MDEC Digital Economy Malaysia Malaysia Digital Economy and Digital Growth Go Digital

1. DIGITAL ECONOMY:
MALAYSIA’S NEW ERA OF
SUPPORTING BUSINESSES
Nik Izuddin Nik Mohd Yusof
Head of GBS & Industry Development
Investment & Industry Development (IID)
31st January 2018

2. One of the RISING technologically developed countries among industrializing
nations in the ASEAN region, strategically located in the heart of Southeast Asia
and its modern infrastructure is designed to serve the Business Community
The Economist
Malaysia is a Federal Constitutional
Monarchy
13 states and 3 federal territories
Total landmass of 330,803 square
kilometers (127,720 sq mi)
MALAYSIAMALAYSIA
- Capital -
Kuala Lumpur
(2,793 sq km)
- Population -
31 Million
(Growth 1.5% pa)
- Multilingual & Diversify Culture -
English, Malay, Mandarin, Tamil,
& More
Japanese, Korean, Arabic,
Tagalog
& More

3. 3
CONTINUOUSLY STRIVE FOR EXCELLENCE
3
rdGlobal Offshoring Destination
(A.T. Kearney Global Services Location Index™ 2017)
4
th
Protecting Investors
(World Bank Doing Business 2017 Report)
5
th Most Attractive Market For Infrastructure Investment
(Global Infrastructure Investment Index 2016)
1
st
Best Country to Invest In
(US News & Wharton University 2017)
3
rd
Commitment To Cybersecurity
(Global Cybersecurity Index 2017)
1
st
Most Attractive Manufacturing Market For Future Relocations
(Cushman & Wakefield Manufacturing Risk Index 2017)

4. MALAYSIA: Home to
Technologically
Innovative Firms in
Dynamic Business
Environment
> 4,000 Foreign & Local High Tech Companies in Malaysia
> RM304 Bil New Investment Generated
> 160,000 Jobs Created
*as at 2016

5. THRIVING DIGITAL ECOSYSTEM

6. 6
AGGRESSIVE SUPPORT FROM MALAYSIAN GOVERNMENT

7. WHY DIGITAL? ALL ABOUT NEW SOURCE OF GROWTH
Source: Accenture Strategy
22%
25%
Global Digital Economy
Growth
17%
20%
Malaysia Digital Economy
Growth
Source: Bernama
2015 2020
2015 2020
2.5%
3%

8. MALAYSIA’S UNIQUE VALUE PROPOSITION

9. MALAYSIA – ACCELERATING GROWTH IN DIGITAL AGE
What Can We Offer? What Have We Achieved?
Penetration Rate 2011 Penetration Rate 2016
Broadband 62.3% 77.9%
Mobile subscriptions 127.7%* 141.6%*
Smartphones 22.2% 64%
Social network 41.1% 67.7%
Sources: Malaysian Communications and Multimedia Commission; PwC Entertainment and Media Outlook 2016-2020; Malaysian
Digital Association; We Are Social
>18 million users
60% more friends than
global average
80 minutes per
day
2x global average
>3.5 million users
Ranked 4th in Asia Pacific,
behind ID, IN & the PH
>160,000 Uber drivers by
end of 2016
Achieved within 2 years
6th in Asia –
Asian Digital Transformation Index 2016by EIU and
Telstra
Cloud Readiness Index 2016 by Asia Cloud
Computing Association6th in Asia –
Huawei Global Connectivity Index 20175th in Asia –
Networked Readiness Index 2016 by WEF, INSEAD
and Cornell University6th in Asia –
*Penetration rate exceeds 100% due to multiple subscriptions
ICT Development Index 2016 by International
Telecommunication Union (ITU)6th in Asia –
5th in Asia – Bloomberg Innovation Index 2017
3rd in Asia – Taylor Wessing Global Intellectual Property Index
2016

10. MALAYSIA GATEWAY TO ASEAN
7th largest
economy in the world
GDP up to USD2.5 trillion
with average 6% growth
Over 625 million
consumers from 10 countries
ASEAN
market
FOREIGN COMPANIES SET UP REGIONAL HUB IN
MALAYSIA TO SERVE ASEAN MARKET
FOREIGN COMPANIES PARTNERING WITH MALAYSIANS
FOR ASEAN EXPANSION
Group’s financial hub ROC for industrial
gas plants
COE for aircraft engine
maintenance, repair &
overhaul
Business Service Centre
IT, finance & other
support services
Manufacturing,
sales & regional
support
functions
COE for
engineering &
construction
COE for
accounting
Innovation &
Management
hub to expand
on Merchant
services,
eMobility &
‘connected-of-
things’ offerings
Principal Hub for
Aerospace, Automation
Control & Solutions and
Performance Materials &
Technologies strategic
business units
JAPAN & MALAYSIA
INDIA & MALAYSIA
AUSTRALIA & MALAYSIA
JAPAN & MALAYSIA
JAPAN & MALAYSIA
JAPAN & MALAYSIA
AUSTRALIA & MALAYSIA

