Friday, Dec 15, 2017
Science & Technology | Asia-Pacific | Malaysia

Tech cities incubate innovation


3 years ago

Asia Aerospace City (AAC) will be built 12 miles west of Kuala Lumpur in Subang by UK-based WS Atkins plc and will create a smart city for the aeronautics industry, complete with cutting-edge R&D facilities, integrated office suites, campuses, a conventio
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From Cyberjaya’s groundbreaking MaGIC project to the planned Asia Aerospace City, Malaysia is showing intrepidness in stepping up technology to become a knowledge-based economy in six years’ time.

In an age of fierce global competition among an increasing number of players, being an upwardly mobile country requires vision, know-how, capital and a bit of magic too. With the inauguration in April of MaGIC, acronym for the Malaysian Global Innovation and Creativity Centre, Malaysia shows it has what it takes to climb the worldwide technology ladder and become a knowledge-based, high-income country by 2020.

Headquartered in Cyberjaya, the Malaysian Silicon Valley situated 31 miles south of Kuala Lumpur, MaGIC will be a greenhouse for innovative start-ups that will create added-value products and services.

Founder of MaGIC and Secretary General of the Treasury, Tan Sri Irwan Serigar Abdullah explains that, “over time, Cyberjaya evolved into an outsourcing hub, which did not fulfil the nation’s economic development objective. We decided to change the strategy. The objective of the ‘new Cyberjaya’ is to house tech-companies, local SMEs and entrepreneurs, which will in turn create more wealth.”

On the strategy shift, Faris Yahaya, Managing Director of Cyberview (the government-owned company that spearheads the development of Cyberjaya), says: “The opportunity has arisen to harness Cyberjaya’s resources further and exploit its full potential and it has now emerged as a city for innovation and creativity, providing growth and jobs; and a community of entrepreneurs are slowly changing the face of the city’s landscape, creating a focus on technology that is inspiring to the new generation.”

With Sajith Sivanandan, Country Manager of Google Malaysia, on MaGIC’s board of directors as well as a signed memorandum of understanding with Stanford University, the center seems well prepared to fulfil its aim to transform Malaysia into a dynamic entrepreneurial nation by enabling domestic and international entrepreneurs to successfully start and grow their businesses.

A one-stop center, MaGIC will provide every facility entrepreneurs need – from obtaining funding from banks or venture capitalists to providing incubators for developing start-ups to improve their products or services. It will create a full-service ecosystem so as to attract top talent, from Malaysia and beyond, and inspire a new wave of entrepreneurs.

Naguib Mohd Nor, Co-COO of Strand AerospaceFaris Yahaya, Managing Director of Cyberview
“We are not just focused on Kuala Lumpur and the big cities,” adds Mr. Irwan. “The entrepreneurships program has also been rolled out to smaller towns and villages all around the country, as we found many aspiring entrepreneurs in these areas. They may not necessarily receive the same opportunities as people in more urbanised areas; however, potentially with the opportunities presented, we may find the next Steve Jobs in Malaysia!”

To improve the chances of success for Malaysia’s most promising students, beginning next year, MaGIC’s Silicon Valley Internship Programme will place high-potential undergraduate students (majoring in Software Engineering, Computer Science and Multimedia Design) as interns in small-to-medium-sized Silicon Valley start-ups for one year.

Another partnership with California’s tech incubation capital is the e@Stanford Program, which will send Malaysian start-ups to Silicon Valley for two weeks to learn from Stanford faculty and industry experts.

Mr. Yahaya says he is “very excited about the set-up of MaGIC as it will be the catalyst to help deliver and boost Cyberjaya’s positioning as a global technology hub.” 

“Cyberjaya is now complete with the essential features enabling technology companies and individuals with ideas to flourish in terms of creativity and innovation,” he adds, pointing to the fact that it is home to about 500 technology-based companies, including 25 multinationals, as well as a number of universities and colleges, notably the Multimedia University (MMU), totaling some 20,000 students. Now, says Mr. Yahaya, to be a true global technology hub Cyberjaya needs to attract global players and carve a niche in which to develop its technology.

A sign of the strategic importance Malaysian authorities attribute to the new Cyberjaya in the making, Prime Minister Najib Razak attended the inauguration of MaGIC in April 2014, together with a distinguished guest, US President Barack Obama.

“We are here because we have a shared commitment to fostering the spirit of entrepreneurship, especially among our young people,” declared Mr. Obama. “We want you to be able to start your own businesses, and come up with your own products and services because that’s how our societies grow. The dreams and talents of these young people help to fuel our economies and create jobs, and they also bring our countries closer together.”

Innovation in the aeronautics industry with Asia Aerospace City (AAC)

The creation of specialized cities that host sectorial clusters – or “ecosystems” as they are now called – is one of the ways chosen by the Malaysian government to foster the creation of enterprises, in particular in knowledge-driven industries, and to increase its presence in high added-value markets. One of the most recent developments in this regard is Asia Aerospace City (AAC), which will be built in Subang, 12 miles west of Kuala Lumpur. Dedicated to the aeronautics industry, AAC will be a smart city with cutting-edge research and development facilities, integrated office suites, campuses, a convention center and residential areas.

According to Atkins, the British design, engineering and project management consultancy chosen by Malaysian authorities to be the leading consultancy and master planner for AAC, this “world-class development aims to attract global engineering services business worth $1.1 billion to Malaysia by 2020.” 

The project is symptomatic of Malaysia’s increasing weight in a highly competitive industry that has evolved in recent years from its traditional American and European base into a global network of manufacturers, vendors and suppliers organized under a supply chain based on sectorial clusters.

Furthermore, Asia is set to play a growing role in the global aviation market. According to the Malaysian Investment Development Authority (MIDA), citing Boeing, half of the new world traffic predicted for 2030 will be to, from or within Asia. In the same period, the Asia-Pacific region will account for 34 percent of new airplane deliveries and 37 percent of the worldwide market value by region.

“The idea is to create a nexus in the heart of Kuala Lumpur to provide high-end knowledge services for aerospace; this is the innovation we bring to the market, and it is a major growth area within Asean. With this strategy in mind, high-skilled capital becomes the essential ingredient,” says Naguib Mohd Nor, Co-COO of Strand Aerospace Malaysia, an engineering services company that is part of the UK-based Strand group.

While a good number of international aeronautics companies are already operating in the country – the United States’ GE, Germany’s Airfoils Services, Japan’s IAC Manufacturing, France’s Messier-Bugatti-Dowty, to name a few – the new AAC is set to attract major players from all over the world.

“Over the past two years, we have centered our core Asean operations in Malaysia,” explains John Brosnan, Regional Managing Director of British multinational defense, security and aerospace company BAE Systems.

“The geographical position and the rapid and impressive development of business infrastructure make of Malaysia an ideal location for a global business looking to establish a regional hub. And we’ve done that in a big way over the past couple of years. We’ve invested more than RM40 million (£7.4m) in new facilities, technologies and skills, creating a strong national presence that will deliver the best possible partnership opportunities for our company.”

Mr. Brosnan adds that the UK Trade and Investment agency (UKTI) “plays an important role in increasing bilateral trade between the UK and Malaysia and we are able to support that process by helping to bring together like-minded enterprises from the UK and Malaysia.” 

British Commissioner Simon Featherstone says that British companies employ some 200,000 people in Malaysia, where “they have found an ideal setting in particular for back-office functions, data processing, finance and human resources”. “Now that Malaysia is moving up and developing its economy in a more specialized way, there are even more opportunities for UK businesses,” he adds.

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