DOMESTIC DIRECT INVESTMENT DOMESTIC DIRECT INVESTMENT (DDI) INITIATIVES(DDI) INITIATIVES

MALAYSIA PRODUCTIVITY CORPORATION

HALAL INDUSTRY DEVELOPMENT CORPORATION

MALAYSIA AUTOMOTIVE INSTITUTE

MITI & ITS AGENCIES

2

MITI & ITS AGENCIES

Deputy CEO (Manufacturing &

Services Development II)

Deputy CEO (Manufacturing &

Services Development I)

Chief Executive Officer

Chairman MIDA’S NEW ORGANISATION

STRUCTURE

Manufacturing Development

(Resource)

Transportation Technology

Production & Advanced

Engineering

Chemical & Advanced Material

Life Sciences & Medical

Technology

Manufacturing Development

(Non-Resource)

Infrastructure, Utilities & After

Sales

Services Development

(I)

Investment Info. Centre

Services Development

(II)

Investment Analysis & Info.

Database

Strategic Planning

Management Services

Administration

Finance Mgmt.Licence & Incentives

Compliance & Monitoring

Domestic Investment

Tariff

E&E

Food Tech. & Sustainable Resources

Investment Ecosystem

Healthcare, Education & Hospitality

IPAs Coordination,

ICM Secretariat & Pipeline TrackingNational

Investment Secretariat

Technology & Business Frontier

IT System Development

Metal & Metal Alloy

Building Technology &

LifestyleLegal & Govt. Relations

Internal Audit

Investment Comm.

Capacity Development

Mgmt. & Industry Talent

Foreign Investment

Coordination

Senior Executive Director (Strategic Planning &

Investment Ecosystem)

Investment Promotion

Strategic Planning &

Policy Advocacy

Clean Tech. &

Environment Mgmt.

IT & Comm. Services

Business & Professional

Services

Oil & Gas

3

Regional Establishment,

Logistics & Supply Chain

R&D and Design

Human Resource

Mgmt.

4

Foreign Direct Investment Domestic Investment Business matching Manufacturing Services

Manufacturing licenses Tax incentives Expatriate posts Duty exemption OHQ, RDC, IPC and R&D status

EvaluationEvaluation

Follow-up /Follow-up /MonitoringMonitoring

PlanningPlanning

Planning for industrial development Recommend policies and strategies on industrial

promotion and development Formulation of strategies, programmes and

initiatives for international economic cooperation

Assist companies in the implementation and operation of their projects

Facilitate exchange & co-ordination among institutions engaged in or connected with industrial development

Advisory Services

PromotionPromotion

Functions of MIDA

Investment Targets under Economic Transformation Programme (ETP), by 2020

The Mission

73% DDI(RM953 billion)

27% FDIRM1.4 trillion

8%Public

Investments

92%(RM1.3 trillion)

Private Investments

* Industrial Master Plan 3 (IMP3) Investment Ratio, DDI:FDI is 60 : 40

6

Domestic Direct Investment (DDI) Initiatives

Domestic Investment Strategic Fund (DISF)Domestic Investment Strategic Fund (DISF)Incentives for Acquiring a Foreign Company Incentives for Acquiring a Foreign Company for High Technologyfor High TechnologyIncentives for Small Scale CompaniesIncentives for Small Scale CompaniesIncentives for Companies in Production Incentives for Companies in Production (Desirous Issue)(Desirous Issue)Incentives for Merger Among Malaysian Incentives for Merger Among Malaysian Services ProvidersServices Providers

D.I.S.F

RM1 billion for the fund under the RM1 billion for the fund under the 1010thth Malaysian Plan Malaysian PlanProvided under the Customised Provided under the Customised Incentive Scheme, Section 127, Income Incentive Scheme, Section 127, Income Tax Act 1967Tax Act 1967

7

Objectives of the Fund

To accelerate the shift of Malaysian-owned companies in targeted industries to high value-added, high technology, knowledge-intensive and innovation-based industriesTo enable domestic investors to develop new sources of competitive advantage and to become active participants in the global ecosystems of industries. To assist capable Malaysian companies to make the quantum leap required in driving the national investment agenda in transforming the economyThe fund is not a business start-up fund but it is applicable to local companies which have new/additional investments

