Palm | Kelapa Sawit

ACCORDING to the recently released 10th Malaysia Plan, Malaysia needs to achieve an average six per cent annual gross domestic product growth in the next five years to achieve the required development toward a high income economy by 2020.

The newly formulated New Economic Model which is based on innovation, creativity and high value sources of growth is intended to shift the country's reliance from a manufacturing base dependent on semi- skilled and low cost labour to one that focuses on high technology dependent upon skilled and highly paid workers, among others.

Considering the competitive global landscape that exists, Malaysia would do well to further diversify its income stream by venturing into markets that will help the country sustain recovery after the credit crisis.

Manufacturing outsourcing is not a new trend, with developed countries outsourcing manufacturing jobs to neighbouring developing nations, sometimes even setting up factories in the country.

However, as the world recovers from the 2008 financial upheaval, original equipment manufacturers are increasingly outsourcing their requirements for parts and components, and modules.

Increases in demand and costs of production will necessitate further outsourcing of assembly, and testing and calibration operations by original equipment manufacturer (OEM) companies.