We are ready to represent the best custom paper writing assistance that can cope with any task like dont go! even at the eleventh hour. The matter is that we posses the greatest base of expert writers. Our staff of freelance writers includes approximately 300 experienced writers are at your disposal all year round. They are striving to provide the best ever services to the most desperate students that have already lost the hope for academic success. We offer the range of the most widely required, however, not recommended for college use papers. It is advisable to use our examples like dont go! in learning at public-education level. Get prepared and be smart with our best essay samples cheap and fast! Get in touch and we will write excellent custom coursework or essay especially for you.
- The Asian American Community is defined here as an instrumental and political one that stems from a shared racial location in the US. The impact of this social framework is evident in pan-Asian organizations, which tend to encourage solidarity among their diverse constituents by stressing shared racial interests.
- An emphasis on racial and political solidarity (as well as inclusionary boundaries) is also apparent in the following descriptions of Asian American Studies
- In highlighting shared racial fate, a strategy of Asian American Studies has been to emphasize a common historical past in the US.
- Asians also share a bond other oppressed groups of color.
-“ A bond” posed by racialization is the US
- The Term “Asian American Identity” encompasses on the one hand strategic politics, and on other limiting trap for the expression of diverse ethnic cultures.
- Incoming immigrants who are not US born citizens are posing a problem to the Pan-Asian Community
- By increasing the size and visibility of the Asian American population, post 165 Asian immigration has lent vigor and urgency to issued of the Asian American Community
- As the question The meaningfulness of the notion of shared racial interests and location that has guided pan-Asian activity.
- After 165, racial divisions within the Asian community started to arise, due to the fact most ‘Asians” at the time were very educated compared to there ancestors before. The question of whether a shared racial fate and location, determined what an “Asian” was came to life.
- A hierarchy of sort within the Asian community started to come about as well (classes)
- Ideas of racial agenda may seem especially problematic in the situations where class or occupational interests overlap with those of ethnic origin. Example 1 La riots, A lot of Korean businesses were destroyed. They have the highest rate of self-employment, a lot of them opened businesses in dominantly black populated areas, during 165 they facing barriers in the mainstream labor market. Koreans then said other Asian-American groups showed lack of interests in them.
- As suggested above, a primary and ongoing challenge to the racial interests framework of pan-Asianism stems from the competing ethnic-specific interests.
- Depending the interests of the group they turn to pan-Asian ties
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Mind that the sample papers like dont go! presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Friday, 28 September 2012
Wednesday, 12 September 2012
Pain
We are ready to represent the best custom paper writing assistance that can cope with any task like Pain even at the eleventh hour. The matter is that we posses the greatest base of expert writers. Our staff of freelance writers includes approximately 300 experienced writers are at your disposal all year round. They are striving to provide the best ever services to the most desperate students that have already lost the hope for academic success. We offer the range of the most widely required, however, not recommended for college use papers. It is advisable to use our examples like Pain in learning at public-education level. Get prepared and be smart with our best essay samples cheap and fast! Get in touch and we will write excellent custom coursework or essay especially for you.
Pain death defiance fear love hate tears love fear want need desire desperation i can’t think of what to say or what to do my mind is whirling and I’m lost in a world of fear n hate I am confused as hell I can’t see a way out I need love and yet I hate it I hate all those you love me despise those who desire me my mind is not sound I want to scream I want to run away to a dark forest and cry and be free from all this shit I feel my dad is trapping me this feels like hell worse than hell I feel I can’t breathe I want to run..run as fast as my legs can carry me away to beautiful freedom I want music to fill my lonely desperate hurt soul I want beauty to surround my every waking moment yet what is around me is all ugly I try to see if I can look at it in another way that will make it beautiful to my eyes but I just don’t have the strength to figure out I want to kill myself shoot myself in my head I don’t like people telling me I’m fucked up its at moments like this that I feel so vulnerable that I’ll break into two because I’m nothing like the responsible steady person I’m trying so hard to be I’m as volatile as water there’s so much pain inside but I’ve barred it locked it up from all prying eyes even from myself otherwise I’ll break into two I want to die I want to die life is so beautiful but with all these trappings in it in want to die my life is hell I want a new one free from all moral judgement that I’m trying so hard to fit in. if u put water in a mould it will evaporate should I then die? I’m so scared will anyone understand that I’m not crazy? I just want to be…to love to be able to trust but how can I do that with so many fingers pointed at me all the time? I want out. Help me I’m screaming from my soul why have you bound me so tight? Why can’t you let me go? What have I done? Why am I destined to spread so much pain when all I want to give out is love? Why the hell am I going through this? For what fault of mine? How can I set my soul free from this ugly restrictive world? I want to leave I want to spread my wings and fly. I want to be beautiful and truly feel that I can be loved.
Mind that the sample papers like Pain presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Pain death defiance fear love hate tears love fear want need desire desperation i can’t think of what to say or what to do my mind is whirling and I’m lost in a world of fear n hate I am confused as hell I can’t see a way out I need love and yet I hate it I hate all those you love me despise those who desire me my mind is not sound I want to scream I want to run away to a dark forest and cry and be free from all this shit I feel my dad is trapping me this feels like hell worse than hell I feel I can’t breathe I want to run..run as fast as my legs can carry me away to beautiful freedom I want music to fill my lonely desperate hurt soul I want beauty to surround my every waking moment yet what is around me is all ugly I try to see if I can look at it in another way that will make it beautiful to my eyes but I just don’t have the strength to figure out I want to kill myself shoot myself in my head I don’t like people telling me I’m fucked up its at moments like this that I feel so vulnerable that I’ll break into two because I’m nothing like the responsible steady person I’m trying so hard to be I’m as volatile as water there’s so much pain inside but I’ve barred it locked it up from all prying eyes even from myself otherwise I’ll break into two I want to die I want to die life is so beautiful but with all these trappings in it in want to die my life is hell I want a new one free from all moral judgement that I’m trying so hard to fit in. if u put water in a mould it will evaporate should I then die? I’m so scared will anyone understand that I’m not crazy? I just want to be…to love to be able to trust but how can I do that with so many fingers pointed at me all the time? I want out. Help me I’m screaming from my soul why have you bound me so tight? Why can’t you let me go? What have I done? Why am I destined to spread so much pain when all I want to give out is love? Why the hell am I going through this? For what fault of mine? How can I set my soul free from this ugly restrictive world? I want to leave I want to spread my wings and fly. I want to be beautiful and truly feel that I can be loved.
Mind that the sample papers like Pain presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Friday, 7 September 2012
Dada and Surrealism
We are ready to represent the best custom paper writing assistance that can cope with any task like Dada and Surrealism even at the eleventh hour. The matter is that we posses the greatest base of expert writers. Our staff of freelance writers includes approximately 300 experienced writers are at your disposal all year round. They are striving to provide the best ever services to the most desperate students that have already lost the hope for academic success. We offer the range of the most widely required, however, not recommended for college use papers. It is advisable to use our examples like Dada and Surrealism in learning at public-education level. Get prepared and be smart with our best essay samples cheap and fast! Get in touch and we will write excellent custom coursework or essay especially for you.
Dada and Surrealism
During the days of World War I, a search began for new and fantastic subject matter, and so this brought together a number of young men. The writer, Hugo Ball, the painter, sculptor and poet, Jean Arp and the painter Hans Richter, as well as many others, all began this search of new and exciting styles that brought on the movement called Dada. This movement was largely a reaction to the destruction, hysteria and madness of the war. The Dadaists felt that reason and logic had resulted in war, and so, they wanted to move away from this and explore different principals such as simultaneity and chance.
There were two main parts to Dada, Zurich Dada and New York Dada. Zurich Dada came about as a result of these men whose demonstrations, art exhibitions, poetry readings and noise concerts attacked Western Art and Culture. Jean Arp was one of the most prolific artists to emerge from Zurich Dada. He studied painting in the early years of the twentieth century but found that there was great conflict between his paintings and what he learnt. This uncertainty that he had, led him to spend years in various small towns in Switzerland where he was greatly influenced by the Swiss landscape. This resulted in many abstract works that were all based on nature and living organic shapes. He wanted to express the reality of the object itself in the most concrete terms as possible; hence he used a form of organic abstraction. This led him from painting to collage and then to relief and sculpture in the round.
A typical work is “Collage with Squares Arranged according to the Law of Chance.”
This work is a collage of torn squares of paper arranged in a random order. He produced many works in this vein and it is said that they were a result of his tearing up drawings with which he was not satisfied and, seeing the arrangement the papers made on the floor, he realized he had found the solution to his problem. It was actions such as this that showed Arp’s interest in “the laws of chance.”
Although Zurich dada had finished by the end of World War I, its influences were just beginning to spread, and it was then that New York Dada emerged. It began with the artists Marcel Duchamp and Francis Picabia arriving in New York and sharing similar ideals. Duchamp was disillusioned by the validity of art. He was influenced by Cubism, as is evident in his paintings, but he didn’t like the more formal ordered direction that it was taking. Another distinct influence was that of the futurists. Not on Duchamp alone but on the Dadaists in general. Although Duchamp used a lot of the Futurist principals, such as devices with the feel of machinery, his Dadaist art was an expression of disillusionment, whereas the Futurists’ art was much more optimistic. Duchamp’s works were often satirical especially when he attempted to re-interpret traditional themes however all of his works take on a brilliant construction of abstract forms. His works include, “The Passage from Virgin to Bride,” and “The Bride Stripped Bare of her Bachelors, Even (The Large Glass).”
Duchamp was also the initiator of “ready-mades.” These were objects or paintings that were complete on their own, that Duchamp would just add to. A good example of this is “L.H.O.O.Q”. Here, he has taken a copy of the “Mona Lisa” and added a beard and moustache to it, and called it a work of art. Another example of a ready-made is a work entitled “Fountain” which is quite simply a urinal on which he has signed “R. Mutt.” Needless to say this caused a great stir when he tried to exhibit it in 117.
Duchamp was in some way trapped He wanted to destroy facets of art altogether, but his Dada works contained elements of his art that he truly hated. However, his primary motive was to show that he rejected the ideas and idols of society. This influenced the “tone” of his paintings in a number of ways. His willingness to use just anything as art, especially the ready-mades brought up the question, “What is Art?” and this is exactly what the Dadaists wanted. However, Dada wasn’t all wild, mad humor aimed at annoying the middle class man. It had a purpose that of re-examining and exposing the conceptions of order and beauty.
Surrealism however, deals with a different kind of reality, a super-reality that exists in our subconscious. The surrealists believed that the reality of dreams was superior to that of waking reality. They were not influenced as much as the Dadaists were by war but by the theories of Sigmund Freud. Up until then, the subconscious was still undefined and they wanted to expand and explore themes involving the subconscious aspects of life.
One of the characteristics of Surrealism was an element of chance, just as was used by the Dadaists. Accidental blots, textures and signs were incorporated into paintings to add to the effect that they wanted to create; where no attempt would be made to define the works or make them understandable. Surrealism has been defined as “the state of mind where there is no difference between the past and the present, between life and death, high and low, real and unreal.” This is exactly what the Surrealists tried to portray even though all the surrealist styles were very different.
The chief Surrealists were Max Ernst, Miro, Magritte and Dali and although their styles were all very different they all had common aspects such as a vision of totally new subject matter and individuality and isolation as artists. Much like the Dadaists they wanted to explore something new and completely different. They also propagated revolt against society and tradition just as the Dadaists did and their works, and also created great controversy because of the subject matter involved.
Salvador Dali epitomizes the Surrealist artist, not only in his art, but also in his lifestyle. He was greatly influenced be De Chirico, Carra and by the writings of Sigmund Freud, and moved to Paris in 1 to join the Surrealists.
Dali tried to recreate his dream world and attempted to make it more real than everyday, accepted reality. His paintings were extremely precise, in complete contrast to many of the Dadaist works in the way that they were almost photographic, as can be seen in his “Basket of Bread.” His works are often very contradictory where mechanical objects are soft or organic. Objects often disintegrate, melt and metamorphosis. An example of this is “The Persistence of Memory” where there are several melting clocks and foreign objects. There are many dissolving and transforming images in his works. Images are doubled, juxtaposed and repeated constantly, however, his paintings were painted in a very realistic style with very fine brushwork with a very gentle and delicate use of colour. He stuck with a very realistic technique instead of painting in the ways of the Cubists and Impressionists. The Dadaists, however, were influenced by the Cubists, as can be seen in many of Duchamp’s works. In his works there is traditional use of line that is neither abstract nor decorative which is, however, seen in Dadaist works. His paintings often have eerie, haunting allegories and phobias often that populate his work.
“I do not know when I start to pretend or when I tell the truth.”
“How do you expect the public to understand the meaning of the images that I transcribe, when I myself, who is the one who makes them, don’t understand them any longer when they appear in my pictures?”
“Beauty should be edible or not at all.”
-Salvador Dali
Another Surrealist artist is Max Ernst. Ernst’s paintings often include machine monsters that show the Dadaists preoccupation with mechanization and automatism. His interest in metamorphosis and double identity of objects led him onto Surrealism and he began painting in a new style that still dealt with realism but in a fantastical way, just like Dali. Ernst’s painting also dealt with Nightmares, dreams and the subconscious with fantastic creatures such as elephants, as seen in “The Elephant Celebes.” His works also include many birds and dream landscapes as seen in “Two Children are Threatened by a Nightingale.” He is said to have created the “surrealist vocabulary” and unlike some of the Dadaist works, they are never totally abstract.
Both Dadaism and Surrealism were extremely dynamic and interesting movements. They rebelled against the conformities of society, began to explore completely different subject matter and although were different in many ways, they were the start to a completely new outlook on art and culture of the 0th century.
Mind that the sample papers like Dada and Surrealism presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Dada and Surrealism
During the days of World War I, a search began for new and fantastic subject matter, and so this brought together a number of young men. The writer, Hugo Ball, the painter, sculptor and poet, Jean Arp and the painter Hans Richter, as well as many others, all began this search of new and exciting styles that brought on the movement called Dada. This movement was largely a reaction to the destruction, hysteria and madness of the war. The Dadaists felt that reason and logic had resulted in war, and so, they wanted to move away from this and explore different principals such as simultaneity and chance.
There were two main parts to Dada, Zurich Dada and New York Dada. Zurich Dada came about as a result of these men whose demonstrations, art exhibitions, poetry readings and noise concerts attacked Western Art and Culture. Jean Arp was one of the most prolific artists to emerge from Zurich Dada. He studied painting in the early years of the twentieth century but found that there was great conflict between his paintings and what he learnt. This uncertainty that he had, led him to spend years in various small towns in Switzerland where he was greatly influenced by the Swiss landscape. This resulted in many abstract works that were all based on nature and living organic shapes. He wanted to express the reality of the object itself in the most concrete terms as possible; hence he used a form of organic abstraction. This led him from painting to collage and then to relief and sculpture in the round.
A typical work is “Collage with Squares Arranged according to the Law of Chance.”
This work is a collage of torn squares of paper arranged in a random order. He produced many works in this vein and it is said that they were a result of his tearing up drawings with which he was not satisfied and, seeing the arrangement the papers made on the floor, he realized he had found the solution to his problem. It was actions such as this that showed Arp’s interest in “the laws of chance.”
Although Zurich dada had finished by the end of World War I, its influences were just beginning to spread, and it was then that New York Dada emerged. It began with the artists Marcel Duchamp and Francis Picabia arriving in New York and sharing similar ideals. Duchamp was disillusioned by the validity of art. He was influenced by Cubism, as is evident in his paintings, but he didn’t like the more formal ordered direction that it was taking. Another distinct influence was that of the futurists. Not on Duchamp alone but on the Dadaists in general. Although Duchamp used a lot of the Futurist principals, such as devices with the feel of machinery, his Dadaist art was an expression of disillusionment, whereas the Futurists’ art was much more optimistic. Duchamp’s works were often satirical especially when he attempted to re-interpret traditional themes however all of his works take on a brilliant construction of abstract forms. His works include, “The Passage from Virgin to Bride,” and “The Bride Stripped Bare of her Bachelors, Even (The Large Glass).”
Duchamp was also the initiator of “ready-mades.” These were objects or paintings that were complete on their own, that Duchamp would just add to. A good example of this is “L.H.O.O.Q”. Here, he has taken a copy of the “Mona Lisa” and added a beard and moustache to it, and called it a work of art. Another example of a ready-made is a work entitled “Fountain” which is quite simply a urinal on which he has signed “R. Mutt.” Needless to say this caused a great stir when he tried to exhibit it in 117.
Duchamp was in some way trapped He wanted to destroy facets of art altogether, but his Dada works contained elements of his art that he truly hated. However, his primary motive was to show that he rejected the ideas and idols of society. This influenced the “tone” of his paintings in a number of ways. His willingness to use just anything as art, especially the ready-mades brought up the question, “What is Art?” and this is exactly what the Dadaists wanted. However, Dada wasn’t all wild, mad humor aimed at annoying the middle class man. It had a purpose that of re-examining and exposing the conceptions of order and beauty.
