THE Covid-19 pandemic has spurred a huge rise in digital investments globally, and to further ride on this wave, Malaysia is positioning itself as the digital hub of Asean.
Against the huge interest shown last year in its Malaysian Tech Week, the Malaysia Digital Economy Corp (MDEC) has extended this year’s digital summit into a month-long affair, with its Digital Investment Summit week starting today.
As of Dec 31 last year, digital investments into Malaysia had reached RM345bil; in terms of investments for MSC-status companies, 44% are foreign direct investments with the other 56% from domestic direct investments.
For the whole year, there has been strong interest to set up digital businesses in Malaysia, specifically in areas such as software research and development, IT support for the region, and global business services.
In global business services alone, there are 571 active MSC-status companies in Malaysia, with investments of RM19.31bil achieved last year.
“Malaysia is focusing a lot on digital technology; MDEC is working actively with global partners and on a number of deals to attract digital investments into Malaysia, ’’ said MDEC investment development division vice-president Hew Wee Choong.
Among its collaborations, MDEC is working with international banks such as HSBC to attract digital investments from clients.
MDEC has more than 10 global partners that include consulting firms, chambers of commerce, banks and legal firms to bring digital investments into Malaysia.
“We are ramping up our efforts to attract more high-tech companies and unicorns, ’’ said Hew.
Over the past nine to 10 months when the world was mired in a pandemic, companies especially in e-commerce and global business services in Malaysia have continued to grow.
Among its pull factors is the multi-cultural background of Malaysia’s talent pool, their digital savviness and language proficiency in technical subjects.
Malaysia also has a relatively strong network infrastructure and a competitive business environment.
Against these positive factors, some multinationals, especially those in digital technology and services, have proceeded with their original investment plans and timelines, regardless of the pandemic.
There are also those that have accelerated their investment timelines as they rush to pursue new revenue streams in technology or digitalisation of operations and processes.
Certain companies, especially those in areas of emerging technology such as fintech and drontech players, have also been drawn to the vibrant testbed environment in Malaysia.
Global events of unrest have also spurred companies to evaluate their risk profiles, following which they have determined that Malaysia is a stable and safe platform, with potential for further expansion.
The smooth transition of many digital ecosystem players to the work-from-home mode in Malaysia had encouraged a migration of investments from places where the transition was less smooth.
Based on a study by global workspace provider Regus, Malaysians are well ahead globally in the adoption of flexible working arrangements.
MDEC’s ongoing endeavours focus on providing leadership and critical support to various companies and industry ecosystems.
“This is to ensure that communication channels are open between industry players and the government, enabling them to continue operations during these challenging times that Covid-19 caused, ’’ said Hew.
MDEC has conducted discussions with the private sector including global multinationals, local tech champions and small and medium enterprises (SMEs).
Topics include the future of the workspace/workplace, employees and talent, business opportunities and change management.
One of the challenges faced is regarding policies to manage the pandemic; while companies understand such policies are necessary, they feel that closer consultation is needed to better understand marketplace demands.
Companies also feel that better communication of policies, which are then implemented in a consistent manner, will also prove helpful for businesses.
Some companies are concerned about the strict travel restrictions that are adversely affecting the movement and management of their foreign talent.
There are quarters that have also requested the government to review the conditions imposed for certain incentives; the changing trends of work means that these policies may no longer be feasible or relevant for the digital and technology industry.
To further aid in digitalisation efforts, the government will roll out the national digital infrastructure plan called Jendela, and continue the momentum of 5G testbed roll-outs.
This is to ensure that Malaysia remains the digital trailblazer for the region.
Within this upswing in digital investments, there is a lot of potential for those currently made jobless to reskill and upskill to fit into new, upcoming positions in digital technology.
As investors are looking to expand into Malaysia, there will be a surge in demand for talent to supply to incoming digital jobs.
Investors can leverage on Malaysia’s talent pool and provide training for new work opportunities.
In Budget 2021, a total of RM100mil has been allocated to MDEC to boost its digital talent development efforts for the coming year.
Among MDEC’s digital initiatives include those measures to accelerate the digitalisation for SME ecosystems, boost digital talent development and further enhance digital ecosystem innovation/support.
As organisations like MDEC rev up their efforts to attract digital investments, there should be all round support to ensure success for Malaysia as a digital hub, and for those reskilled and upskilled to find their place in the sun.
Yap Leng Kuen is the former business editor of StarBiz. Views expressed here are the writer’s own.
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