INTERNATIONAL BIOECONOMY PROFILE MALAYSIA POLICY

INTERNATIONAL BIOECONOMY PROFILE
MALAYSIA
POLICY
Structure of the Bioeconomy Institutional system
Responsible National
Authorities / Agencies
Ministry of Science, Technology and Innovation (MOSTI)
Malaysia Biotechnology Corporation Sdn Bhd (BiotechCorp)
www.biotechcorp.com.my
www.bioeconomy.my
BiotechCorp, an agency under the purview of Ministry of Science, Technology and Innovation (MOSTI), is responsible for executing the objectives of the National Biotechnology Policy (NBP) and acts to identify value propositions in both R&D and commerce and to support these ventures via financial assistance and develop-mental services.
BiotechCorp as a bio-based developer in Malaysia continuously works towards strategic developments de-signed to
maximise commercial opportunities in bio-based industries and transform Malaysia into a high-income and sustainable nation by 2020.
BiotechCorp’s key mandates are as follows:
 Act as a one-stop-center
 Nurture and accelerate growth of Malaysian biotechnology companies
 Actively promote foreign direct investments in biotechnology
 Create conducive environment for biotechnology
Bioeconomy Background in Malaysia
Bioeconomy refers to all economic activity that is derived from the continued commercial application of biotechnology. It encompasses the production of renewable biological resources and their conversion into food, feed,
chemicals, energy and healthcare wellness products via innovative and efficient technolo-gies.
The Malaysian Government has identified Bioeconomy as one of the key strategic drivers to elevate the na-tion’s socio-economic development. Being one of the world’s 17 megadiverse countries, Malaysia has a rich source of biodiversity to tap into in support of a Bioeconomy. In view of this, The National Biotechnology Policy (NBP) was launched
in 2005 to oversee this emerging sector.
List of " bioeconomy-relevant" policy initiatives
Bioeconomy
Strategy
The National Biotechnology Policy 2005 (NBP)
The implementation of NBP are divided into three stages: Phase 1 (2005-2010) on capacity building;
Phase 2 (2011-2015) on shifting science to business; and Phase 3 (2016-2020) on going global. In
line with Phase 2, Biotechnology in Malaysia is currently focused on com-mercialisation efforts and
Malaysia have begun intensifying various overseas collaborations and global programmes in moving
forward for Phase 3.
The National Biotechnology Policy is focused on the development of three major biotechnology sectors namely AgBiotech, BioMedical and BioIndustrial underpinned by nine policy thrusts:
1.
Agriculture Biotechnology Development
Transform and enhance the value creation of the agricultural sector
through biotechnol-ogy.
2.
Healthcare Biotechnology Development
Capitalize on the strengths of biodiversity to commercialise discoveries in natural products as well as
position Malaysia in the bio-generics market.
3.
Industrial Biotechnology Development
Ensure growth opportunities in the application of advanced bio-processing and bio-manufacturing
technologies.
4.
R&D and Technology Acquisition
Establish Centres of Excellence, in existing or new institutions, to bring together multidisci-plinary research teams in coordinated research and commercialisation initiatives. Accelerate technology development via strategic acquisitions.
5.
Human Capital Development
Build the nation’s biotech human resource capability in line with market needs through spe-cial
schemes, programs and training.
6.
Financial Infrastructure Development
Apply competitive ‘lab-to-market’ funding and incentives to promote committed participation by academia, the private sector as well as government-linked companies. Implement sufficient exit mechanisms for investments in biotech.
7.
Legislative and Regulatory Framework Development
Create an enabling environment through continuous reviews of the country’s regulatory framework
and procedures in line with global standards and best practices. Develop a strong intellectual property protection regime to support R&D and commercialisation efforts.
8.
Strategic Positioning
Establish a global marketing strategy to build brand recognition for Malaysian biotech and benchmark progress. Establish Malaysia as a center for contract research organisations and contract manufacturing organisations.
9.
Government Commitment
Establish a dedicated and professional implementation agency overseeing the development of Malaysia’s biotech industry, under the aegis of the Prime Minister and relevant govern-ment ministries.
Link: http://www.biotek.gov.my/images/stories/publications/biotech_policy.pdf
BIOECONOMY RELATED POLICY INITIATIVE:

Bioeconomy Transformation Programme (BTP)
BTP has been endorsed by the National Bioeconomy Council (NBC) launched by the Ma-laysian Prime Minister on 30
October 2012. It is a platform provided by the government for the private sector to channel and maximise commercial opportunities in bio-based industries.
Through BTP, the government and leading industry players work in tandem to set national goals and objectives for the
application of biotechnology in agriculture production, industrial manufacturing and human healthcare, put in place
the required structural conditions and develop fundamental mechanisms to ensure that policy can flexibly adapt to
new opportunities.
10 Entry Point Projects (EPPs) have been identified to kick-start the growth of Malaysia’s Bioeconomy in the AgBiotech, BioMedical and BioIndustrial sectors. Within these 10 EPPs, 20 private-sector driven Trigger Projects have
been assessed for potential benefit to the na-tion from the perspective of Gross National Income (GNI) generated,
employment created and investment attracted.
Since its launch in October 2012, BiotechCorp has continued to identify and evaluate high potential proposed Trigger
Projects to be added under the programme through BTP Work-shops and Labs as well as ongoing engagement with
the private sector. 95 out of 175 pro-jects identified from the BTP Workshops have been shortlisted as commercial
ready with additional 5 projects were evaluated from external engagement from the private sector.
To date, a total of 25 Trigger Projects have been identified which are expected to generate a total GNI of USD1.3 billion (RM4.2 billion) in 2020, provide 18,100 job opportunities, and secure cumulative investments of USD4.2 billion
(RM13.7 billion) by 2020. Ultimately, BTP is envisioned to target the overall investments of USD15.5 billion (RM50 billion), creation of 170,000 job opportunities and Gross National Income (GNI) of USD14.9 billion (RM48 bil-lion) by
2020.
This transformation programme receives strong support from the relevant ministries such as Ministry of Science,
Technology and Innovation (MOSTI), Malaysian Investment Develop-ment Authority (MIDA), Ministry of Energy, Green
Technology and Water, Malaysia (KeT-THA), Ministry of Plantation Industries and Commodities (MPIC), Ministry of Natural Re-sources and Environment (NRE) and Ministry of Agriculture & Agro-Based Industry (MOA).
Link: http://www.biotek.gov.my/images/stories/bioeconomy/BTP2013.pdf