Surrealism however, deals with a different kind of reality, a super-reality that exists in our subconscious. The surrealists believed that the reality of dreams was superior to that of waking reality. They were not influenced as much as the Dadaists were by war but by the theories of Sigmund Freud. Up until then, the subconscious was still undefined and they wanted to expand and explore themes involving the subconscious aspects of life.
One of the characteristics of Surrealism was an element of chance, just as was used by the Dadaists. Accidental blots, textures and signs were incorporated into paintings to add to the effect that they wanted to create; where no attempt would be made to define the works or make them understandable. Surrealism has been defined as “the state of mind where there is no difference between the past and the present, between life and death, high and low, real and unreal.” This is exactly what the Surrealists tried to portray even though all the surrealist styles were very different.
The chief Surrealists were Max Ernst, Miro, Magritte and Dali and although their styles were all very different they all had common aspects such as a vision of totally new subject matter and individuality and isolation as artists. Much like the Dadaists they wanted to explore something new and completely different. They also propagated revolt against society and tradition just as the Dadaists did and their works, and also created great controversy because of the subject matter involved.
Salvador Dali epitomizes the Surrealist artist, not only in his art, but also in his lifestyle. He was greatly influenced be De Chirico, Carra and by the writings of Sigmund Freud, and moved to Paris in 1 to join the Surrealists.
Dali tried to recreate his dream world and attempted to make it more real than everyday, accepted reality. His paintings were extremely precise, in complete contrast to many of the Dadaist works in the way that they were almost photographic, as can be seen in his “Basket of Bread.” His works are often very contradictory where mechanical objects are soft or organic. Objects often disintegrate, melt and metamorphosis. An example of this is “The Persistence of Memory” where there are several melting clocks and foreign objects. There are many dissolving and transforming images in his works. Images are doubled, juxtaposed and repeated constantly, however, his paintings were painted in a very realistic style with very fine brushwork with a very gentle and delicate use of colour. He stuck with a very realistic technique instead of painting in the ways of the Cubists and Impressionists. The Dadaists, however, were influenced by the Cubists, as can be seen in many of Duchamp’s works. In his works there is traditional use of line that is neither abstract nor decorative which is, however, seen in Dadaist works. His paintings often have eerie, haunting allegories and phobias often that populate his work.
“I do not know when I start to pretend or when I tell the truth.”
“How do you expect the public to understand the meaning of the images that I transcribe, when I myself, who is the one who makes them, don’t understand them any longer when they appear in my pictures?”
“Beauty should be edible or not at all.”
-Salvador Dali
Another Surrealist artist is Max Ernst. Ernst’s paintings often include machine monsters that show the Dadaists preoccupation with mechanization and automatism. His interest in metamorphosis and double identity of objects led him onto Surrealism and he began painting in a new style that still dealt with realism but in a fantastical way, just like Dali. Ernst’s painting also dealt with Nightmares, dreams and the subconscious with fantastic creatures such as elephants, as seen in “The Elephant Celebes.” His works also include many birds and dream landscapes as seen in “Two Children are Threatened by a Nightingale.” He is said to have created the “surrealist vocabulary” and unlike some of the Dadaist works, they are never totally abstract.
Both Dadaism and Surrealism were extremely dynamic and interesting movements. They rebelled against the conformities of society, began to explore completely different subject matter and although were different in many ways, they were the start to a completely new outlook on art and culture of the 0th century.
Mind that the sample papers like Dada and Surrealism presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Tuesday, 4 September 2012
escape from freedom-review
We are ready to represent the best custom paper writing assistance that can cope with any task like escape from freedom-review even at the eleventh hour. The matter is that we posses the greatest base of expert writers. Our staff of freelance writers includes approximately 300 experienced writers are at your disposal all year round. They are striving to provide the best ever services to the most desperate students that have already lost the hope for academic success. We offer the range of the most widely required, however, not recommended for college use papers. It is advisable to use our examples like escape from freedom-review in learning at public-education level. Get prepared and be smart with our best essay samples cheap and fast! Get in touch and we will write excellent custom coursework or essay especially for you.
Escape from Freedom- An Academic Review
Over the course of history, man’s desire for complete freedom has been overcome by the responsibilities and dangers involved with liberty. Freedom can represent different things to people, this can entail civil, political and ethic liberty’s. The more freedom we poses, the bigger the burden and the more we are responsible for. This causes some of us to desire less freedom in favour of support for those who will decide for us, freedom then becomes a negative situation from which we try to escape.
Erich Fromm’s book Escape from Freedom explains how freedom comes at a price. He believes “That modern man, freed from the bonds of pre-individualistic society, which simultaneously gave him security and limited him, has not gained freedom in the positive sense of the realization of his individual self, that is, the expression of his intellectual, emotional and sensuous potentialities. Freedom, though it has brought him independence and rationality, has made him isolated and, thereby, anxious and powerless.”(forward x) Fromm believes we feel lonely and isolated due to our separation from nature and each other. We are the only species of animal to feel this isolation, he thereby refers to it as the human condition.
Fromm takes a social-psychological approach by combining the theories of Freud and Marx. Freud’s theories of psychoanalysis focussed on the individual self, while Marx’s views pertained to society as a whole. Fromm breaks his structure of thinking into three groups His purpose in studying and writing about this subject is because he believes this to be the main crisis of our time. The initial version of this book was first written during the
reign of the Nazi party over Germany. Fromm’s goal was to develop a clear understanding of how such an evil organization could become so powerful. The fact that Nazi party gained control of a democratic nation shows that this could happen even in todays free world. Hitler’s rise to power was a combination of economic, political and psychological issues facing Germans at that time. The Nazi party appealed to the lack of patriotism facing the country, after the loss of the first world war.
Fromms most significant argument in this text are the three ways in which he believes we escape from freedom Authoritarianism, Destructiveness and Automation Conformity. Authoritarianism, according to Fromm, can be approached in two ways. One is to submit to the power of others, and the second is to make others submit to your power. In both cases Fromm believes you escape your individual self, and thus have lost your freedom. Fromm refers to these extreme forms of Authoritarianism as Masochistic and Sadistic. Masochism is when we avoid freedom and individuality by submitting to the powers of others to compensate for a lack of strength. The other extreme form being sadism, which Fromm believes can be broken into three different types intertwined together. The first is to create unrestricted power of dependency, the second is to not only rule over others but to cripple their liberties, and finally the third is a desire to make and see others suffer() Fromm uses the example of Authoritarianism to explain how Adolf Hitler and the Nazi party convinced so many to follow him on his mission to remove all liberties, including life, from their supposed enemies, the Jews. Both the masochistic and sadistic forms of authoritarianism solve the problem of anxiety associated with freedom, by destroying the individual self. Fromm refers to these traits as symbiosis. “Symbiosis, in the psychological sense, means the union of one individual selfwith another self (or any other power outside of the own self) in such a way as to make each lose the integrity of its own self and to make them completely dependent on each other.”(p.157) Destructiveness as a form of escape can easily be confused with sadism and masochism. Fromm argues the close relation between sadism and destructiveness by explaining their differences. “Sadism is not identical with destructiveness, although it is to a great extent blended with it. The destructive person wants to destroy the object, that is, to do away with it and to get rid of it. The sadist wants to dominate his object and therefore suffers a loss if his object disappears.”(p.158) In this text Fromm also states that sado-masochistic behaviour is often hidden under the guise of love, yet the true meaning of the act is generally due to one’s enjoyment of dependence or domination. The destructive person escapes isolation and weakness by destroying the world around them. These people feel the need to be destructive to the world in order to stop it from destroying them. This Destructivenss also refers to the desire to destroy those with power. This destruction can be channelled in several different ways, such as, hate groups, religion and patriotism. These actions can be rationalized by the mentally ill who turn to this form of “escaping freedom.”() This behaviour can lead to acts of vandalism, hatred, such as racism and crime in general. Destructiveness can also be focused inward resulting in a self-destructive mentality. The most severe example being suicide. Hatred and Destructiveness stem out of frustration from attempts to live and act creatively. The positive energy is transformed into destructive energy. Automation Conformity is the most common way in which we “escape from freedom.” Fromm states that out of a fear of alones we conform to the mass of society. By acting, doing, believing and looking the same as everyone else we gain a sense of power. Through the masses we gain the comfort of being a part of something and belonging, thus empowering ourselves. At the same time this denies us of our individuality and changes our natural selves. Thus in conforming to the model of society, there is no reason to acknowledge your freedom or responsibility. Fromm believes people to be products of the society that they grew up in. The behaviours we have come to know as normal, are learned, therefore natural to us. Fromm traces idea of society back to the middle ages, he shows how the structure has changed. As a reaction to this our individual needs and place in this world have changed. In the society of the middle ages people thought of themselves as having a pre-determined place in life, such as servents, royalty and tradesman. As we moved into modernity people began to realize and fight for the benefits of freedom. Fromms theories are also relevant in the world today. Not only do these ideas apply to the facist dictators of the Middle east, they are also extremely relevant in our so called “free” western society.
“Escape from Freedom” introduces the reader to psychoanalytic theory and how it applies to thre understanding of society, giving reasons as to why we act the way we do. This text also delves into the psychology of facism and authoritarianism, explaining how such systems are capable of gaining so much power. Fromm covers all areas of his argument in depth, he explains where we started from and where we need to be. While this text ‘Escape from Freedom, offers many insights into the history and psychology of society and the structure ivolved. Erich Fromm wrote this text with the purpose of gaining some insight as to how the Nazi party gained so much power in previously democratic society. Fromms main problem seems to be his tendency to over generalize about the world. He makes assumptions supported by nothing more than his own beliefs. Fromm attempts to draw parallels between human behaviour and society backed by nothing more than philosophy and his own assumptions. Ideas are taken as facts, assuming that psychology is the truth. The subject matter seems to personal for fromm to be fairly objective between his search for the truth and what he believes to be right. All in all, ‘Escape from Freedom’ is a very relevant worth while read. The subject matter brings up valuable theroies which might have gone unnoticed if not for the passion of Erich fromm. This text provides important insights into the inner workings of society. Whether or not these ideas are entirely factual, they must not be ignored, Instead we must embrace them and attempt to explore them further.
Mind that the sample papers like escape from freedom-review presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Escape from Freedom- An Academic Review
Over the course of history, man’s desire for complete freedom has been overcome by the responsibilities and dangers involved with liberty. Freedom can represent different things to people, this can entail civil, political and ethic liberty’s. The more freedom we poses, the bigger the burden and the more we are responsible for. This causes some of us to desire less freedom in favour of support for those who will decide for us, freedom then becomes a negative situation from which we try to escape.
Erich Fromm’s book Escape from Freedom explains how freedom comes at a price. He believes “That modern man, freed from the bonds of pre-individualistic society, which simultaneously gave him security and limited him, has not gained freedom in the positive sense of the realization of his individual self, that is, the expression of his intellectual, emotional and sensuous potentialities. Freedom, though it has brought him independence and rationality, has made him isolated and, thereby, anxious and powerless.”(forward x) Fromm believes we feel lonely and isolated due to our separation from nature and each other. We are the only species of animal to feel this isolation, he thereby refers to it as the human condition.
Fromm takes a social-psychological approach by combining the theories of Freud and Marx. Freud’s theories of psychoanalysis focussed on the individual self, while Marx’s views pertained to society as a whole. Fromm breaks his structure of thinking into three groups His purpose in studying and writing about this subject is because he believes this to be the main crisis of our time. The initial version of this book was first written during the
reign of the Nazi party over Germany. Fromm’s goal was to develop a clear understanding of how such an evil organization could become so powerful. The fact that Nazi party gained control of a democratic nation shows that this could happen even in todays free world. Hitler’s rise to power was a combination of economic, political and psychological issues facing Germans at that time. The Nazi party appealed to the lack of patriotism facing the country, after the loss of the first world war.
Fromms most significant argument in this text are the three ways in which he believes we escape from freedom Authoritarianism, Destructiveness and Automation Conformity. Authoritarianism, according to Fromm, can be approached in two ways. One is to submit to the power of others, and the second is to make others submit to your power. In both cases Fromm believes you escape your individual self, and thus have lost your freedom. Fromm refers to these extreme forms of Authoritarianism as Masochistic and Sadistic. Masochism is when we avoid freedom and individuality by submitting to the powers of others to compensate for a lack of strength. The other extreme form being sadism, which Fromm believes can be broken into three different types intertwined together. The first is to create unrestricted power of dependency, the second is to not only rule over others but to cripple their liberties, and finally the third is a desire to make and see others suffer() Fromm uses the example of Authoritarianism to explain how Adolf Hitler and the Nazi party convinced so many to follow him on his mission to remove all liberties, including life, from their supposed enemies, the Jews. Both the masochistic and sadistic forms of authoritarianism solve the problem of anxiety associated with freedom, by destroying the individual self. Fromm refers to these traits as symbiosis. “Symbiosis, in the psychological sense, means the union of one individual selfwith another self (or any other power outside of the own self) in such a way as to make each lose the integrity of its own self and to make them completely dependent on each other.”(p.157) Destructiveness as a form of escape can easily be confused with sadism and masochism. Fromm argues the close relation between sadism and destructiveness by explaining their differences. “Sadism is not identical with destructiveness, although it is to a great extent blended with it. The destructive person wants to destroy the object, that is, to do away with it and to get rid of it. The sadist wants to dominate his object and therefore suffers a loss if his object disappears.”(p.158) In this text Fromm also states that sado-masochistic behaviour is often hidden under the guise of love, yet the true meaning of the act is generally due to one’s enjoyment of dependence or domination. The destructive person escapes isolation and weakness by destroying the world around them. These people feel the need to be destructive to the world in order to stop it from destroying them. This Destructivenss also refers to the desire to destroy those with power. This destruction can be channelled in several different ways, such as, hate groups, religion and patriotism. These actions can be rationalized by the mentally ill who turn to this form of “escaping freedom.”() This behaviour can lead to acts of vandalism, hatred, such as racism and crime in general. Destructiveness can also be focused inward resulting in a self-destructive mentality. The most severe example being suicide. Hatred and Destructiveness stem out of frustration from attempts to live and act creatively. The positive energy is transformed into destructive energy. Automation Conformity is the most common way in which we “escape from freedom.” Fromm states that out of a fear of alones we conform to the mass of society. By acting, doing, believing and looking the same as everyone else we gain a sense of power. Through the masses we gain the comfort of being a part of something and belonging, thus empowering ourselves. At the same time this denies us of our individuality and changes our natural selves. Thus in conforming to the model of society, there is no reason to acknowledge your freedom or responsibility. Fromm believes people to be products of the society that they grew up in. The behaviours we have come to know as normal, are learned, therefore natural to us. Fromm traces idea of society back to the middle ages, he shows how the structure has changed. As a reaction to this our individual needs and place in this world have changed. In the society of the middle ages people thought of themselves as having a pre-determined place in life, such as servents, royalty and tradesman. As we moved into modernity people began to realize and fight for the benefits of freedom. Fromms theories are also relevant in the world today. Not only do these ideas apply to the facist dictators of the Middle east, they are also extremely relevant in our so called “free” western society.
“Escape from Freedom” introduces the reader to psychoanalytic theory and how it applies to thre understanding of society, giving reasons as to why we act the way we do. This text also delves into the psychology of facism and authoritarianism, explaining how such systems are capable of gaining so much power. Fromm covers all areas of his argument in depth, he explains where we started from and where we need to be. While this text ‘Escape from Freedom, offers many insights into the history and psychology of society and the structure ivolved. Erich Fromm wrote this text with the purpose of gaining some insight as to how the Nazi party gained so much power in previously democratic society. Fromms main problem seems to be his tendency to over generalize about the world. He makes assumptions supported by nothing more than his own beliefs. Fromm attempts to draw parallels between human behaviour and society backed by nothing more than philosophy and his own assumptions. Ideas are taken as facts, assuming that psychology is the truth. The subject matter seems to personal for fromm to be fairly objective between his search for the truth and what he believes to be right. All in all, ‘Escape from Freedom’ is a very relevant worth while read. The subject matter brings up valuable theroies which might have gone unnoticed if not for the passion of Erich fromm. This text provides important insights into the inner workings of society. Whether or not these ideas are entirely factual, they must not be ignored, Instead we must embrace them and attempt to explore them further.
Mind that the sample papers like escape from freedom-review presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Sunday, 2 September 2012
Hello whats going on
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For those wondering what happened to the Booker T I Remember note storyline, WWE officially dropped plans to continue the angle.
I have it confirmed Goldust was set to be the author of the note, but once it was decided he would be released, they dropped the storyline. What is not known at this point is whether it wouldve brought back Goldust and Booker T as allies, or if the two wouldve feuded.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
Mind that the sample papers like Hello whats going on presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
CJ Search is our managed search solution for advertisers that has been designed to complement and promote your search efforts. Based on the belief that a well-managed search marketing solution should include the efforts of an advertisers publisher base, CJ Search successfully combines affiliate marketing and search marketing.
For those wondering what happened to the Booker T I Remember note storyline, WWE officially dropped plans to continue the angle.
I have it confirmed Goldust was set to be the author of the note, but once it was decided he would be released, they dropped the storyline. What is not known at this point is whether it wouldve brought back Goldust and Booker T as allies, or if the two wouldve feuded.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
It is not expected that WWE will acknowledge the storyline again, since its gone several weeks without follow-up, but it is always on the backburner in case WWE comes up with something.
