MANUFACTURING SECTOR FOCUS TO STAY

KUALA LUMPUR, May 12 (Bernama) -- The manufacturing sector will still
continue to drive the country's economic growth despite the government's recent
liberalisation of 27 services sub-sectors.

"The government will still stick with the manufacturing industry and at the
same time give some emphasis on the services sector," Deputy Minister of
International Trade and Industry, Mukhriz Mahathir, said here Tuesday.

Mukhriz said Malaysia's services sector exports had picked up for two
quarters, adding that it was a new and upcoming industry that really needed to
grow.

"We are not abandoning the manufacturing sector because it was one of the
major contributors to the gross domestic product for quite some time," he said.

He said this at a media briefing after the launch of the Unido Industrial
Development Report 2009, "Breaking In and Moving Up: New Industrial Challenges
for the Bottom Billion and the Middle-Income Countries," here Tuesday.

Unido, the United Nations Industrial Development Organisation, is mandated
to promote industrial development and international industrial cooperation.

The event was co-organised by Khazanah Nasional Bhd.

Mukhriz said industry players expected the manufacturing sector to recover
between year-end and end-2010.

"The government is optimistic although we have not seen it as a trend yet,
but there is a deceleration of the downturn," he said.

He said the ministry welcomed industry players to identify particular
sectors that needed government help.

"This is not only to generate jobs but also to increase income," he said.

Mukhriz said Malaysia, a fast growing middle-income country, must start to
be creative and innovative to bring the economy to another level.

"If Malaysia is to attain the coveted developed nation status in the next 10
years, we must shift away from our emphasis on an investment-related competitive
advantage to one that is driven by technology and innovative," he said.

He said the government not only provided grants and loans for branding,
promotion and packaging to companies who hoped to break into the international
market.

"The government also provides match-making services overseas companies via
Malaysian Industrial Development Agency and Malaysia External Trade Development
Corp, which promote Malaysia as an investment destination and bring in foreign
companies to team up with local firms," he said.

The Unido report showcases ten dynamic locations that grew rapidly by taking
advantage of global value chain, agglomeration economies and good governance.

It said industrialisation and economic growth were powerful ways for the
"bottom billion" countries to escape from poverty and move firmly to the path of
sustainable development.

The "buttom billion" is defined as a group of around 60 countries with a
total population of about one billion people, which has grown significantly
slower than the rest of the world for the past 20 years, thus maintaining high
levels of absolute poverty.

Among the location highlighted was Penang, which was among the poorest
states in Malaysia in the early 1970s.

However, Penang has now become the Silicon Island of the world by connecting
with the electronics manufacturing value chain.
-- BERNAMA