Selangor Menteri Besar Dato’ Seri Mohamed Azmin Ali’s recent visit to Japan in January 2018 saw the signing of two business collaborations worth more than RM 1.26 billion. This sizeable investment from a foreign country further cements Selangor’s role in driving the Malaysian economy. In 2016, Selangor contributed 22.7% of the nation’s GDP amounting to RM251.6 billion. According to the Malaysian Investment Development Authority (MIDA), for the period between January to September 2017, Selangor raked in investments worth RM3.049 billion through 132 manufacturing projects while creating 5,494 job opportunities.
This collaboration is another testament of Selangor being the most preferred investment destination for Japanese corporations. It also reflects foreign investors’ confidence in the strong fundamentals and administration of Selangor which is based on a policy of good governance, transparency and accountability to fight corruption. One of the practices of good governance in the state is the practice of open tenders. This process upholds transparency and accountability standards that are pegged against international best practices to ensure there are no elements of corruption and the misuse of power. Since 2014 till 21 February 2018, this practice has recorded a savings of RM615.1 million.
In the past Malaysia had a “look East” policy but lately it appears that “the East” is looking towards Selangor for consultancy and business opportunities. Countries like Japan and Taiwan are looking at Selangor as a regional partner in many areas but at the forefront is Selangor’s expertise in the halal industry that is creating various opportunities for collaboration.
Halal International Selangor (HIS) will introduce its consultation programs such as Halal Technical Competent Person (HTCP) and its accreditation program – Halal Trade Delivery Assurance (HTDA) to Halal International Japan. This in turn will provide a platform for both Japan and Malaysia to learn from each other’s expertise and how best to meet global halal industry compliance standards.
Through the HTCP program a trained person will be equipped with Shariah and halal management knowledge in line with the international halal trade standards. They will also have exposure to halal industry requirements that enable them to practice and maintain the halal guarantees in an organization.
HTDA serves as a halal service centre that coordinates the accreditation program and halal guarantee process. It also carries out performance ratings and rating systems for products, service integrity, reliability, safety and quality.
Acrosx Japan of Halal International Japan, Selangor’s counterpart will mobilize this agenda. This collaboration will benefit both parties in terms of trade and services market penetration support, international human resources, investment and technology transfer.
1.26 billion ringgit expansion program
The Selangor delegation’s visit to Japan also attracted more investments to Selangor.
Worldwide Holdings Bhd (WHB, a wholly owned subsidiary of the Selangor State Development Corporation) and GS Paperboard and Packaging (GSPP) Group signed an agreement which will allow for a 1.26 billion ringgit expansion of the GS Paperboard’s current paper mill business in Selangor.
This agreement creates a joint venture company to develop, manage and operate a new water treatment plant to supply treated river water to GSPP for its paper machine operations. Besides paving the way for a 1.26 billion ringgit expansion of GSPP’s current paper mill business in Kuala Langat, it will allow GS Paper to produce an additional 450,000 tonnes of containerboard paper per year.
Investing in water treatment
The involvement of Worldwide Holdings in the water project will help create a platform for further development of the water treatment business, giving a strategic impact for Worldwide Holdings to expand its business portfolio.
This partnership constitutes part of the State’s long-term initiative to nurture the State GLCs to become industry leaders locally and regionally.
The collaboration between GSPP and WHB was established since mid-1990s. GSPP is also a long-term customer of WHB as they use Worldwide landfill facility to dispose their sludge. This joint venture signifies a sustainable and trusting relationship not only between GSPP and WHB but also with the Selangor state government.
The involvement of WHB will help create a platform for further development of water treatment business under the state-government company, giving a strategic impact for WHB to expand its business portfolio.
The high value investment by Oji Holdings Corp and GSPP reflect Selangor being the most preferred investment location among the states of Malaysia. This is in line with the State’s continuous effort in being an investment hub for ASEAN. Oji Holdings Corp, the largest paper manufacturer in Japan, owns GSPP.
The agreement between GS Paperboard and Worldwide Holdings marks a major milestone and reflects the sustainable and growing business relationship between Selangor and Japan.
Oji Holdings currently has six packaging plants and one paper mill in Malaysia. It was recently reported that Oji Holdings is planning to increase its market share in the Malaysian corrugated carton industry to 40% from the current 30%. This expansion will add another 90,000 tonnes of annual capacity to the group by 2019.
Selangor the gateway for foreign investments
Japanese investment in Selangor has been growing and remains the dominant top 15 of foreign investments into Selangor. The Selangor government is focussed and is active in its effort in making Selangor an investment hub for the ASEAN region and actively continues to draw investment to the State.
Selangor, among all other states of Malaysia is best positioned to serve as a gateway for foreign companies doing business. This will be a natural outcome of Selangor’s vision to transform it into a regional smart state and also to attract potential employment in Selangor.
Selangor, Engine Of Growth For Malaysia’s Economy
From 2013 to 2016, Selangor also successfully attracted RM34,425,688,466 in total capital investment for 1,008 projects with total employment of 72,806 from the manufacturing sector. From 2016 to September 2017, Selangor garnered total investment of RM3,049,396,790.
According to Department of Statistics Malaysia, GDP contribution in 2016 by six states accounted for 70.6% GDP. Selangor topped the list with a share of 22.7%, followed by WP Kuala Lumpur (15.3%), Sarawak (9.8%), Johor (9.4%), Pulau Pinang (6.7%) and Sabah (6.7%).
The Selangor State government through Invest Selangor as the state’s investment promotion agency (that promotes and facilitates investments in Selangor), is always supportive of foreign investment into Selangor especially in facilitating better project execution and necessary approvals. This initiative of the Selangor government makes it easier for investments to pour in seamlessly.
Selangor Menteri Besar, Dato’ Seri Mohamed Azmin Ali’s recent achievement is a testament that Selangor under his administration has proven to be more than successful in increasing the state’s revenue, making huge contribution to Malaysia’s GDP, creating more jobs and bringing material benefit for the rakyat of Selangor.
Tokyo Olympics 2020
The Japanese market in particular holds great promise for Selangor’s halal industry with the approaching of the Olympics 2020. Serving Japan’s upcoming Tokyo Olympics in 2020 will provide an emerging niche halal market for Selangor’s halal industry players as it prepares for the influx of Muslim visitors and spectators who will be flying to the country for the Olympics.
According to a rating agency, more than 20 million tourists are expected to land in Japan in 2020, and over one million of them are Muslims. Selangor’s participation will not only bring in revenue to the state, it will also promote Selangor to the global halal arena.
Halal International Selangor is a Selangor State Government initiative which is a Global *Halalan Toyyiban Trade and Industry (GHTTI) platform solution that comprises of real estate, delivery assurance, human capital and market development to meet the needs of halal consumers globally.
*Halalan toyyiban means food or products that are allowed and permissible for consumption with relation to Syariah law as long as they are safe and not harmful.