Mind that the sample papers like Hello whats going on presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Wednesday, 22 August 2012
DOING BUSINESS IN AN INDUSTRY WITH DIFFICULTECONOMICS—FOOD MASTER'S EXPERIENCE IN DAIRYPROCESSING AND MARKETING IN KAZAKHSTAN
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Introduction
This Discussion Paper used the following quote from investor, Warren Buffett, as part of
the framework for analyzing the experience of Food Master (a dairy processing and
marketing firm) in Kazakhstans dairy business []
When a management with a reputation for brilliance tackles a business with a
reputation for poor fundamental economics, it is the reputation of the business that
remains intact.
Findings relating to favorable and unfavorable economics provide insights about dairy
marketing and processing conditions in Kazakhstan. Food Master, a dominant dairy
processing and marketing firm in the Almaty region of Kazakhstan, and an important dairy
firm in Astana (Akmola region) has found itself in a business with difficult fundamental
economics. And despite having excellent top management and doing many things correctly,
this case firm lost money in 1 and was forced to restructure. While there have been
positive developments for the business in 000 and 001, the firms long-term profit
prospects are uncertain.
The paper provides background information on Food Master, describing the firms excellent
top management, what the firm did right, what went wrong in the late 10s, why Food
Master will continue to face difficult economics, and lessons from Food Masters
experience for investors and Kazakhstans government agencies.
Background Information on Food Master
The ownership of Food Master is split between Developed Technology Resources, Inc.
(DTR) and Agribusiness Partners International (API), both U.S. firms. DTR owns a 0%
share and API a 70% share of Food Master.
Food Master owns a controlling interest in eight dairy firms, five in Kazakhstan, two in
Moldova, and one in Ukraine.
The firm has a 50% to 55% market share of fluid milk sales in the Almaty region and lower
market shares in the Akmola region.
The origins of Food Masters operations in Kazakhstan began in Almaty, Kazakhstan in
15 as a joint venture between DTR and the Kazakh firm, Ak-Bulak Dairy.
In March 17, DTR and API formed Food Master. DTR contributed its dairy businesses
in Almaty, Kazakhstan and API contributed U.S.$6.0 million in cash to create Food Master.
Food Master reported its first profitable year in March 18. Company sales in
Kazakhstan totaled U.S.$14 million in 18 and were projected to be substantially higher in
1.
However, in April 000 Food Master reported losses of U.S.$6. million for 1. The
losses were deep and spread across the firms dairy operations in Kazakhstan, Moldova, and
Ukraine.
Mr. John Hupp, President of DTR, attributed the losses to sales reductions associated with
the economic crisis that hit Russia in August 18 and spread to Kazakhstan, Moldova, and
Ukraine, negatively affecting Food Masters dairy operations. The crisis saw the
Kazakhstan tenge fall in value from 8 to one U.S. dollar in December 18 down to 1 to
Saulesh Esenova, a native of Kazakhstans Almaty region, was employed as a researcher for the
Global Livestock CRSP and Ph.D. student at McGill University in Canada when this research was
conducted. W.D. Dobson is Professor of Agricultural & Applied Economics, Co-Director of the
Babcock Institute, and Director of the Renk Agribusiness Institute at the University of Wisconsin-Madison.
Doing Business in an Industry with Difficult Economics�Food Masters Experience in Dairy Processing
and Marketing in Kazakhstan
Babcock Institute Discussion Paper No. 001-1
one U.S. dollar at the end of 1 (over 60%), reducing the dollar value of the firms
earnings and increasing the price of imported inputs.
In mid-1, Food Master began to restructure by eliminating certain dollar-denominated
expenses and by adopting rationalization measures.
Food Masters Excellent Top Management
Food Master experienced problems in Kazakhstan despite the presence of strong top
management for DTR and Food Master. The strength of the top management for the two
firms derives from the background and experience of Mr. John Hupp and Mr. Erlan
Sagadiev.
Mr. John Hupp, DTR President, has good Russian language skills and had extensive
business experience in Russia and the former Soviet Union before joining DTR.
Mr. Erlan Sagadiev, General Director of Food Master in Kazakhstan, is fluent in Russian
and English. He is a native of Kazakhstan who completed a graduate education in the U.S.,
has a prestigious family background, and possesses good political connections in
Kazakhstan.
Hupp characterized Sagadievs value to the firm as follows Erlan Sagadiev is the real
reason that DTR went into Kazakhstan. It was Erlans honesty and connections that made
Food Master a reasonably successful business. This success came about because the
company
�Entered via a joint venture with a Kazakh firm.
�Made a well-timed entry.
�Gained potential advantages from entry and exit barriers.
�Made extraordinary efforts to maintain a suitable milk supply.
�Chose effective marketing practices for the firms products.
However, these actions did not shield the firm from incurring losses in 1 and the need to
restructure.
Whether Food Master will achieve above normal profits (or even normal profits) over the
longer-run will depend on whether the firm can consistently overcome challenges associated
with operating in an industry with difficult economics.
What Went Wrong in the Late 10s?
DTR attributed the losses incurred by the firm in 1 mainly to a demand-depressing
regional economic crisis that culminated in devaluation of the tenge.
While the problems encountered by Food Master in the Almaty and Akmola regions that
stem from macroeconomic conditions are arguably transitory, the firm faces other
conditions that will cause difficult economics to persist in Kazakhstans dairy industry.
Why Food Master Will Continue to Face Difficult Economics
The firm will continue to face difficult economic conditions because
�Capable middle and lower-level managers will remain in short supply.
�Quality milk will remain scarce.
�The Akmola region presents unique problems.
�Credit constraints exist.
�Corruption.
Problems associated with obtaining an adequate supply of quality milk and corruption are
likely to be deep-seated, long-term problems for the firm. Milk production declined % in
Kazakhstan from 10 to 18 in response to adverse developments that�for the most
part�still persist.
The dearth of capable middle and lower managers, problems in the Akmola region, and
credit shortages should be manageable, intermediate-term problems.
It is too early to tell how profitable Food Masters operations will be in Kazakhstan over the
longer-run. Despite the persistence of problems, there is little reason that DTR and Food
Master should, in the language of Warren Buffett, change vessels rather than continue to
patch leaks.
There is an encouraging sign for Food Master�DTRs shares, which trade as a NASDAQ
BB stock in the U.S., rose in price during February 001.
What Are the Lessons for Investors in Kazakhstans Dairy Industry?
Food Master was probably positioned better than most foreign-Kazakh joint venture firms
to succeed in Kazakhstans dairy industry. Therefore, other investors should be prepared to
encounter problems at least as difficult as those experienced by Food Master in
Kazakhstan.
Lessons for investors, ranked in order of importance, are as follows
�Dependable supplies of quality milk will be difficult for many processors to obtain for
the foreseeable future.
�Corruption will be a problem for foreign-based processors that fail to employ a politically
well-connected Kazakh in the business.
�Dairy processing and marketing firms will need to devote substantial efforts to training
programs to give employees management and marketing skills needed to operate under
market conditions in Kazakhstan.
�Credit and equity capital for use in Kazakhstans dairy businesses will remain scarce
and/or costly.
�Due diligence inquiries will assume importance for dairy processing and marketing
investments in all parts of Kazakhstan.
What are the Lessons for Kazakhstans Government?
Certain problems affecting Food Master and the firms domestic competitors have
implications for government agencies wishing to foster sound investments in Kazakhstans
dairy processing and marketing businesses, and in dairy farming. These relate mainly to
credit availability, milk supply, and corruption.
�Credit problems will defy easy solution by government agencies. The problem is both
one of lack of available credit for dairy processors and dairy farmers and, at times, high
real interest rates.
�A possible cost-effective way for Kazakhstans government agencies to ensure that more
credit becomes available to dairy processing and marketing firms, and to dairy farmers
would be to expand guarantees of credit provided by banks and other commercial
lenders.
�Infusions of capital and skilled management into dairy farming will be needed to foster
an environment where mid-sized and larger dairy farms can be established with
reasonable prospects for success. Expansion of credit guarantees, business management
assistance to farmers, and improved terms of trade for dairy farmers are called for to deal
with this problem.
�Corruption is an impediment to foreign investment in dairy processing and other
agricultural businesses in Kazakhstan. This problem must be addressed by government
if it is to be reduced.
Doing Business in an Industry with Difficult Economics�Food Masters Experience in Dairy Processing
and Marketing in Kazakhstan
DOING BUSINESS IN AN INDUSTRY WITH DIFFICULT ECONOMICS�
FOOD MASTERS EXPERIENCE IN DAIRY PROCESSING AND MARKETING
IN KAZAKHSTAN
Saulesh Esenova and W. D. Dobson
Introduction
When a management with a reputation for brilliance tackles a business with a reputation for
poor fundamental economics, it is the reputation of the business that remains intact.
Warren Buffett []
This simple point describes an important part of the management philosophy of Warren Buffett,
one of the worlds most successful investors. Interestingly, Buffetts comment provides a useful
framework for analyzing the experience of Food Master (a dairy processing and marketing firm
discussed at length in this paper) in Kazakhstans dairy business. In short, Buffett contends that
investors should avoid businesses with difficult economics. He adds that Should you find
yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more
productive than energy devoted to patching leaks [, p. 47]. Buffett concedes that businesses with
good fundamental economics cannot be identified with engineering precision. However, he
provides guidance on this point, suggesting that securities in companies selling commodity-like
products should come with a warning label that, competition may prove hazardous to human
wealth.
Buffett emphasizes that management foibles, which he labels as the institutional imperative,
can exacerbate the effects of difficult economics [, pp. 5-6]. In this connection, he argues that
(a) as if governed by Newtons first law of motion, an institution will resist any change in its current
direction, (b) just as work expands to fill available time, corporate projects or acquisitions will
materialize to soak up available funds, (c) any business craving of the leader, however foolish, will
be quickly supported by detailed rate-of-return and strategic studies prepared by his troops, and
(d) the behavior of peer companies, whether they are expanding, acquiring, setting executive
compensation or whatever, will be mindlessly imitated.
Michael Porter, a well-known business strategist at Harvards Business School, offers similar
arguments relating to good fundamental economics and difficult economics�albeit in less colorful
language, pointing out that [16, pp. -4]
Not all industries have the same potential. They differ fundamentally in their ultimate
profit potential as the collective strength of the forces (driving industry competition) differs;
the forces range from intense in industries like tires, paper, and steel�where no firm earns
spectacular returns�to relatively mild in industries like oil-field equipment and services,
cosmetics, and toiletries�where high returns are quite common.
Porter indicates that the four primary forces affecting industry competitors and rivalry among
existing firms are (a) bargaining power of suppliers, (b) threat of new entrants, (c) bargaining power
of buyers, and (d) threat of substitute products or services. In an earlier paper, the authors found
that lack of bargaining power of milk suppliers has an important impact on competitive conditions
in Kazakhstans dairy industry []. Most milk suppliers in Kazakhstan have so little bargaining
power that it is difficult for them to stay in business.
What do the arguments about favorable or unfavorable fundamental economics have to do
with dairy marketing and processing in Kazakhstan? Quite a bit it turns out.
Food Master International (Food Master), a dominant dairy processing and marketing firm in
the Almaty region of Kazakhstan, and an important dairy firm in Astana (Akmola region), has
found itself in a business with difficult fundamental economics. Despite having excellent top
management and doing many things correctly, the firm incurred losses in 1 and was forced to
restructure. Food Masters experience provides important lessons for other firms planning to invest
in Kazakhstans dairy businesses and for government policy to encourage sound investments in
Kazakhstans dairy industry.
This Discussion Paper provides background information on Food Master. It describes the
firms excellent top management, what the firm did right, what went wrong for the firm in the late
10s, why Food Master will continue to face difficult economics, and lessons based on Food
Masters experience for investors and Kazakhstans government agencies. The paper reflects
insights gained by the authors from interviews conducted in Kazakhstan in the summer and fall of
000.
I. Background Information on Food Master
The ownership of Food Master (a limited liability company) is split between Developed
Technology Resources, Inc. (DTR) and Agribusiness Partners International (API), both U.S.
firms [4]. DTR owns a 0% share and API a 70% share of Food Master. Food Master currently
owns a controlling interest in eight dairy firms�five in Kazakhstan, two in Moldova, and one in
Ukraine. Food Masters dairy plants in Kazakhstan are located in Almaty (Kazakhstans largest city
and former capital), Yessyk, Chimkent, Kurdai and Astana (Kazakhstans new capital). Figure 1
shows the location of the cities of Almaty and Astana.
The firm has a 50% to 55% share of fluid milk sales in the Almaty region. Food Masters
market shares are lower in Astana�about 45% of the fluid milk market, 0% of the kefir market,
and 1% of the ice cream market in the winter [4]. The firms market shares for fluid milk items
in the Akmola region, in particular, decline in the summer when farmer-distributors become strong
competitors.
The origins of Food Masters operations in Kazakhstan�the main focus of this paper�began
in Almaty, Kazakhstan in 15 as a joint venture between DTR and the Kazakh firm, Ak-Bulak
Dairy. The joint venture business began with the production of yogurt and expanded into kefir,
fluid milk, fluid cream, sour cream, ice cream, cheeses, fruit juices, and snack foods. Food Master
subsequently bought the kefir business of the joint venture partner, reducing the contribution of Ak-Bulak
Dairy to the business.
More detailed information on the evolution of DTR, API, and Food Master and selected
financial data for the firms appear below [4,6]
March 17 DTR and API formed Food Master. DTR contributed its dairy businesses in
Almaty, Kazakhstan and API contributed $6 million in cash.
March 17 Food Masters operations in Astana, Kazakhstan were established.
October 17 Food Master Kazakhstan revenues grew from $.7 million in 16 to
$8.18 million in 17.
March 18 DTR reported the first profitable year in its history. Company sales in
Kazakhstan totaled U.S.$14 million in 18 and were projected to be substantially higher in
1.
October 18 API committed an additional $6 million for expansion of Food Master.
August 1 The European Bank for Reconstruction and Development (EBRD) became
an investor in the firms Kazakhstan operations. The EBRD investment provided working
capital to complete Food Masters state-of-the-art fruit juice and milk packaging plant in
Kazakhstan.
April 000 Food Master reported losses of $6. million for 1. The losses were deep
and spread across dairy locations in Kazakhstan, Moldova, and Ukraine.
Mr. John Hupp, President of DTR, attributed the losses to a regional economic crisis, as
follows in April 000 [1]
The economic crisis that hit Russia in August 18 significantly affected our businesses
in Kazakhstan, Moldova, and Ukraine in late 18 and early 1. The crisis saw the
Kazakhstan tenge fall from 8 tenge to the dollar in December 18 to 1 to the dollar at
the end of 1, with similar devaluations in Moldova and Ukraine. The crisis occurred at
the same time Food Master was investing in new dairy assets, including our state-of-the-art
aseptic juice and milk packaging factory in Kazakhstan. Unfortunately the currency
devaluation was not matched by internal inflation within these countries, making it impossible
to raise prices sufficiently to maintain margins (emphasis supplied). Demand dropped with
price increases, creating overcapacity and difficulty in covering overhead expenses, many of
which were dollar denominated expenses.
Hupp described the restructuring that was undertaken to deal with Food Masters losses, as
follows [1]
In mid-1, some initial restructuring began, with the elimination of some of the ex-patriate,
dollar-based employee expenses. In the summer of 1, more than 00 employees
at our Ukraine operation were terminated to bring expenses in line with reduced margins. In
November of 1, DTR and Agribusiness Partners International agreed to eliminate the
overhead in Minneapolis and move the management to the local levels. Further cuts in ex-patriate
employee wages were made in December.
Hupp described Food Masters problems as stemming mainly from a regional economic crisis.
This was clearly an important cause of the firms losses. However, as noted later, the problems
facing Food Master extend beyond those associated with the regional crisis.
Mind that the sample papers like DOING BUSINESS IN AN INDUSTRY WITH DIFFICULTECONOMICS—FOOD MASTER'S EXPERIENCE IN DAIRYPROCESSING AND MARKETING IN KAZAKHSTAN presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Introduction
This Discussion Paper used the following quote from investor, Warren Buffett, as part of
the framework for analyzing the experience of Food Master (a dairy processing and
marketing firm) in Kazakhstans dairy business []
When a management with a reputation for brilliance tackles a business with a
reputation for poor fundamental economics, it is the reputation of the business that
remains intact.
Findings relating to favorable and unfavorable economics provide insights about dairy
marketing and processing conditions in Kazakhstan. Food Master, a dominant dairy
processing and marketing firm in the Almaty region of Kazakhstan, and an important dairy
firm in Astana (Akmola region) has found itself in a business with difficult fundamental
economics. And despite having excellent top management and doing many things correctly,
this case firm lost money in 1 and was forced to restructure. While there have been
positive developments for the business in 000 and 001, the firms long-term profit
prospects are uncertain.
The paper provides background information on Food Master, describing the firms excellent
top management, what the firm did right, what went wrong in the late 10s, why Food
Master will continue to face difficult economics, and lessons from Food Masters
experience for investors and Kazakhstans government agencies.
