KUALA LUMPUR: Malaysia should leverage on its strong financial sector and commodities to position itself as key hubs during the upswing in the economy.
“There are great opportunities for us now. Our financial system is much more solid than the global financial system and we are leaders in the commodities sector,” said Monash University’s school of business deputy head Professor Mahendhiran Nair.
“So, we should leverage on that. We need to move in the direction of repositioning ourselves as a key hub in key critical sectors,” he told The Edge Financial Daily, adding that Islamic banking and finance was a key sector to build on at the moment.
“We should be promoting it as an alternate way of addressing the integrity issues plaguing the financial sector. By selling it as a more secure financial system with none of the integrity issues that we have now, it is a way of bringing the investors here.
“We came out of the 1997 Asian financial crisis very strong. Our financial sector and real economy are strong. Of course we are impacted by the global downturn. But in the upswing, we need to position ourselves as a key financial hub to provide leadership in that area not just to the global community but to the OIC. That is where the money is,” he said.
Speaking at the Blue Ocean Strategy Seminar last week, organised by UCSI Blue Ocean Strategy Regional Centre, he said Malaysia had tremendous potential with the right infrastructure in place. However, he said there was a lack of coordinated effort to create value in those sectors that the country was strong in.
“In some areas like palm oil and commodities, we are there. We are leaders but we have close competition like Indonesia and a lot of the other Latin American countries.
“So, while we have a very good industrial and information structure, we should move to a space where not a lot of people are in and see how that space can complement the economy.
“We can look into things like how can commodities be an important ingredient to a knowledge-based society. How can we tie up our other sectors to the agriculture sector to develop new products or services that can be exported?
“We use commodities as a leverage to build upon. But as we build, we also need to see how we can link that with the other sectors. We are not the greatest or biggest, but we can leverage on our strengths,” he said. Nair said a lot of potential industries were also not given enough boost to achieve their full potential such as the alternative energy, biofuel and the Halal hubs.
He said while there was a lot of talk on biofuel in the past, much of the interest had “fizzled out”. With plenty of innovation, Malaysia could be a key hub for these sectors as they were picking up momentum in the global community, he said.
He was hopeful that the new leadership would direct Malaysia toward a more focused economy.
“In some areas, we have done reasonably well. But if we want to be a pacesetter, we need a leader who not only plays the global tune, but also play its own tune that will become global,” he said.
Blue Ocean Strategy is a business strategy that promotes creating new market space or “blue ocean” rather than competing in an existing industry.
The UCSI Blue Ocean Strategy Regional Centre Sdn Bhd is the exclusive official representative of Blue Ocean Strategy and has exclusive business rights to the Blue Ocean Strategy concepts and brand in Malaysia, Australia, Canada, China, India, Indonesia, the Philippines, Singapore, Taiwan, and Thailand.