Monday 16 February 2015

Why Downstream Industrialization Failed? Junz Asked

by : Junz Wong

ADUN LIKAS Junz Wong agreed with Datuk Raymond Tan that developing and expanding oil and gas downstream was one good strategy to drive Sabah economy.

Junz recalled learning the economic theories even when he was studying in high school & college time in Singapore, at least 15-20 years back.

Thus he wondered what was the delay with Sabah downstream industrialization ?

Junz raised a few questions and wished Datuk Raymond to enlighten Sabahans :

1) what are the challenges ?
What are the hurdles, obstacles which have stopped Sabah Govt to develop downstream activities and progress well on industrialization ?

For instances, KKIP has not been a success as industrialization hub - one of the main efforts driven by the State Govt.

Govt has also failed to achieve the TEUs target set. State Govt industrialization efforts has not attracted enough investments despite the potential for downstream businesses.

Sabah port efficiency certainly didn't help.

Junz Wong who is also DAP Sabah Organizing secretary said that industrialization of downstream activities could have started back in those timber times and again didn't materialize or succeed due to reasons only known by the ruling govt.

"Has cabotage policy been one of the obstacles which has become bottleneck to Sabah economy industrialization ? What's Tan stand ?

When Datuk Raymond mentioned how successful was Singapore, he must not forget that Singapore is employing a FREE PORT policy while Sabah has Cabotage policy.

Is Tan ready to propose for Sabah Govt to do away with Cabotage policy if indeed Cabotage was proven to be one of the reasons for Sabah industrialization failure ?" Junz inquired

Junz hoped that Datuk Raymond Tan could enlighten Sabahans on the reasons what was the setbacks all about. What was the obstacles faced by State Government.

"Please don't think that I'm making things difficult for you bcos I'm actually trying to help here.

If we don't identify and address the reasons why we have failed to industrialize and develop downstream, the same reason or problem would still be there to hamper govt value added plan." Junz explained

"I sincerely don't want to see it remains a beautifully structured talk but wholeheartedly wish Sabah economy to realize its potentials." Junz emphasized

Junz, DAPSY Sabah Youth Chief, also raised concerns whether or not State Government has possessed the political will to ensure downstream activities become a success story rather than just beautifully structured economic talk.

"Will Government implement several policies to restrict and monitor the exports as many, even many Ministers I believe, have accepted reasons given by these exporters that these (by direct exporting) are merely business decisions as they are profit oriented organizations?" Junz asked

Thus govt must possess that political will to tell these privileged business owners
"Look... these resources and raw materials are extracted from Sabah and has to be used in Sabah for downstream industrialization for the sake of good future for Sabah even if it means lower profiteering for these exporters."

"Is the govt ready to take this drastic step to ensure resources stay in the state for value added economic development for the good of our future generations ?" Junz asked again

"It's better late than not doing it at all. So I once again welcome the announcement by Datuk Raymond Tan on the new value added economic strategy and wish to see him delivering it rather than just merely a motivational talk and remains as an economic theory in Sabah." Junz concluded

Raymond statement mentioned :

1) developing and expanding oil and gas downstream - a good strategy to drive Sabah economy.

2) value-added economic strategy so we do not sell oil & gas but instead get investments in, get manufacturers to build factories, create industries, give jobs.

3) emulating Singapore : Singapore has no natural resource but had a 50-years head start when it comes to downstream development.
They bought what we sell, our oil and process that and then resell the processes products worldwide. People come in and invest, pay high salaries and that is pull factor that draws talent in, further heightening it's economy.

4) Tan even mentioned "our raw materials were exported to the United States and Europe and China and then processed goods will be sold back to us.
So we want investors to come, we want them not only for the jobs and economic benefits but more importantly we want technology transfer from the US and Europe."

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