I have oftentimes said that the sun rises where 'sunset' industries go to, whilst the sun sets where 'sunset' industries leave.
Well right now, Datuk Tan Teik Cheng, Malaysian Chinese Association (MCA) Penang State Liaison Committee Chairman and MCA Vice President, describes the closure of four major electrical and electronic (E&E) factories in Penang since 2010 and contends that Penang has lost is shine as a 'Pearl of the Orient' and I will add is steadily losing its shine as a 'Silicon Island' or shall I say 'Silly Con Island'.
OK. Granted that the MCA is a member party of the Barisan Nasional coalition which is now in opposition, so we can assume that Datuk Tan Teik Cheng is being a tad overdramatic, especially since these seven E&E factory clousures and retrenchement of 5,245 employees began during the time of their rival Pakatan Harapan state government of Penang, under Penang Chief Minister Y.B. Lim Guan Eng, who now is Malaysia' Finance Minister in the Pakatan Harapan federal government's cabinet.
Anyway, the sun has been setting on Penang's famed E&E industry as these multinationals had been relocating to lower wage countries such as China, Thailand, Vietnam, Indonesia and so forth.
However, there still can be hope for Penang following U.S. President Donald Trump jacking up import tariffs on China's goods imported into the U.S., supposedly to protect American jobs and 'Make America Great Again', as this could result in China companies deciding to set up subsidiary factories in countries such as Malaysia, including in Penang, in order to circumvent the U.S. tariffs on imports from China, since legally, they would be Malaysian companies for trade purposes.
So current Penang Chief Minister Y.N. Chow Kon Yeow should more aggressively bid for investments from China, whilst Malaysia will also need to have in place a bi-lateral free trade agreement with the United States for this strategy to work, so our Economic Affairs Minister and Minister of International Trade and Industry need to work on this.
However, whether these China-owned factories will make E&E products or something else is left to be seen, though the Penang state government should institute re-training programmes for E&E workers to enable them to master the new skills required.
For instance, if a China company sets up a factory making toilet bowls and other bathroom accessories such as urinals and bidets in Penang, then the former E&E workers will need to be re-trained in the techniques, production processes, quality control and so forth involved in manufacturing these products, such shown below:-
Toilets bowls on display, including a high-tech one in the middle.
A bidet
A 'vomitorium' said to be in a Vietnamese restaurant.
That facility in the photo above is mistakenly called a 'vomitorium', when in fact a vomitorium is a passageway which allows rapid audience exit especially from the lower terraces of a stadium, arena or theatre as shown in the the illustration below.
An actual vomitorium, or as some theatres now call it - a 'vormitory'.
Who knows, a Malaysian could design a toilet which can flush without using water and patent the design as his or her intellectual property.
However, Malaysian restaurants, especially those which hold all-you-can-eat buffets may want to consider installing such 'vomitoria' for their paying guests to vomit out what they had eaten so they can continue to eat some more, like the elites did in ancient Rome during the dying days of the Roman Empire., when bread and circuses were a great distraction for the populace, similar to league football, well choreographed wrestling matches where professionals wrestlers take turns to bash each other to a pulp without leaving a bruise, soap operas and so forth.
Since as manufacturing industries decline, they leave behind services industries, so the Penang state government may want to develop Penang's services industries, including restaurants with 'vomitoria' to attract tourists for the 'ancient Roman' experience, earn foreign exchange and provide services jobs for Penang's workers.
As part of its services industry drive, Penang state may want to install a network of public pay toilets around Penang where the state can earn additional revenue, including from tourists, whilst enterprising applications developers can develop mobile device apps which show where these toilets are located, plus prepaid fintech-based payment applications to pay the fees for their use.
Also, these public pay toilets can provide minimum wage (must be RM1,500 per month, not RM1,050 or RM1,100) paying jobs for unemployed graduates to clean them regularly and keep them smelling fragrant, which will Malaysia achieve the goal of becoming a 'high, income, knowledge-based, information-rich economy by 2020' (oops! postponed to 2024).
Following below is Datuk Tan's article in the Malay Mail of 10 May 2019.
Fall in foreign investments and factory closures, sunset for Penang’s E&E industry — Tan Teik Cheng
Published 22 hours ago on 10 May 2019
MAY 10 — In just four years, seven multinational electrical and electronics (E&E) factories have shut whereby 5,245 employees have lost their jobs while foreign direct investment fell sharply from RM10.81 billion in 2017 to RM5.78 billion last year. This plunge should give Penang a wake-up call. However, not only does Chief Minister Chow Kon Yeow not face up to the problem or actively invite other investments, he also ignores this investment freefall. With foreign investments departing with the closure of factories, the once renowned Penang electronics now turns into a sunset industry, Penang is left no longer attractive.
Since 2015 to March this year, seven multinational electronic plants have ceased their production lines in Penang or moved their production lines to other countries, resulting in 5,245 employees being laid off or accepted voluntary retrenchment. Apparently Penang has lost its appeal and its status as the “Pearl of the Orient” has been eclipsed.
Policies under the new Pakatan Harapan government are not pro-business, thereby undermining Malaysia’s wage growth and investments. These unfriendly policies, increase in foreign worker levy, insurance policies for foreign workers have increased the cost of doing business for local employers. Such conditions also resulted in the private sector being particularly caution in reviewing employee salaries or making new investment decisions. Additionally, the business community also faces many challenges. Uncertainties over policy trends also led to people being more cautious in their spending.
Foreign direct investment (FDI) in Penang was once ranked highest in the country. The then Chief Minister Lim Guan Eng and the DAP government showed some eagerness to attract investments. However, according to FDI figures released by the Malaysia Investment Development Authority (MIDA), Penang’s FDI from 2010 to 2013 fell by 82%. Presently, for the fourth consecutive year, seven multinational E&E factories have closed, resulting in 5,245 workers being unemployed. Penang’s ranking for FDI in the country also fell from the first spot to the fifth position.
Moreover, MIDA’s statistics also revealed that investments into Penang’s manufacturing sector in 2018 was RM5.781 billion, down 46.54% from RM10.814 billion in 2017, a dive by nearly 50%.
In Penang’s Industrial Free Trade Zone, Chief Minister Chow Kon Yeow sadly shirked responsibility. On the issue of FDI withdrawal, he responded that this was a “normal situation.” The Penang state government sadly refuses to own up to the fact that FDI has been continuously withdrawing from Penang, causing this northern state to lose its shine.
* Datuk Tan Teik Cheng is the MCA Penang State Liaison Committee Chairman and MCA Vice President.
**This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.
Yours trully
IT.Scheiss
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