Let’s do our part to help build Malaysia

Upping the ante on public service delivery

As a young student at Universiti Sains Malaysia, on a few occasions, I had to take the bus from Pudu Raya terminal in Kuala Lumpur to Penang. At the terminal, travel-worn commuters had to stomach choking exhaust fumes, brave filthy corridors and carefully navigate poorly lit, steep stairways to get to their respective platforms where smoke-belching buses sometimes arrived on time.

So when we ran the lab on Urban Public Transport in 2010, we were determined to transform the Pudu Raya terminal. At the Open day with the public, during my briefing, I even referred to the Pudu Raya terminal as “hell on earth” and that was why we wanted to transform it.

Our Prime Minister approved the lab recommendation and it was implemented.

Early this year, I decided to visit Pudu Raya again. I dropped in unannounced so I could observe the goings-on at the terminal without the standard ‘guided tour’. I had heard a lot about the improvements but wanted to test the user experience from an accessibility and service quality standpoint.

Getting there was seamless. My assistant and I boarded the Kelana Jaya Line LRT at KL Sentral and alighted at Masjid Jamek station where I switched to the Ampang Line, getting off at Plaza Rakyat, just a stop away.

A brisk 5-minute walk later we arrived at Pudu Raya. The place was unrecognisable.

Waiting areas are fully air-conditioned, clear signage everywhere and amenities to make it easy and comfortable for the public

Waiting areas are fully air-conditioned, clear signage everywhere and amenities to make it easy and comfortable for the public

As a result of the National Blue Ocean strategy, the concept of Urban Transformation Centre (UTC) was mooted a few years later and Pudu Sentral houses the Kuala Lumpur Urban Transformation Centre (UTC).

The UTC is part of the government’s transformation drive under the National Blue Ocean Strategy to build effective synergies between agencies, ministries, and different levels of government. Today there are six other UTCs – in Melaka, Perak, Pahang, Kedah, Sabah and Sarawak serving up to 3,000 people daily.

Led by the Ministry of Finance, this is indeed a prime example of how national transformation can add value to directly benefit the rakyat.

On top of the 39 government departments and commercial offices at the Kuala Lumpur UTC, there are also scores of private businesses – Kedai Rakyat 1Malaysia, Kedai Kain 1Malaysia and the country’s first Kedai Buku 1Malaysia. The UTC even has a gym, futsal court and a rock climbing wall for youths looking for clean and healthy fun.

Puduraya is more than just a bus station today. Now known as Pudu Sentral, the terminal also houses the Kuala Lumpur Urban Transformation Centre (UTC)

Puduraya is more than just a bus station today. Now known as Pudu Sentral, the terminal also houses the Kuala Lumpur Urban Transformation Centre (UTC)

For someone who knew what it was like before, the KL UTC centre is an impressive achievement. As expected, the place was bustling with folks running errands. But amidst the hustle and bustle, everything appeared to be operating in a systematic and orderly fashion. Clean and clear structures were in place making it conducive for civil servants to do a good job managing the demands made on them.

I stopped to talk to a Mr Wong from Bandar Tun Razak, who had just completed registering his second business. It had taken him more than three working days to register his business the first time seven years ago.

As a Klang Valley dweller myself, I could empathise with his grouses of traffic and parking issues. But this time round, it was all done within a day, and Wong also managed to squeeze in some time to renew his passport.

Indeed, UTCs are designed as one-stop centers for a range of government and private sector services. It is the one place you can go to get things done under one roof – applying for identity cards; renewing driving licenses, road tax and insurances; registering vehicles; renewing, filing and paying income tax; registering of GST to getting healthcare and dental treatment. There are also banks, postal and courier services plus zakat collection centers.

Around 9.6 million visitors have been using services at the UTC since its launch in 2012. I encourage sceptics and if you’re a doubting Thomas, to drop in and to see for yourself changes that have taken place in Puduraya.

Government has made leaps in executing improvements by being cognizant of public demands and collaborating as a whole to deliver quality services to people.

Pudu Raya of my youth, thank goodness, is a thing of the past.

There are 39 government departments and commercial offices at the Kuala Lumpur UTC

There are 39 government departments and commercial offices at the Kuala Lumpur UTC

 

I also took the opportunity to shop at the Kedai Rakyat 1Malaysia (KR1M) there

I also took the opportunity to shop at the Kedai Rakyat 1Malaysia (KR1M) there

 

Private Sector To Take Lion Share

Just last month, the 333-metre long “MT Mesdar” weighing in at 315,802 metric tonnes arrived from the Middle East to discharge crude oil at Malaysia’s first deep water storage terminal in Pengerang, Johor, marking the first time a Very Large Crude Carrier berthed there.