Background Information on Food Master
The ownership of Food Master is split between Developed Technology Resources, Inc.
(DTR) and Agribusiness Partners International (API), both U.S. firms. DTR owns a 0%
share and API a 70% share of Food Master.
Food Master owns a controlling interest in eight dairy firms, five in Kazakhstan, two in
Moldova, and one in Ukraine.
The firm has a 50% to 55% market share of fluid milk sales in the Almaty region and lower
market shares in the Akmola region.
The origins of Food Masters operations in Kazakhstan began in Almaty, Kazakhstan in
15 as a joint venture between DTR and the Kazakh firm, Ak-Bulak Dairy.
In March 17, DTR and API formed Food Master. DTR contributed its dairy businesses
in Almaty, Kazakhstan and API contributed U.S.$6.0 million in cash to create Food Master.
Food Master reported its first profitable year in March 18. Company sales in
Kazakhstan totaled U.S.$14 million in 18 and were projected to be substantially higher in
1.
However, in April 000 Food Master reported losses of U.S.$6. million for 1. The
losses were deep and spread across the firms dairy operations in Kazakhstan, Moldova, and
Ukraine.
Mr. John Hupp, President of DTR, attributed the losses to sales reductions associated with
the economic crisis that hit Russia in August 18 and spread to Kazakhstan, Moldova, and
Ukraine, negatively affecting Food Masters dairy operations. The crisis saw the
Kazakhstan tenge fall in value from 8 to one U.S. dollar in December 18 down to 1 to
Saulesh Esenova, a native of Kazakhstans Almaty region, was employed as a researcher for the
Global Livestock CRSP and Ph.D. student at McGill University in Canada when this research was
conducted. W.D. Dobson is Professor of Agricultural & Applied Economics, Co-Director of the
Babcock Institute, and Director of the Renk Agribusiness Institute at the University of Wisconsin-Madison.
Doing Business in an Industry with Difficult Economics�Food Masters Experience in Dairy Processing
and Marketing in Kazakhstan
Babcock Institute Discussion Paper No. 001-1
one U.S. dollar at the end of 1 (over 60%), reducing the dollar value of the firms
earnings and increasing the price of imported inputs.
In mid-1, Food Master began to restructure by eliminating certain dollar-denominated
expenses and by adopting rationalization measures.
Food Masters Excellent Top Management
Food Master experienced problems in Kazakhstan despite the presence of strong top
management for DTR and Food Master. The strength of the top management for the two
firms derives from the background and experience of Mr. John Hupp and Mr. Erlan
Sagadiev.
Mr. John Hupp, DTR President, has good Russian language skills and had extensive
business experience in Russia and the former Soviet Union before joining DTR.
Mr. Erlan Sagadiev, General Director of Food Master in Kazakhstan, is fluent in Russian
and English. He is a native of Kazakhstan who completed a graduate education in the U.S.,
has a prestigious family background, and possesses good political connections in
Kazakhstan.
Hupp characterized Sagadievs value to the firm as follows Erlan Sagadiev is the real
reason that DTR went into Kazakhstan. It was Erlans honesty and connections that made
Food Master a reasonably successful business. This success came about because the
company
�Entered via a joint venture with a Kazakh firm.
�Made a well-timed entry.
�Gained potential advantages from entry and exit barriers.
�Made extraordinary efforts to maintain a suitable milk supply.
�Chose effective marketing practices for the firms products.
However, these actions did not shield the firm from incurring losses in 1 and the need to
restructure.
Whether Food Master will achieve above normal profits (or even normal profits) over the
longer-run will depend on whether the firm can consistently overcome challenges associated
with operating in an industry with difficult economics.
What Went Wrong in the Late 10s?
DTR attributed the losses incurred by the firm in 1 mainly to a demand-depressing
regional economic crisis that culminated in devaluation of the tenge.
While the problems encountered by Food Master in the Almaty and Akmola regions that
stem from macroeconomic conditions are arguably transitory, the firm faces other
conditions that will cause difficult economics to persist in Kazakhstans dairy industry.
Why Food Master Will Continue to Face Difficult Economics
The firm will continue to face difficult economic conditions because
�Capable middle and lower-level managers will remain in short supply.
�Quality milk will remain scarce.
�The Akmola region presents unique problems.
�Credit constraints exist.
�Corruption.
Problems associated with obtaining an adequate supply of quality milk and corruption are
likely to be deep-seated, long-term problems for the firm. Milk production declined % in
Kazakhstan from 10 to 18 in response to adverse developments that�for the most
part�still persist.
The dearth of capable middle and lower managers, problems in the Akmola region, and
credit shortages should be manageable, intermediate-term problems.
It is too early to tell how profitable Food Masters operations will be in Kazakhstan over the
longer-run. Despite the persistence of problems, there is little reason that DTR and Food
Master should, in the language of Warren Buffett, change vessels rather than continue to
patch leaks.
There is an encouraging sign for Food Master�DTRs shares, which trade as a NASDAQ
BB stock in the U.S., rose in price during February 001.
What Are the Lessons for Investors in Kazakhstans Dairy Industry?
Food Master was probably positioned better than most foreign-Kazakh joint venture firms
to succeed in Kazakhstans dairy industry. Therefore, other investors should be prepared to
encounter problems at least as difficult as those experienced by Food Master in
Kazakhstan.
Lessons for investors, ranked in order of importance, are as follows
�Dependable supplies of quality milk will be difficult for many processors to obtain for
the foreseeable future.
�Corruption will be a problem for foreign-based processors that fail to employ a politically
well-connected Kazakh in the business.
�Dairy processing and marketing firms will need to devote substantial efforts to training
programs to give employees management and marketing skills needed to operate under
market conditions in Kazakhstan.
�Credit and equity capital for use in Kazakhstans dairy businesses will remain scarce
and/or costly.
�Due diligence inquiries will assume importance for dairy processing and marketing
investments in all parts of Kazakhstan.
What are the Lessons for Kazakhstans Government?
Certain problems affecting Food Master and the firms domestic competitors have
implications for government agencies wishing to foster sound investments in Kazakhstans
dairy processing and marketing businesses, and in dairy farming. These relate mainly to
credit availability, milk supply, and corruption.
�Credit problems will defy easy solution by government agencies. The problem is both
one of lack of available credit for dairy processors and dairy farmers and, at times, high
real interest rates.
�A possible cost-effective way for Kazakhstans government agencies to ensure that more
credit becomes available to dairy processing and marketing firms, and to dairy farmers
would be to expand guarantees of credit provided by banks and other commercial
lenders.
�Infusions of capital and skilled management into dairy farming will be needed to foster
an environment where mid-sized and larger dairy farms can be established with
reasonable prospects for success. Expansion of credit guarantees, business management
assistance to farmers, and improved terms of trade for dairy farmers are called for to deal
with this problem.
�Corruption is an impediment to foreign investment in dairy processing and other
agricultural businesses in Kazakhstan. This problem must be addressed by government
if it is to be reduced.
Doing Business in an Industry with Difficult Economics�Food Masters Experience in Dairy Processing
and Marketing in Kazakhstan
DOING BUSINESS IN AN INDUSTRY WITH DIFFICULT ECONOMICS�
FOOD MASTERS EXPERIENCE IN DAIRY PROCESSING AND MARKETING
IN KAZAKHSTAN
Saulesh Esenova and W. D. Dobson
Introduction
When a management with a reputation for brilliance tackles a business with a reputation for
poor fundamental economics, it is the reputation of the business that remains intact.
Warren Buffett []
This simple point describes an important part of the management philosophy of Warren Buffett,
one of the worlds most successful investors. Interestingly, Buffetts comment provides a useful
framework for analyzing the experience of Food Master (a dairy processing and marketing firm
discussed at length in this paper) in Kazakhstans dairy business. In short, Buffett contends that
investors should avoid businesses with difficult economics. He adds that Should you find
yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more
productive than energy devoted to patching leaks [, p. 47]. Buffett concedes that businesses with
good fundamental economics cannot be identified with engineering precision. However, he
provides guidance on this point, suggesting that securities in companies selling commodity-like
products should come with a warning label that, competition may prove hazardous to human
wealth.
Buffett emphasizes that management foibles, which he labels as the institutional imperative,
can exacerbate the effects of difficult economics [, pp. 5-6]. In this connection, he argues that
(a) as if governed by Newtons first law of motion, an institution will resist any change in its current
direction, (b) just as work expands to fill available time, corporate projects or acquisitions will
materialize to soak up available funds, (c) any business craving of the leader, however foolish, will
be quickly supported by detailed rate-of-return and strategic studies prepared by his troops, and
(d) the behavior of peer companies, whether they are expanding, acquiring, setting executive
compensation or whatever, will be mindlessly imitated.
Michael Porter, a well-known business strategist at Harvards Business School, offers similar
arguments relating to good fundamental economics and difficult economics�albeit in less colorful
language, pointing out that [16, pp. -4]
Not all industries have the same potential. They differ fundamentally in their ultimate
profit potential as the collective strength of the forces (driving industry competition) differs;
the forces range from intense in industries like tires, paper, and steel�where no firm earns
spectacular returns�to relatively mild in industries like oil-field equipment and services,
cosmetics, and toiletries�where high returns are quite common.
Porter indicates that the four primary forces affecting industry competitors and rivalry among
existing firms are (a) bargaining power of suppliers, (b) threat of new entrants, (c) bargaining power
of buyers, and (d) threat of substitute products or services. In an earlier paper, the authors found
that lack of bargaining power of milk suppliers has an important impact on competitive conditions
in Kazakhstans dairy industry []. Most milk suppliers in Kazakhstan have so little bargaining
power that it is difficult for them to stay in business.
What do the arguments about favorable or unfavorable fundamental economics have to do
with dairy marketing and processing in Kazakhstan? Quite a bit it turns out.
Food Master International (Food Master), a dominant dairy processing and marketing firm in
the Almaty region of Kazakhstan, and an important dairy firm in Astana (Akmola region), has
found itself in a business with difficult fundamental economics. Despite having excellent top
management and doing many things correctly, the firm incurred losses in 1 and was forced to
restructure. Food Masters experience provides important lessons for other firms planning to invest
in Kazakhstans dairy businesses and for government policy to encourage sound investments in
Kazakhstans dairy industry.
This Discussion Paper provides background information on Food Master. It describes the
firms excellent top management, what the firm did right, what went wrong for the firm in the late
10s, why Food Master will continue to face difficult economics, and lessons based on Food
Masters experience for investors and Kazakhstans government agencies. The paper reflects
insights gained by the authors from interviews conducted in Kazakhstan in the summer and fall of
000.
I. Background Information on Food Master
The ownership of Food Master (a limited liability company) is split between Developed
Technology Resources, Inc. (DTR) and Agribusiness Partners International (API), both U.S.
firms [4]. DTR owns a 0% share and API a 70% share of Food Master. Food Master currently
owns a controlling interest in eight dairy firms�five in Kazakhstan, two in Moldova, and one in
Ukraine. Food Masters dairy plants in Kazakhstan are located in Almaty (Kazakhstans largest city
and former capital), Yessyk, Chimkent, Kurdai and Astana (Kazakhstans new capital). Figure 1
shows the location of the cities of Almaty and Astana.
The firm has a 50% to 55% share of fluid milk sales in the Almaty region. Food Masters
market shares are lower in Astana�about 45% of the fluid milk market, 0% of the kefir market,
and 1% of the ice cream market in the winter [4]. The firms market shares for fluid milk items
in the Akmola region, in particular, decline in the summer when farmer-distributors become strong
competitors.
The origins of Food Masters operations in Kazakhstan�the main focus of this paper�began
in Almaty, Kazakhstan in 15 as a joint venture between DTR and the Kazakh firm, Ak-Bulak
Dairy. The joint venture business began with the production of yogurt and expanded into kefir,
fluid milk, fluid cream, sour cream, ice cream, cheeses, fruit juices, and snack foods. Food Master
subsequently bought the kefir business of the joint venture partner, reducing the contribution of Ak-Bulak
Dairy to the business.
More detailed information on the evolution of DTR, API, and Food Master and selected
financial data for the firms appear below [4,6]
March 17 DTR and API formed Food Master. DTR contributed its dairy businesses in
Almaty, Kazakhstan and API contributed $6 million in cash.
March 17 Food Masters operations in Astana, Kazakhstan were established.
October 17 Food Master Kazakhstan revenues grew from $.7 million in 16 to
$8.18 million in 17.
March 18 DTR reported the first profitable year in its history. Company sales in
Kazakhstan totaled U.S.$14 million in 18 and were projected to be substantially higher in
1.
October 18 API committed an additional $6 million for expansion of Food Master.
August 1 The European Bank for Reconstruction and Development (EBRD) became
an investor in the firms Kazakhstan operations. The EBRD investment provided working
capital to complete Food Masters state-of-the-art fruit juice and milk packaging plant in
Kazakhstan.
April 000 Food Master reported losses of $6. million for 1. The losses were deep
and spread across dairy locations in Kazakhstan, Moldova, and Ukraine.
Mr. John Hupp, President of DTR, attributed the losses to a regional economic crisis, as
follows in April 000 [1]
The economic crisis that hit Russia in August 18 significantly affected our businesses
in Kazakhstan, Moldova, and Ukraine in late 18 and early 1. The crisis saw the
Kazakhstan tenge fall from 8 tenge to the dollar in December 18 to 1 to the dollar at
the end of 1, with similar devaluations in Moldova and Ukraine. The crisis occurred at
the same time Food Master was investing in new dairy assets, including our state-of-the-art
aseptic juice and milk packaging factory in Kazakhstan. Unfortunately the currency
devaluation was not matched by internal inflation within these countries, making it impossible
to raise prices sufficiently to maintain margins (emphasis supplied). Demand dropped with
price increases, creating overcapacity and difficulty in covering overhead expenses, many of
which were dollar denominated expenses.
Hupp described the restructuring that was undertaken to deal with Food Masters losses, as
follows [1]
In mid-1, some initial restructuring began, with the elimination of some of the ex-patriate,
dollar-based employee expenses. In the summer of 1, more than 00 employees
at our Ukraine operation were terminated to bring expenses in line with reduced margins. In
November of 1, DTR and Agribusiness Partners International agreed to eliminate the
overhead in Minneapolis and move the management to the local levels. Further cuts in ex-patriate
employee wages were made in December.
Hupp described Food Masters problems as stemming mainly from a regional economic crisis.
This was clearly an important cause of the firms losses. However, as noted later, the problems
facing Food Master extend beyond those associated with the regional crisis.
Mind that the sample papers like DOING BUSINESS IN AN INDUSTRY WITH DIFFICULTECONOMICS—FOOD MASTER'S EXPERIENCE IN DAIRYPROCESSING AND MARKETING IN KAZAKHSTAN presented are to be used for review only. In order to warn you and eliminate any plagiarism writing intentions, it is highly recommended not to use the essays in class. In cases you experience difficulties with essay writing in class and for in class use, order original papers with our expert writers. Cheap custom papers can be written from scratch for each customer that entrusts his or her academic success to our writing team. Order your unique assignment from the best custom writing services cheap and fast!
Sunday, 19 August 2012
investment and business oppoetunities in malaysia
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Introduction
The purpose of this paper is to analyze the investment and business opportunities in Malaysia. We will do this by analyzing Malaysia’s economic factors and indicators. As a country inherited elements of democracy from its previous colonizers and its experience of gaining independence, Malaysia could be seen as one of the few Islamic majority democracies, and one of the few highly successful Islamic states. Currently around 4000 foreign companies are operating in Malaysia. Many of these companies have expanded and diversified their operations over the years, reflecting their continued confidence in Malaysia.
Summary
After analyzing the economic conditions and investing opportunities in Malaysia we came to the conclusion that, Malaysia’s with its favorable investment environment which includes such factors as political and social stability, supportive government policies, available and qualified labor, competitive cost structures, excellent infrastructure, quality of life, and a generally good standard of living, has been successful in attracting direct foreign investment and will continue to do so.
History
Malaysia was first mentioned in Chinese and Sanskrit records of the 7th and 8th centuries. In subsequent centuries the area was under the influence and loose control of various Thai and Indonesian empires, including the great Sumatra-based civilization of Sri Vijaya.
The city of Malacca, founded by a Sumatran prince at the beginning of the 15th century, became the center of an Islamic empire and was to remain the primary trading post between India and China for more than 00 years.
In 1511, the control of Malacca went to the spice-trading Portuguese. In 1641, the Dutch defeated the Portuguese and ruled for 154 years. They used imported Dutch stone to construct distinctive pink buildings, many of which still stand.
The British established a thriving port in Penang in 1786 and took over Malacca in 175. The British, discovered tin, and moved inland. Kuala Lumpur, was founded at the confluence of the Klang and Gombak rivers in 1864. The British began building colonial-style structures and made it the capital of the Protected Malay States.
Malay nationalism and desire for self-rule was felt around the 10s. A call for independence was made but the move was halted by the Second World War. Later, the movement resumed and independence was declared on the 1st of August 157.
http//www.planetgypsy.com/destinations/malaysia/generalinfo.html
In 16, Malaysia was formed, bringing together the states of Malaya, Singapore, Sabah and Sarawak. Singapore, however, left the federation in 165.
