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Malaysian ICT initiative records double-digit growth despite tough market

AvantiKumar | May 30, 2013
ICT agency MDeC says 2012 was another very good year for the MSC Malaysia national ICT programme.

MDeC MSC Malaysia financials 

Photo - Datuk Badlisham Ghazali, Chief Executive Officer, MDeC.

 

Malaysia's Multimedia Development Corporation (MDeC) said the national ICT programme - MSC Malaysia - recorded double-digit growth in export sales and GDP contribution in 2012, exceeding the previous year, which was its best year.

MDeC chief executive officer Datuk Badlisham Ghazali said in 2012, MSC (Multimedia Supercorridor) Malaysia revenue came in at RM33.53 billion (US$10.94 billion), which was an increase of 5.7 percent from 2011, while exports grew to RM11.6 billion (US$3.78 billion), which reflected a 14 percent rise from the previous year. This resulted in MSC Malaysia's contribution to gross domestic product (GDP) standing at RM11.3 billion (US3.69 billion), recording a significant double digit growth of 18 percent from 2011. 

Badlisham said 9,700 jobs were created in 2012, which represented a 28 percent growth over 2011 bringing the total number of jobs created since inception to 128,850.

"2012 was another very good year for MDeC with growth across the board," he said. "This is especially significant when you consider that 2011 had been our best year ever."

Badlisham said the InfoTech Cluster accounted for 44 percent of the total revenue of MSC Malaysia Status companies amounting to RM14.66 billion (US$4.78 billion), while the Shared Services and Outsourcing (SSO) cluster saw 31 percent revenue, which amounted to RM10.45 billion (US$3.41 billion). This was followed by the Creative Multimedia cluster and Institutions of Higher Leaning (IHLs) and Incubators, which generated revenues of RM6.99 billion (US$2.28 billion) (21 percent) and RM1.44 billion (US$469.7 million) (4 percent) respectively.

Investments also recorded steady growth coming in at RM2.92 billion (US$952.2 million), which represented a 17 percent increase over 2011. In terms of distribution, 76 percent of this was Domestic Direct Investment (DDI) while 24 percent was Foreign Direct Investment (FDI), he added.

Seventy-one percent of total investments in 2012 were driven by the Infotech cluster amounting to RM2.1 billion [US$684.7 million] while the Shared Services and Outsourcing (SSO) cluster constituted 17 percent of total investment translating into RM0.5 billion (US$163 million). The Creative Multimedia cluster on the other hand represented 12 percent of the investment which amounted to RM0.34 billion (US$110.7 million).

Confident in the coming year

Badlisham said the Shared Services & Outsourcing Cluster led job creation in 2012 with 7,388 new jobs, accounting for 76 percent of total new jobs, followed by the Creative Multimedia Cluster which contributed 19.4 percent or 1,887 new jobs, while IHLs and Incubators accounted for 7.9 percent with 766 new jobs.

"The strong performance in 2012 can be attributed to several factors including MSC Malaysia's strategy of continuing to look at key emerging Southeast Asian markets, improving market access, acceleration of channel development programmes and the formation of new go-to-market stacks that offered flexible product portfolios, thus meeting industry demands," he said.

"In addition, MSC Malaysia's sustained attractiveness as a destination for Knowledge Process Outsourcing (KPO) has also contributed to the positive growth. Our strategic move to enhance the delivery capability of our companies from pure play Business Process Outsourcing (BPO) services to KPO and now integrated solutions in specific verticals such as Finance and Accounting and Oil and Gas has resulted in a clear competitive advantage," he added.

Badlisham said the adoption of cloud computing in the country along with increasing focus on customer-centricity in regional markets through the Channel Development (or 'superbuyers') and Solution Stacking growth strategies should continue to speed up growth.

"MDeC is confident of continued growth and believes that there will be even more opportunities in the coming year," he said. "We feel that MSC Malaysia will continue on this growth trajectory as more companies venture out to seize the opportunities that are mushrooming in the region while our firm footing in the SSO sector will mean more high value jobs and strategic investments, both local and international."

 

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