Investments to pour into Malaysia, Boston Scientific plant in Penang to be ready by 2017

Fruitful partnership: Lee receiving a souvenir from Boston Scientific executive vice-president of operations Ed Mackey during the ground-breaking ceremony of the company’s facility in the Batu Kawan Industrial estate. It is expected to be operational in the fourth quarter of 2017.

BATU KAWAN: Malaysia is targeting to attract RM40bil worth of investments from the manufacturing and services sectors this year.

Malaysian Investment Development Authority (Mida) chief executive officer Datuk Azman Mahmud said that of the RM40bil, about RM800mil would be for the medical device segment.

“For the first quarter of the year, we have approved RM651mil investments for the medical sector, compared to RM194.7mil achieved in the same period of 2015.

“The approved medical device investments would create 1,610 job opportunities,” he said.

Azman said this after the ground-breaking ceremony of Boston Scientific new plant at the Batu Kawan Industrial Estate.

The RM40bil investments would come mainly from the United States and Europe, according to Azman.

“We are now negotiating for these investments,” he added.

Deputy Minister of International Trade and Industry (Miti) Datuk Lee Chee Leong represented Minister Datuk Seri Mustapa Mohamed at the event to officiate the groundbreaking ceremony.

Lee also read out Mustapa’s speech.

In the speech, Mustapa said in 2015, the exports of medical devices increased by 15% to RM15.5bil from 2014.

“According to the National Export Council (NEC), revenues from the export of medical devices are projected to grow to RM26bil by 2020.

“In this regard, industry players in Malaysia will be able to enhance their exports by capitalising on the liberalisation of markets such as Asean, facilitating access to the region’s 620 million strong market,” Mustapa said. Also present at the event was Penang Chief Minister Lim Guan Eng.

Boston Scientific’s new medical device manufacturing plant, which will involve investments running more than hundreds of millions of ringgit, is scheduled to be operational in the fourth quarter of 2017.

By David Tan The Star/ANN

Boston Scientific plant in Penang to be ready by 2017 

New plant: Artist’s impression of the new Boston Scientific plant at Batu Kawan Industrial Park.

GEORGE TOWN: Boston Scientific’s new medical device manufacturing plant in Batu Kawan Industrial Park, which will involve investments running more than hundreds of millions of ringgit, will be operational in the fourth quarter of 2017.

Boston Scientific vice-president (operations) Dave Mitchell told StarBiz the group would move production equipment into the facility in the second quarter of 2017.

“The plant will be operational in the fourth quarter of 2017, and we expect to ship our first “Made-in-Malaysia” product before the end of 2017,” Mitchell said in an e-mail.

The construction of the facility will begin in the first half of 2016 and scheduled for completion in the second half of 2017.

Mitchell said the site and facility were designed to accommodate at least 10 years of growth, including new products, additional volume and added capabilities, which might include research and development (R&D) or distribution.

“We anticipate having more than 400 employees at the Penang site within four years of operation, with room to grow significantly beyond that.

“Initially we will focus on building manufacturing capability and capacity in the Penang facility.

“We have the space and ability for additional capabilities at the site, including both R&D and distribution,” he said.

On the outlook of the global medical device market, Mitchell said that according to research firm Euromonitor, in 2016 the medical device industry was expected to record strong growth of almost 6% to reach US$315bil.

“Unlike the traditional markets such as Western Europe and the US, the Asia-Pacific medical device market is projected to to grow and gain a wider market in 2016,” he said.

Boston Scientific was founded in 1979 and is the worldwide developer, manufacturer and marketer of medical devices.

Its products and technologies are used to diagnose or treat a wide range of medical conditions, including heart, digestive, pulmonary, vascular, urological, pelvic health, and chronic pain conditions.

The group has 23,000 employess in 40 countries.

By David Tan The Star/ANN

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Poser over Penang Bayan Mutiara deal

Bayan Mutiara is a prime land, given its proximity to the Bayan Lepas free trade zones, the international airport and also the second Penang Bridge.

Comment by KHOO KAY PENG

There are still several questions left unanswered by the Penang government over the sale of the prime property.

SEVERAL Penang-based analysts and local community leaders have questioned the Penang government for selling a 41.5ha plot of prime state land to a private developer, Ivory Properties Group Berhad, for RM1.07bil.

Their concern is understandable due to scarce availability of state-owned land on the island which may hinder the ability of the state government to drive a balanced development and ensure it does not drive out the lower middle-income group from the area.

Most private property projects on the island are focused primarily on premium and luxury property which have driven up prices beyond the reach of most Penangites. There is worry that the sale of the state-owned Bayan Mutiara land to a private developer may end up in a similar fate.

Apart from escalating property prices, there is a concern that the land may have been sold below the prevailing market value. The state government had explained that the current selling price was above market value at the time of transaction.

However, it does not explain if it is usual to allow the purchaser a period of five years to settle the full payment. Did the transacted price factor in any interest payment accrued by the five-year payment period?

The opportunity cost derived from a potential increase in land premium over the next five years should be included to ensure that it is a fair deal.

