MALAYSIAN INNOVATION LANDSCAPE

Vilasini Pillai, PhDNational Science and Research CouncilMalaysiavilasini@mosti.gov.my

CountryThe Federation of Malaysia comprises of Peninsular Malaysia, and the states of Sabah and Sarawak on the island of Borneo.

Geographic Location Situated between 2º and 7º to the North of the Equator line, Peninsular Malaysia is separated from Sabah and Sarawak by the South China Sea. In the northern part of Peninsular Malaysia lies Thailand, and in the south, neighbouring Singapore. Sabah and Sarawak are bounded by Indonesia while Sarawak also shares borders with Brunei.

Area330,290 square km

Population29 million

LanguageBahasa Melayu or Malay Language is the national language in use, but English is widely spoken. The ethnic groups also converse in the various languages and dialects.

EconomyManufacturing constitutes the largest single component of Malaysia's economy beside tourism and primary commodities such as petroleum, palm oil and rubber

Malaysia at a Glance

“The challenge of establishing a scientific and progressive society, a society that is innovative and forward looking, one that is not only a consumer of technology but also a contributor to the scientific and technological civilization”

Vision 2020:establishing a scientific and progressive society

| 3 |

“The Government will transform Malaysia through a comprehensive innovation process, comprising innovation in public and private sector governance, societal innovation, urban innovation, rural innovation, corporate innovation, industrial innovation, education innovation, healthcare innovation, transport innovation, and branding innovation...

… The Government is committed and serious in undertaking total innovation to elevate the nation to a more advanced economy. Innovation Leadership for 1United, Innovative Malaysia.”

- Y.A.B. Dato’ Sri Mohd. Najib Tun Abdul Razak, Prime Minister of Malaysia on Innovation Budget Speech 2010 on 23th October 2009

1Malaysia

People First,Performance Now

April 2009

Government Transformation

Programme (GTP)

6 National Key Result Areas (NKRAs)

January 2010

Economic Transformation

Programme (ETP)

8 Strategic Reform Intiatives (SRIs)

March 2010

10th Malaysia Plan

Macroeconomic Growth Targets &

Expenditure Allocation

March 2010

Preservation and enhancement of unity

in diversity

Effective delivery of government services

New Economic Model – A high income,

inclusive and sustainable nation

Smooth implementation of government’s

development programme

VISION 2020

Source: EPU, GTP, NEM5

Transforming Malaysia into an Innovation-led High Income Economy

Where are we now?

6

06.02.2014

06.02.2014

06.02.2014

06.02.2014

06.02.2014

06.02.2014

06.02.2014

HIGH INCOMEBOUNDARY

Rep. of KoreaCzech Rep

Source : NEM, 2010

•Vision 2020; STP 1 &2; Biotech policy; Green tech policy; increasing allocation for STI;

Initiatives •Establishment of MOSTE; NIC; NSRC; ASM; AIM; development plans

Institutions and

Integration

•PRIs; universities; science parks; incubators ;

•Wide ranging schemes and incentives

Infrastructure and Incentives

•Massive investments in education and training;

Investments •We have shared our STI development experience with other countries e.g OIC; CPTM; ISTIC; GSIAC

International Outreach

We have made great strides in STI

Malaysia Innovation Agency (AIM)• Provide policy input to NIC• Oversee functioning of the NIS• Undertake evaluation of policy

instruments and programme• Assess innovation outcome

Malaysia Innovation Agency (AIM)• Provide policy input to NIC• Oversee functioning of the NIS• Undertake evaluation of policy

instruments and programme• Assess innovation outcome

Other Ministries/Agencies/

Univ/Research Institutions

•To support innovation activities in their respective areas

Other Ministries/Agencies/

Univ/Research Institutions

•To support innovation activities in their respective areas

National Innovation Council (NIC)

Chaired by PM

Provide Strategic leadership

Policy decision making

National Innovation Council (NIC)