8

Priority Sectors

9

AerospaceMachinery & Equipment Medical Devices

Services including Design, R&D, testing, quality and standard certification, technical and skills training, engineering services, and logistics service providers

Other industries, on a case by case basis

PharmaceuticalsAdvanced ElectronicsRenewable Energy

Scope of the Fund

The fund will provide matching grants (1:1) on reimbursable basis to cater for expenditures incurred for the following activities:

Training of Malaysians R&D activities carried out in MalaysiaLicensing or Purchase of New TechnologyObtaining International Standards/Certification Modernisation and upgrading of facilities and tools to undertake manufacturing or services activities for Multinational Corporations (MNCs) and Malaysian conglomerates (Outsourcing activities)

10

Definition of Outsourcing: A subcontracting process that involves manufacturing, manufacturing related services, business services and delegation of some/all operations to an external entity, usually specialised in that operation.

Eligibility

11

New and Existing companies in the Manufacturing & Services New and Existing companies in the Manufacturing & Services sectors with Malaysian equity ownership of at least 60%sectors with Malaysian equity ownership of at least 60%

Incorporated under the Companies Act, 1965Incorporated under the Companies Act, 1965

For Training, R&D, International Standards / Certification and Licensing and Purchase of New Technology:

Eligibility

12

For Upgrading and Modernisation of Facilities for Outsourcing activities:

A subsidiary of an existing company operating in the relevant industryThe parent company must have proven track record in the relevant industry Effective equity of at least 60% owned by Malaysians;

New CompanyNew Company Existing CompanyExisting CompanyA company which undertakes reinvestments in the form of expansion / modernisation / diversification; The company must have the capability and proven track record in the relevant industry;Effective equity of at least 60% owned by Malaysians

Approved Projects under D.I.S.F.

13

RM114.2 millionRM80.8 million

RM39.1 million

RM2.65 millionRM238.3 million

A total of 40 projects

Electrical & Electronics

Machinery & Advanced Engineering

Life Sciences

Transport

Wood-based

Services

As at 31 July 2013:

ICT

RM1.5 million

R&D

Capital

International Standards/Certification

Licensing & Purchase of New/High Technology

R&D

Training

Training of Malaysians

Courses such as product technology, process technology, equipment technology, equipment maintenance, quality control, tools & facilities and other training related to the approved project.

Motivational courses / workshops / seminarsLanguage coursesManagement / Marketing coursesFurther study (Postgraduate; PHD / Masters)Training related to safety

Types of TrainingTypes of TrainingPre-operational / Operational TrainingOn-the-job TrainingValidationD&D and R&DIn-house Training (Internal, External or Overseas

Trainers)External Training (within Malaysia)Overseas training

14

EligibleEligible Not EligibleNot Eligible

Based on Guideline on Training Grant under Strategic Fund

Research & Development

Definition of R&D – systematic or intensive study carried Definition of R&D – systematic or intensive study carried out in the field of science & technologyout in the field of science & technology

Improvement of materials, devices, products, produce or processesDesign, Development and Prototyping

Quality Control of products, or routine testing of materials, devices, products or produceResearch in social sciences or humanitiesRoutine data collectionEfficiency surveys or management studiesMarket research or sales promotion

EligibleEligible Not EligibleNot Eligible

15Based on Guideline on R&D Grant under Strategic Fund

Eligible ExpenditureEligible Expenditure

Special machinery / equipment which is only used in the relevant industry. Special production machines can be considered if these are additional machines and not replacing existing machines; whereby these machines are required to penetrate new markets or industriesSpecial machinery / equipment which is required by MNCs / Malaysian conglomerates for vendors to undertake outsourcing activities

Normal production machinery / equipment which is used in the general production lineNormal testing machinery / equipment

Non-Eligible ExpenditureNon-Eligible Expenditure

16

Purchase of Machinery and Equipment for Modernisation and Upgrading of Facilities and Tools for Outsourcing activities

17

The fund covers technology acquisition through:The fund covers technology acquisition through:

PatentDesignBlueprints Manufacturing/Services Know-HowTechnical support

Licensing or Purchase of New/High Technology

Technology Licensing; andAcquisition of Technology

Eligible Cost of Licensing / Acquisition of Eligible Cost of Licensing / Acquisition of Technology :Technology :

Note: Eligibility does not include costs of acquisition of trademark, copyright and proprietary information

Submission

18

Thank youThank you

19