks an occasion of reflection and

The Government Transformation Programme The Economic Transformation

4 UNITY IS MALAYSIA'S FOUNDATION

6 GETTING OUR GROOVE BACK

22 GROWTH, CONFIDENCE AND RESILIENCE

266 EXPENDITURE BUDGET 2015

267 AGREED-UPON PROCEDURES BY PWC

268 NTP PERFORMANCE 2015

Reflecting on the last six

has been an instrumental Transformation Programme (ETP).

2 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 3

Moving forward into 2016, I am confident that the NTP will

4 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 5

6 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

DATO SRI ABDUL WAHID OMAR

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 7

8 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 9

The GTP comprised six National

10 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

Resilience Critical to Growth

pursuing growth, but this leaves the

The Government chose to be

4 International Monetary Fund, 2015 Article IV Mission to Malaysia, 2016 https://www.imf.org/external/np/sec/pr/2016/pr1621.htm

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 11

Catalysing the Economy

12 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

are 10 PAKARs located in the states

underwent improvement EPP2: Small

yielded positive results.

economy (Exhibit 3), in line with the 21.5%

on oil and gas revenue over the last

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 13

14 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

...the waiting time

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 15

16 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 17

18 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

Liveable City 2020

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 19

20 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 21

step into 2016 from a on the back of steady economic

position of strength, As Chief Executive Officer

holding our heads and Delivery Unit (PEMANDU),

a high-income nation. transformation.

22 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

the Malaysian Agricultural Research 6.3

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 23

24 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

50.2% 51.4% 51.8% 52.4% the Government can instead focus on

appraised. We have been recording

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 25

highest-ranked developing Asian

for the Future

26 NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015

NATIONAL TRANSFORMATION PROGRAMME ANNUAL REPORT 2015 27

NKEA SECTOR GNI Value at current prices (RM billion)

Palm Oil/Rubber 61.0

Oil, Gas & Energy 171.1