Chaired by PM

Provide Strategic leadership

Policy decision making

MOSTI•Secretariat to NIC

•Formulate policies for S & T development

•Oversee resource allocation for technological innovation

MITI•Promote enterprises innovation

•Oversee resource allocation for non-technological innovation

MITI•Promote enterprises innovation

•Oversee resource allocation for non-technological innovation

National Science & Research Council

(NSRC)•Set priorities for R&D investment

•Evaluate R&D programmes & monitor outcomes

National Science & Research Council

(NSRC)•Set priorities for R&D investment

•Evaluate R&D programmes & monitor outcomes

MTDC •Nurture Technology based enterprises

•Provide support services for commercialization

MTDC •Nurture Technology based enterprises

•Provide support services for commercialization

MPC•Undertake productivity enhancement research & activities

•Advisory & training to enable enterprise innovation

MPC•Undertake productivity enhancement research & activities

•Advisory & training to enable enterprise innovation

Source: Tenth Malaysian Plan, pg 85

Institutional Structure Supporting Innovation and R & D

10

INNOVATION ECONOMY

Funding

Institutions

SME

Technology

Market

Human Capital

National SME

Development Council, SMECorp

MVCDC

Malaysian Innovation Foundation

NITC

National Green Technology Advisory Council

National Innovation Council

National ICT Implementation Design Council

Biotech

Corp

National Higher Education Council

VC’s Council

Source : MVCDC’s analysis

Note: Entities reflected in this diagram may not be exhaustive

AIM

NSRC

National Professorial

Council

Govt & Private Funds

AIM GC

Greentech Council

GSIAC

Multiple Entities Responsible For Innovation

Economic Corridors

MDec

MSC

MIGHT

Hi Tech Parks

MOE (FRGS, RU, APEX)MOE (FRGS, RU, APEX)

KKLWKKLW

MITI (SME Corp)MITI (SME Corp)

CRADLE CRADLE

KPPK (CESS FUND)KPPK (CESS FUND)

MINDEF (STRIDE)MINDEF (STRIDE)

KeTTHA (Green Tech)KeTTHA (Green Tech)

MOA (AGRO BANK)MOA (AGRO BANK)

SCIENCEFUNDSCIENCEFUND

Techno/InnoFund etcTechno/InnoFund etc

MTDC, Biotech Corp, etcMTDC, Biotech Corp, etc

MAVCAP, MDVMAVCAP, MDV

MOF (BGF)MOF (BGF)

MOF (BSF)MOF (BSF)

KPKK (CREATIVE INDUSTRY FUND)

KPKK (CREATIVE INDUSTRY FUND)

MGSMGS 11

R, D & C funding continuum in RMKe-10 (2011-2015)…

Global Innovation Index 2013 by INSEAD, Malaysia’s overall is ranked at 32 out of 142 countries

Parameters

CountriesSwitzerlan

dFinlan

dSingapor

eUSA Korea

MALAYSIA

Thailand

Overall 1 6 8 5 18 32 57Institutions 16 2 7 17 32 49 93Human Capacity

14 1 3 6 2 40 46

ICT and Infrastructure

8 7 6 17 4 33 60

Business Sophistication

4 14 1 2 42 27 60

Market Sophistication

6 19 5 2 17 23 37

Scientific Outputs

1 9 11 17 12 24 53

Creative Outputs and Well Being

2 15 40 19 54 38 7613

No. Country2011-2012 2010 – 2011 2009 – 2010

Ranking Score Ranking Score Ranking Score

1. Singapore 2 5.63 3 5.48 3 5.55

2. United States 5 5.43 4 5.43 2 5.59

3. Japan 9 5.40 6 5.37 8 5.37

4. United Kingdom 10 5.39 12 5.25 13 5.19

5. Australia 20 5.11 16 5.11 15 5.15

6. Saudi Arabia 17 5.17 21 4.95 28 4.75

7. Malaysia 21 5.08 26 4.88 24 4.87

8. China 26 4.90 27 4.84 29 4.74

9. Brunei Darussalam 28 4.78 28 4.75 32 4.64

10. Thailand 39 4.52 38 4.51 25 4.84

11. Indonesia 46 4.38 44 4.43 54 4.26

Source: Global Competitiveness Report 2010-2011, World Economic Forum 14

MALAYSIA’S GLOBAL COMPETITIVENESS RANKING

25th

24/6/2013 BENGKEL AKTA SAINS

Current Expenditure Capital Expenditure Total GERD/GDP

RM

Million

GE

RD

/GD

P

Source: MASTIC(2012), National Survey of Research and Development 2008 (Updated Results), p.4

Gross Expenditure on R&D (1996 to 2011)

