Hong Kong
                                                                                                              Taipei
             NEW  TOWNSHIP                KEDAH
              INDUSTRIAL  PARK
              CITIES/TOWNS
              EXISTING  ROAD                                                      Bangkok
              RAILWAY
                    Beach  Resorts
             PENANG
                                 T
             ISLAND             R
                                O              Kulim
                                P
                                               High-Tech
                                    PRAI       Park
                                                                          Medan       KL
                                          Bukit
                        Bayan  Lepas      Minyak
                        Industrial  Park                                                  Singapore
                   Penang             Batu
                   International      Kawan
                   Airport
                                                                                         Jakarta
                             Where is Penang?
                                                                                                                       2
           The Penang Growth Story
            Trading        Manufacturi     Services Hub
                                ng
          1786-1969         1970-2000      2001-current
        Entrepot           Global           Innovation 
        Loss of free       manufacturi       economy 
        port status        ng hub and      and business 
        Declining          tourism         and services 
        trade              destination         hub
                                                           3
      Penang’s Economic Transformation
    • GDP by sector (1970)        • GDP by sector (2010)
              5.5 19.7    Agriculture
                                               1.6
                                                1.8
                                                 0.1
                   0.3    Mining
                  12.7
            61.8          Manufacturing
                                        42.5
                          Services                     54
                          Construction
        US$500 million                    US$10,000 million
       Success of the Growth Pole Strategy
                                         1970          2010
    Population (‘000)               0.78           1.61
    Per capita income (US$)         400            5600
    Unemployment rate (%)           16             3
    Poverty rate (%)                32.3           0.3
    Infant Mortality Rate (%)       38             0.4
                                      Value Roadmap – Industrial Transformation
         Value Add                                                Version 1                                               Version 2                          Version 3 ?
                                                                                                                 •    Business Management
                                                                                                 R&D             •    Outsourcing                 • MNCs
                                                                                               Sub-con           •    Service Contract
                                                                                                                 •    R&D                         • Operational HQ
                                                                                               Support           •    Software
                                                                                               Centres           •    Global Hub                  • Logistics / Distribution Centres
                                                                                                                 •    Alternative sale
                                                                                                                                                  • BPO / SSO
                                                                  Quality                •    Semicon process                                     • Design & Development 
                                                                      &                  •    Test system        •    Base Software
                                                                Automation                 development           •    Design Companies               Centres
                                                                                         •    Supply chain       •    Contract
                                                                                           management               Manufacturing
                                                                                         •    Disk drives
                                                             •     Semiconductor      
                                                               Manufacturing             •    Investment in high-      Global                   • Local Companies
                                                             •     Consumer Electronics                             Competition
                                                             •     Automation              tech machine shops
                                                                                         •    Drive components                                  •
                                 •                           •     TQC                                                                              OEM to ODM
                                      Low Value Added                                      production
                                   Exports                                               •    Test auto handlers                                • Market Outreach beyond 
                                 •    Textile / Garments     •                           •    PCB assembly   
                                 •                                 Tool & die              automation                                               Malaysia / MNCs
                                      Labour Intensive       •     Machine Integration
                                 •    Electronic Component  •                            •    Manufacturing sub-con
                                                                   Plastic Moulding      •    General Manufacturing                             • Growth of Design / R&D 
                                   Assembly                  •     Custom Services
                                 •    Test                   •     Improvement Projects   machinery                                                 Companies
                                 •    Machine Shop Service
                                 •    General Maintenance
                                 •    Trade
            Basic Industries
            Agriculture
       60s                  70s                        80s                       90s                      00s & beyond
         Adapted from “Technology Roadmap for the Electrical and Electronic Industry of Penang”