You must have faith in the ability and capability of the people. It’s time for the government to get their act together. So, definitely, we have to work together to bring more entrepreneurship in the country and we need the talent back to Malaysia.
Asean Business Leaders: I can not imaging how difficult must be walking in your shoes since you were appointed the new minister of finance, as there is a lot of expectation to see whether your remarkable success in Penang can be duplicated in Malaysia.
Lim Guan Eng: Well, everything that has been happening in the last 61 years, you can’t change it overnight. I have to ask Malaysians to give the government time until the country’s financial situation improves. Thus, Malaysia’s financial situation was not good as the government debt stood at RM1 trillion. Moreover, we have a serious job in our agenda to bring down debt, curb spending and fight corruption.
One of the key point of success that I have learnt as former Chief Minister in Penang is to not interfere with the businesses. The business world and the government need to stay separate. The businessmen are the experts in their field and definitively the engine for development and growth.
If we look at the Ministry of Finance, we see that it’s a very large and specialized Ministry. It can be broken down into three main areas:
1. Cost centers
2. Revenue centers
3. Productivity centers.
Cost and revenue centres are self-explanatory. Productivity centers are to generate new sources of income. For example, emerging technologies such as Industry 4.0, IOT, Big Bata, Data Science, E commerce, are set to change the business environment in a really short period of time. And in the Ministry of Finance we have to foster public-private sector collaboration to catch up this new trend at a very fast pace.
As former Chief Minister of Penang, we decided to focus deeply into arts and culture, because we found out that the sector could generate returns. See Penang is an arts and cultural center. The approach that was taken in Penang, we want to replicate this nationally. The philosophy behind it is: “We should go back to the basics, stick to our core task and core duties; providing money to promote creativity and innovation and also setting a vision for the future.
Asean Business Leaders: To what extent do you think that entrepreneurs in Malaysia have the right mind-set to understand the need to expand across borders and to represent Malaysia’s services and products regionally?
Lim Guan Eng: I see Malaysia as an entrepreneurial state where we try to harness the energy, the expertise and the entrepreneurship of the people of Malaysia. Moreover, I have faith in Malaysians and I have faith in their expertise, entrepreneurship and their energy. Look at the number of Malaysians who are working overseas. The Malaysian diaspora easily is 1 in 2 million. They are everywhere, not just in Asia, but also in Europe and the US. You must have faith in the ability and capability of the people. It’s time for the government to get their act together. So, definitely, we have to work together to bring more entrepreneurship in the country and and we need to bring the talent back to Malaysia.
Asean Business Leaders: Do you think that this new era can be seen as a golden opportunity to bring back the talent of those people who are putting their talents into other markets?
Lim Guan Eng: As a matter of fact, if we don't value our own talent, do you blame other countries for helping them? What I need to do is to make Malaysia more attractive again... a place of hope... and I'm sure that Malaysians will come back. You need to understand that the main reason why they leave the country is because they feel that there’s no future for their children and even more that the economy and the political environment is hostile. Another factor is the payroll. There is a big paying difference between what they’re getting overseas and here. So, they invest in property and businesses, and then they come home. What we must do now is ensure that they come back sooner. Malaysia now is a place of hope. We have now stood up and we’re telling the world we are no longer this kleptocracy. We are now a normal country that aspires to be a great nation for its people by ensuring that we are free from corruption, abusers of power, and free from the despair.
Asean Business Leaders: Malaysia’s brand perception after the scandal of 1MDB has not been good?
Lim Guan Eng: Unfortunately, but more importantly is the new administration that will lead this country to reach greater heights. Just to free Malaysia from this global kleptocracy. The image that has been imposed on Malaysia is very negative. We want to show that we’re a normal country that wants to fulfil their international obligations and promotes competency, accountability and transparency. Thus, it will take some time, but we all Malaysians have to joint efforts as this is crucial for nation building.
Asean Business Leaders: Is there any measurement you have in mind to maintain the growth and make sure the ringgit is strengthened in the future, can Investors feel more interest in Malaysia after the first 100 days in power?
Lim Guan Eng: At the end of the day, it is the market that will decide. If the global economy slows, as a trading nation, definitively Malaysia will be impacted. I see GDP growth easing to about 5%. We have to restore full confidence, that’s why we have to take steps. Investors that have never looked at Malaysia, are suddenly getting close. I think that we’ve generated interest, but in order to make this reality, we must produce results. We have to correct the scandals committed by our previous government. Just one scandal will cost us to fork out 15 billion RM over the next 20 years. I’m focused on cost containment to ensure that we clean up the mess made. We’re focus both on cost and revenue centers. After the first 100 days we can set up the new direction of the economy of Malaysia.
Asean Business Leaders: SME’s in Malaysia is considered the backbone of the economy and they have very talented people that want to capitalize on business opportunities across borders. What do you have in mind here?
Lim Guan Eng: I think we try to give them more access to capital. Not only capital, but also technology. Every business must be part of the digital economy, whether they like it or not. Industry 4.0 is here to stay, so you must look at “how can we apply this to our business.” So, you either adapt and use it, or die, there are no two ways about it.
You have four sectors, the private sector, the public sector, the professionals and the public/people. What we’re looking at here, is the collaboration of these four key factors. But most importantly, without the people it won’t work. We have to find the right balance between them and maximize the outcome.
Asean Business Leaders: In Silicon Valley, the new businesses says that “Data is the new King in business”.
Lim Guan Eng: Indeed, SME’s are the backbone of our country, they are here to stay. Again, we must improve access to capital, widen the base and keep on providing skills training, because they really invest their profits. “Data is king as they said, but don’t forget talent is everything.”. It’s not about the physical mind anymore, it’s about talent. It is all about human resources who can adapt to this new era, not necessarily brain power. Moreover, we are currently busy with the moon-shot program. Where we invest USD1,43M in to free coding classes for 120,000 school going kids over 3 years.
Asean Business Leaders: What would be your advice to the CEOs of important banks in Malaysia with regards to sending a message of confidence to investors that the private sector is still the engine of the economic growth in Malaysia. What is the role you want them to play in the globalization of putting Malaysia on the map?
Lim Guan Eng: I think that in the past they were constraint by the government. I believe they should focus on R&D,
because R&D is everything for future growth, while at the same time I would advise them to bring recognition of Malaysia’s banking capabilities and expertise in the Asia Pacific region. Hence, I am sure they will help to restore our country’s reputation in international financial circles. So, we are going to tell these private companies you don’t have to pay premiums like in the past, better you invest that money in R&D, invest it in talent spotting and training. “At the end of the day I say, it’s not about how blessed you are with natural resources, it’s about how well you train the people, invest in the people; the returns will be remarkable.”
Asean Business Leaders: The former government proposed establishments of trading links between the stock exchange of Malaysia and Singapore, why only Singapore, why not expand more links into other markets in ASEAN?
Lim Guan Eng: We are part of ASEAN, it’s more an Asian thing. We want to have consensus, we want to be friends with anyone. We want to be building relationships. We don’t want to be exclusive, we want to be welcome and open to all. Hence, our approach will go into that direction.
Asean Business Leaders: What would be your main priority in 2018?
Lim Guan Eng: My main priority is to meet a fiscal target of 2.8 per cent of GDP for this year.