Bridges: What is JETRO’s role in Kuala Lumpur?
Onozawa: JETRO (Japan External Trade Organization) is a Japanese government-related organization under the Ministry of Economy, Trade and Industry in Japan that promotes trade and investment between Japan and the rest of the world.
JETRO KL’s role is to support Japanese SMEs and startups export their products and services to Malaysia, while promoting Foreign Direct Investments (FDIs) into Japan. We also support Japanese companies which are already based in Malaysia through our surveys and research as well as consultation services. Another important role that we have been assigned recently is to promote investment of Japanese big firms into high value-added industrial area in Malaysia and to tie up with Malaysian companies in Digital Transformation (DX) area.
What current and future projects would you like to share with our readers?
JETRO KL has been actively involved in the Digital Transformation (DX) field to support the startup ecosystem in both countries. We have the “JETRO Global Acceleration Hub” to support the overseas expansion of Japanese startups into Malaysia tech ecosystem, aiming to promote innovative collaboration between Japanese startups and companies in Malaysia. JETRO KL has also been collaborating with Sunway Innovation Labs (a.k.a. Sunway iLabs) under the “DX Accelerator Program” to provide direct access to one of Malaysia’s largest conglomerates, Sunway Group’s innovative ecosystem to accelerate their potential and growth.
For Malaysian startups, we have exclusive platforms such as “J-Bridge” and “Invest Japan” to help Malaysian companies find Japanese big and small companies as their business partners and to expand to Japan. In addition, JETRO KL is currently conducting market research to look into the Malaysian startup ecosystem, particularly those that are supported by the universities. This report in Japanese would be released by early next year.
Under the healthcare industry, JETRO KL has organized a hybrid seminar last February and invited 2 Malaysian healthcare companies to be our guest speakers, focusing on rehabilitation and preventive healthcare. We plan to organize another seminar early next year before our annual healthcare business matching event commences.
Not forgetting the environment, JETRO KL has also been promoting decarbonization initiatives. We have published a research report listing 89 key players working on decarbonization in Malaysia. We have disseminated the list to Japanese companies looking for technical cooperation with these local players. Based on this basic information, JETRO would like to promote further business matching between Malaysian and Japanese companies to contribute towards carbon neutral goals in both countries.
Following Malaysian government’s announcement on the “Industry4WRD” national policy in October 2018, the Malaysian government represented by MITI, MIDA and SIRIM, as well as the Japanese government represented by the Embassy of Japan, JACTIM and JETRO, have come together to form the “Malaysia-Japan Collaboration on Smart Manufacturing” in May 2019, comprising 3 phases of collaboration. Under Phase 1, SIRIM and JETRO conducted 10 business seminars held across 5 states across the country; 2 online business matching workshops involving nearly 50 business meetings between Malaysian SMEs and Japanese solution providers were also carried out under Phase 2; and for Phase 3, JETRO and the Federation of Malaysian Manufacturers (FMM) co-organized the “Malaysia-Japan Industry 4.0 Summit 2023” which attracted more than 400 participants in total.
In the Food and Beverage industry, JETRO has been implementing many projects in response to the growing demand and sophisticated market needs in Malaysia. In particular, we recognize the significant possibility for Halal businesses between Malaysia and Japan, based on the keen interest demonstrated by the Japanese companies recently. In line with this, we exhibited sample showcase in the ‘Japan Pavilion’ of MIHAS* in this September with 80 halal-certified Japanese food products of 20 companies. After MIHAS, we will continue to conduct business matching in Halal area through showcasing samples at JETRO KL office.
*MIHAS = Malaysia International Halal Showcase
How would you describe the current relations between Japan and Malaysia?
With over 1,600 Japanese companies operating in Malaysia, we believe the business relationship between Japan and Malaysia will continue to strengthen and diversify. Most of the major Japanese manufacturing companies have already established their presence in Malaysia since the 1970s while recent investments in the manufacturing sector for both new and expansion projects are moving towards high value-added activities.
At the same time, under Malaysia’s steady economic growth, consumers’ purchasing power has been increasing. In recent years, there has been a significant increase in the number of Japanese companies interested to explore potential markets in the services sector. The halal market is one of them. Meanwhile, in the field of digital transformation, we are already seeing increasing number of successful business developments in Malaysia under the partnership between Japanese digital companies and Malaysian partners.
What message would you like to share regarding the importance of the Japan-Malaysia partnership for the region?
Looking at the results of JETRO’s annual survey conducted end of last year, 96% of Japanese companies consider to continue their business in Malaysia and around half of them would like to expand their business in the next one to two years. In fact, the same survey revealed that 70.8% of Japanese companies based in Malaysia highlight the ease of language and communication as the main advantages of doing business in Malaysia.
At the same time, Malaysia’s economy has been growing year by year and is currently heading towards becoming a high-income nation. Hence, it is important for both Japanese and Malaysian companies to recognize new potential areas and possibilities in our partnership.
Further high value-added manufacturing especially in Electric and Electronics areas is one possible collaboration area since Malaysia has a certain volume of supporting industries as well as high level of industrial human resources in this area. B. DX area is another new area for our further cooperation. As a multi-ethnic, multilingual country, Malaysia is an ideal test bed for Japanese digital companies planning to expand to the ASEAN region. C. Carbon neutral is a promising area for both countries which have the same goals to achieve zero carbon by 2050. D. Some Japanese companies are considering Malaysia as a hub for their business expansion in ASEAN and the world, particularly in logistics and halal industrial area.
Last year, we celebrated the 65th anniversary of the establishment of diplomatic relations between Japan and Malaysia as well as the 40th anniversary of the Look East Policy. We have come a long way to establish the close ties that we now enjoy. I hope that more Japanese companies, particularly the SMEs would seek the assistance of JETRO to expand their footprints to Malaysia, the strategic gateway to ASEAN.