Today, Malaysia is a strong participant of the six-member Association of South-East Asian Nations -ASEAN-. This association, comprising Brunei Darussalam, Indonesia, Malaysia, Thailand, the Philippines and Singapore, was formed to promote regional growth and cooperation among member nations. Malaysia has since been prosperous and generally peaceful from 165. (www.planetgypsy.com)
Geography
Rightly known as a tropical paradise, Malaysia is situated 7 degrees north of the Equator in the heart of Southeast Asia. Malaysia covers an area of about 0,071 sq.km., occupying the Malay Peninsular and the states of Sabah and Sarawak in the north-western coastal area of Borneo island. The two regions are separated by about 51.1 km of the South China Sea. Peninsular Malaysia, covering 11,587.67 sq.km, has its frontiers with Thailand while East Malaysia, which consists Sabah and Sarawak, about 18,847.4 sq.km, border the territory of Indonesias Kalimantan. (www.planetgypsy.com)
Climate
Malaysia is the classic example of a wet tropical zone- hot and humid all through the year, with the temperature ranging between 1º C and ºC, and the humidity usually touching around 0%. As in all of South East Asia, the monsoons are an important feature of the climate- Malaysia has two monsoons, one in August-September and the other between November and February. The time to see turtles on the east coast is between May and September. (www.planetgypsy.com)
Religion
The different types of religion in Malaysia reflect the variety of races living there. Islam is the official religion but Buddhism, Hinduism, Christianity and other religions are practiced freely. Islam is practiced predominantly by the Malays. Most of the Chinese believe in Buddhism and Taoism but others are Christians. Hinduism is mostly practiced by the regions Indian population. Many indigenous people have converted to Christianity but others still practiced animism. (www.planetgypsy.com)
Language
The national language in Malaysia is Bahasa Malaysia. English, Tamil, Chinese (in its different dialects- Mandarin, Cantonese, Hokkien, Hakka, Hainan and Foochow), Telugu, Malayalam and Punjabi are the other languages spoken by different ethnic groups. In addition, in East Malaysia several indigenous languages are spoken, the main ones being Iban and Kadazan. English is widely spoken by the business community. Mandarin and Tamil are taught concurrently with Bahasa Malaysia and English in schools. (www.planetgypsy.com)
http//www.planetgypsy.com/destinations/malaysia/generalinfo.html
Political Structure
Malaysia is a federal constitutional monarchy with a bicameral federal legislature and unicameral state legislatures. Nine of the 1 states have hereditary rulers (eight Sultans and one Rajah) who share the position of King (Agong) on a five-year rotating basis. The Kings functions are purely ceremonial since constitutional amendments in 1 and 14.
The governing Barisan Nasional (National Front) coalition comprises the United Malays National Organisation (UMNO), the Malaysian Chinese Association (MCA), Gerakan - a Chinese-based party, and the Malaysian Indian Congress (MIC), plus a number of other parties including some based in Sabah and Sarawak. This coalition, in which UMNO is the dominant voice, has been in power in one form or another since the first elected government in 155. At the November 1 general election, the governing coalition was returned to power with its two thirds majority intact. The four national opposition parties formed a loose coalition, Barisan Alternatif (Alternative Front), and increased the number of opposition seats in federal parliament. The next federal election is due to be held by 004. (www.dfat.gov)
Economy
General
Malaysia is an export-oriented economy. In the past 5 years, it has developed rapidly from an agriculture-based economy to one dominated by intermediate manufacturing. Manufactures now account for about 8 per cent of exports, of which about 70 per cent are electrical and electronic products. Chemical and wood products make up the bulk of the remaining manufactured exports. Malaysia is also the worlds leading exporter of palm oil.
Malaysias strong economic performance in the 180s and most of the 10s was built on careful economic planning and management. The government has sought to divest itself of direct ownership in industry, and in the early 10s undertook an ambitious privatisation program. As a result of these reforms, Malaysia enjoyed strong inflows of foreign direct investment in the decade before the Asian economic crisis, further enhancing its industrialisation process. The government � directly, and indirectly through its agencies � still has significant interests in the top 10 listed companies on the Kuala Lumpur stock exchange. The Asian financial crisis impacted greatly on the Malaysian economy. Growth fell sharply and unemployment rose significantly. The government adopted a range of policy responses, including capital controls and the pegging of the ringgit at RM.80 to the US dollar. Non-performing loans worth nearly RM50 billion have been restructured since 18, and the government has injected new funds into the ailing banking industry. The Corporate Debt Restructuring Committee has overseen the successful restructuring of a further RM44 billion in non-performing loans. (www.dfat.gov)
http//www.planetgypsy.com/destinations/malaysia/generalinfo.html
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
Recent Economic Performance
The Asian financial crisis followed a decade of high growth in Malaysia. Between 1 and 17, Malaysia sustained growth of around per cent per annum, with per capita income rising to among the highest in the region. In 18, the economy contracted by 7.4 per cent. From 1, capital control measures - introduced at the height of the economic crisis - were progressively eased in recognition of the need to restore foreign investor confidence. The RM/USD peg remains in place, but other capital control measures have now been abolished.
Malaysias economy recovered strongly in 1, achieving growth of 5.6 per cent. The turnaround was propelled largely by burgeoning exports and public sector spending. The economy grew by over 8 percent in 000 but slowed to 0.4 per cent growth in 001, reflecting weaker global economic conditions and decreased demand for exports in Malaysias key america and asian export markets. (www.dfat.gov)
The governments upward revision in September 00 of its 00 growth estimate (from .5 per cent to between four and five percent) proved accurate, with Malaysia recording a 4. per cent expansion on the back of growth in private consumption and positive export performance. Private consumption overtook manufacturing production as the main contributor to growth, expanding by 4.5% in 00. Analysts suggest that the upward trend in the Malaysian economy is based upon a number of favourable factors, including relatively low interest rates, rising incomes in the public and private sectors, greater access to credit and the governments expansionary fiscal policy.
Source Consensus Economics (March 00)
In 00, exports expanded by about 6%, while imports grew at 8.% in line with stronger domestic demand. The trade account maintained a sizeable surplus of RM50. billion in 00, slightly down from RM54.1 billion in 001.
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
The 00 budget (released in September 00) forecast growth of 6 to 6.5 per cent for 00, assuming export growth of 10.5 per cent. Recent forecasts are less optimistic, owing to the current slowdown in electronic shipments to the US. Consensus Economics forecasts growth of 4.8 per cent for 00. The 00 budget continues the inclination towards fiscal deficits since the 17 economic crisis. Government consumption and increased spending - particularly in the construction sector - have been crucial to ensuring positive growth in recent years. The government is targeting a fiscal deficit of . per cent of GDP for 00 and aims to achieve a balanced budget by 005. This target may prove difficult to realise in light of the softening US economy and the knock-on effects of military conflict in the Gulf. (www.dfat.gov)
Economic Policy
Since the early 10s, Prime Minister Mahathirs 00 Vision has underpinned Malaysias aspirations for economic development. The 00 Vision strives for an eightfold increase in GDP and achievement of “industrialised country” status by the year 00. The policy sets privatisation as a cornerstone of national development, whilst retaining an emphasis on foreign investment to sustain industrialisation.
The National Vision Policy (NVP), implemented in 001, replaces the New Economic Policy (NEP) (introduced in 16), and its successor, the National Development Policy (NDP). The 16 NEP was designed to eradicate poverty and advance the economic position of Bumiputras (sons of the soil, mainly Malays but also other indigenous groups). The NDP, implemented in 11 after the expiry of the NEP, incorporated most of the elements of the NEP, but placed greater emphasis on developing Bumiputra entrepreneurial skills. The NVP largely incorporates and updates these objectives. While the Governments target of 0 per cent Bumiputra ownership of capital has not been achieved, there has been a very significant shift in the balance of ownership, coinciding with the emergence of an influential new class of Bumiputra entrepreneurs. (www.dfat.gov)
Foreign Trade and Investment
Trade Policy regime
Malaysia has been a strong exponent of trade liberalisation and a supporter of the multilateral trading system. Malaysia participates actively in regional economic arrangements, including the ASEAN Free Trade Area (AFTA) and APEC. Malaysia is also an active member of the World Trade Organisation (WTO).
In the AFTA context, Malaysia places a high priority on the early implementation of the common effective preferential tariff (CEPT) scheme which provides for concessional tariffs on intra-ASEAN trade. However, Malaysia continues to offer significant protection for its national automotive industry. In 000, Malaysia won a concession from other AFTA members for the non-application of AFTA to its automotive industry until 005. Malaysian market access for foreign service providers remains limited in the financial and professional services sectors. (www.dfat.gov)
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
Foreign Investment
Foreign Direct Investment (FDI) has played a large part in Malaysias development. FDI grew significantly throughout the 180s, averaging about 5 per cent of GDP. At its peak in 1 and 1, FDI accounted for 8.7 per cent of GDP. The bulk of FDI during the early to mid 10s flowed into the manufacturing sector (65 per cent), oil and gas (18 per cent), services (10 per cent) and property (7 per cent). However, FDI inflows have since slowed, falling to RM14.4 billion (4. per cent of GDP) in 000.
In recent years, strong competition from the labour-rich emerging markets of India and china and labour supply constraints have led to escalating pressure on wages in Malaysia. The government has sought to channel investment into high technology, capital-intensive manufacturing operations. The ultimate goal is to sustain increasing wage costs by managing the transition of the Malaysian manufacturing base from labour to capital-intensive that generates a higher level of value-added per employee. (www.dfat.gov)
Supportive Government Policies
Government policies that maintain a business environment with opportunities for growth and profits have made Malaysia an attractive manufacturing and export base in the region. The private sector in Malaysia is encouraged to become partners with the public sector in achieving the nations’s development objectives.
A major factor that has attracted investors to Malaysia is the government’s commitment to maintain a business envirnoment that provides companies with the opportunities for growth and profits. This commitment is seen in the government’s constant efforts to obtain feedback from the business community through channels of consultation such as regular government-private sector dialogues. These allow the various business communities to air their view and to contribute towards the formulation of government policies, which concern them.. (www.combinet.net)
Liberal Equity Policy
Generally, foreign investors in Malaysia’s manufacturing sector can hold 100% equity in projects, which exports atleast 80% of their production. However , currently, for projects applications received until 1 december 00, foreign investors can hold 100% equity irrespective of their level of exports, with the exception of certain products/activities where Malaysian SMIs have the capabilities. (www.combinet.net)
Employment of Expatriates
Foreign companies are allowed to employ expatriates in cases where certain skills are still lacking in Malaysia. A company with foreign paid-up capital of US$ million or more will be allowed five expatriate posts, including key posts, that is, posts that are permanently filled by foreigners. (www.combinet.net)
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol http//www.combinet.net/wldecnmy/Nov/recent.html
Attractive Tax Incentives
Malaysia’s company tax rate is attractive at 8% and is applicable to both resident and non-resident companies. Malaysia also offers a wide range of tax incentives for manufacturing projects under the Promotion of Investment Act 186 and the Income Tax Act 167. the main incentives are the Pioneer Status, Investment Tax Allowance, Reinvestment Allowance, Incentives for High Technology Industries and Incentives for Strategic Projects. (www.combinet.net)
Work Force
Malaysia offers investors a young, educated and productive workforce at very competitive costs. Malaysia’s literacy rates are high at % and school leavers entering the job market have at least 11 years of basic education. Malaysia offers investors a young, educated and productive workforce at costs competitive with ither countries in Asia. Backed by the government’s continued support of human resource development in all sectors, the quality of Malaysia’s workforce is one of the best in the region. In addition , labor productivity has grown steadly at more than 5% per annum over the last few years. (www.capstrans.com)
High Priority on Education
Education is accorded high priority in development with about 15% of total public development expenditure allocated for this purpose under Malaysia’s five-year development plans.
There are nine public universities, six private universities, about 600 government and private colleges, and several polytechnics and industrail training institutes which offer courses leading to certificate, diploma, degree and post-degree qualifications. Total enrolment in public institutions of higher learing alone is projected to reach over 50,000 this year, with more than half in the science and technical disciplines.
The private sector has also set up educational institutions to supplement the government’s efforts to generate a larger pool of professional and semi-professionals. Among these are institutions of higher learning set up by large corporations such as Telekom Malaysia Berhad, Tenaga Nasional Berhad and Petronas, which provide degree-level courses. Various private colleges in Malaysia offer degree programs on a twinning basis with overseas institutions of higher learing, while foreign universities have set up branch campuses in the country. (www.capstrans.com)
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
http//www.combinet.net/wldecnmy/Nov/recent.html
Industrial Training
In 1, the Human Resource Development Fund (HRDF) was launched by the government to encourage training, retraining and skills upgrading in the private sector. Manufacturers who contribute to this fund will be eligible to apply for grants to defray or subsidize costs incurred in training their workers.
The National Vocational Training Council under the Ministry of Human Resources coordinates the plainning and development of a comprehensive system of vocational and industrial training programs for all public training agencies. It also develops the National Occupational Skills Standards (NOSS) on a continuous basis. To-date there are more than 450 NOSS covering basic, intermediate and advanced taining levels.
Besides the increasing number of Training institutions such as techincal schools, polytechnics, industrial training institutes and skills development centers, to meet the growing requirements of the industrail sector, collaborative efforts between the Malaysian government, enterprises and foreign governments have resulted in the establishment of several advanced skills training institutes such as the German-Malaysian institute, Malaysia France Institute, Japan Malaysia Technical Instiute and Bristish Malaysia Instiute. (www.capstrans.com)
Industrail Relations
Industrail relations in the country are harmonious with minimal trade disputes. Malaysia’s Labor laws safeguard the interests and spell out the rights and responsibilities of employers and employees, thus providing a legal framework for the orderely conduct of industrail relations in the country. (www.capstrans.com)
Infrastructure
Network of Highways
Malaysia has one of the finest road systems in Asia covering 6,445 km. The 848 km expressway links major industrial areas and urban centers of the country. The East-West Highway serves as part of the Asian Highway System linking Thailand with Malaysia. The development of road infrastructure and the Network of highways gave a boost in the income levels. In 1, there were 5.4 million motor vehicles of which 8.6% were motorcars, 54.8% motorcycles and 6.6% goods vehicles. This increased by 50.5% to reach 8.1 million motor vehicles in 17, with motorcycles accounting for 5% of the total, followed by motorcars 40% and goods vehicles 7%. The number of motor vehicles per 100 populations, which is an indicator of the quality of life of the population, increased from 7.6 in 1 to 7.6 in 17. In 1 there was a 6.5 million rail passenger traffic, which by 17 reduced to 5.4 million. How ever there was an increase in air passenger from .8 million in 1 to 0.5 million in 17. (www.northport.com)
http//www.combinet.net/wldecnmy/Nov/recent.html
http//www.capstrans.edu.au/apec_report/_Malaysia.html
Efficient Seaport
The international trade in Malaysia is a sea borne trade. 5 % of the countries trade is by the seven international ports � Penang Port, port clang, Johor port, port of tanjung pelepas, kuantanport, and kemaman port in peninsular Malaysia and Bintulu port in Sarawak.
THE cargo arm of Malaysia Airlines has introduced a three-letter code for seven seaports around the country to enhance efficiency in the movement of the goods. The ports involved in the procedure are Kuching, Kuantan, Penang, the Port of Tanjung Pelepas (PTP), Bintulu, Kota Kinabalu and Pasir Gudang. The International Air Transport Association (IATA) as a point of origin recognizes the three-letter code, which displays the abbreviated port of destination on e-way bills. Currently, it is only implemented in Port Klang under the abbreviated name of XPQ. With the confirmation, the seven ports will join Port Klang as a known destination for forwarders in the air and shipping industries. “Kuantan Port is well-known for being a chemical hub in the region. If they were to be a point of destination, it will open up many possibilities for the country. Malaysia may well be the point of origin for all sea-air links in Asean,” Malaysia Airlines senior general manager (cargo) Ong Jyh Jong. (www.northport.com)
International Airports
Malaysia has five International airports, including those at Kuala Lumpur, George Town and Kota Kinabalu and Sepang along with 15 Domestic airports and STOL Ports. Recognized as leader in multisystem integration Malaysian airport Technologies focus on quality has been unwavering. (ww0.malaysiamanufacturers.com)
Projects under the 8th Malaysia Plan are as follows
Project Status Completion
New Tawau Airport, Sabah Completed 1 May 001
New Bintulu Airport, Sarawak In Progress September 00
New Limbang Airport, Sarawak In Progress May 00
Upgrading of Sibu Airport, Sarawak Planned -
Upgrading of Miri Airport, Sarawak Planned -
Upgrading of Alor Setar Airport, Kedah Planned -
Upgrading of Rural Airstrips - BaKelalan, Long Seridan, Long Lelang, Long Banga, Sarawak Completed 001
Perlis Air Strip (Microflight Aircraft) Planned -
Source http//www.mot.gov.my/english/Division.asp?div=100
High Tech Telecommunication
Malaysia has one of the most modern telecommunication systems in the Southeast Asia. Apart from the telephone service the department provides Telegraph and Telex services and facilitates communication for Broadcasting, civil Aviation, Police, Customs and fisheries. The telecommunication system is supported by microwave trunk telephone network linking all the cities. Communication between Peninsula Malaysia and Sabah and Sarawak are via satellite and the troposcatter system and by submarine cable enabling the operation of nationwide Subscriber Trunk Dialing (STD) and the expansion of television broadcasting services throughout the country.