11. Driving
Investment
Building
Local
Tech
Champions
Catalysing
Digital
Innovation
Ecosystems
Propagating
Digital
Inclusivity

12. Attract foreign direct investments
into the country through the MSC
Malaysia status offering as well as
its robust and progressive
technology ecosystem
MSC MALAYSIA STATUS COMPANY
Knowledge Worker
Unrestricted employment of foreign
knowledge worker
Infrastructure
Provide world-class physical
infrastructure
IP Protection
Intellectual property protection and
cyberlaws
Telco Tariff
Globally competitive telecommunication
tariffs
One-Stop Agency
MDEC as the one-stop agency

13. Identify and accelerate Malaysian
tech champions by ‘future-
proofing’ their businesses through
the development and adoption of
disruptive technologies
GAIN
SNAPSHOT OF MALAYSIAN COMPANIES STAMPING THEIR MARK GLOBALLY

14. Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
MDEC DRIVE eCOMMERCE
Internet Users 158 million
Digital Buyers 87 million
eCommerce CAGR 37.6%
from $7b (2013) - $34.5b (2018)
Source: F&S High Growth & Consolidation
Expected in Southeast Asia’s eCommerce
Market
ASEAN OPPORTUNITY
MALAYSIA OPPORTUNITY
MALAYSIA AT AN
INFLECTION POINT
Growth of Malaysia’s eCommerce
Market – Double by 2020

15. Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
MDEC DRIVE CYBERSECURITY
MDEC CYBERSECURITY STRATEGIC
PROGRAM
Developing Critical Talent
Promoting Cybersecurity Practices
Cybersecurity as Catalyst
Move-up Solution Value

16. Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
MDEC PROMOTE DIGITAL
TRANSFORMATION
MICHELIN CASE STUDY
From Selling Tyres to
Selling Outcomes
Embraced digital to
create new sources of
growth by launching
Michelin Solutions and
building a holistic
mobility solutions. They
partnered with digital
companies (i.e. BDA)
and have grown from a
small pilot to
800 employees and
500,000 trucks serviced.
Source: World Economic
Forum report (Jan 2016)

17. IoT
Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
MDEC DRIVE DATA ECONOMY
DATA ECONOMY Creating Value from Data
Combination of Big Data Analytics
Example 1 Example 2

18. Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
ASEAN DATA ANALYTICS EXCHANGE

19. Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
MALAYSIA DIGITAL HUB

20. Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
MYDIGITAL MAKER MOVEMENT

21. Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
Towards 100% Industry Alignment:
 Digital tech career centres to profile/match potential job-seekers to industry
 Agile approval process for new/revised curriculum
 Industry attachment/training for educators and career centres personnels
PREMIER DIGITAL TECH UNIVERSITY

22. Future-proofing the economy, by
building a strong digital
innovation ecosystem, as
technology change the
rules of business
DIGITAL FREE TRADE ZONE

23. 1,972 SMEs ONBOARDED ONTO DFTZ AS OF NOV
2017
Top 5 Popular Malaysian Products
1. Food & Beverage
2. Agriculture
3. Beauty & Personal Care
4. Furniture
5. Health & Medical
Unique Malaysian products to be
promoted jointly with Alibaba
1. Batik & Songket
2. Traditional health
supplements, eg. Gamat
3. Wau Kite
4. Mangosteen
5. Pepper, Nutmeg Oil, etc.
Malaysian Pavillion on Alibaba.com
Buyer
Traffic

24. SMEs ONBOARDED WITH ALIBABA.COM
• Location: Terengganu
• Products: Traditional musical
instruments (Gamelan,
Caklempong) Guitars,
Percussions
• Achieved sales of USD$ 30,000
to USA after two months
PBH MUSIC ART SOUND AND
LIGHTING SDN BHD
YAN MING RESOURCES
SDN. BHD.
• Location: Selangor
• Products: Raw clean birds’ nest
and instant drink (bottle) birds’
nest from Malaysia.
• Achieved savings of RM100k via
the VIP exchange rate on
Alibaba.com
• Location: Sabah
• Secured an order to supply 2
containers of fresh coconuts to
Poland via DFTZ worth
USD$14,000
AFIQ TRADING CO
RM0
ONLINE SALES(BEFORE)
RM122,300
ONLINES SALES (AFTER)
RM2.4M
ONLINE SALES(BEFORE)
RM10m RM57,600
ONLINES SALES (AFTER) ONLINES SALES (AFTER)
RM0
ONLINE SALES(BEFORE)

