Tuesday, February 28, 2006

Hiring an engineer in Guangdong costs more than hiring one in Malaysia

Surprise, Surprise! This
IHT report reveals that oft-repeated predictions of the demise of South-East Asia's manufacturing industry might just be wrong.

Though the impact of China has been dramatic, ("The Malaysian government estimates that almost 15 percent of Penang's manufacturing jobs were lost between 2001 and 2003") some manufacturers are now seriously reconsidering whether they should be putting all their eggs into the single bamboo basket.

Some of their concerns: "Rampant technology piracy, resurgent nationalism, and - surprisingly in a country of 1.3 billion people - a dire shortage of high-skilled labor."

And interestingly, the article continues: "But the most common frustration foreign investors face in China - and one of the biggest surprises - is the spiraling cost of increasingly scarce skilled labor, which on China's eastern seaboard can roughly approximate salaries in some of its Southeast Asian rivals. Indeed, executives say hiring an engineer in Guangdong already costs more than hiring one in Malaysia."

With so many manufacturers racing to hire a limited pool of skilled workers, it doesn't surprise me that this has happened to China. But let's not kid ourselves into thinking that Penang is going to boom like the old days again - we'll more likely move up the value chain and produce more advanced electronics components to complement China's factories - and then find that we have to move up higher again to keep at least 2 or 3 steps ahead of China.

Sunday, February 26, 2006

The Tranquil Tropics? Forget it – we’re among the most stressed in the world

According to the Grant Thornton International Business Owners Survey, Malaysian business owners are among the most stressed in the world.

In fact, four ASEAN countries are among the Top 10 with Taiwan taking the hit for being the most stressful place for business owners.

There is a direct correlation between stress and the amount of holidays taken (except public holidays) – Malaysians, despite being constantly reminded that we have one of the most public holidays around, only take about 10 days of annual leave a year which is near the bottom of the leisure league.

In contrast, Europeans are a relaxed lot, with an average of 22 days annual leave.

When measured against stress caused by concerns over the turnover growth in their businesses, all ASEAN countries fell in the quadrant of “Low Sales Turnover Growth, High Stress Increase”

In my business travels to Philippines & Thailand, I have found that local business owners and their staff work extremely hard, clocking in marathon 15-hour days. My anecdotal observation is that they worry too much about the details and are not necessarily working smart. A lot of time is wasted fretting over minor, unimportant but seemingly urgent details in the daytime leaving them precious little choice but to spend the evenings working on the important, non-urgent ones. Having to sit in horrendous daytime traffic does little to ease this vicious cycle.

Better delegation, staff empowerment and use of technology would go a long way to ease these stressed business owners.

Friday, February 24, 2006

Online Activism: Malaysia 1, Singapore 0

Online Activism is better developed in Malaysia than Singapore, according to a Singaporean academic, Cherian George. The very fact that Harakah Online and Malaysiakini are thriving is testament to this fact he says.

What is online activism you ask? Well, as Wikipedia puts it: "the intentional action to bring about social or political change." And in Malaysia, it is apparently the existence of an active social network and activism outside of the internet as well as the Reformasi movement that has spurred the development of the online scene.

I also believe the thoroughness, severity and swiftness with which the Singapore government responds to any perceived false allegation, has made many of its citizens a bit wary of airing their personal views too openly; even on the internet.

Technorati tags: online activism, Singapore, Malaysia, Harakah, Malaysiakini

Small Bumi Firms told to buck up or lose special treatment

Can this threat be taken seriously? Apparently our Second Finance Minister Tan Sri Nor Mohamed Yakcop said this in a closed-door meeting with Bumiputera players recently.

He said that if they didn’t do so, they would lose special treatment from the Government. Aspects of this ‘affirmative action’ business practice have been implemented at a great cost to the economy - the BT report says “[bumi firms] would be paid prices that are higher than what GLCs would be able to get under open tenders, for example.”

There will be a forum organized by the Bumiputera Manufacturers and Services Industry Association of Malaysia called "New Approach by GLCs to Build SMEs" at the SME Bank on March 3 to discuss and find ways to help Bumiputera companies get projects from GLCs.

Hopefully this 'new approach' would be a better thought-through strategy and not another excuse for creating more rent-seekers, middlemen and commission agents.

Technorati tags: sme, malaysia, bumiputra, politics

Thursday, February 23, 2006

Spreading the Travel Bug among Bird Flu Countries

New Tourism Minister Tengku Adnan couldn’t have picked a worse time to announce his ambitious target of attracting 20.1 million tourists by 2007. On Monday, Malaysia reported its first case of bird flu for more than a year. To add to his woes, 7 people who are living in the affected area were admitted to hospital for further tests because they had flu symptoms.