Introduction of Industrial Parks
Industries in Malaysia are spread over 00 industrial estates or parks and 14 Free Industrial Zones (FIZs), which are developed throughout the country. These sites are fully equipped with infrastructure facilities such as roads, electricity and water supplies, and telecommunications, are continuously being developed by state governments as well as private developers to meet demand.
FIZs are export-processing zones, which have been designed to cater to the needs of export-oriented industries basically for manufacturing and trading establishments that export 80 to 100 percent of their products. Companies in FIZs are allowed duty free imports of raw materials, components, parts, machinery and equipment directly required in the manufacturing process, as well as in the export of their finished products. In areas where FIZs are not available, companies can set up Licensed Manufacturing Warehouses (LMWs), which are accorded facilities similar to those enjoyed by establishments in FIZs. (ww0.malaysiamanufacturers.com)
Introduction of Specialized parks
Malaysia has developed specialized parks to cater to the needs of specific industries. Such as the Technology Park Malaysia in Bukit Jalil, Kuala Lumpur and the Kulim Hi-Tech Park in the northern state of Kedah which cater to technology-intensive industries and R&D activities. The sprawling 1,450-hectare (,580-acre) Kulim Hi-Tech Park is the countrys first fully integrated high technology industrial park. The parks master plan emphasizes on quality of life in a self-contained environment, which incorporates industries, R&D facilities, and a new township with full amenities such as a shopping center, a hospital, educational institutions and recreational facilities. The first phase of its industrial zone covering 50 hectares (60 acres) has been fully leased, and tenants have started moving into the second phase. According to Kulim Technology Park Corporation (KTPC), the developer and manager of the park, a total investment attracted to the park has exceeded RM14 billion (US$.7 billion). (ww0.malaysiamanufacturers.com)
http//ww0.malaysiamanufacturers.com/profitcentre/infrastructure.html#Airports
Business Environment
Malaysia has a mixed economy, comprising of an active private sector of multinational and indigenous businesses and a public sector with extensive involvement in business. The private sector in Malaysia is expected to play a dominant role in the country’s economy and in assisting the country to achieve the status of an industrialized nation by the year 00.
A market oriented economy and government policies that provide business with the opportunity for growth and profits have made Malaysia a highly competitive manufacturing and export base. The biggest advantage of Malaysia is the pool on young, educated trainable workforce. The use of English in Malaysia facilitates your communication with local personnel and suppliers. The country practices the British accounting system, which is acceptable to most international companies.
Framework of the Industry
The industry falls into three broad categories.
1. Indigenous small business, which are once largely concentrated in light industry as well as in wholesale and retail distribution and trading, have successfully moved towards small and medium scale industries (SMIs) through the governments umbrella strategy.
. Large Malaysian corporations, many of which are listed on Kuala Lumpur Stock Exchange. The shareholders in these companies are largely institutional, with significant proportions held by government trust agencies.
. Local operations of multinationals, most of which are majority owned by their foreign parent corporation.
Chamber of commerce and industry
Newcomers to Malaysia’s business environment will feel at home with presence of various chambers of commerce and trade associations made up of investors from different countries. These organizations are invaluable sources for general business information, advice assistance, and compliment the role of government agencies. The major ones are
1. The Malaysian international chamber of commerce and Industry. (MICCI)
. Federation of Malaysian manufacturers (FMM)
. The Japanese chamber of trade and industry (JACTIM)
4. American � Malaysian chamber of commerce (AMCHAM)
Besides several trade associations such as the Malaysian � American electronics industry (MAEI) Group.
Banking and Finance
A well-developed financial and banking sector has enhanced Malaysia’s position as a dynamic export base in Asia. Sophisticated financial facilities are available through domestic and foreign commercial Banks. There are 7 licensed commercial banks in operation. Other financial institutions include merchant banks, retail finance and leasing companies, discount houses, development finance houses and the agricultural bank. The country’s law restricts ownership of banks and financial institutions.
Islamic Banking
As an alternative system, Malaysia offers Islamic banking, which is based on the concept of profit sharing as opposed to the use of interest in the conventional banking system. commercial banks, 18 finance companies and merchant banks were given approval for interest free banking in the year 14.
The central bank has embarked on a plan to develop Malaysia as a regional Islamic financial center. It has formed a consultative committee on Islamic banking in January 16 to serve as a think-tank group to develop strategies and proposals to map out the future directions on Islamic banking.
Specialized Financial Institutions
Malaysia has 40 finance companies, operating through 860 offices, which accepts retail deposits and provide financing for installments (Hire � Purchase) and leasing transactions and housing loans. 156 registered leasing companies serving mainly the industrial sector supplement the services of finance companies.
Source Doing Business In Malaysia � The price water house in Malaysia 16
Joint Ventures Partnerships and sole proprietorships
In addition to business activities conducted by companies, business may be carried on in Malaysia by a partnership or sole proprietorship. A partnership may consist of individuals or companies or a combination of both, but no more than 0 partners if it carries on a business for gain. An exception is made for partnerships in certain professions that have been specifically proclaimed to be excluded from the rule of membership limit. Partnership or sole proprietorship may be registered under the business registration act. Foreign investments do not commonly take for of sole proprietorships.
There is no specific statute that regulates joint ventures or defines the rights and obligations of the parties to the venture. A joint venture can take the form of a partnership, or it may be incorporated.
Restrictions On Foreign Investment
Malaysia recognizes its lack of experience and know-how in many fields of industrial endeavor and the valuable contribution that can be made in economic and industrial development by foreign industrialists. How ever the need for foreign technology and capital must be balanced against the ownership targets of the national development plan. In 11 the NDP replaced the New Economic Policy (NEP), sets out the guidelines and objectives of the governments policies on t he distribution of ownership and participation in the commercial and industrial sectors. The industrial act 175 requires all manufacturing companies to apply to the Malaysian industrial Development Authority (MIDA), an agency of Ministry Of International Trade and Industry, for permission to commerce or expand operations.
This act sets provides for the issue of manufacturing licenses, sets out conditions for BUMIPUTRA and other Malaysian participants.
Some of the conditions are
1. No equity will be imposed on companies that will export 80 percent or more of their production.
. For projects exporting between 51 and 7 percent of their production, foreign equity ownership of 7 percent may be allowed.
. For projects exporting between 0 and 50 percent of their production, foreign equity ownership between 0 to 50 percent will be allowed.
4. Projects less than 0 percent of their production, foreign equity of ownership 0 percent will be allowed.
Quality of life in Malaysia
Malaysia is one of the most friendly and hospitable countries in the world to live in and do business or work. Foreigners coming to this country to do business will not only have hospitable conditions for business, but also can enjoy the modern day facilities like very good living conditions, state of art healthcare and medical conditions, world class educational institutions, and also un surpassing recreational and sports facilities. The cost of such facilities in country like Malaysia is far less than in any of the western country or developed countries. The country is generally warm throughout the year with temperatures ranging from 1° to ° Celsius in the lowlands. This can however be as low as 16° Celsius in the highlands. (geographia.com/Malaysia)
Malaysia reflects different cultural traditions, including those of China, India, the Middle East, Europe, and the entire Malay Archipelago. Early Malay empires absorbed Indian influences, such as Hindu epics and the Sanskrit language. The kingdom of Malacca, centered in the present-day state of Melaka, developed as an Islamic state, or sultanate, in the 1400s. Later, new cultural influences from Europe and China mixed with Hindu and Islamic traditions.
A collective but distinctively Malay cultural pattern has emerged out of all these influences, with artistic expressions in literature, music, dance, and art forms. With such a mix of cultures, most Malaysians can speak two to three languages. Their mother tongue, Malay being the national language is spoken by almost everyone, and English (Mapzones.com).
http//www.geographia.com/malaysia/
Housing
There are several options for living in Malaysia - bungalows or freestanding homes, condominiums (apartments with extra facilities) and apartments (usually with limited facilities). Recently built condominiums in good areas include most of the following - pool, gym, lifts, 4-hour security service, adequate parking, convenience store and landscape gardens. Kuala Lumpur is no different from any other city in the world; location and facilities are all important. There are few natural attractions that make certain areas better for living - being inland, for example, there are no beach-side locations near to the city. The dress circle areas therefore tend to be based upon location with proximity to the CBD, all-important. Other popular upmarket suburbs have long been established and are very well equipped with plenty of amenities. Some indication of monthly rents in Kuala Lumpur. Modern, three-bedroom condominium, ,100 sq. feet in Bangsar - RM7, 500 and a two-bedroom condominium, 1,00 sq. feet in Bangsar - RM, 000. Semi-detached house in central area, RM4,000 to RM6,000 and detached house, central location and pool - RM,000 to RM15,000. By international standards, Malaysian housing is cheap. (expatkl.com)
Education
Education is free and compulsory for children between the ages of 6 and 16, and an additional two years of free education are optional. In 17, 101 percent of Malaysian children attended primary school. Parents may choose between Bahasa Malaysia, Chinese, or Tamil as the language of instruction for their primary-school children. Bahasa Malaysia is the primary language of instruction in all secondary schools, although continued learning in Chinese and Tamil is available and English is a compulsory second language. Enrollment in secondary education was 64 percent in 17. Malaysia has a number of institutions of higher education, including nine universities.
Universities include the National University, in Bangi; the University of Technology, in Johor Baharu; and the University of Malaya, in Kuala Lumpur. Local school curricula are taught in Bahasa Malaysia (national language), Chinese, English or Tamil. There are international schools that use British, Japanese, Indonesian, American, Australian and French curricula. International schools come with a cost but the standards and facilities are high. The International schools are located in Bukit Kiara, Kuala Lumpur, Ampang, and labuana. (Mapzones.com, expatkl.com)
http//www.mapzones.com/world/asia/malaysia/cultureindex.php
http//www.mapzones.com/world/asia/malaysia/educationindex.php
http//www.expatkl.com/housing1.php
http//www.expatkl.com/education.php
Shopping
Malaysia is a shopper’s paradise. There is a wide range of shopping establishments and modern air-conditioned shopping malls, department stores, handicraft centers, bazaars and night markets. Night markets or pasar malam begin their trading activities in the late afternoon. These open-air markets feature hawker stalls that sell a variety of local produce, foodstuff, clothing, traditional medicine vendors and cakes. Bargaining is a common practice. Bukit Bintang area is the oldest shopping center. This place has local and international goods such as clothes, fashion accessories, footwear, sports goods, electrical equipment, pharmaceutical products, computers and furniture.
Exploring Malaysias outdoor markets is pure adventure (and of course one can take home whatever they hunt - or bargain - down). The variety of bargain items that can be found in the major markets is endless, ranging from quality electronics to blowguns to traditional arts and crafts. Currently, the dollar goes a long way in Malaysia. (planetgypsy.com, geographia.com)
Lifestyle
Life in Malaysia is adventure. It offers an exceptional lifestyle especially for the people who love the outdoors. You can spend many exciting weekends at some of the beautiful places in Malaysia. There are clubs for almost any interest i.e. yachting and martial arts; and most daily newspapers often list the clubs and contact numbers for their activities. Most large national groups of expats have associations. Membership for expats are also offered by exclusive where they are assured of basic amenities like swimming pool, tennis / squash / badminton courts, pool tables, and some have their own golf courses or are at least affiliated to one. Because of its myriad cultural influences, Malaysia is renown for its creative, complex, and lovingly prepared original cuisine. Food is taken very seriously here, from the five-star restaurants right down to the hawkers booths. Sauces tend to be highly developed, often incorporating local fruits and spices, and the seafood dishes are what youd expect from a country almost entirely surrounded by ocean. (geographia.com, planetgypsy.com)
http//www.planetgypsy.com/destinations/malaysia/shopping.html
http//www.geographia.com/malaysia/cuisine.html
Risk Factors
Short-term risk event
The growing influences of conservative Islam in Malaysia risks undermining the country’s image abroad as a progressive Islamic state as well as constraining domestic economic development. (home.aigonline.com)
Political risk
The delayed departure of the Prime Minister, Mahathir Mohamad, from politics is proving destabilizing. Although Abdullah Badawi, the deputy president, has been appointed as his successor, uncertainty about policy continuity and speculation about the changing locus of political power will persist. (home.aigonline.com)
Economic outlook
The economy in 00-04 will expand more rapidly than in 00, when growth was an estimated .8%. A fiscal stimulus package is expected to help offset soft domestic and external demand in the early part of the year. The current account will remain in healthy surplus; foreign-exchange reserves will continue to rise. The currency is expected to remain pegged to the US dollar, although the Economist Intelligence Unit expects a shift away from the peg in late-004 as the US currency strengthens. (home.aigonline.com)
Debt outlook
The government will accumulate more foreign debt to finance its fiscal stimulus package, but debt servicing will remain manageable. (home.aigonline.com)
Policy Issues
Following the Asian economic and financial crisis in mid-17, the government abandoned its tight monetary and fiscal policies and adopted an expansionary strategy to revive the economy. On September 1st 18 the government introduced wide-ranging capital controls to gain greater flexibility in lowering interest rates, and pegged the ringgit at M$.80US$1. Since February 1 the government has eased most of these controls. The stimulative fiscal and monetary stance has remained basically unchanged since the 17-8 crisis. The government remains committed to the fixed exchange rate, and the weakness of the US currency has eased pressure for an adjustment of the peg. (home.aigonline.com)
http//home.aigonline.com/country_view/0,4605,157,00.html
Conclusion
Malaysia’s success in attracting the foreign investment in capital-intensive, technology, and knowledge-based projects is the result of many factors. Malaysia with excellent Infrastructure, educated and efficient work force and retaining long-term policies and incentives that provide the confidence to businessmen that their millions of ringgit worth of investments would not be wasted due to change of policies after a change in government.
Malaysia’s location also makes it a logical choice for foreign corporations seeking to establish operational headquarters in the ASIAN region.
Appendix
Key Economic Indicators
1 000 001
Population .7 million . million 4.4 million
GDP RM1.8billion RM0.billion RM10 billion
GDP growth rate 5.8% 8.5% 0.%
Per capita income US$,8 US$,516 US$,000
Inflation rate .8% 1.6% 1.5%
Labor force . million .6 million . million
Unemployment rate .4% .1% .7%
Total exports f.o.b US$ 8.billion 8.1billion 4.4billion
Total imports f.o.b US$ 61.billion 77.billion 76.billion
Major Export’s electronic equipment, petroleum and liquefied natural gas, wood and wood products, palm oil, rubber, textiles, chemicals
Major Import’s electronics, machinery, petroleum products, plastics, vehicles, iron and steel and iron and steel products, chemicals
Source cia.gov/cia/publications/factbook, Bank Negara Malaysia Annual report 000.
References
WWW.planegypsy.com
http//www.planetgypsy.com/destinations/malaysia/history.html
http//www.planetgypsy.com/destinations/malaysia/generalinfo.html
http//www.planetgypsy.com/destinations/malaysia/shopping.html
WWW.dfat.gov
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
WWW.combinet.net
http//www.combinet.net/wldecnmy/Nov/recent.html
WWW.capstrans.edu
http//www.capstrans.edu.au/apec_report/_Malaysia.html
WWW.cia.gov
http//www.cia.gov/cia/publications/factbook/geos/my.htm
WWW.georaphia.com
http//www.geographia.com/malaysia/
http//www.geographia.com/malaysia/cuisine.html
WWW.mapzones.com
http//www.mapzones.com/world/asia/malaysia/cultureindex.php
http//www.mapzones.com/world/asia/malaysia/educationindex.php
WWW.expatkl.com
http//www.expatkl.com/children.php
http//www.expatkl.com/housing1.php
http//www.expatkl.com/education.php
WWW.home.aigonline.com
http//home.aigonline.com/country_view/0,4605,157,00.html
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Introduction
The purpose of this paper is to analyze the investment and business opportunities in Malaysia. We will do this by analyzing Malaysia’s economic factors and indicators. As a country inherited elements of democracy from its previous colonizers and its experience of gaining independence, Malaysia could be seen as one of the few Islamic majority democracies, and one of the few highly successful Islamic states. Currently around 4000 foreign companies are operating in Malaysia. Many of these companies have expanded and diversified their operations over the years, reflecting their continued confidence in Malaysia.
Summary
After analyzing the economic conditions and investing opportunities in Malaysia we came to the conclusion that, Malaysia’s with its favorable investment environment which includes such factors as political and social stability, supportive government policies, available and qualified labor, competitive cost structures, excellent infrastructure, quality of life, and a generally good standard of living, has been successful in attracting direct foreign investment and will continue to do so.
History
Malaysia was first mentioned in Chinese and Sanskrit records of the 7th and 8th centuries. In subsequent centuries the area was under the influence and loose control of various Thai and Indonesian empires, including the great Sumatra-based civilization of Sri Vijaya.
