MPMA FOUNDS INDUSTRIAL PARK

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The Malaysian Plastics Manufacturers Association is willing to play entrepreneur and landlord in an effort to help its members gain a competitive edge.

In an unusual arrangement, the Selangor, Malaysia-based MPMA has struck a deal with government officials of Malaysia's state of Terengganu to build and manage a 148-acre industrial park near the city of Dungun on the east coast of Malaysia. The objective is to provide MPMA member companies the opportunity to acquire land, labor and raw materials at a reduced cost, to enhance their ability to compete in international markets, according to Liew Sew Yee, MPMA president and managing director of a major Malaysian plastics injection molder and extruder.

Conceived last August and already approved by the state government, the plan will be supported by private investment and open to participation by all 870 of MPMA's member companies, Liew said in an interview conducted in early February by e-mail.

The association and state already have agreed in principle on terms and conditions, he added, though further details must be negotiated before MPMA members will be invited to apply for land in the park, located in the government-designated Eastern Corridor Industrial Zone. No date has been set yet for construction to begin.

Liew said he is unaware of any similar projects in the ASEAN region. The plan calls for the state government to offer land in the park at a reduced price, plus other, unspecified incentives related to siting a factory there. The government also has agreed to subsidize the initial cost of workers for companies' first year of business in the park, as a means of stimulating worker training.

Despite the fact that many Malaysian plastics firms have been forced to look abroad for skilled foreign workers to staff their plants in the country's more traditional manufacturing regions, Liew said, ``The state government believes there is abundant labor available. Therefore, special incentives will be given to companies having a work force of more than 350.''

The association expects there to be a ready supply of plastic resins, since the federal government has targeted the petrochemical sector as a strategic industry in that region. Malaysia already produces all the major commodity resins, and expects a sharp increase in monomer as well as polymer production when several planned capacity expansions come on stream in the next couple years.

``MPMA is also expected to negotiate with the resin suppliers in the eastern corridor for a special price structure to encourage companies who wish to export their products from this area to be competitive in the international arena,'' Liew said.

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