It might be better for him to re-strategise and promote ourselves as a tourist destination to countries that are already being hit by the bird flu (e.g. Hungary, India, China, Indonesia, Nigeria etc.) He might call this group the CHIRP countries (Countries Hurt by avIan Repiratory Problems) and promote tours to affected villages and farms. Part of the itinerary could include culling demonstrations, displays of local bird species affected by the disease, visits to local pharmacies or medical stores to buy our sturdy made-in-malaysia masks and end with a meal of farm-bred goat meat.

Any tour agency like to take this idea up?

Technorati Tags: bird, flu, malaysia, tourism, tours

Wednesday, February 22, 2006

GST delayed

The Goods and Services Tax (GST) that was supposed to be introduced on Jan 1st, 2007 has now been postponed. This report from the Star says that the new date will be announced 'later'. The Edge has a fuller report.

Most in the industry were waiting for this announcement - there has after all been a dearth of details about the GST ever since it was mooted in the 2005 Budget. There was not even a mention of the tax at Pak Lah's 2006 Budget last October. So here we have it - GST delayed.

Watch this space.

Technorati tags: GST, Malaysia, Tax

Malaysian Diaspora - someone's giving you a link home

Lightning put my blogging updates to a stop as my modem and phone lines were both fried over the weekend. It's good to be back online now!

I just came across this link to the Global Malaysian website which is a collaboration between the Star and the Asian Centre for Media Studies. Its aim is to "facilitate networking and tap into the resources - knowledge, skills, investment and contacts - that Malaysians can offer to other Malaysians wherever they are in the world."

There is a feature within this site for registered MyStar members (free) to locate expatriate Malaysians overseas for the purposes of networking. Select the country and field of work you are interested in and bingo, a list will be displayed whom you can then email and connect with. Not too bad - at least it's better than the Bank Negara SMEInfo Directory whose functionality I am still trying to understand.

Technorati tags: Malaysian, diaspora, networking, sme

Thursday, February 16, 2006

Sonic Teenager Deterrent (UPDATED) - Now Malaysia REALLY needs it!

Today's Star carries this piece of news that police are seeking the help of parents in keeping teenagers below 17 off the streets at night – and out of trouble.

Well, they should seriously think of contacting Mr Stapleton to import a few of his Sonic Teenager Deterrents to keep our kids off the streets!

A clever British inventor has come up with this nifty little device that annoys teenagers so much, they have to disperse and lepak elsewhere!

The Sonic Teenager Deterrent generates high-frequency noise that can only be heard by those who are under 20yrs of age! Sounds like a brilliant solution to get rid of youths who lepak around and do nothing all day. The wonderful thing is that it was conceived at home by a former British Aerospace electronics apprentice who was getting annoyed by youths hanging around his local shop and intimidating customers.

1 up for the small business owner!

Wednesday, February 15, 2006

Kindred Spirit in the UK

Just found out another like-minded blogger in the UK who has chosen to focus on SMEs in his blog. His appears to be more commercial in nature though, but nonetheless it's good to see similar blogs around.

Small good, Medium Better says Rafidah

Looks like our dear Rafidah Aziz is back in action after surviving the latest Cabinet reshuffle (which was incidentally more like a little nudge rather than a reshuffle if you ask me).

She is quoted in today's Business Times as saying that her ministry will give 'separate attention' to medium sized enterprises rather than small ones as the former are better positioned for the export market. Some of the goodies she promises for these medium-sized SMB/SMEs are market development and export promotion grants as well as tax incentives.

Smaller companies are still in the basic nurturing phase and as such would need assistance in entrepreneurship development, information technology adoption and book-keeping.

Sounds like good sense to me.

Tuesday, February 14, 2006

Room for more hotels in Sabah

Feeling the entrepreneurial itch? Well, you might like to try opening a hotel in Sabah which is facing a tremendous shortage of rooms due to the increased tourist traffic.

According to this
report, the state will require more than 6000 additional rooms to cope with growth by the end of 2011 (i.e. the end of the 9th Malaysia Plan period). Sabah currently has 12,500 rooms in 270 hotels which are already apparently running at full capacity.

I've only been to KK once and it's a nice enough place with a lovely sea frontage and a very human-scale built environment. I'm not so thrilled though about the poor stateless street kids who roam the city at night to beg - it lends an air of hopelessness which is more akin to other cities in the region.

RambutanGate: Singapore responds

Singapore has responded that current WTO regulations do not have harmonised criteria for determining the origin of a product and that the determination of this will be governed by a country's domestic laws.

For Singapore, this means a product must have at least 25 per cent local content to be deemed as of local origin. In the case of our tin of rambutans, I am sure the sg exporters can get away with declaring that since the combined weight of both the tin (made in singapore) and the sugar syrup (brewed in singapore) comes up to 25% of the total product, they can safely declare their finished product as being of Singapore origin.

Love them or hate them, you've got to admire the way our Southern neighbours always revert to the letter of the law when they respond to our accusations. Full report here.

