E

E-commerce in Malaysia grew sharply in 2000. Revenue was estimated at RM 1.6 billion (US$ 425 million), up some 600 percent over the previous year. E-commerce is projected to reach RM 11.4 billion (US$ 3 billion) by 2004 or 60 percent[1].

As a result of fair trade and investment policies, foreign direct investment in Malaysia reached US$6 billion in 1997, but then dropped to US$3.8 billion in 1998 due to the Asian economic crisis. In 1999, flows of foreign direct investment again increased by 31 percent and GNP rose 5.4 percent—much faster than initially forecasted. This increase was led by manufacturing, particularly in ICT-related electronics (for export), and this sector is now the key driver of growth in the economy. In 1999, the contribution of the ICT sector to GNP was approximately 36.5 percent.

Incentives and projects are underway to foster entrepreneurship and business efficiency. The government provides financial, and non-financial incentives to Malaysian businesses. Financial incentives include zero income tax for a period of 10 years, R&D grants, and a 100 percent investment tax allowance on new investment in the MSC. Non-financial incentives include unrestricted employment of foreign knowledge workers, no restrictions on global capital, and limited restrictions on ownership[2].

The E-Business cluster aims to shape an electronic business environment competitive with the major economic powers. This cluster has an enormous potential market that could be one of the driving forces for future economic growth.

E-commerce is transforming the way in which business was conducted - it enables businesses to become more adaptive and responsive. E-commerce aims to provide more efficient and better quality services to the community, and encourage the business and community to accept electronic business as an integral part of their daily lives[3].

Since 1996, one of the MSC’s key strategic thrusts has been emphasized on the development of small and medium enterprises (SMEs). The SMEs are seen as substantial contributors to economic growth as they create new wealth and job opportunities in the knowledge-based economy. As a result of MSC initiatives, as of April 2003, there were more than 1,850 Malaysian SMEs compared to less than 300 in 1996.

In recognizing the need to enhance the MSC’s efforts to develop Malaysian SMEs, the Government launched the Technopreneur Development Flagship (TDF) in November 2001. The lead agency driving the Flagship is the Ministry of Energy, Communications and Multimedia with Multimedia Development Corporation acting as the implementing agency for the Flagship.

[1] International Telecommunication Union

[2] Accenture http://www.opt-init.org/framework/pages/appendix3Case5.html

[3] http://www.msc.com.my/msc/flagship.asp#ebusiness

[4] http://www.msc.com.my/msc/flagship.asp#ebusiness

Quick Links

E-Commerce


Home About Malaysia Size of Domestic IT Market National ICT Policies Information Policy Computing & Internet Diffusion Domestic IT Production E-Commerce and E-Business E-Government IT Workforce IT Geographics IT Financing Telecom Infrastructure Telecom Regulation & Liberalization Analysis Links INITEB Home Page		Quick Links Asia E-Commerce Report 2000 PDF E-Commerce Overview Download Adobe Acrobat E-Commerce E-commerce in Malaysia grew sharply in 2000. Revenue was estimated at RM 1.6 billion (US$ 425 million), up some 600 percent over the previous year. E-commerce is projected to reach RM 11.4 billion (US$ 3 billion) by 2004 or 60 percent[1]. As a result of fair trade and investment policies, foreign direct investment in Malaysia reached US$6 billion in 1997, but then dropped to US$3.8 billion in 1998 due to the Asian economic crisis. In 1999, flows of foreign direct investment again increased by 31 percent and GNP rose 5.4 percent—much faster than initially forecasted. This increase was led by manufacturing, particularly in ICT-related electronics (for export), and this sector is now the key driver of growth in the economy. In 1999, the contribution of the ICT sector to GNP was approximately 36.5 percent. Incentives and projects are underway to foster entrepreneurship and business efficiency. The government provides financial, and non-financial incentives to Malaysian businesses. Financial incentives include zero income tax for a period of 10 years, R&D grants, and a 100 percent investment tax allowance on new investment in the MSC. Non-financial incentives include unrestricted employment of foreign knowledge workers, no restrictions on global capital, and limited restrictions on ownership[2]. The E-Business cluster aims to shape an electronic business environment competitive with the major economic powers. This cluster has an enormous potential market that could be one of the driving forces for future economic growth. E-commerce is transforming the way in which business was conducted - it enables businesses to become more adaptive and responsive. E-commerce aims to provide more efficient and better quality services to the community, and encourage the business and community to accept electronic business as an integral part of their daily lives[3]. Since 1996, one of the MSC’s key strategic thrusts has been emphasized on the development of small and medium enterprises (SMEs). The SMEs are seen as substantial contributors to economic growth as they create new wealth and job opportunities in the knowledge-based economy. As a result of MSC initiatives, as of April 2003, there were more than 1,850 Malaysian SMEs compared to less than 300 in 1996. In recognizing the need to enhance the MSC’s efforts to develop Malaysian SMEs, the Government launched the Technopreneur Development Flagship (TDF) in November 2001. The lead agency driving the Flagship is the Ministry of Energy, Communications and Multimedia with Multimedia Development Corporation acting as the implementing agency for the Flagship. The core objectives of the Flagship are to: To spawn and nurture a critical mass of strategic high technology industries such as ICT, Biotechnology and other life science start-ups[4] To facilitate the growth of existing ICT SMEs into world-class companies For more information, log on to www.technopreneur.net [1] International Telecommunication Union [2] Accenture http://www.opt-init.org/framework/pages/appendix3Case5.html [3] http://www.msc.com.my/msc/flagship.asp#ebusiness [4] http://www.msc.com.my/msc/flagship.asp#ebusiness