Building capacity through collaboration

Among the ICP’s area of interests are transportation and urbanisation, medical and healthcare as well as biotechnology. Based on said areas, the TDA facilitates local companies to work with industry partners to close gaps in terms of skills and knowledge.

INDUSTRY collaboration programmes (ICPs) have worked to the advantage of many local businesses the world over.

Through ICPs, also known as offset programmes, companies learn the skills and strengths of their industry partners and gain stronger footing in their field by turning knowledge into action, which results in greater economic returns for the country.

In Malaysia, the Technology Depository Agency (TDA) is responsible for facilitating such collaborative platforms.

The agency, which runs under the purview of the Finance Ministry, plans, monitors and manages all ICPs based on government mandate.

“Every year, the Government has a set of budgets for a number of procurement programmes to be drawn out.

“TDA functions to ensure that expenses made based on the approved budgets will give optimum returns to the country,” said Technology Depository Agency Bhd chief executive officer Datuk Zailani Safari.

The ICPs were where the value of procurement would be maximised, he said.

Among the programme’s key areas of interest are cyber security, energy security, water and food security, transportation and urbanisation, medical and healthcare as well as biotechnology.

“Based on these areas, we help local companies to close the gaps between knowledge, skills and capabilities,” said Zailani.

When a procurement takes place, the agency identifies the suppliers and their capabilities, and measures the gaps faced by local companies before getting the parties involved to work together.

Drawing examples from success cases abroad, Zailani said Turkey, for instance, achieved a breakthrough in its defence industry through the offset programme.

“They made strides in the fields of maritime and aerospace defence systems, and is now producing their own products,” he explained.

He also noted South Korea’s accomplishments in learning from a supplier about fighter jets, of which the country was now exporting.

In Malaysia, one of the most recent ICP success cases was the SMH Rail-Siemens Offset Programme for the KVMRT Line-1.

“We did not want to acquire CBU (complete built-up) train units, but rather, wanted to be able to manufacture and assemble them locally.

“Through the programme, the train supplier agreed to work with a local company to set up a facility,” explained Zailani.

“From there, we acquired fragmented parts (complete knock down) from the supplier and assembled them in the facility before supplying them to the MRT.”

Fifty-eight sets of a four-car electric train were developed for the MRT lines, some of which are already up and running.

Zailani said in that process, more job opportunities were created for locals while the company gained the know-how on product assembly and equipment testing.

“If you don’t undergo the offset programme and merely get products that are completely supplied, you don’t gain anything.”

For further insight into offset programmes around the world, the Global Offset and Countertrade Association (GOCA) will have its first Asia Pacific conference in Kuala Lumpur from March 26 to 29.

This is the region’s first GOCA conference, as well as a first to be hosted in Malaysia.

“GOCA has their conferences twice a year, but it has always taken place in the United States or Europe for the past three to four decades; this time around, they want to bring it to this part of world.”

Zailani said Malaysia was chosen in recognition of its successful ICPs that have been carried out.

“GOCA’s aim is to have an avenue where offset practitioners from all over the world can share experience and knowledge.

“It also sheds light on how offset can be a very effective tool for economic development,” said Zailani.

He said through the conference, Malaysian companies can learn about how to leverage on offset programmes to propel their companies to create more economic returns.

“At the same time, they can also look into networking opportunities to expand their business horizons to a global level.”

GOCA APAC 2017 is co-organised by the Finance Ministry, GOCA and TDA.

To date, the conference has received registrations from participants from over 50 countries.

“BAE Systems, Thales Group, Lockheed Martin, Boeing and Rolls Royce are among companies that will be a part of the conference, while government representatives from other countries will also be present,” Zailani concluded.