Opening remarks by YAB Tuan Lim Guan Eng, Chief Minister of Penang at the Free Industrial Zone Penang Companies Association (Frepenca) Mid Year AGM at Equatorial Hotel, Penang on Monday, 4^th October 2010 at 12 noon: 

Opening remarks at the Free Industrial Zone Penang Companies Association (Frepenca) Mid Year AGM 

Once again, I wish to thank Frepenca's organizing committee for inviting me for today's dialogue for the third time in as many years. We believe that these annual interactions will help not only to facilitate your company's operations but also shape the growth of the manufacturing sector, which is one of the twin engines of economic growth.

With Penang contributing more than half of the electronics exports of Malaysia, Penang needs to further enhance its capabilities. Penang recorded RM 2.1 billion in investments in 2009. Our target this year is a 100% increase to RM 4.2 billion. For the 2nd quarter, Penang saw a jump of 881% from Q1 to Q2 to RM1.5 billion worth of investments, We have a long way to go before we achieve our targeted RM4.2 billion in 2010 but we will redouble our efforts.

There are 7 key factors that makes Penang as the location of choice for investors.

1. Ready availability of skilled human talent

2. Effective and efficient supply chain management

3. Competent and reliable logistics and communications hub

4. Strong Intellectual Property protection

5. Good governance and strong leadership

6. Building creativity and innovation in science and technology

7. Livable and intelligent city

The recent announcement by the Penang state government to set up and the 200 acre education hub at Balik Pulau shows the commitment of the state government to promote Penang as an education hub for the region. We believe that this is the right step forward toward promoting In order for Penang to become a high income, knowledge based economy.

The 19th century was a century of empires; the 20th century was a century of nation states. The 21st century will be a century of cities driven by demand for human capital where economic growth is driven as much by capital as by the density and availability of talents. Cities that possess the right physical, cultural, economic and social conditions would become a magnet for talent.

It is our hope to transform Penang to transform itself into an international city that can compete globally. Human talent is the new oil of this century. With human talent you can not fail without human capital you can not succeed. So if Penang is to succeed with our goal of becoming an international city, it must become an intelligent city. An intelligent city is defined as:

1. Human intelligence

2. Collective intelligence

3. Digital Intelligence

4. Institutional intelligence

5. Integrity intelligence

We believe that Penang is on its way to acquiring all the requisite 5 aspects of intelligence of above. We have established a 200 acres Education Hub in Balik Pulau to set up branch campuses of top universities and several of them have expressed keen interest.

To harness the talents of all our people we need to start them young. 6 months ago, the Penang Science Council, was formed to promote rekindle the interest of science and technology amongst school children and young adults. With full participation from the academic and industry player and no government interference in its activities, I am excited to see progress in all the key 5 pillars.

1. Sustainable Education and Learning Pillar headed by Motorola - to rekindle interest in science and technology amongst the young and students through talks by renowned successful entrepreneurs, especially the upcoming Robotics competition.

2. Mentoring the young scientific entrepreneur headed by Mini Circuits - this pillar hopes to provide a platform of guidance, opportunity and funding through seed money to commercialize their ideas and inventions.

3. Nurturing Industry headed by Dato Wong Siew Hai to bring the industry to the next level of development. Establishing a Penang Tech center to showcase Penang's success in inventions and innovations in its 35 years of industrialization together with R&D and incubataor hubs spur new inventions is our way of saying thank you for taking this incredible journey of excellence with us.

4. Innovation and Research headed by Intel - to continue Penang's competitive advantage of human talents who have a proven track record as an outsourcing centre, sophisticated supply chain network and research and innovation facilities which includes funding to encourage creative ideas and new inventions.

5. Life sciences & Medical Health headed by B.Braun - nurturing the young to be interested in the field of life sciences and to know more about "sunrise" industries in Penang.

I wish to take this opportunity to extend the state government's appreciation to all your members for participating in the Penang Science Council. The key task force leaders of the Penang Science Council have made great efforts to play their part in promoting the council's vision of making Penang the science and technology center of excellence. This is truly commendable and I hope all of you will continue to forge forward with the efforts. I look forward to the first Robotics Day in Penang as well as the announcement of the Penang Tech Centre in months to come.

Apart from that, the state government is encouraged with the participation of Frepenca members through dialogues and feedback to the local council as well as my office. Through a framework of public private partnership we are resolving some local issues such as traffic congestion and the condition of the coastal highway roads. As some of these issues intersect with the Federal government, Frepenca can also raise this with MITI.

Whilst we may have some successes we must not be stuck in the past as one is only as good as the next successful outcome. Both government and industry must boldly embrace the future wherein prosperity is underpinned by practicing good governance, balanced development, integrity in leadership, shared society and a culture of innovation.

We need good and democratic governance. We can only embrace the future with ideas of freedom and democracy to generate growth and prosperity. We need a professional civil service centered on efficiency and productivity. Not only can the professional civil service do their work faster and with lower cost, we also want higher value in return for every RM spent.

Needless to say, there must be respect for the rule of law and integrity in leadership with zero tolerance for corruption. This will promote certainty and clarity in business as well as a level playing field. By adopting international best practices, CAT governance of competency, accountability and transparency has allowed Penang to achieve record budget surpluses and win accolades from Transparency International.

Allowing economic growth will generate prosperity but ensuring balanced development for all will engender social justice and political stability. Failed policies that are uncompetitive must be discarded and replaced by those centered on optimal allocation of resources and maximizing outcomes and results.

For any society to prosper, it is essential that it must be a shared society that sees equal opportunity and diversity as a source of unity and strength. USA is the largest economy in the world because it sees itself as a land of opportunity open to all. For instance, more than half of the successful high-tech companies in Silicon Valley in California are migrants to USA.

For this reason Penang is promoting a culture of innovation, creativity and excellence. We want to nurture innovators, not just entrepreneurs. Penang must brand itself as synonymous with quality, integrity, safety, reliability and sustainability. Only with innovation, can we join the race to the top.

Without these areas of focus, Penang will continue to run down the value chain instead of up and we will not be able to compete with other emerging cities around the world.

In laying the foundations for transforming Penang into a high-income knowledge economy, we will strive to train, retrain, retain and attract the best talent. I wish to take this opportunity to once again thank you for inviting the state government to be present today and we hope Frepenca will continue to provide the necessary feedback for the coming year.

*Lim Guan Eng, DAP Secretary General & MP for Bagan