25. Groom and transform the
Rakyat (Malaysians) into a
tech-savvy workforce that will
support the growth of a
digital economy
eRezeki

26. Groom and transform the
Rakyat (Malaysians) into a
tech-savvy workforce that will
support the growth of a
digital economy
eUsahawan

27. 27
INSIGHT ON FURTHER IMPACT IN SABAH
AS AT DEC 2016/2017 – OUTREACH & TRAINING DRIVEN
26,004
TOTAL OUREACH
2017
4,765
TOTAL REGISTERED
2017
14,492
TOTAL OUREACH
2016
4,017
TOTAL REGISTERED
2016

28. 28
SUCCESS STORIES IN SABAH
AS AT DEC 2016/2017 – IMPACT THE NATION
RM 800
Per month
SALES BEFORE
RM 18,291
Per month
SALES AFTER
Service
(Printing &
Souvenirs
service)
SAKINAHTUL NABILAH , 33
Kota Kinabalu, Sabah
RM 300
Per month
SALES BEFORE
RM 2,976
Per month
SALES AFTER
Service
(Repair
computer
service)
MUHAMMAD
ZULKARNAIN, 27
Sandakan, Sabah
RM 2,000
Per month
SALES BEFORE
RM 6,166
Per month
SALES AFTER
Health &
Beauty
(Healthy
drink)
• Single mom with 5 children after been left
by her husband.
• Started her business in 2014 from home by
placing her product in retail shops and
restaurants.
• She joins eUsahawan in August 2016 and
started to applied the technique learn
specifically via Facebook and Instagram
and her sales increase rapidly.
• Now she has regular customers that
always supporting her business.
HUSMINA TAIB, 36
Sandakan, Sabah
• Wheelchair-bound. Has guillain-
barré syndrome, a rapid-onset
muscle weakness caused by
damage to the peripheral
nervous system.
• He runs his own business full-time
with his brother.
• Prior to eUsahawan, ran business
from home.
• He has since registered his
business and opened his own
store. Already opening a 2nd
store in Sandakan
• An accident in 2014 affected right
hand. Previously involved in
kitchenware supply business but
switched after accident.
• Before eU: Operated from home.
No staff and no consistent order.
• After eU: Opened new business
premises in Feb 2017. 2 staff and 5
dropship agents. Consistent
souvenir order.
• Now has customers in Johor &
Sarawak. She has also become an
eU facilitator.

29. 29
SUCCESS STORIES IN SABAH
AS AT DEC 2016/2017 – IMPACT THE NATION
RM 800
Per month
SALES BEFORE
RM 5,271
Per month
SALES AFTER
Service
(Printing
service)
• Single from 5 sibling.
• He operated his business in 2014 by
opening a printing service centre
together with his friend.
• Before eUsahawan, he’s having
difficulties to close the deal with
customer.
• After eUsahawan, he’s more open to
talk about his business and his sales
also increase simultaneously.
MOHD SAHRIL AZHAM, 28
Kota Kinabalu, Sabah
RM 10,000
Per month
SALES BEFORE
RM 21,000
Per month
SALES AFTER
Food &
Beverages
(Foodtruck)
RM 0
Per month
SALES BEFORE
RM 3,414
Per month
SALES AFTER
Service (T-Shirt
Printing and
sport
equipment)
• Married and operated his business in
2017 by selling coffee drink in food-
truck.
• Also use Facebook Page but since he
lack of knowledge in online
marketing, he did not receive any
feedback from social media
medium.
• Post-eUsahawan, expanded his social
media marketing which helped to
increase his sales and market reach.
• Have feedback whereby his business
is well known by customer in Kota
Kinabalu area.
LIEW YIN CHONG, 29
Kota Kinabalu, Sabah
MAILSON MAHAP, 42
Kota Kinabalu, Sabah
• Married with 1 children and began his
business in 2014 by selling printed T-
shirt and supplying sport equipments.
• Already having 6 years of experience
in business but never use online
medium to promote his business.
• After eUsahawan, he expanded his
social media marketing which helped
to increase his sales and market
reach.

30. 30
THANK YOU
Nik Izuddin Nik Mohd Yusof
Head of GBS & Industry Development
Investment & Industry Development (IID)