market opportunities in 4 billion populations
Generally, the Belt and Road Initiative is often perceived as something complicated and big which involve only giant corporations, government, and government linked companies or non-governmental organizations. However, through the presentation of Dato’ Joseph Lim, it is clear that the Belt and Road Initiative is actually benefiting all level of society along the regions. Micro businesses are able to tap on the opportunities arise and enjoy the benefits generated out of it.
Dato’ Joseph Lim presented the introduction of Belt and Road Initiative and some of the opportunities arise during an oval debate event organized by PGRM Central Bureau of SME on November 21, 2015. Among the guests were Tan Sri Dr. Koh Tsu Koon, Tan Sri Dato’ Soong Siew Hoong (Executive Adviser of The Associated Chambers of Commerce and Industry of Malaysia, ACCCIM) and Dr. Daniele Gambero (CEO and co-founder, REI Group of Companies).
According to Dato’ Joseph, many SMEs in Malaysia are living in their comfort zone until they are hit by the economic turbulent. By then, it could be too late for them to response. Thus, SMEs should set up a R&D department to constantly producing better products. When the company has a good selling product in the market, there should be new or improved products line up for subsequent launch. “These SMEs are more toward family businesses. This is nothing wrong, but putting the right people on the right position is very important nowadays, ” emphasizes Dato’ Joseph.
The ultimate objective of Belt & Road Initiative is to build economic community along the designated regions. The BELT refers to the NEW Silk Road economic belt starts from Xi Ann toward African countries, Middle East countries, Europe and ended at London. Beside Shang Hai, under the China initiative, London is identified as another financial hub.
Meantime, the ROAD refers to the 21st Century Maritime Silk Road which starts from Fujian, Quan-Zhou toward the South East Asia passing by Malaysia, Thailand, Singapore and crossing the Straits Of Melacca toward India, Africa and Europe as well.
“Malaysia is very lucky. We are not only chosen by China as part of the Belt and Road, we also being chosen by United States as one of the TPPA partner” Dato’ Joseph says. These two economic plans are different in nature. The Belt and Road initiative is initiated by the Chinese government without signing any agreement with other countries along the regions. These countries within the regions are freely to join and to tap onto the initiative to benefit from it. However, the Tran Pacific Partnerships Agreement (TPPA) is an agreement which signed among the coordination countries.
Under the Belt and Road Initiative, there are three key elements, which are Partners, Build and Share. The five key sectors within this initiative covers Policy, Infra (Power Plant, Road, High Speed Train),Bilateral Trade, Finance (Building trust in between China and Malaysia banking) and People. “In the Belt & Road initiative, People are the most important issue. The China Chinese and Malaysian Chinese are actually having different culture. Thus, it is very important to synchronize and synergize the different culture. ” comments Joseph.
The bilateral trade between Malaysia and China recorded a historic high of USD102 billion (RM363.5 billion) last year. Consecutively for five years, Malaysia is ahead of Singapore. Within the USD102 Billion trade, 20% is contributed by GuangDong – Malaysia bilateral trade. Dato’ Joseph excitedly encourages the SMEs to focus on the opportunities in GuangDong. Currently, there are 80 million populations in GuangDong Province, which is approximately 2.5 times of Malaysia population.
“Under the Belt and Road Initiative, it consisted of 4 billion populations. In order to tap along the Belt and Road initiative, we must ask ourselves, are we ready on our production, quality, branding and financing. This is a special time for Malaysia. ” emphasizes Dato’ Joseph.
The China government has sponsored Malaysia SMEs to participate in the just ended China SME Expo. The sponsorship include the cost of setting up exhibition booth and accommodation of 5-day 4-Night. Malaysia SMEs generally received overwhelming response with many of them succeeded to sell all stocks brought along.
In order to maintain 7% annual growth while there is over supply in domestic market, China government encourage the local entrepreneurs to explore opportunities outside of China. In other words, it is expected to have large amount of investment flow from China entrepreneurs to other countries such as Malaysia. However, the classification and scale of SMEs in China is totally different than in Malaysia. Malaysia SMEs mean companies with RM25 million annual turnovers and below. While in China, companies with annual turnover of RMB200 million (which is about RM100 million) are classified as SME. “This is an opportunity for Malaysia SMEs to work with China SMEs to develop projects together through joint venture.” highlights Dato’ Joseph
There are about 30,000 china students studying in Malaysia. Under the Belt and Road initiative, these students, upon graduate, can be the strategic human resources to contribute in the ventures between China and Malaysia.
As the closing remark, Dato’ Joseph urges Malaysia SMEs to have their own Unique Selling Point to enable themselves to capture opportunities that come along the way.
About the Presenter:
Dato’ Joseph Lim, Heng-Ee
Vice President of Malaysia-China Chamber of Commerce
Founder & Managing Director of Global Green Synergy Sdn. Bhd.
Winner of MCCC – Golden Green Award
Champion of Creative Young Entrepreneur Award (2011)
Master’s Degree in Business Administration ( Honolulu University)
Higher Diploma (London Chamber of Commerce and Industry)
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© 2015, Monde Journal.