Monday, February 13, 2006

My Singapore Lychee is better than your Malaysian Rambutan

Looks like another trade spat is brewing between us and our southern neighbours. Apparently the creative folks down there have been repackaging our rambutans as ‘Singapore Lychees’ in markets such as Hong Kong. Orchids and ornamental fish have also fallen under the same 'made-in-Singapore' fate.

Agriculture minister Muhyiddin Yasin said that a number of Singaporean companies had refused to import pre-packaged Malaysian products “as it enables them to pack the products and rebrand them as Singaporean products to be resold elsewhere."

This isn’t the first time I’ve read about this sort of wrong ‘country of origin effect’ attribution to Singapore – Not too long ago, I was shocked to tune into the Travel & Living Channel to have celebrity chef Anthony Bourdain spout the praise of Ampang Yong Tow Foo in a Singapore coffee shop!!!
That’s nearly as bad as Made-in-Malaysia Danish cookies!

Saturday, February 11, 2006

Bank Negara's SME Info Portal Goes Live

Bank Negara’s new SME portal is finally up and running. Its stated purpose is to provide “information on all aspects of SME development”. Hopefully this will be a regularly updated site that won’t fall into the ‘jarang update’ trap of many other local information sites.

The SME Directory feature was included for ‘networking’ possibilities though I am not sure what Bank Negara hopes to achieve with this feature. So far, it acts like a directory of sorts; so for example if you typed in advertising, it displays the relevant registered companies in that industry. How business owners are supposed to network from this still remains a mystery to me. I guess more functionality will be added at a later date? Are we looking at an alibaba.com style of b2b matchmaking?

Thursday, February 09, 2006

Malaysian Small Business PC Spending to Grow at 8.1 percent CAGR, says AMI-Partners

According to this report 2/3rds of Malaysian Small Businesses already own a PC and among those that don’t, one in three say that there is an intention to purchase in the next 12 months.

IBM/Lenovo, HP and Acer are the preferred brands for their future computer purchases

Apparently owning a PC correlates with better overall performance, as the report states that “the non PC-owning firms generate less than half the amount of their PC-owning counterparts in sales turnover.”

Read report here.

Tuesday, February 07, 2006

So where have all the Malaysians gone?

As a follow up to my earlier entry, I thought it would be interesting to find out just where our fellow Malaysians have emigrated to.

Below, are some figures I managed to get from the Net. All data are from the respective country’s Population Census – so they should be pretty accurate.

Only Australia provides the breakdown into the various ethnic groups.

Country Number of Malaysian-born residents (year of census)

New Zealand 11461 (2001)

UK 49207 (2001)

US 49460 (2000)

Singapore 306998 (2000)

Australia 78850 (2001)
Chinese 51910
Malays 5690
Indians 3440
Others 17810

Total 495976

That’s about half a million in these selected countries which I assume are the more popular destinations for our émigrés. Singapore has the most number of Malaysians resident there from this list.

Does anybody else have any other data available for other countries? I have read on some other sites claims of up to 3 million who have migrated - can anyone tell me where the other 2.5 million are?

Saturday, February 04, 2006

Will UMNO force retailers to surrender 30%? Vote in my poll

In the upcoming 9th Malaysia Plan, do you think the UMNO government is going to force foreign retailers to surrender 30% equity to their supporters?

Click on the poll (bottom right panel) and let's see what everyone thinks!

Friday, February 03, 2006

Pro-Business not Poor Business

It’s been a wonderfully relaxing CNY break and a good time to recharge the brain cells. I felt quite vindicated about my last post after I read yesterday’s NST article “Looking for a boost for small businesses” commenting on the upcoming 9th Malaysia Plan.

The DPM, Najib Tun Razak is quoted as saying that though Malaysia doing well at the macro level, “there are discernible rumblings that things are not moving fast enough and that business remains slow.”

And his prognosis? “We need to seriously address the savings-investment gap and stimulate stronger domestic investments.”- which is exactly what I was trying to drive at in my last post. However, as always is the case in this country, politician rarely does what politician says - especially as rent-seeking (thinly disguised as social and economic restructuring) constantly hovers at the top of the UMNO government’s agenda.

The article also mentions that the ‘private sector’ hopes the 9th MP will “enhance national competitiveness with greater economic liberalization and fewer government regulations”. Paraphrased, it probably says “Lighten up on the equity rules please. Just introduce pro-business policies and don’t force us to surrender our hard-earned success to some already wealthy-but-greedy rent-seeker.” Knowing the UMNO government, that ain’t going to happen soon, so we’ll have to wait with bated breath for the new ways they plan to force you to share your pie with them.

On another note, the government is also advised to re-think how banks can help generate business growth. Dr Mohamed Ariff, Executive Director of MIER (Malaysian Institute of Economic Research), comments that medium enterprises are taking up the lion’s share of the Government’s financial support, whereas smaller companies “face different problems” (not elaborated).

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