In Part 4 of our article we covered human resource development, technology adoption and innovation, support infrastructure and other initiatives to enable them under the 12th Malaysia Plan (12th MP).

In this fifth and final part we will cover initiatives to boost digitalisation and advanced technology. These initiatives address four priority areas A, B, C and D, namely Advancing Digital Economy, Mainstreaming Digitalisation for Inclusive Development,   Accelerating Research, Development, Commercialisation and Innovation and Capitalising on Advanced Technology Potential

The 12th MP aims achieve a 25.5% contribution by the digital economy to gross domestic product (GDP), 10.5% by e-commerce, 8% average growth rate of digital content export, the creation of 200 items of intellectual property, 100% 4G coverage of populated areas, broadband speeds of over 100Mbps, fixed broadband access by nine million premises by 2025.

To enable inclusive development, the 12th MP aims to have 90% of citizens an Internet users, provide 4,323 broadband points-of-presence in rural areas, have 50 locally accredited sharing economy platforms, and 100% urban and rural household Internet subscriptions by 2025.

To drive research, development, commercialisation and innovation the 12th MP aims for 25% gross expenditure on research & development (GERD) to GDP, 70% business expenditure on R&D to GERD, 130 number of researchers per 10,000 labour force, 50% experimental development research expenditure to GERD, 2,000 patent applications by Malaysians, 40.4% multi-factor productivity contribution to GDP growth, for Malaysia to rank amongst the top 20 in the Global Innovation Index, for 500 products or solutions to be commercialised through the National Technology and Innovation Sandbox (NTIS) and Malaysia Commercialisation Year (MCY) by 2025.

Drawing upon the experiences of business and society’s reliance on digitalisation during the COVID-19 pandemic, the 12th MP will focus on providing an enabling environment for the growth of the digital economy, strengthen the provision of digital infrastructure and services, develop future-ready digital talent and position Malaysia as the ASEAN digital centre.

The first strategy to achieve the objectives of Priority Area A provides an enabling environment for the growth of the digital economy, including changes in mindset, policies and legislations, better technologies and infrastructure.

Measures will be undertaken to streamline digital governance, accelerate trade through e-commerce, expand the sharing economy and strengthen cyber security, to ensure that the public have equal access to opportunities in the digital economy.

The digital economy involves the production and use of digital technology by individuals, businesses and government, which will change the conventional approach of businesses and consumer practices in obtaining information, services and goods.

Key outcomes in the Malaysia Digital Economy Blueprint introduced in 2021, include an agile and data-driven government, innovative digital economy growth and seamless and extensive digital connectivity. It also expects to create suitable digital talent, establish a secure and trusted digital environment and produce a digitally responsible and inclusive society.

Other related initiatives include streamlining digital governance, accelerating trade through e-commerce, expanding the sharing economy and strengthening cyber security. These include providing encouragement, funding, facilities and guidance to micro-enterprises and small to medium enterprises (MSMEs) to adopt and increase their use of e-commerce and strengthened cybersecurity measures.

The second strategy under Priority Area A involves increased provision of digital infrastructure and services, equitable access to both fixed and wireless broadband infrastructure, and access to wider 5G coverage, thus facilitating adoption of emerging and alternative technologies and to provide an enabling environment for digital infrastructure development.

Telecommunication services will be made a public utility, like water and electricity, through uniform building by-laws and other relevant laws, whilst pay-per-use telecommunication services will be explored for greater public access and affordability.

Digital-by-default laws will be introduced to enable the provision of digital services, protect consumers and promote innovation and competition. The Universal Service Provision programme will be restructured to increase transparency, flexibility and participation by a wider range of firms in network deployment. Also, innovative funding mechanisms will be introduced by both commercial banks and government to encourage more investment in the development of digital infrastructure.

In facilitating adoption of emerging and alternative technology, for instance the development of smart cities will consider issues pertaining to energy consumption, public transport, waste and disaster management. In line with the National IR 4.0 (4th Industrial Revolution) policy, incentives will be provided for industries to share best practices, conduct trials and adopt the sandbox approach in encouraging the adoption of emerging and alternative technologies.

