Malaysia in good position to benefit from Japan’s stimulus package: Ambassador

29 May 2020 / 00:53 H.

KUALA LUMPUR: Asean member states, particularly Malaysia, will be in good position to reap benefits from Japan’s economic stimulus package due to its close proximity to Japan economically and historically, besides having extensive Japanese business network, said Japan’s Ambassador to Malaysia Hiroshi Oka.

Oka said Malaysia – being a politically stable country, having people with good command of English, and high value-added supply chain to produce spare parts for aircraft and medical equipment – can make the country an ideal destination for Japanese companies to diversify their production bases.

“There is an urgent need to strengthen the resilience of the global supply chain in the wake of Covid-19 pandemic and make it less vulnerable to any re-emergence of deadly infectious diseases in (the) future.

“In order to strengthen the resilience of the global supply chain, it is important to have diversification in manufacturing bases.

“This means, instead of putting all the production facilities in one country, diversifying the production bases will make production processes less vulnerable (to disruption due to any future infectious diseases),“ he said, adding that Japan’s subsidy programme doesn’t have any particular country in mind at the moment.

The ambassador disclosed this to Bernama when responding to media reports that Japan will launch a subsidy programme to encourage domestic manufacturers to transfer their production bases to Asean as the Covid-19 pandemic has greatly disrupted their supply chains heavily dependent on China.

Foreign media has reported that Japan has earmarked ¥243.5 billion (RM10.2 billion) of its record economic stimulus package, compiled to try to offset the devastating effects of the pandemic, to help its manufacturers to diversify the production bases to strengthen their supply chain resilience, as the coronavirus disrupts supply chains between the major trading partners.

Oka said in order to attract foreign investments, Malaysia should give tax incentives besides allowing movement of foreigners to facilitate business activities locally.

The envoy also said there are 1,400 Japanese companies in Malaysia, of which about half are in the manufacturing sector.

“Japan is the largest cumulative investor in manufacturing sectors in Malaysia and these Japanese manufacturers produce some 348,000 employment opportunities,” he said. – Bernama

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