Bernama.com (Malaysian National News Agency), 7 November, 2006

Taiwanese Investors Keen On Agriculture, Animal Husbandry In M'sia

By Yeong Hui Ling

KUALA LUMPUR, Nov 7 (Bernama) -- Taiwanese investors still regard Malaysia as a good investment destination for expansion into the rest of Asean, which has a total population of 600 million people, says an official from the Taipei Investors Association in Malaysia.

Its chairman, Datuk Dr Ting Chung Cheng, said Taiwan may be left out of Asean's trade picture once the ASEAN Free Trade Area (AFTA) and ASEAN Economic Community (AEC) came to full bloom.

"Trade between ASEAN members and their dialogue partners will be intensified as a result of tax exemptions and products from Taiwan will find it difficult to penetrate the ASEAN market because of their relatively higher prices," he said in an interview with Bernama.

Products which are not from ASEAN members and their dialogue partners are likely to attract a tax of about 20 per cent compared with lower tax levels enjoyed by members and dialogue partners.

Dr Ting advised Taiwanese investors to set up plants in Malaysia and use the country as a springboard to export to other ASEAN countries.

"Their products will become ''Malaysian'' products and will enjoy tax exemptions when they are exported to other Asean member countries," he added.

Asked on talk that a number of Taiwanese investors had pulled out from Malaysia to go to countries like Vietnam and China because of lack of manpower and costlier wages, Dr Ting denied such a notion and said that workers could be recruited from abroad.

However, he said the ever-changing rules on the recruitment of foreign workers into Malaysia had often placed difficulties on foreign investors, who were more keen to employ Bangladeshi workers.

"The government's policy on freezing the intake of workers from Bangladesh on two occasions had placed a number of Taiwanese investors in a quandary," he said.

Bangladesh was once the choice supplier of foreign workers to Malaysia but in 1996 the Malaysian government froze the intake because of disciplinary and social problems among the workers. The Malaysian government then decided earlier this year to lift the freeze but re-imposed the ban in October because none of the 21,988 workers from Bangladesh who had obtained approval from the Bangladesh Association of International Recruiting Agencies (Baira) had come to Malaysia.

This came about when recruiting agents in Malaysia and Bangladesh smeared the reputation of Baira and had directly contacted the potential employers themselves.

"Almost all the Taiwanese investors in Malaysia are keen on Bangladeshi workers because they are hardworking but Malaysia's recruitment policy is always changing. Lack of human resources means that Taiwanese investors cannot expand their operations in Malaysia and this also discourages new foreign investors from coming into the country," said Dr Ting.

According to statistics from the Malaysian Industrial Development Authority (MIDA), Taiwanese investments in Malaysia rose by 3.9 per cent to US$113.34 million in 2005 from US$109.9 million in 2004.

Taiwanese investors in Malaysia are usually in manufacturing, food and furniture-making.

Dr Ting said Taiwanese investors were keen to investors in Malaysia and regard the country as having good potential in modern agriculture, biotechnology, halal food and animal husbandry, which had been emphasised under the Ninth Malaysia Plan.

"Malaysia has its own attractions in agriculture and animal husbandry as the country has plenty of fertile land. Its weather is also relatively good and agro-products from Malaysia on the whole are better in quality than those from Taiwan. That is why Taiwanese investors are keen on the agriculture sector in Malaysia," Dr Ting said.

He said a golden opportunity had emerged for Taiwanese investors since Taiwan possessed sophisticated technology in agriculture and animal husbandry as well as in genetic engineering while Malaysia welcomed investments in R&D in those areas.

He hoped that the Malaysian government would undertake a major promotion programme to attract Taiwanese investors in a big way just like it did in the 1980s.

On the halal food industry, Dr Ting said Malaysia, as a Muslim country and currently the chair of the Organisation of Islamic Conference (OIC) countries as well as having an internationally accredited halal monitoring system was a good investment destination.

Dr Ting said Taiwanese investors could work with their bumiputera counterparts to expand the halal food market.

As for Malaysia's incentives to attract foreign investors, he said they were not quite enough under the present circumstances.

For example, he said the pioneer status incentive for 10 years was no longer relevant because many Taiwanese investors were already in Malaysia for 10 to 15 years.

He said time had come for the government to redefine pioneer status and hoped that it could grant better incentives to companies whose products were exported and contributed to the Malaysian economy.

-- BERNAMA