In providing an enabling environment for digital infrastructure development, the digital-by-default laws will help enable the development of digital infrastructure. The dedicated fund to expand the digital infrastructure will continue to be allocated to state governments and local authorities, whilst collaboration between federal and state governments will be strengthened, with speedier approval process at all levels.

Industry players will be encouraged to cooperate to ensure effective implementation of digital infrastructure projects. Investments in submarine cable landing stations will be intensified to improve fixed broadband services and promote the establishment of high-end data centres.

In developing future-ready digital talent to promote digital economy, a conducive ecosystem will be provided to enhance the digital skills of the workforce and sustainable and inclusive funding will be provided for this purpose.

Organisations and individuals will be encouraged to contribute towards digital reskilling and upskilling programmes, with incentives such as tax exemptions and matching grants available for industry players that provide digital education and training programmes, whilst companies will be encouraged to hire latent talent.

Expertise in cyber security will be strengthened to ensure a trusted, secure and reliable digital ecosystem, whilst more local talent will be developed to reduce dependency on foreign cyber security experts.

Industrial training will be enhanced and expanded to develop more digital content talent, with upskilling and reskilling programmes undertaken, particularly in animation, games and films that are globally marketable.

In nurturing digital talent, emerging digital technologies will be included in the school curriculum from an early age, with digital facilities in schools upgraded to ensure quality digital education, whilst adaptability skills, creative thinking and an innovative mindset will be nurtured.

Continuous professional development programmes will enable technical and vocational education and training (TVET) instructors to obtain professional certificates in digital-related fields, with the private sector encouraged to provide industrial training in the latest technologies.

Digital devices will be provided to students from selected groups through people-private-public partnerships and complimentary data plans will be provided to underprivileged students.

Efforts to make Malaysia the ASEAN digital centre will facilitate strategic and quality investment and digitalisation of MSMEs to broaden market access by improving the investment climate and encourage local and foreign venture capital to support a niche digital economy market, whilst new value propositions to drive strategic investments in the digital economy will be created.

The digital ecosystem will be improved to accelerate growth of the digital content industry, focused on developing talent, strengthening the industry value-chain and commercialising intellectual property.

An holistic financing mechanism will be provided to accelerate the adoption of digital solutions by MSMEs and to assist them and entrepreneurs amongst B40 households to acquire knowledge, secure insurance and to obtain micro-financing.

These will include fintech accelerator programmes to encourage the setting up of fintech businesses through networking, funding, mentorship and customer acquisition for early-stage fintech entrepreneurs to enable market expansion and accelerate innovation in digital financial services, whilst local businesses will be encouraged to obtain international certification to better commercialise digital products and solutions globally.

MSMEs will be encouraged to adopt digital technologies in production, processes and business services, mainly in the back-end of business operations. Training and awareness programmes will be implemented for MSMEs to enhance their readiness to digitalise and compete in the international market.

Appropriate digital solutions will be identified and proposed to match their level of business readiness through digital adoption incentives, and finance will be provided to accelerate their adoption of digital solutions and to expand their business internationally.

Priority Area B aims to mainstream digitalisation for inclusive development so the public have equal opportunities to participate and benefit from the digital economy, along with measures to expand digitalisation and improve digital governance.

The first strategy under Priority Area B is to expand digitalisation to broaden socioeconomic development and ensure digital inclusion, with an emphasis on facilitating digital opportunities, create more online business ventures and to promote greater public participation in the digital economy.

E-commerce activities will be expanded to scale up digital opportunities for vulnerable groups to exploit digital platforms, whilst one-stop service centres will be established to guide and facilitate MSMEs to take their business worldwide.

The sharing economy will enable better inclusiveness, with initiatives to facilitate growth of this economy, develop standards, set up new platforms and foster cross border activities. Awareness programmes will further promote participation in the sharing economy, especially among the vulnerable groups.

The second strategy is to improving digital governance for inclusive digitalisation to enable citizens to reap opportunities from the digital economy through improvement of data integration and privacy for more efficient service delivery to encourage an inclusive growth of the digital economy.