15

Gross Expenditure on R&D (GERD) (1996-2011)…

R&D Personnel (Researchers), 1996-2011

1996 1998 2000 2002 2004 2006 2008 2009 2010 20110

10.000

20.000

30.000

40.000

50.000

60.000

70.000

80.000

0,0

10,0

20,0

30,0

40,0

50,0

60,0

70,0

42436249

1502217790

23092

19021

31442

53304

67412

73752

5,17

15,6

1821,3

17,9

28,5

47,1

55,4

58,2

Researchers (Headcount) Researchers (Headcount) per 10,000 Labour Force

Number of Researchers (headcount) Researcher/10,000 LF

Source : National Survey of Research & Development (R&D)

2000 2002 2004 2006 2008 2009 2010 2011

Researchers (Headcount)

15,022

17,790

23,092

19,021

31,442

53,304

67,412

73,752

Researchers (Headcount) per 10,000 Labour Force 15.6 18.0 21.3 17.9 28.5 47.1 55.4 58.2

7

18

Source : MyIPO (March 2012)

19Source : ISI (including articles, proceeding papers, meeting abstracts, reviewers, and editorial materials)

24/6/2013 BENGKEL AKTA SAINS 20

ISSUESBut we are lagging in our R&D output compared to the innovative countries;

Uptake of public R&D output by industry is minimal;Less than 5% of public funded R&D projects have

been commercialised;Less than 3% of public funded R&D is funded by

industry;Only 38% of manufacturing companies are

innovative;

We need to enhance technological capabilities and increase uptake of STI and support knowledge and high valued added technology intensive industries………through STRENGTHENING of TALENT, PARTNERSHIPS,PRIORITISATION,PROFICIENCY and PERFORMANCE

• Estimated 4% of country’s population reside overseas

• >300K Malaysians – with tertiary qualifications have migrated

• Talent Corporation Malaysia established in 2011 - to stem growing deficits in skilled manpower in the country

• Estimated 4% of country’s population reside overseas

• >300K Malaysians – with tertiary qualifications have migrated

• Talent Corporation Malaysia established in 2011 - to stem growing deficits in skilled manpower in the country

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Brain drain…

THE INNOVATION IMPERATIVEThe economic downturn makes it imperative to find new sources of growthWHAT CAN THE GOVERNMENT DO TO UNLEASH INNOVATION?• S&T EDUCATION AND ENCULTURATION TO START FROM A YOUNG AGE;

•INCREASE THE TALENT POOL;

•TRAIN PEOPLE TO BECOME ENTERPRENEURS - critical for providing the right skills, attitudes and behaviour for starting and growing a business;

•PROVIDE INCENTIVES TO BUSINESS TO CARRY OUT R&D;

•LOWER BARRIERS TO ENTERPRENEURSHIP An effective and implementable regulatory framework is important to allow businesses to enter the market and grow; and

•BALANCE TAX INSTRUMENTS SO AS NOT TO DISCOURAGE ENTREPRENEURSHIP

24/6/2013 BENGKEL AKTA SAINS 23

The government recognises the challenges faced in its

endeavour to Advance the National STI Agenda. The NPSTI represents the Government’s

commitment towards Revitalising the Nation’s STI Ecosystem so that the nation can be more

Competitive, Innovative and Creative in advancing STI to achieve the nation’s goal

to Generate Knowledge, Create Wealth and raise the Quality of Life.

NATIONAL POLICY ON STI

GovernmentTransformation

Plan (GTP)

Effective Delivery of Government Services

GovernmentTransformation

Plan (GTP)

Effective Delivery of Government Services

10th & 11th Malaysia PlanMacroeconomic growth targets & expenditure allocationImplementation of Government’s Development Programmes

Economic Transformation

Programme (ETP)

New Economic Model A High Income, Inclusiveand Sustainable Nation

Economic Transformation

Programme (ETP)

New Economic Model A High Income, Inclusiveand Sustainable Nation

1Malaysia – People First, Performance NowPreservation and Enhancement of Unity in Diversity

Source: PEMANDU, NEAC, EPU

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National Social Tranformation

Programme (NSTP)

National Social Tranformation

Programme (NSTP)

PoliticalTranformation

Programme (PTP)

PoliticalTranformation

Programme (PTP)

NPSTI has been formulated within the context of various national transformation

programmes…

ST 1Advancing

scientific and social

research, development

and commercialisa

tion

ST 2Developing,harnessing

and intensifying

talent

ST 3Energisingindustries

ST 4Transforming

STI governance

ST 5Promoting

and sensitising

STIStrategic Thrusts

STI for Policy

Policy for STI

Industry Commitment to STI

STI Governance

STI for Stable, Peaceful, Prosperous, Cohesive and Resilient Society

Foundation

Advancing and mainstreaming STI at all levels and in all sectors

A scientifically advanced nation for socio-economic transformation and inclusive growth

