1. The NTBp is a blueprint commissioned by the Ministry of Trade and Industry (‘MITI’) and developed by the Malaysia External Trade Development Corporation (‘MATRADE’).
2. The NTBp outlines a 5-year (2021-2025) development strategy and initiatives to enhance Malaysia’s competitiveness in the export of merchandise. The NTBp framework is guided by four strategic priorities, three strategic themes and eight strategic thrusts with 40 recommendations to improve and enhance Malaysia’s trade competitiveness.
3. Based on statistics by the World Trade Organisation, Malaysia has slipped from 23rd place in 2015 to 26th place in 2019 in the global export rankings; having been overtaken by our ASEAN neighbours, Thailand and Vietnam.
4. According to the Executive Summary, the contribution by Small and Medium Enterprises (‘SMEs’) to total exports has stagnated in the past five years, with the average growth being slower as compared to the country’s overall export growth and exports by non-SMEs.
5. Hence the NTBp was developed to provide clear directions and initiatives to enable the country to regain its competitiveness in trade, even as global trade becomes increasingly complex and competitive.
ELEMENTS
1. The key guiding principles - The key guiding principles that have been embedded in the strategies outlined in the NTBp are as follows:
- Building upon Malaysia’s existing foundation and strengths
- Prioritising the need to cultivate a competitive mindset among all stakeholders
- Emphasising the need to ensure sustainability in accordance with global demands
- Ensuring seamless and transparent processes to improve efficiency and reduce redundancy among all stakeholders
- Taking a collaborative approach among all stakeholders and agencies to position exports as the utmost priority
- Ensuring consistency and proper monitoring mechanisms for all recommendations and implementation plans to allow for continuous improvement
2. The vision and the mission - The vision enshrined in the NTBp is to further strengthen Malaysia’s position as a leading exporter through four strategic priorities, three strategic themes and eight strategic thrusts that have been identified to enhance the country’s export competitiveness.
3. The four strategic priorities under the NTBp are:
- Increase exporting companies
- Increase high value export goods
- Diversify export products
- Improve the export ecosystem
4. The three strategic themes of the NTBp are:
- BUILD – improve the operating environment for all exporters
- GROW – enhance capacities for export promotion
- COMPETE – expand Malaysia’s established excellence of products to greater heights
THE EIGHT STRATEGIC TRUSTS
1. Strengthening Export Ecosystem Remove business constraints and export bottlenecks to ensure smooth exporting processes and creation of a robust ecosystem
2. Uplifting Export Capacity and Capabilities Strengthen SMEs’ production capacity and capabilities to enter the global value chain (GVC)
3. Elevating Malaysia’s Strengths in Export Extend the support to existing sectors with high potential to groom new champions across the supply chain, thereby stimulating the economy and promote export growth further
4. Harnessing Growth Through Technology and E-Commerce Strengthen bases of competitive advantage, work in partnership with industries and support them to scale up, increase productivity and internationalisation
5. Facilitating and Widening Market Access Continuously increase engagement with key markets to improve market access
6. Promoting Malaysia’s Brands and Product Increase the visibility of Malaysian brands on regional and international export markets
7. Driving Growth Through Investment and Export Diversification Attracting investments and diversifying exports would be critical for Malaysia to manage the uncertainties in the global trade environment
8. Pursuing Sustainability and Innovation Encourage the adoption of sustainable good practices and standards
OVERVIEW AND STRUCTURE
1. The NTBp sets out various action plans and strategies that are to be implemented to achieve the objectives under each of the strategic thrusts. For example, one of the initiatives to achieve the second strategic thrust (Uplifting Export Capacity and Capabilities) is to encourage multinational corporations in Malaysia to source locally through vendor development programmes.
2. The Executive Summary also identifies the key stakeholders who will be responsible to implement the various initiatives and the time frame (i.e. short-, medium- or long-term or continuous basis) within which such initiatives are to be implemented.
3. These strategies have been developed based on studies of the existing export ecosystem in Malaysia and in some instances, seek to overcome the pain points that have been identified, e.g. low level of awareness of the range of trade financing assistance provided by government agencies and statutory bodies and barriers to access to financing.
4. The Jawatankuasa Koordinasi Eksport (Export Coordination Committee) (‘JK-X’) consisting of various Malaysian ministries and agencies involved in export promotion will be charged with the responsibility to govern the implementation of the NTBp initiatives . Where required, strategic decisions for the implementation of recommendations that require national level direction will be made by the Economic Action Council (EAC), chaired by the Prime Minister.
5. Seven Working Groups (‘WGs’), each comprising representatives of the government and private sector, will be formed. Each of the WGs will be responsible to make recommendations and prepare an implementation plan for a specific area, e.g. investment, digitalisation and technology, standards and conformance, regulatory and logistics, innovation, and branding.
6. Eleven existing Sectorial Task Force (‘STF’) will, among other responsibilities, align export promotion programmes, budget and policies relating to the sector under their purview. The STF will also discuss latest trends, developments and issues related to exports and propose potential solutions to meet these new challenges.
7. A Project Management Office staffed by MITI and MATRADE will monitor and report on export promotion programmes and NTBp recommendations.
GAPS
1. These initiatives appear to be a rehash of earlier solutions to address long-standing problems in some of the processes hindering market access. For example, logistics challenges were long identified in the Logistics and Trade Facilitation Master Plan (2015-2020), that was launched five years ago.
2. While the Blueprint has heavily emphasised improving export-related processes, enhancing export competitiveness also requires the production of export goods that can compete globally, based on quality and cost. On this front, the Blueprint appears relatively thin on strategies and recommendations. It does emphasise the need to adopt standards and certification, but there is no mention of improving labour productivity. Yet, the ability to compete on costs requires continuous improvements in labour productivity, inputs and backbone services, while competing on quality requires improving standards and innovation.
3. The Blueprint gives the nod to the need for product innovation to produce new and complex products for exports and the need to meet the challenges of sustainability. However, it appears lacking in substance since it merely re-emphasises the need for fostering better collaboration between public and private institutions for R&D and increasing awareness and registration of intellectual property rights. The Blueprint instead emphasises country branding as one of its key strategies.
4. While establishing a Sustainable Manufacturing Centre in Penang is recommended in the Blueprint, other sustainability-related action items do not appear to convey strong commitment, nor do they seem to have much teeth. For example, it aims to address forced labour issues by merely “raising awareness” among manufacturers.
5. Meanwhile, ASEAN competitors such as Cambodia have already developed a Suppliers Database with Sustainability Dimensions for improving linkages between foreign firms and domestic suppliers.
6. Another omission of the Blueprint is its decision to deal with services separately in yet another Blueprint. This ignores the crucial linkages between the manufacturing and services sectors. The Blueprint fails to acknowledge that manufacturing increasingly buys, produces and sells services. For coherence, manufacturing and services need to be developed together and not in silos for the country to reap the synergies between the two sectors.
Souce:
https://fulcrum.sg/malaysias-national-trade-blueprint-mind-the-gap/
https://www.lexology.com/library/detail.aspx?g=6578aa8e-b69f-41a8-b040-af04a9125592