The city of Malacca, founded by a Sumatran prince at the beginning of the 15th century, became the center of an Islamic empire and was to remain the primary trading post between India and China for more than 00 years.
In 1511, the control of Malacca went to the spice-trading Portuguese. In 1641, the Dutch defeated the Portuguese and ruled for 154 years. They used imported Dutch stone to construct distinctive pink buildings, many of which still stand.
The British established a thriving port in Penang in 1786 and took over Malacca in 175. The British, discovered tin, and moved inland. Kuala Lumpur, was founded at the confluence of the Klang and Gombak rivers in 1864. The British began building colonial-style structures and made it the capital of the Protected Malay States.
Malay nationalism and desire for self-rule was felt around the 10s. A call for independence was made but the move was halted by the Second World War. Later, the movement resumed and independence was declared on the 1st of August 157.
http//www.planetgypsy.com/destinations/malaysia/generalinfo.html
In 16, Malaysia was formed, bringing together the states of Malaya, Singapore, Sabah and Sarawak. Singapore, however, left the federation in 165.
Today, Malaysia is a strong participant of the six-member Association of South-East Asian Nations -ASEAN-. This association, comprising Brunei Darussalam, Indonesia, Malaysia, Thailand, the Philippines and Singapore, was formed to promote regional growth and cooperation among member nations. Malaysia has since been prosperous and generally peaceful from 165. (www.planetgypsy.com)
Geography
Rightly known as a tropical paradise, Malaysia is situated 7 degrees north of the Equator in the heart of Southeast Asia. Malaysia covers an area of about 0,071 sq.km., occupying the Malay Peninsular and the states of Sabah and Sarawak in the north-western coastal area of Borneo island. The two regions are separated by about 51.1 km of the South China Sea. Peninsular Malaysia, covering 11,587.67 sq.km, has its frontiers with Thailand while East Malaysia, which consists Sabah and Sarawak, about 18,847.4 sq.km, border the territory of Indonesias Kalimantan. (www.planetgypsy.com)
Climate
Malaysia is the classic example of a wet tropical zone- hot and humid all through the year, with the temperature ranging between 1º C and ºC, and the humidity usually touching around 0%. As in all of South East Asia, the monsoons are an important feature of the climate- Malaysia has two monsoons, one in August-September and the other between November and February. The time to see turtles on the east coast is between May and September. (www.planetgypsy.com)
Religion
The different types of religion in Malaysia reflect the variety of races living there. Islam is the official religion but Buddhism, Hinduism, Christianity and other religions are practiced freely. Islam is practiced predominantly by the Malays. Most of the Chinese believe in Buddhism and Taoism but others are Christians. Hinduism is mostly practiced by the regions Indian population. Many indigenous people have converted to Christianity but others still practiced animism. (www.planetgypsy.com)
Language
The national language in Malaysia is Bahasa Malaysia. English, Tamil, Chinese (in its different dialects- Mandarin, Cantonese, Hokkien, Hakka, Hainan and Foochow), Telugu, Malayalam and Punjabi are the other languages spoken by different ethnic groups. In addition, in East Malaysia several indigenous languages are spoken, the main ones being Iban and Kadazan. English is widely spoken by the business community. Mandarin and Tamil are taught concurrently with Bahasa Malaysia and English in schools. (www.planetgypsy.com)
http//www.planetgypsy.com/destinations/malaysia/generalinfo.html
Political Structure
Malaysia is a federal constitutional monarchy with a bicameral federal legislature and unicameral state legislatures. Nine of the 1 states have hereditary rulers (eight Sultans and one Rajah) who share the position of King (Agong) on a five-year rotating basis. The Kings functions are purely ceremonial since constitutional amendments in 1 and 14.
The governing Barisan Nasional (National Front) coalition comprises the United Malays National Organisation (UMNO), the Malaysian Chinese Association (MCA), Gerakan - a Chinese-based party, and the Malaysian Indian Congress (MIC), plus a number of other parties including some based in Sabah and Sarawak. This coalition, in which UMNO is the dominant voice, has been in power in one form or another since the first elected government in 155. At the November 1 general election, the governing coalition was returned to power with its two thirds majority intact. The four national opposition parties formed a loose coalition, Barisan Alternatif (Alternative Front), and increased the number of opposition seats in federal parliament. The next federal election is due to be held by 004. (www.dfat.gov)
Economy
General
Malaysia is an export-oriented economy. In the past 5 years, it has developed rapidly from an agriculture-based economy to one dominated by intermediate manufacturing. Manufactures now account for about 8 per cent of exports, of which about 70 per cent are electrical and electronic products. Chemical and wood products make up the bulk of the remaining manufactured exports. Malaysia is also the worlds leading exporter of palm oil.
Malaysias strong economic performance in the 180s and most of the 10s was built on careful economic planning and management. The government has sought to divest itself of direct ownership in industry, and in the early 10s undertook an ambitious privatisation program. As a result of these reforms, Malaysia enjoyed strong inflows of foreign direct investment in the decade before the Asian economic crisis, further enhancing its industrialisation process. The government � directly, and indirectly through its agencies � still has significant interests in the top 10 listed companies on the Kuala Lumpur stock exchange. The Asian financial crisis impacted greatly on the Malaysian economy. Growth fell sharply and unemployment rose significantly. The government adopted a range of policy responses, including capital controls and the pegging of the ringgit at RM.80 to the US dollar. Non-performing loans worth nearly RM50 billion have been restructured since 18, and the government has injected new funds into the ailing banking industry. The Corporate Debt Restructuring Committee has overseen the successful restructuring of a further RM44 billion in non-performing loans. (www.dfat.gov)
http//www.planetgypsy.com/destinations/malaysia/generalinfo.html
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
Recent Economic Performance
The Asian financial crisis followed a decade of high growth in Malaysia. Between 1 and 17, Malaysia sustained growth of around per cent per annum, with per capita income rising to among the highest in the region. In 18, the economy contracted by 7.4 per cent. From 1, capital control measures - introduced at the height of the economic crisis - were progressively eased in recognition of the need to restore foreign investor confidence. The RM/USD peg remains in place, but other capital control measures have now been abolished.
Malaysias economy recovered strongly in 1, achieving growth of 5.6 per cent. The turnaround was propelled largely by burgeoning exports and public sector spending. The economy grew by over 8 percent in 000 but slowed to 0.4 per cent growth in 001, reflecting weaker global economic conditions and decreased demand for exports in Malaysias key america and asian export markets. (www.dfat.gov)
The governments upward revision in September 00 of its 00 growth estimate (from .5 per cent to between four and five percent) proved accurate, with Malaysia recording a 4. per cent expansion on the back of growth in private consumption and positive export performance. Private consumption overtook manufacturing production as the main contributor to growth, expanding by 4.5% in 00. Analysts suggest that the upward trend in the Malaysian economy is based upon a number of favourable factors, including relatively low interest rates, rising incomes in the public and private sectors, greater access to credit and the governments expansionary fiscal policy.
Source Consensus Economics (March 00)
In 00, exports expanded by about 6%, while imports grew at 8.% in line with stronger domestic demand. The trade account maintained a sizeable surplus of RM50. billion in 00, slightly down from RM54.1 billion in 001.
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
The 00 budget (released in September 00) forecast growth of 6 to 6.5 per cent for 00, assuming export growth of 10.5 per cent. Recent forecasts are less optimistic, owing to the current slowdown in electronic shipments to the US. Consensus Economics forecasts growth of 4.8 per cent for 00. The 00 budget continues the inclination towards fiscal deficits since the 17 economic crisis. Government consumption and increased spending - particularly in the construction sector - have been crucial to ensuring positive growth in recent years. The government is targeting a fiscal deficit of . per cent of GDP for 00 and aims to achieve a balanced budget by 005. This target may prove difficult to realise in light of the softening US economy and the knock-on effects of military conflict in the Gulf. (www.dfat.gov)
Economic Policy
Since the early 10s, Prime Minister Mahathirs 00 Vision has underpinned Malaysias aspirations for economic development. The 00 Vision strives for an eightfold increase in GDP and achievement of “industrialised country” status by the year 00. The policy sets privatisation as a cornerstone of national development, whilst retaining an emphasis on foreign investment to sustain industrialisation.
The National Vision Policy (NVP), implemented in 001, replaces the New Economic Policy (NEP) (introduced in 16), and its successor, the National Development Policy (NDP). The 16 NEP was designed to eradicate poverty and advance the economic position of Bumiputras (sons of the soil, mainly Malays but also other indigenous groups). The NDP, implemented in 11 after the expiry of the NEP, incorporated most of the elements of the NEP, but placed greater emphasis on developing Bumiputra entrepreneurial skills. The NVP largely incorporates and updates these objectives. While the Governments target of 0 per cent Bumiputra ownership of capital has not been achieved, there has been a very significant shift in the balance of ownership, coinciding with the emergence of an influential new class of Bumiputra entrepreneurs. (www.dfat.gov)
Foreign Trade and Investment
Trade Policy regime
Malaysia has been a strong exponent of trade liberalisation and a supporter of the multilateral trading system. Malaysia participates actively in regional economic arrangements, including the ASEAN Free Trade Area (AFTA) and APEC. Malaysia is also an active member of the World Trade Organisation (WTO).
In the AFTA context, Malaysia places a high priority on the early implementation of the common effective preferential tariff (CEPT) scheme which provides for concessional tariffs on intra-ASEAN trade. However, Malaysia continues to offer significant protection for its national automotive industry. In 000, Malaysia won a concession from other AFTA members for the non-application of AFTA to its automotive industry until 005. Malaysian market access for foreign service providers remains limited in the financial and professional services sectors. (www.dfat.gov)
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
Foreign Investment
Foreign Direct Investment (FDI) has played a large part in Malaysias development. FDI grew significantly throughout the 180s, averaging about 5 per cent of GDP. At its peak in 1 and 1, FDI accounted for 8.7 per cent of GDP. The bulk of FDI during the early to mid 10s flowed into the manufacturing sector (65 per cent), oil and gas (18 per cent), services (10 per cent) and property (7 per cent). However, FDI inflows have since slowed, falling to RM14.4 billion (4. per cent of GDP) in 000.
In recent years, strong competition from the labour-rich emerging markets of India and china and labour supply constraints have led to escalating pressure on wages in Malaysia. The government has sought to channel investment into high technology, capital-intensive manufacturing operations. The ultimate goal is to sustain increasing wage costs by managing the transition of the Malaysian manufacturing base from labour to capital-intensive that generates a higher level of value-added per employee. (www.dfat.gov)
Supportive Government Policies
Government policies that maintain a business environment with opportunities for growth and profits have made Malaysia an attractive manufacturing and export base in the region. The private sector in Malaysia is encouraged to become partners with the public sector in achieving the nations’s development objectives.
A major factor that has attracted investors to Malaysia is the government’s commitment to maintain a business envirnoment that provides companies with the opportunities for growth and profits. This commitment is seen in the government’s constant efforts to obtain feedback from the business community through channels of consultation such as regular government-private sector dialogues. These allow the various business communities to air their view and to contribute towards the formulation of government policies, which concern them.. (www.combinet.net)
Liberal Equity Policy
Generally, foreign investors in Malaysia’s manufacturing sector can hold 100% equity in projects, which exports atleast 80% of their production. However , currently, for projects applications received until 1 december 00, foreign investors can hold 100% equity irrespective of their level of exports, with the exception of certain products/activities where Malaysian SMIs have the capabilities. (www.combinet.net)
Employment of Expatriates
Foreign companies are allowed to employ expatriates in cases where certain skills are still lacking in Malaysia. A company with foreign paid-up capital of US$ million or more will be allowed five expatriate posts, including key posts, that is, posts that are permanently filled by foreigners. (www.combinet.net)
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol http//www.combinet.net/wldecnmy/Nov/recent.html
Attractive Tax Incentives
Malaysia’s company tax rate is attractive at 8% and is applicable to both resident and non-resident companies. Malaysia also offers a wide range of tax incentives for manufacturing projects under the Promotion of Investment Act 186 and the Income Tax Act 167. the main incentives are the Pioneer Status, Investment Tax Allowance, Reinvestment Allowance, Incentives for High Technology Industries and Incentives for Strategic Projects. (www.combinet.net)
Work Force
Malaysia offers investors a young, educated and productive workforce at very competitive costs. Malaysia’s literacy rates are high at % and school leavers entering the job market have at least 11 years of basic education. Malaysia offers investors a young, educated and productive workforce at costs competitive with ither countries in Asia. Backed by the government’s continued support of human resource development in all sectors, the quality of Malaysia’s workforce is one of the best in the region. In addition , labor productivity has grown steadly at more than 5% per annum over the last few years. (www.capstrans.com)
High Priority on Education
Education is accorded high priority in development with about 15% of total public development expenditure allocated for this purpose under Malaysia’s five-year development plans.
There are nine public universities, six private universities, about 600 government and private colleges, and several polytechnics and industrail training institutes which offer courses leading to certificate, diploma, degree and post-degree qualifications. Total enrolment in public institutions of higher learing alone is projected to reach over 50,000 this year, with more than half in the science and technical disciplines.
The private sector has also set up educational institutions to supplement the government’s efforts to generate a larger pool of professional and semi-professionals. Among these are institutions of higher learning set up by large corporations such as Telekom Malaysia Berhad, Tenaga Nasional Berhad and Petronas, which provide degree-level courses. Various private colleges in Malaysia offer degree programs on a twinning basis with overseas institutions of higher learing, while foreign universities have set up branch campuses in the country. (www.capstrans.com)
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
http//www.combinet.net/wldecnmy/Nov/recent.html
Industrial Training
In 1, the Human Resource Development Fund (HRDF) was launched by the government to encourage training, retraining and skills upgrading in the private sector. Manufacturers who contribute to this fund will be eligible to apply for grants to defray or subsidize costs incurred in training their workers.
The National Vocational Training Council under the Ministry of Human Resources coordinates the plainning and development of a comprehensive system of vocational and industrial training programs for all public training agencies. It also develops the National Occupational Skills Standards (NOSS) on a continuous basis. To-date there are more than 450 NOSS covering basic, intermediate and advanced taining levels.
Besides the increasing number of Training institutions such as techincal schools, polytechnics, industrial training institutes and skills development centers, to meet the growing requirements of the industrail sector, collaborative efforts between the Malaysian government, enterprises and foreign governments have resulted in the establishment of several advanced skills training institutes such as the German-Malaysian institute, Malaysia France Institute, Japan Malaysia Technical Instiute and Bristish Malaysia Instiute. (www.capstrans.com)
Industrail Relations
Industrail relations in the country are harmonious with minimal trade disputes. Malaysia’s Labor laws safeguard the interests and spell out the rights and responsibilities of employers and employees, thus providing a legal framework for the orderely conduct of industrail relations in the country. (www.capstrans.com)
Infrastructure
Network of Highways
Malaysia has one of the finest road systems in Asia covering 6,445 km. The 848 km expressway links major industrial areas and urban centers of the country. The East-West Highway serves as part of the Asian Highway System linking Thailand with Malaysia. The development of road infrastructure and the Network of highways gave a boost in the income levels. In 1, there were 5.4 million motor vehicles of which 8.6% were motorcars, 54.8% motorcycles and 6.6% goods vehicles. This increased by 50.5% to reach 8.1 million motor vehicles in 17, with motorcycles accounting for 5% of the total, followed by motorcars 40% and goods vehicles 7%. The number of motor vehicles per 100 populations, which is an indicator of the quality of life of the population, increased from 7.6 in 1 to 7.6 in 17. In 1 there was a 6.5 million rail passenger traffic, which by 17 reduced to 5.4 million. How ever there was an increase in air passenger from .8 million in 1 to 0.5 million in 17. (www.northport.com)
http//www.combinet.net/wldecnmy/Nov/recent.html
http//www.capstrans.edu.au/apec_report/_Malaysia.html
Efficient Seaport
The international trade in Malaysia is a sea borne trade. 5 % of the countries trade is by the seven international ports � Penang Port, port clang, Johor port, port of tanjung pelepas, kuantanport, and kemaman port in peninsular Malaysia and Bintulu port in Sarawak.