Transformation Programme

Vision

Mission

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ST 6Enhancing strategic

international alliances

A High Income, Inclusiveand Sustainable Nation

National Social Transformation

Programme (NSTP)

Political Transformation

Programme (PTP)

OVERALL FRAMEWORK OF THE NATIONAL POLICY ON SCIENCE, TECHNOLOGY AND INNOVATION (NPSTI)

I-THINK1Enhancing thinking skills for our next generation

Lack of Critical and creativethinking skills

Rolled out to 10 schools

Roll out to > 10,000 schools

Trained > 400,000 teachersChange the lives of > 5m students

RATIONALE

2012 MILESTONES ACHIEVED

BY END 2013

ASPIRATIONS

Trained 800 teachers

Benefiting >10,000 students

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Rolled out to

Trained

Benefiting

1,067 schools & 27 IPGs

52,500 teachers

588,000 students

Aim• To set up a National Technology Commercialisation Platform in collaboration with

SME Corp Malaysia to provide end-to-end facilitation in IPR commercialisation

Unmet need• There exist many initiatives to promote innovation. These are fragmented and not inter-linked• Many gaps exist between the different phases of the commercialisation process and there are no

initiatives that focus on market driven IP

Solution• Set up a National Technology Commercialisation Platform • Collaboration between AIM and SME Corp Malaysia• The platform should be government-owned but run by a private company (Sdn. Bhd.) and a private

management team• Would underpin collaborative linkage of initiatives that operate in vertical silos for maximising the

support provided to Malaysian universities, SMEs, PRIs and grassroots innovators to commercialise their IPRs

• To use the platform which will work alongside International Collaboration Initiative• AIM will be working with TERAJU to introduce and match available IBOs with 450 companies under

TERAS

Technology Commercialisation Platform

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*IPR – Intellectual Property Rights

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INTERNATIONAL COLLABORATIONPURPOSE

• To establish Scouting Partners with

other countries for “game changing” technology for

investment opportunities to create new wealth for the country

• Game changing technologies will help protect Malaysian interest in key

areas such as food security, water security, renewable energy, etc.WHERE WE ARE

• Foreign companies in USA, UK, Sweden, Russia, India & Australia have already expressed interest in collaborating with AIM.

• Government of Ecuador has expressed interest in AIM to help develop a similar organisation in Ecuador.

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SEA Knowledge Transfer Office

WHERE ARE WE

• To provide a wider access to potential investors and/or entrepreneurs to commercialise Malaysian Innovations.

• Providing access and exposure to approximately 600 million people across SEA.

• Vise versa, this will bring innovations from SEA countries to Malaysian entrepreneurs and innovators

• Inaugural dialogue session was held on 12th Nov 2013 during the World Innovation Forum 2013

• 7 SEA countries participated in the dialogue• AIM will engage the other SEA countries for their

feedback• 7 nations unanimously supported and agreed

establishment of South East Asia Knowledge Transfer Office

• The participants are seeking approval from their respective authorities before a formal collaboration can be drawn up

• AIM has undertaken the challenge of coming up with a detailed mechanism to move forward with this

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Dana Harta Intelek

APPROACH

To set up a dedicated IP Fund to serve innovators, entrepreneurs and grassroots inventors to protect their IPR

• Set up a dedicated IP Fund – Dana Harta Intelek

• Would help support Malaysian inventions to gain IPR in international markets

• Would help establish the practice of securing IPR in foreign jurisdictions

• Would create wealth for Malaysia in the long-run

BENEFITS

• To support Malaysian inventions to gain IPR in international markets.

• To help establish the practice of securing IPR in foreign jurisdictions.

SCIENCE TO ACTION PROGRAMME

The Science to Action Programme, announced by the Prime Minister on the

1st November 2013 is to raise the profile of S&T in socio economic development for sustainable Inclusive growth to beyond 2020.

The implementation of the S2A will be undertaken with the following targets in mind:

•Global Competitiveness and Innovation Indices- targeting Malaysia as a top 20 nation•Global Happiness Index- placing Malaysia amongst the top 50 happiest nation in the world•GERD- increasing the country’s GERD to at least 2% by 2020

Strengthening:•STI Governance and the STI ecosystem•Science for Industry•Science for Well Being

Innovation Ecosystem Framework

Innovation Agenda

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THANK YOU

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www.mosti.gov.my