ASEAN Economic Community 2015: Malaysian Perspective

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  • 1. Fi Asia Conference 2011 21st Sept 2011 Bangkok Thailand Industry Perspectives AEC 2015-Impact to the Food Industry By Mr Kamalbahrin Hj Khamsan PresidentMalaysia Food Processing and Packaging Entrepreneurs Association (MAFPA)
  • 2. Introduction The Association of Southeast Asian Nations (Asean) have a great potential for food market (supply and demand) Malaysia is a relatively small nation with multi ethnic population of 28.5 million people Malaysia have a niched in halal food ingredient producer and manufacturer Malaysian government is encouraging world halal food manufacturer especially Fi to takes advantage of USD 2.1 trillion potential market through Malaysia. AEC 2015 will open more opportunities in Fi market with a strategic planning and comprehensive managementFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 3. Background of ASEAN area of 4.46 million km², 3% of the total land area of Earth, population of 600 million people( 8.8% of the world population.) combined nominal GDP about US$1.8 trillion. as a single entity, it rank as 9th largest economy in the world.Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 4. Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 5. ASEAN Six Majors Economy(GDP)2010 Indonesia USD 695 billions (1,027 billions) Indonesia USD 708 billions (1.029 trillion) Thailand USD 312 billions (584 billions) Malaysia USD 218 billions (412 billions) Singapore USD 217 billions (291 billions) Philippines USD 189 billions (350 billions) Vietnam USD 101 billions (275 billions) Note GDP Nominal (GDP PPP)Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 6. MAFPA Background Represent Malaysia Food Processing & Packaging Industry Members in Food Manufacturing, Supplies /Services and Trade Current programmes and activities focus on export Fully support by industry and government Fi Asia good platform for promote development of Malaysia food ingredient industryFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 7. Scope of Presentation AEC 2015-Impact to the Food Industry Regulation; source of raw material; labor & technology; government’s policy and plan; market opportunities & challengesFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 8. ASEAN ECONOMIC COMMUNITY 2015 emphasised regional cooperation in security,sociocultural and economic integration.From CEPT to AEC A Common Effective Preferential Tariff (CEPT)scheme to promote the free flow of goods withinASEAN lead the ASEAN Free Trade Area (AFTA).Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 9. The Next Step Is ASEAN EconomicCommunity (AEC) main objectives are: single market and production base highly competitive economic region region of equitable economic development region fully integrated into the global economyFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 10. AEC Areas of Cooperation human resources development and capacity building; recognition of professional qualifications; closer consultation on macroeconomic and financial policies; trade financing measures; enhanced infrastructure and communications connectivity; development of electronic transactions through e-ASEAN; ntegrating industries across the region to promote regional sourcing; and enhancing private sector involvement for the building of the AEC. In short, the AEC will transform ASEAN into a region with free movement of goods, services, investment, skilled labour, and free flow of capital.Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 11. ASEAN Economic Performance both export and domestic demand fuelled growth to expand by 7.5 % in 2010 Intra-ASEAN trade and investment flows have shown an upward momentum and are likely to support its 2011 domestic growth, which is estimated between 5.7 and 6.4 %. NOTE: Reported by The Deputy Secretary-General of ASEAN H.E. Mr. S. Pushpanathan for ASEAN Economic Community (DSG)Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 12. ASEAN Foreign Direct Investment (FDI) FDI into ASEAN reached US$ 75.8 billion last year, doubling the 2009 level, and surpassing the pre-global crisis peak in 2007 of US$ 75.7 billion. FDI flows in ASEAN over the last ten years have grown at an annual average rate of 19%.Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 13. Malaysia’s Trade With Asean Countries (USD)Billion 2005 2006 2007 2008 Total Export 46.5 51.0 51.6 57.1 Import 36.8 43.8 42.7 42.1 Net 9.7 7.2 8.9 15.0 Indonesia Export 4.1 5.0 5.9 6.9 Import 6.2 6.0 7.1 8.1 Net (2.1) (1.0) (2.2) (1.2) Thailand Export 9.6 10.4 10.0 10.6 Import 7.6 9.4 9.0 9.8 Net 2.0 1.0 1.0 0.8 Source: Department of StatisticFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 14. Malaysia’s Trade With Asean Countries (USD)Billion 2005 2006 2007 2008 Singapore Export 27.9 30.1 29.6 32.6 Import 16.9 18.6 19.3 19.1 Net 11.9 11.5 10.3 13.5 Philippines Export 2.5 2.7 2.9 3.3 Import 4.1 3.5 3.2 2.3 Net (1.6) (0.8) (1.3) 1.0 Others Export 2.4 2.8 2.0 3.7 Import 2.0 6.3 4.1 2.8 Net 2.4 (3.5) (1.0) 0.9 Source: Department of StatisticFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 15. AEC 2015-Impact to the Food Industry Regulation import duties Harmonisation of quality and standards assurance of food safety, standardisation of trade certificationFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 16. AEC 2015-Impact to the Food Industry In Sourcing of Raw Material free movement of raw material. reduce trade barrier. reduce cost of doing business through tax exemption Inter complimentary Increased profitFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 17. AEC 2015-Impact to the Food Industry In Sourcing of Raw Material free movement of raw material. Malaysia import raw material for food industry from Indonesia (vegetable), Thailand (aquaculture, rice and fruit) and Vietnam (rice) Malaysia export raw material for food industry to Thailand (palm oil and vegetable), Vietnam (palm oil)Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 18. AEC 2015-Impact to the Food Industry In Labor free movement of skilled labour and technology. Malaysia rapid economic development cause shortest of skilled and low skilled workers 3 million foreign low skilled workers mostly from Indonesia, Philippines,Thailand,Cambodia and Vietnam, Malaysia hired skilled worker from Singapore Also export Malaysia skilled worker to Singapore.Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 19. AEC 2015-Impact to the Food Industry Technology Technology transfer through: Procument finished good from ASEAN country Equity participation in ASEAN viable project and business. Hiring professional and skilled worker for ASEAN viable project and business. Training in food related industry in ASEAN country Placement of Trade office and representative in ASEAN country to promote bilateral trade License for Contract Manufacturing and business among ASEAN country services Rules for Trade Pattern and Copyright accepted by ASEAN country.Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 20. AEC 2015-Impact to the Food Industry In Government’s Policy and Plan Since 2011, AEC has agreed to strengthen the position and increase the competitive edges of small and medium enterprises (SME) in the ASEAN region.[ Comprehensive Investment Area The ASEAN Comprehensive Investment Area (ACIA) will encourage the free flow of investment within ASEAN. The main principles of the ACIA are as follows[72] All industries are to be opened up for investment, with exclusions to be phased out according to schedules National treatment is granted immediately to ASEAN investors with few exclusions Elimination of investment impediments Streamlining of investment process and procedures Enhancing transparency Undertaking investment facilitation measuresFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 21. AEC 2015-Impact to the Food Industry In Government’s Policy and Plan Export-Oriented Economy Foreign Investment Policy Vision 2020 Government Transformation Programme National Food Policy Malaysia as World Halal HubFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 22. AEC 2015-Impact to the Food Industry In Government’s Policy and Plan Malaysias exports grew by 11.1% to USD $19.6 billion whereas imports grew by 9.4 % USD15.9 billion in April 2011 According to the world investment report 2011 released recently by the United Nations Trade and Development Agency, the foreign direct investment to Malaysia soared 536 per cent to USD $9.3 billion in 2010, constituting the highest record in the history. driven by the free trade agreements and strong pressure from relevant countries to open up our marketFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 23. AEC 2015-Impact to the Food Industry In Market Opportunities & Challenges The global market for food ingredients was estimated to be worth roughly USD25bn (€18.5bn) in 2007, and is expected to reach $30bn by 2010, demonstrating a growth rate for the market of 5- 6% year on year. Globally, food ingredients is a multibillion dollar industry and is fast expanding, growing in sync with the processed food market. Innovation in the food and beverage market, especially in processed foods, has created innumerable opportunities for new product development in the ingredients market too.Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 24. Fi Global Market Consultants Corner Aditi Basu/Frost & Sullivan The global market for food ingredients was estimated to be worth roughly $25bn (€18.5bn) in 2007, and is expected to reach $30bn by 2010, demonstrating a growth rate for the market of 5-6% year on year. Globally, food ingredients is a multibillion dollar industry and is fast expanding, growing in sync with the processed food market. Innovation in the food and beverage market, especially in processed foods, has created innumerable opportunities for new product development in the ingredients market too. Growing urbanization, changing lifestyles and the need for convenient healthy foods have ushered in a new category of functional and health foods that claim to be fortified with certain new-age health ingredients offering functional health benefits over and above the basic nutritional value of the foodstuff.Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 25. AEC 2015-Impact to the Food Industry In Market Opportunities & Challenges Malaysia offer attractive package for halal Fi manufacturing development Malaysia multicultural country offer best platform for Halal Fi market R & D Malaysian government is encouraging world halal food manufacturer especially Fi to takes advantage of USD 2.1 trillion potential market through Malaysia. MAFPA offer helping hand to help Fi manufacturer to develop halal niche Fi in MalaysiaFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 26. AEC 2015-Impact to the Food Industry In Working Together For Greater Opportunities & Challenges We  in  Malaysia  share  your  values  and  your  aspirations,  and  we  urge  you  to  work  with  us. The  decision had made ASEAN "a friend, not an adversary;  a colleague, not a competitor; a partner, not a rival",  All ASEAN countries and their peoples would be able  to  fulfil  their  true  potential  and  secure  their  place  at  the forefront of the new global economic societyFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 27. Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 28. Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 29. Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 30. Fi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand
  • 31. THANK YOUFi Asia Conference 2011 Malaysia Food Processing and Packaging21st Sept 2011 Entrepreneurs Association (MAFPA)Bangkok Thailand