THE cargo arm of Malaysia Airlines has introduced a three-letter code for seven seaports around the country to enhance efficiency in the movement of the goods. The ports involved in the procedure are Kuching, Kuantan, Penang, the Port of Tanjung Pelepas (PTP), Bintulu, Kota Kinabalu and Pasir Gudang. The International Air Transport Association (IATA) as a point of origin recognizes the three-letter code, which displays the abbreviated port of destination on e-way bills. Currently, it is only implemented in Port Klang under the abbreviated name of XPQ. With the confirmation, the seven ports will join Port Klang as a known destination for forwarders in the air and shipping industries. “Kuantan Port is well-known for being a chemical hub in the region. If they were to be a point of destination, it will open up many possibilities for the country. Malaysia may well be the point of origin for all sea-air links in Asean,” Malaysia Airlines senior general manager (cargo) Ong Jyh Jong. (www.northport.com)
International Airports
Malaysia has five International airports, including those at Kuala Lumpur, George Town and Kota Kinabalu and Sepang along with 15 Domestic airports and STOL Ports. Recognized as leader in multisystem integration Malaysian airport Technologies focus on quality has been unwavering. (ww0.malaysiamanufacturers.com)
Projects under the 8th Malaysia Plan are as follows
Project Status Completion
New Tawau Airport, Sabah Completed 1 May 001
New Bintulu Airport, Sarawak In Progress September 00
New Limbang Airport, Sarawak In Progress May 00
Upgrading of Sibu Airport, Sarawak Planned -
Upgrading of Miri Airport, Sarawak Planned -
Upgrading of Alor Setar Airport, Kedah Planned -
Upgrading of Rural Airstrips - BaKelalan, Long Seridan, Long Lelang, Long Banga, Sarawak Completed 001
Perlis Air Strip (Microflight Aircraft) Planned -
Source http//www.mot.gov.my/english/Division.asp?div=100
High Tech Telecommunication
Malaysia has one of the most modern telecommunication systems in the Southeast Asia. Apart from the telephone service the department provides Telegraph and Telex services and facilitates communication for Broadcasting, civil Aviation, Police, Customs and fisheries. The telecommunication system is supported by microwave trunk telephone network linking all the cities. Communication between Peninsula Malaysia and Sabah and Sarawak are via satellite and the troposcatter system and by submarine cable enabling the operation of nationwide Subscriber Trunk Dialing (STD) and the expansion of television broadcasting services throughout the country.
Introduction of Industrial Parks
Industries in Malaysia are spread over 00 industrial estates or parks and 14 Free Industrial Zones (FIZs), which are developed throughout the country. These sites are fully equipped with infrastructure facilities such as roads, electricity and water supplies, and telecommunications, are continuously being developed by state governments as well as private developers to meet demand.
FIZs are export-processing zones, which have been designed to cater to the needs of export-oriented industries basically for manufacturing and trading establishments that export 80 to 100 percent of their products. Companies in FIZs are allowed duty free imports of raw materials, components, parts, machinery and equipment directly required in the manufacturing process, as well as in the export of their finished products. In areas where FIZs are not available, companies can set up Licensed Manufacturing Warehouses (LMWs), which are accorded facilities similar to those enjoyed by establishments in FIZs. (ww0.malaysiamanufacturers.com)
Introduction of Specialized parks
Malaysia has developed specialized parks to cater to the needs of specific industries. Such as the Technology Park Malaysia in Bukit Jalil, Kuala Lumpur and the Kulim Hi-Tech Park in the northern state of Kedah which cater to technology-intensive industries and R&D activities. The sprawling 1,450-hectare (,580-acre) Kulim Hi-Tech Park is the countrys first fully integrated high technology industrial park. The parks master plan emphasizes on quality of life in a self-contained environment, which incorporates industries, R&D facilities, and a new township with full amenities such as a shopping center, a hospital, educational institutions and recreational facilities. The first phase of its industrial zone covering 50 hectares (60 acres) has been fully leased, and tenants have started moving into the second phase. According to Kulim Technology Park Corporation (KTPC), the developer and manager of the park, a total investment attracted to the park has exceeded RM14 billion (US$.7 billion). (ww0.malaysiamanufacturers.com)
http//ww0.malaysiamanufacturers.com/profitcentre/infrastructure.html#Airports
Business Environment
Malaysia has a mixed economy, comprising of an active private sector of multinational and indigenous businesses and a public sector with extensive involvement in business. The private sector in Malaysia is expected to play a dominant role in the country’s economy and in assisting the country to achieve the status of an industrialized nation by the year 00.
A market oriented economy and government policies that provide business with the opportunity for growth and profits have made Malaysia a highly competitive manufacturing and export base. The biggest advantage of Malaysia is the pool on young, educated trainable workforce. The use of English in Malaysia facilitates your communication with local personnel and suppliers. The country practices the British accounting system, which is acceptable to most international companies.
Framework of the Industry
The industry falls into three broad categories.
1. Indigenous small business, which are once largely concentrated in light industry as well as in wholesale and retail distribution and trading, have successfully moved towards small and medium scale industries (SMIs) through the governments umbrella strategy.
. Large Malaysian corporations, many of which are listed on Kuala Lumpur Stock Exchange. The shareholders in these companies are largely institutional, with significant proportions held by government trust agencies.
. Local operations of multinationals, most of which are majority owned by their foreign parent corporation.
Chamber of commerce and industry
Newcomers to Malaysia’s business environment will feel at home with presence of various chambers of commerce and trade associations made up of investors from different countries. These organizations are invaluable sources for general business information, advice assistance, and compliment the role of government agencies. The major ones are
1. The Malaysian international chamber of commerce and Industry. (MICCI)
. Federation of Malaysian manufacturers (FMM)
. The Japanese chamber of trade and industry (JACTIM)
4. American � Malaysian chamber of commerce (AMCHAM)
Besides several trade associations such as the Malaysian � American electronics industry (MAEI) Group.
Banking and Finance
A well-developed financial and banking sector has enhanced Malaysia’s position as a dynamic export base in Asia. Sophisticated financial facilities are available through domestic and foreign commercial Banks. There are 7 licensed commercial banks in operation. Other financial institutions include merchant banks, retail finance and leasing companies, discount houses, development finance houses and the agricultural bank. The country’s law restricts ownership of banks and financial institutions.
Islamic Banking
As an alternative system, Malaysia offers Islamic banking, which is based on the concept of profit sharing as opposed to the use of interest in the conventional banking system. commercial banks, 18 finance companies and merchant banks were given approval for interest free banking in the year 14.
The central bank has embarked on a plan to develop Malaysia as a regional Islamic financial center. It has formed a consultative committee on Islamic banking in January 16 to serve as a think-tank group to develop strategies and proposals to map out the future directions on Islamic banking.
Specialized Financial Institutions
Malaysia has 40 finance companies, operating through 860 offices, which accepts retail deposits and provide financing for installments (Hire � Purchase) and leasing transactions and housing loans. 156 registered leasing companies serving mainly the industrial sector supplement the services of finance companies.
Source Doing Business In Malaysia � The price water house in Malaysia 16
Joint Ventures Partnerships and sole proprietorships
In addition to business activities conducted by companies, business may be carried on in Malaysia by a partnership or sole proprietorship. A partnership may consist of individuals or companies or a combination of both, but no more than 0 partners if it carries on a business for gain. An exception is made for partnerships in certain professions that have been specifically proclaimed to be excluded from the rule of membership limit. Partnership or sole proprietorship may be registered under the business registration act. Foreign investments do not commonly take for of sole proprietorships.
There is no specific statute that regulates joint ventures or defines the rights and obligations of the parties to the venture. A joint venture can take the form of a partnership, or it may be incorporated.
Restrictions On Foreign Investment
Malaysia recognizes its lack of experience and know-how in many fields of industrial endeavor and the valuable contribution that can be made in economic and industrial development by foreign industrialists. How ever the need for foreign technology and capital must be balanced against the ownership targets of the national development plan. In 11 the NDP replaced the New Economic Policy (NEP), sets out the guidelines and objectives of the governments policies on t he distribution of ownership and participation in the commercial and industrial sectors. The industrial act 175 requires all manufacturing companies to apply to the Malaysian industrial Development Authority (MIDA), an agency of Ministry Of International Trade and Industry, for permission to commerce or expand operations.
This act sets provides for the issue of manufacturing licenses, sets out conditions for BUMIPUTRA and other Malaysian participants.
Some of the conditions are
1. No equity will be imposed on companies that will export 80 percent or more of their production.
. For projects exporting between 51 and 7 percent of their production, foreign equity ownership of 7 percent may be allowed.
. For projects exporting between 0 and 50 percent of their production, foreign equity ownership between 0 to 50 percent will be allowed.
4. Projects less than 0 percent of their production, foreign equity of ownership 0 percent will be allowed.
Quality of life in Malaysia
Malaysia is one of the most friendly and hospitable countries in the world to live in and do business or work. Foreigners coming to this country to do business will not only have hospitable conditions for business, but also can enjoy the modern day facilities like very good living conditions, state of art healthcare and medical conditions, world class educational institutions, and also un surpassing recreational and sports facilities. The cost of such facilities in country like Malaysia is far less than in any of the western country or developed countries. The country is generally warm throughout the year with temperatures ranging from 1° to ° Celsius in the lowlands. This can however be as low as 16° Celsius in the highlands. (geographia.com/Malaysia)
Malaysia reflects different cultural traditions, including those of China, India, the Middle East, Europe, and the entire Malay Archipelago. Early Malay empires absorbed Indian influences, such as Hindu epics and the Sanskrit language. The kingdom of Malacca, centered in the present-day state of Melaka, developed as an Islamic state, or sultanate, in the 1400s. Later, new cultural influences from Europe and China mixed with Hindu and Islamic traditions.
A collective but distinctively Malay cultural pattern has emerged out of all these influences, with artistic expressions in literature, music, dance, and art forms. With such a mix of cultures, most Malaysians can speak two to three languages. Their mother tongue, Malay being the national language is spoken by almost everyone, and English (Mapzones.com).
http//www.geographia.com/malaysia/
Housing
There are several options for living in Malaysia - bungalows or freestanding homes, condominiums (apartments with extra facilities) and apartments (usually with limited facilities). Recently built condominiums in good areas include most of the following - pool, gym, lifts, 4-hour security service, adequate parking, convenience store and landscape gardens. Kuala Lumpur is no different from any other city in the world; location and facilities are all important. There are few natural attractions that make certain areas better for living - being inland, for example, there are no beach-side locations near to the city. The dress circle areas therefore tend to be based upon location with proximity to the CBD, all-important. Other popular upmarket suburbs have long been established and are very well equipped with plenty of amenities. Some indication of monthly rents in Kuala Lumpur. Modern, three-bedroom condominium, ,100 sq. feet in Bangsar - RM7, 500 and a two-bedroom condominium, 1,00 sq. feet in Bangsar - RM, 000. Semi-detached house in central area, RM4,000 to RM6,000 and detached house, central location and pool - RM,000 to RM15,000. By international standards, Malaysian housing is cheap. (expatkl.com)
Education
Education is free and compulsory for children between the ages of 6 and 16, and an additional two years of free education are optional. In 17, 101 percent of Malaysian children attended primary school. Parents may choose between Bahasa Malaysia, Chinese, or Tamil as the language of instruction for their primary-school children. Bahasa Malaysia is the primary language of instruction in all secondary schools, although continued learning in Chinese and Tamil is available and English is a compulsory second language. Enrollment in secondary education was 64 percent in 17. Malaysia has a number of institutions of higher education, including nine universities.
Universities include the National University, in Bangi; the University of Technology, in Johor Baharu; and the University of Malaya, in Kuala Lumpur. Local school curricula are taught in Bahasa Malaysia (national language), Chinese, English or Tamil. There are international schools that use British, Japanese, Indonesian, American, Australian and French curricula. International schools come with a cost but the standards and facilities are high. The International schools are located in Bukit Kiara, Kuala Lumpur, Ampang, and labuana. (Mapzones.com, expatkl.com)
http//www.mapzones.com/world/asia/malaysia/cultureindex.php
http//www.mapzones.com/world/asia/malaysia/educationindex.php
http//www.expatkl.com/housing1.php
http//www.expatkl.com/education.php
Shopping
Malaysia is a shopper’s paradise. There is a wide range of shopping establishments and modern air-conditioned shopping malls, department stores, handicraft centers, bazaars and night markets. Night markets or pasar malam begin their trading activities in the late afternoon. These open-air markets feature hawker stalls that sell a variety of local produce, foodstuff, clothing, traditional medicine vendors and cakes. Bargaining is a common practice. Bukit Bintang area is the oldest shopping center. This place has local and international goods such as clothes, fashion accessories, footwear, sports goods, electrical equipment, pharmaceutical products, computers and furniture.
Exploring Malaysias outdoor markets is pure adventure (and of course one can take home whatever they hunt - or bargain - down). The variety of bargain items that can be found in the major markets is endless, ranging from quality electronics to blowguns to traditional arts and crafts. Currently, the dollar goes a long way in Malaysia. (planetgypsy.com, geographia.com)
Lifestyle
Life in Malaysia is adventure. It offers an exceptional lifestyle especially for the people who love the outdoors. You can spend many exciting weekends at some of the beautiful places in Malaysia. There are clubs for almost any interest i.e. yachting and martial arts; and most daily newspapers often list the clubs and contact numbers for their activities. Most large national groups of expats have associations. Membership for expats are also offered by exclusive where they are assured of basic amenities like swimming pool, tennis / squash / badminton courts, pool tables, and some have their own golf courses or are at least affiliated to one. Because of its myriad cultural influences, Malaysia is renown for its creative, complex, and lovingly prepared original cuisine. Food is taken very seriously here, from the five-star restaurants right down to the hawkers booths. Sauces tend to be highly developed, often incorporating local fruits and spices, and the seafood dishes are what youd expect from a country almost entirely surrounded by ocean. (geographia.com, planetgypsy.com)
http//www.planetgypsy.com/destinations/malaysia/shopping.html
http//www.geographia.com/malaysia/cuisine.html
Risk Factors
Short-term risk event
The growing influences of conservative Islam in Malaysia risks undermining the country’s image abroad as a progressive Islamic state as well as constraining domestic economic development. (home.aigonline.com)
Political risk
The delayed departure of the Prime Minister, Mahathir Mohamad, from politics is proving destabilizing. Although Abdullah Badawi, the deputy president, has been appointed as his successor, uncertainty about policy continuity and speculation about the changing locus of political power will persist. (home.aigonline.com)
Economic outlook
The economy in 00-04 will expand more rapidly than in 00, when growth was an estimated .8%. A fiscal stimulus package is expected to help offset soft domestic and external demand in the early part of the year. The current account will remain in healthy surplus; foreign-exchange reserves will continue to rise. The currency is expected to remain pegged to the US dollar, although the Economist Intelligence Unit expects a shift away from the peg in late-004 as the US currency strengthens. (home.aigonline.com)
Debt outlook
The government will accumulate more foreign debt to finance its fiscal stimulus package, but debt servicing will remain manageable. (home.aigonline.com)
Policy Issues
Following the Asian economic and financial crisis in mid-17, the government abandoned its tight monetary and fiscal policies and adopted an expansionary strategy to revive the economy. On September 1st 18 the government introduced wide-ranging capital controls to gain greater flexibility in lowering interest rates, and pegged the ringgit at M$.80US$1. Since February 1 the government has eased most of these controls. The stimulative fiscal and monetary stance has remained basically unchanged since the 17-8 crisis. The government remains committed to the fixed exchange rate, and the weakness of the US currency has eased pressure for an adjustment of the peg. (home.aigonline.com)
http//home.aigonline.com/country_view/0,4605,157,00.html
Conclusion
Malaysia’s success in attracting the foreign investment in capital-intensive, technology, and knowledge-based projects is the result of many factors. Malaysia with excellent Infrastructure, educated and efficient work force and retaining long-term policies and incentives that provide the confidence to businessmen that their millions of ringgit worth of investments would not be wasted due to change of policies after a change in government.
Malaysia’s location also makes it a logical choice for foreign corporations seeking to establish operational headquarters in the ASIAN region.
Appendix
Key Economic Indicators
1 000 001
Population .7 million . million 4.4 million
GDP RM1.8billion RM0.billion RM10 billion
GDP growth rate 5.8% 8.5% 0.%
Per capita income US$,8 US$,516 US$,000
Inflation rate .8% 1.6% 1.5%
Labor force . million .6 million . million
Unemployment rate .4% .1% .7%
Total exports f.o.b US$ 8.billion 8.1billion 4.4billion
Total imports f.o.b US$ 61.billion 77.billion 76.billion
Major Export’s electronic equipment, petroleum and liquefied natural gas, wood and wood products, palm oil, rubber, textiles, chemicals
Major Import’s electronics, machinery, petroleum products, plastics, vehicles, iron and steel and iron and steel products, chemicals
Source cia.gov/cia/publications/factbook, Bank Negara Malaysia Annual report 000.
References
WWW.planegypsy.com
http//www.planetgypsy.com/destinations/malaysia/history.html
http//www.planetgypsy.com/destinations/malaysia/generalinfo.html
http//www.planetgypsy.com/destinations/malaysia/shopping.html
WWW.dfat.gov
http//www.dfat.gov.au/geo/malaysia/malaysia_brief.html#pol
WWW.combinet.net
http//www.combinet.net/wldecnmy/Nov/recent.html
WWW.capstrans.edu
http//www.capstrans.edu.au/apec_report/_Malaysia.html
WWW.cia.gov
http//www.cia.gov/cia/publications/factbook/geos/my.htm
WWW.georaphia.com
http//www.geographia.com/malaysia/
http//www.geographia.com/malaysia/cuisine.html
WWW.mapzones.com
http//www.mapzones.com/world/asia/malaysia/cultureindex.php
http//www.mapzones.com/world/asia/malaysia/educationindex.php
WWW.expatkl.com
http//www.expatkl.com/children.php
http//www.expatkl.com/housing1.php
http//www.expatkl.com/education.php
WWW.home.aigonline.com
http//home.aigonline.com/country_view/0,4605,157,00.html
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