The sharing and use of data is crucial to the success of digitalisation, as this will improve decision-making, whilst protect data privacy. Data will be synchronised and shared amongst different stakeholders to promote data-driven activities including evidence-based decision making. This will enable targeted mechanisms for socioeconomic programmes and narrow the inclusion-exclusion gap.

Digital identity will facilitate the use of new technologies, e-commerce and other administrative processes, which will curb fraud and enhance the protection of individual rights.

As 87.1% of government services are provided online, 87.4% of the public are internet users and as broadband penetration in populated areas was 127.4% in the first quarter of 2020, the need for safe, secure and protected national digital identification becomes essential.

National digital identification (NDI) is a secure and trusted electronic credential for authentication, which can improve convenience, promote inclusivity, reduces access cost to services and enhances service delivery for online transactions. It employs digital signing which relieves users from having to remember different usernames and passwords for various services or carry multiple tokens for digital transactions.

Priority Area C involves the acceleration of research, development, commercialisation and innovation (R&D&C&I).

The first strategy under this area more greatly emphasises increased capacity and capability in R&D&C&I to create greater wealth. Here, national scientific, technology and innovation (STI) will be streamlined, funding for R&D&C&I will be increased and the translation of R&D and intellectual property into high value-added products will be encouraged to contribute to innovation-led growth.

The Malaysian Science, Technology, Innovation and Economy (MySTIE) Framework shown above involves increased funding for research, development, commercialisation and innovation, thus translating research and development as well as intellectual property into high value-added products through demand-driven R&D activities which will encourage technology funding from banks and venture capital providers.

The second strategy is to nurture and grow a sufficient, competent and quality STI talent pool to meet industry demand through non-formal scientific, technology, engineering and mathematics learning. The career path and remuneration of STI talent such as researchers, technology transfer officers and research managers will be improved to make these preferred career choices.

The availability of STI talent will be increased through public-private partnerships where industries co-fund scholarships, provide internships and apprenticeships and programmes to overcome the skills mismatch between graduates and industry.

Priority Area D is to capitalise on advanced technology potential and transform Malaysian talents from being mere technology adopters into technology developers and creators of advanced and deep technology applications, with efforts to gear up for the 4th Industrial Revolution (IR 4.0), including the adoption of emerging technologies in new product development.

Gearing up for the Fourth Industrial Revolution

IR 4.0 includes technologies in city planning and development, transportation and logistics, energy and utilities, resource management, urban systems resilience, government service delivery and others.

IR 4.0 technologies have contributed to containing the spread of COVID-19 and in mitigating the associated socioeconomic impact. The use of big data platforms that store information of residents from various sources, has enabled close contact tracing of diagnosed patients and has enabled relevant authorities to take prompt action to contain its spread. IR 4.0 and the digital economy will also enhance the resilience of the economy.

National strategies on artificial intelligence (AI) and blockchain will be developed to guide the growth of every sector in the economy. The National Internet of Things (IoT) Strategic Roadmap will be reinvigorated to ensure it fully benefits citizens, whilst IR 4.0 innovation parks will be established to provide a secure testbed and pool together IR 4.0 technology providers to stimulate new technology breakthroughs.

The parks, supported by 5G-enabled key services, cloud computing and supercomputers, will provide access for MSMEs and innovators to develop products and solutions utilising emerging technologies such as AI, IoT and big data analytics.

A conducive ecosystem will be created to harness the potential of IR 4.0 and a dedicated technology fund will be established to encourage companies, especially MSMEs, to adopt IR 4.0 technology.

Measures will be initiated to facilitate and enable society to reap the benefits of IR 4.0. Open data sharing infrastructure will be upgraded to enable accessibility of digital information by the public and private sectors, academia and citizens, whilst guidelines and regulations on personal data protection and data sharing will be strengthened to ensure data is safeguarded against cyber-attacks and unethical uses.

This article can also be found at https://www.enterprisetv.com.my/the-12th-malaysia-plan-technology-challenges-and-solutions-part-5/