Malaysia to Build Multimedia Corridor Despite Recession

By Julian Matthews

November 4, 1998 (KUALA LUMPUR) — The Malaysian government is pushing ahead with its plan to build the Multimedia Super Corridor although its economy will shrink by about 4.8 percent in 1998, for its first recession in 13 years.

Prime Minister Mahathir Mohamad said the project is crucial for the country to achieve his dream of attaining developed nation status by 2020.

However, the project’s lofty plans to turn a 750-sq.-km former rubber and palm oil estate into an industrial park have come under criticism amidst the political and financial crises.

Mahathir, who assumed the position of finance minister following the sacking of deputy premier Anwar Ibrahim, presented a national budget on Oct. 23 in deficit for the first time in six years.

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Subcontractors Bank On Telecom, Networking Orders

By Julian Matthews

Local subcontractor manufacturers are expecting between 25% and 30% growth this year despite the Asian financial crisis.

Growth is spurred by increased demand for a variety of linear and mixed-signal electronic components particularly for the telecommunication and networking industries.

Carsem (M) Sdn Bhd, a subsidiary of Malaysian Pacific Industries Bhd, is investing about US$90 million for equipment and expansion for this fiscal year.

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Super Corridor Ahead of Schedule Despite Crisis

By Julian Matthews

Malaysia’s Multimedia Super Corridor (MSC) is progressing ahead of schedule and will not be delayed by the regional economic turmoil, said Prime Minister Mahathir Mohamad.

“There is no reason to put this project on hold because a lot of the expenditure is coming mainly from the companies participating,” he said.

Since the economic downturn in July 1997, the ringgit has devalued more than 30% against the US dollar, and several factories in the country have shut down, downsized their operations or retrenched staff.

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Slowdown Shaves IT Growth to 12 percent

By Julian Matthews

The Asian financial meltdown has begun to take its toll and the signs of a slowdown in 1998 are already showing.

O K Lee, chairman of the northern branch of the Federation of Malaysian Manufacturers, said a number of manufacturers have begun to downsize their operations and have frozen recruitment, controlled overtime, and reduced shifts.

“The slowdown has mainly affected companies which have high imports of equipment and raw materials and are dependent on local and regional markets,” he said. He added that companies that have taken out foreign loans are also in a bind.

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