Accusations and allegations of a lack of transparency in the tender process should be comprehensively addressed by the state government. Critics had alleged that the sale was done through direct negotiations between the state government and the purchaser.

Without justifying the five-year payment period, these allegations will create doubt over the much ac­­claimed transparency and ac­­count­ability of the state government.

Moreover, the allegations are peppered by talk that a bidder who is prepared to make a full payment for the purchase was not selected during the tender process.

Some analysts have questioned how can the sale benefit the people? They wonder why the development of Bayan Mutiara cannot be taken up by the Penang Development Corporation (PDC) which has the capacity and experience to handle people-centric development projects such as the Penang Free Trade Zones, housing estates, Komtar and others.

Regrettably, the issue of public accountability and good governance has been grossly politicised by certain parties. Politicians have gone to the extent of throwing down the gauntlet of challenging each other to resign over false allegations related to the land sale. We expect such showmanship from politicians but we deserve straight and accurate answers from them.

Politicising this issue is going to deprive many concerned stakeholders a chance to ask relevant and legitimate questions about the decision to sell the land to a private developer.

Chief Minister Lim Guan Eng had described allegations of wrongdoing over the tender award for the Bayan Mutiara mixed deve­lopment project by PDC as “a pack of lies”.

While some of these allegations may be malicious, it is pertinent for Lim’s administration to identify legitimate concerns over the sale. He should acknowledge that the state government controls less than 5% of total land size on the island and this calls for a prudent and strategic management of state-owned prime land.

Hence, it is best for his administration to address these issues immediately in order to convince the people of Penang that it has taken the best interests of the people into consideration before agreeing to the sale. Major issues include:

> What was the rationale to allow a five-year payment period to the purchaser? It gives an impression that the purchaser may not have secured financing for the purchase.

> Is it true there was another bidder who was prepared to pay an upfront full payment for the asking price?

> Did the transacted price factor in any interest charges or projected land price appreciation over the next five years?

> Is there any restriction or precondition between the state government and the purchaser to discourage any sub-sales? If the purchaser were to divide and resell some parcels of the land to other developers at a higher premium, it may further drive up property prices on the island. If such sales were allowed, is the state government entitled to a share of the higher premium?

> It is understood that the government would like to use the proceeds from Bayan Mutiara land to finance its low-cost housing scheme in Batu Kawan. While the low-cost housing scheme is welcomed and encouraged, the state government needs to justify if the sale of Bayan Mutiara land is the best option to help finance the project.

> Lim said part of the RM500mil financing for the housing scheme came from the state coffers. If this is the case, what is stopping the state from raising money through external sources to fund the entire project and carefully weigh all options to optimise the use of the Bayan Mutiara prime land bank?

Bayan Mutiara is no longer about selling above the current market value but the use of scarce prime land on the island for the purpose of socio-economic transformation. Ownership of prime land is very crucial for the state government to drive the state’s economy.

We do not want a repeat of high premium-reclaimed lands being sold to private developers who in turn inflate property prices in Penang and raked in billions in profit at the expense of the people.

Bayan Mutiara could be what the state government needs to help transform the landscape of Penang and create new attractions to boost its attractiveness as a tourism and cultural destination and a services hub.

Time will judge if the current state government has made the right decision on Bayan Mutiara and if the proposed plan is not going to turn out to be just another expensive commercial project by a private property developer.

> Khoo Kay Peng is an independent policy analyst and a management consultant. He was born and raised in Penang. Khoo can be contacted at kpkhoo@gfworld.com.my.

Read more: Land deal raises more questions - Columnist - New Straits Times http://www.nst.com.my/opinion/columnist/land-deal-raises-more-questions-1.51940#ixzz1nYV1Q098

Swiss VAT plant proposed for Penang

Swiss firm to open new plant in Penang

By SIMREN KAUR simren@thestar.com.my

GEORGE TOWN: A Swiss semiconductor company has chosen Penang to open its first manufacturing plant in Asia.

VAT Manufacturing Malaysia Sdn Bhd will be built on a 3.035ha in Batu Kawan and is expected to commence production by December this year.

VAT executive vice-president Quality and Procurement Andreas Scheibe said it was a big step for VAT to open its first branch in Asia.

“A lot of our customers in the United States have moved to Asia, so we decided to move as well to be able to better serve our customers,” said Andreas.

An artist’s impression of the proposed VAT plant in Penang.

“After surveying several Asian countries, we chose Penang because it is the only one that meets our requirements,” he said.



VAT is the world's leading supplier of vacuum valves for state-of-the-art applications in the semiconductor industry, for manufacturing flat screens and solar panels, as well as for coating optical systems and tools.

Penang Chief Minister Lim Guan Eng said that he was delighted that VAT had chosen Penang over China, Japan, South Korea, Singapore, Taiwan, Thailand and Vietnam.

“We are proud that our human resources, suppliers in mechanical and electronic components, infrastructure and logistics support as well cost of living comply with the requirements of VAT,” he said.

Lim was speaking at the sale and purchase signing ceremony between VAT and Penang Development Corp at his office at Komtar yesterday.

He added that the new facility, with investments totalling US$25mil (RM75mil) was expected to generate 100 new jobs.