Canadian
Business in Malaysia and South East Asia
Remarks to
the Malaysian Canada Business Council by
Hon. David
Kilgour, Secretary of State (Asia-Pacific)
and
Member of
Parliament for Edmonton Southeast
Mandarin
Oriental Hotel
Kuala Lumpur,
Malaysia
June 20,
2002
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Yesterday,
we celebrated Canada Day at the High Commissioner's
home. Canada Day, for us, is a day to celebrate
the cultural/religious/linguistic diversity
that makes our country one of the best in
the world. This morning, let's talk about
some of the diverse successes and challenges
of Canadian companies in Malaysia and what
our government can do to help.
CANADIAN
SUCCESSES
Let's start
with some good news:
·
Harris Corporation of Montreal has just
signed a $60 million contract to supply
their local Malaysian partner with wireless
broadband equipment,
·
Bombardier is close to signing a contract
to supply 70 supplementary cars to PUTRA,
Kuala Lumpur's Light Rail Transit system.
·
The Malaysian government is considering
the purchase of two Bombardier CL-415 amphibious
aircraft to improve aerial fire-fighting
and maritime search and rescue.
·
Finally, CAE will provide marine control
systems for the six ships of the Royal Malaysian
Navy's Offshore Patrol Vessel programme,
a contract worth $58 million.
There are
also a number of Canadian information and
communications technology firms active in
Malaysia:
·
Corel Corp., of Ottawa, is especially active
in the Malaysian education and corporate
marketplace.
·
Montreal-based Eicon Tech is enthusiastic
about its collaborative promotions with
Telecom Multimedia and the plans to create
a regional market from Australia to India.
·
Agra Spectrocan has a 5-year service and
maintenance contract for spectrum management
with Malaysia's regulating authority.
These sorts
of success stories add to the almost $2.5
billion in two-way trade between Canada
and Malaysia...and the opportunities seem
boundless. Malaysia has sound macro-economic
fundamentals, a transparent regulatory framework,
a strong financial system, a liberal trading
regime and political stability. Just as
importantly, it has an active business council
that promotes the interests of Canadian
and Malaysian businesses here and at home.
The Government of Canada values your contribution.
The efforts of organizations such as yours
are critical to the success of Canada's
international trade policy.
These are
the successes. Now lets look at some challenges.
In reviewing our trade and investment strategy
for South East Asia, we've identified three
key areas:
1. We need
to look beyond countries in isolation, and
start looking at South East Asia as a whole.
2. We need
some solid PR work. We need to:
(a) address
misperceptions of South East Asia among
Canadians and,
(b) rebrand
Canada in the region.
Let's look
at each of these in turn.
SOUTH EAST
ASIA AS A REGION
Canada and
Canadian business need to see South East
Asia more clearly as a region. Yesterday
for example, at a working lunch with Malaysian
officials from the Ministry of Foreign Affairs,
we heard them promote the idea of ASEAN
as a trade region. In yesterday's New Straits
Times, moreover, it was said that many businesspeople
believe that “the ASEAN Free Trade
Area along with free trade agreements will
have a positive impact on business in the
long run.”
In terms
of trade statistics, looking at it from
a country to country perspective, Canada's
trade with a country like Vietnam or the
Philippines may not seem all that substantial.
But by the end of 2000, trade and investment
between Canada and the ASEAN countries was
over $10.4 billion - more than 17 times
what it was in 1977.
But it isn't
just about trade figures. All of Canada's
foreign policy priorities are at play in
the region - things like job creation, rule
of law, transparency, accountability and
good governance. Good governance is good
for business, translating into economic
advancement, investment and growth.
Unfortunately,
it works both ways. One country with a problem
can reflect poorly on the entire region.
The case of Manulife Financial in Indonesia
is a dismaying example. As you probably
all know, in an indicated unfathomable decision
by an Indonesian court, Manulife - a flagship
Canadian company – has been declared
bankrupt and is at risk of losing millions
in investment.
But it's
not just Manulife that will suffer. The
fallout could be enormous. The country stands
to lose 4,000 jobs. 400,000 policy-holders
are at risk. Just as importantly, the whole
situation could seriously undermine investors'
confidence in the entire region. Investor's
aren't necessarily going to see this as
strictly an Indonesia problem. In some people's
eyes, if it can happen there, it can happen
anywhere. In face, tomorrow, I'm going to
deliver this message in the strongest terms
to the Indonesian government.
REBRANDING
SOUTH EAST ASIA
It's not
surprising then that South East Asia has
received some bad publicity over the last
little while. Since September 11, we’ve
seen front page news stories about Indonesia
being the weakest link in the war against
terrorism. We've seen stories tying Malaysia,
Singapore and the Philippines into major
terrorist networks…not the best PR
for South East Asia. The reality is South
East Asia is a region of relative economic
stability and enormous potential. On the
terrorism front, individually and as a region,
these countries have taken great strides
to condemn the terrorist attacks and fight
terrorism in the region. Canadian business
people and Canadians generally need to know
this.
REBRANDING
CANADA
Just as South
East Asia's reputation is suffering since
September 11, there is work to be done in
updating Canada's brand. Earlier this week
for example, while we were visiting CommunicAsia
in Singapore, I was told that Canada is
seen more as a destination rather than a
business partner or a place to invest. Canada
is a modern, high tech, innovative and competitive
country.
Our ICT industry, for example, has attracted
the attention of investors from all over
the world. Canadian telecommunication companies
regularly form strategic alliances with
international firms to increase distribution
and foster new product development. Our
regulatory environment makes it easy for
Canadian businesses and their international
partners to move innovative new products
and services into the global marketplace.
Our e-commerce and cybersecurity laws encourage
Canadian companies to take advantage of
the opportunities presented by e-commerce,
while protecting the confidentiality, integrity
and security of data and computer networks.
South East Asians need to know this.
A federal,
government initiative to rebrand Canada
is already well underway. This is, in fact,
one of the aims of my trip. But in the long
run, success depends on the active involvement
of Canadian business people.
Enough from
me though. I'd like to hear from you:
What are
the challenges you face in doing business
in Malaysia and in the region?
·
How can Canada’s government help you
overcome them?
·
For our Malaysian partners, how do you see
Canada?
·
Do you think Canada’s brand is accurate
in south East Asia?
·
If no, what can we do about?
·
Do you think the Manulife case will affect
investors’ perception of the region?
Essentially,
we’re here to listen. How can we best
do that?
Thank you
for hosting this breakfast. I look forward
to your views.
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