Business Times (Malaysia): UK investments in Malaysia to focus on services sector: “Oil and gas is another major sector which has seen strong participation from companies like Shell, which is listed on the London Stock Exchange. It is investing US$1 million (US$1 = RM3.80) a day into developing oil and gas fields and downstream activities, mainly off Sarawak. It invested US$400 million in the previous year.” (ShellNews.net) 10 Jan 05
RUPA DAMODARAN ..HL: BRITISH investments in Malaysia will be more focused on the services sector this year as global companies target the Multimedia
BRITISH investments in Malaysia will be more focused on the services sector this year as global companies target the Multimedia Super Corridor (MSC) to expand their shared services operations.
Director of Trade and Investment with the British High Commission, Gordon Reid, said the MSC's emergence as a regional information and communications technology hub, especially in shared services, has attracted the interest of many Fortune Global 500 companies, including HSBC Group, the Royal Dutch/Shell Group of Companies, British Telecommunications plc (BT) and the Axon group. "Outsourcing is an important area, and it is a trend of global companies to spread their operations and risks here," he told Business Times.
The MSC's appeal as a shared services centre expanded as AT Kearney ranked Malaysia third in their Offshore Location Attractiveness Index.
HSBC has set up a group service centre serving various functions, including financial services processing and call and contingency centres.
Reid said HSBC has recruited 1,800 people and is due to employ more to meet its target of 4,000 staff members, which makes it one of the largest employers in skilled jobs doing back office processing information technology operations for HSBC global.
Standard Chartered Bank has also set up its centre with 1,000 employees.
BT, which has 10 research centres in the UK and one in the US, has set up its first research laboratory in the Asia-Pacific region at the MSC to cater for wireless and mobile technology.
Axon, an applications consultant for SAP software set up its Asian hub at the MSC with 80 consultants.
"We have a host of engineering, manufacturing and business consultancies that are ready to use Malaysia as a base, and competition emerges as they look at neighbouring Singapore. "But Malaysia has an added advantage due to its infrastructure, skills, and the base is cheaper (compared to Singapore).
"British businessmen looking to China tell us that when they added up all the costs and risk factors, setting up a base for business in Malaysia for both the domestic and regional markets turns out to be cheaper than China and the risks are lower," he added.
Reid said Britain's biggest investments last year were in the services sector.
Tesco plc, Britain's biggest supermarket chain which has six hypermarkets in the country since the opening of its first store in 2002, has plans to expand its network further this year.
On the education front, Reid said Nottingham University has invested GBP12 million (GBP1 = RM7.20) to set up a new campus in Semenyih, Selangor. The campus, expected to be ready for the 2005/6 academic year, will provide a high-quality living environment for students and will have state-of-the-art teaching and learning facilities.
Its move is likely to encourage other major British universities to set up similar campuses here to take advantage of the vast potential of tertiary education in Malaysia.
Oil and gas is another major sector which has seen strong participation from companies like Shell, which is listed on the London Stock Exchange. It is investing US$1 million (US$1 = RM3.80) a day into developing oil and gas fields and downstream activities, mainly off Sarawak. It invested US$400 million in the previous year.
Reid said Malaysian exports to Britain totalled GBP1.5 billion for the period up to September 2004, a 10 per cent increase compared to the previous year.
"Malaysian exports are heading towards more than GBP2 billion, which means Malaysia is selling to us as much as India does." Britain's exports to Malaysia topped GBP1 billion in 2003, and Reid expects the numbers to remain the same for 2004, bringing total trade up to RM22 billion.
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