The first phase of the terminal developed by Pengerang Independent Terminals Sdn Bhd – a private-public partnership between Dialog Group Bhd, Holland’s Royal Vopak N.V. and the Johor State Government, has welcomed 143 vessels since April 2014. With the inclusion of the Pengerang terminal into Platts’ Singapore Price Assessment process on May 1, business is expected to pick up significantly.

The Pengerang Integrated Petroleum Complex spread over 20,000 acres is being built to ramp up our downstream play.

Malaysia is now a net importer of petroleum liquids. This project allows us to tip the balance by creating value to the downstream oil and gas value chain while leveraging its location to serve growing demand.

Pengerang is expected to attract RM170 billion in investment once the Master Plan is realised in the long-term, making it the biggest private sector investment in our history.

With current developments alone, Malaysia springboards closer towards its regional oil and gas hub ambition.

When we first held the oil and gas lab in 2010, Pengerang was a quiet fishing enclave. Dialog, enthusiastic to pursue the deep water terminal project struggled for many years to get it off ground.

A few crucial things needed to happen – land reclamation of 500 acres, construction of roads requiring various approvals and the relocation of graveyards, schools and places of worships.

These were complex tasks but through a series of constructive processes between the private sector, government and residents we moved forward.

The Pengerang storage terminal project characterises the very reason why the Economic Transformation Programme was mooted – to create a conducive business environment for private sector to flourish.

In order to appreciate where we are today, let’s step back a little. The Asian Financial Crisis in 1998 resulted in a fragile, jittery private sector. The Government had to dive straight in to prop-up the economy with public investment to ensure we did not slip into a recession.

Over the long-term, this model is unsustainable. When the global financial crisis of 2008 unfurled, we were reminded of the salutary lesson – to continue on the same trajectory would lead us deeper into the quagmire of debt and deficit.

Government alone cannot shoulder the burden of keeping the economy going without being adversely impacted. To build economic resilience for the long haul, private sector must carry the yoke and bring in the lion’s share of investment, and create high quality jobs.

Government can then focus on enhancing quality of life – uplifting people’s welfare and improving public services such as transportation, education and healthcare. We must also build buffers in the financial system to withstand external shocks.

Over four years since the launch of the ETP, private sector has risen to the occasion in an extraordinary fashion. The gap between public and private investment is widening with the latter taking the lead at 64% of total investment in 2013 compared to 52% in 2009 (see chart 1). We are inching closer towards the 92:8 investment ratio by 2020 led by private sector.

Chart 1: Private sector dominates investment ratio

Chart 1: Private sector dominates investment ratio

Realised private investment recorded a phenomenal five-fold growth to 13.9% (CAGR 2010-2014) compared to 3.1% (CAGR 2007-2010) (See chart 2).

Chart 2: Acceleration of private investment post ETP.

Chart 2: Acceleration of private investment post ETP.

MIDA’s pipeline of approved investments have been consistently exceeding the 10th Malaysia Plan’s RM148 billion annual target of approved investments. In 2011, we recorded RM154.6 billion, 2012 RM167.8 billion, 2013 RM216.5 billion and just last year, we hit RM235.9 billion. (See chart 3)

Chart 3: Approved investment post ETP launch

Investments are a precursor to economic growth. Since 2010, 1.8 million jobs have been created within the top 12 economic sectors. Malaysia today is considered at full employment, with unemployment in January 2015 at a healthy 3.1 percent.

With more Malaysians employed and businesses in an upswing, we have seen steady increase in the nation’s wealth. In 2014, our economy grew by six percent beating economists’ forecast of 4.5%-5.5%, with GNI per capita increasing from USD10,106 in 2013 to USD10,426 last year[1].

At the tail end of 2014, we were hit by another whammy – slumping global oil prices and ensuing weakening of the ringgit.

The way I see it, there are two ways in which a government can respond to a slowdown:
1. We can head down the path of austerity to cut deficit and debt. The flipside, it puts the economy into further recession OR
2. We can take the path to gradually reduce our fiscal deficit over the long-term and spur private sector to take on the role of driving the economy

I prefer the latter – recovery may be slower but it puts us on a mildly, comfortable enough expansionary course. It is also what we have done here in Malaysia. In addition to achieving strong GDP growth year-on-year since 2010, we have successfully reduced our fiscal deficit to GDP in the last four years from 6.6 percent in 2009 to 3.5 percent last year. Not too shabby.

There is investment potential yet unlocked within our economy waiting to be tapped by the private sector. I urge you to go forth and claim your lion’s share!

[1] GNI by Expenditure Components in Current Prices, BNM; Exchange rate 1USD = 3.273MYR (Exchange rate average from BNM for 2014)

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