BioNexus Companies
BioNexus is a special status awarded to qualified international and Malaysian biotechnology companies undertaking
value-added biotechnology and/or life sciences activities. The status endows fiscal incentives, grants and other guarantees to assist growth. Apart from the overall benefits and supports, BioNexus companies are assured a list of privileges as stipulated in the BioNexus Bill of Guarantees (http://www.biotechcorp.com.my/bionexus-new/)
As at September 2014, a total of 241 companies are awarded with BioNexus status comprising Agbiotech (136), BioMedical (65) and BioIndustrial (40) sectors.
Link: http://www.biotechcorp.com.my/bionexus-new/

National Biomass Strategy 2020
The National Biomass Strategy 2020 lays the foundations for Malaysia to capitalise on its biomass by channelling it
into higher value downstream uses. Agensi Inovasi Malaysia (AIM) acts as the Malaysia’s innovation agency to assess
Malaysia’s combined strengths and resources as a nation and create new industries and high-value jobs for Malaysians by introducing innovative approaches and strategies to capitalise on these existing strengths.
Link: http://innovation.my/pdf/1mbas/Biomass%20Strategy2013.pdf
RESEARCH
Bioeconomy R&D Investments
PUBLIC R&D INVESTMENT in Bioeconomy (year xxxx)
Info source: Malaysia Government
As of 30 June 2014, a total of USD1.1 billion (RM 3.57 billion) of funds have been utilised under the 9th and 10th Malaysia Plan. TechnoFund and ScienceFund are two main funding programmes under MOSTI, which are described as follows:
ScienceFund
Under Ninth Malaysia Plan (RMK 9) and Tenth Malaysia Plans (RMK 10), a total of USD241.7 million (RM781.2million)
investment has been approved for 4,065 R&D projects.
TechnoFund
A total of USD328.2 million (RM1.1 billion) investment has been approved for 382 R&D projects under RMK 9 and RMK
10.
The diagram below summarised the total investment of USD209.3 million (RM676.1) approved under RMK 10:
th
10 MALAYSIA PLAN
(source: MOSTI Report on R&D&C outcome as of June 2014)
Meanwhile, USD896.0 million (RM2.9 billion) of investment has been approved under RMK 9 as below:
(source: MOSTI Report on R&D&C outcome as of June 2014)
PRIVATE R&D INVESTMENT in Bioeconomy
Info source: Malaysia Government
BioNexus Companies
USD30.1m
USD30.8m
USD24.4m
USD54.1m
USD19.9m
USD66.5m
USD134.9m
USD13.5m
USD6.3m
USD8.5m
USD1.5m
USD14.3m
Total R&D Spending (from Q3 2007 to Q1 2014)
R&D Spending (by year)
.
The above pie chart shows the total BioNexus R&D spending from year 2007 until Q1 2014. From the 3 sectors, BioMedical represents the highest total of investment worth USD66.5 million (RM214.6 million) since 2007, followed
by AgBiotech USD54.1 million (RM174.6 million) and BioIndustrial for USD14.3 million (RM46.0 million) worth of
R&D investment.
MARKETS
References to existing Market Studies/Forecasts about Bioeconomy
Analysis has determined that Bioeconomy as a whole in Malaysia contributed 13.4% of total Gross Domestic Product
(GDP) and is valued at USD33 billion (RM106.7 billion) in year 2010 (Total Malaysian GDP in 2010 was USD246.6 billion (RM797.3 billion)). This value encompasses economic contribution from sectors of economy that could benefit
from application of bio-based technology, like agriculture, chemical production, and oil & fat processing.
Based on Dynamic Computable General Equilibrium (DCGE) modelling forecasted at 10% yearly growth, Bio-economy
is valued at USD36.4 billion (RM117.6 billion) in 2020 and USD48.8 billion (RM157.6 billion) in 2030. The top five
forecasted sectoral contribution ranked in order are Oil Palm, Rubber, Oil & Fat Processing, Fishing and Forestry &
Logging.
We have also utilised OECD assumptions of possible contribution of biotechnology applications (i.e. 50% of primary
production, 35% of industrial applications, and 80% of healthcare manufacturing) to estimate contribution of biobased technologies. The findings, assuming 10% growth, is described in the table below:
Forecasted Biotechnology contribution to Bioeconomy in Malaysia (GDP in RM billion):
Sectors
2010
2015
2020
2025
2030
Biotechnology contribution to
Bio-economy
49.9
60.6
66.8
73.6
81.2
In addition to this, Input Output (IO) Modeling was also conducted using 2005 IO tables as a baseline. Sectors in Malaysia was classified under defined categories as follows: Agriculture, Forestry & Logging, Fishing, Manufacturing, Services, and ROS (Rest of the Sectors). Rest of the Sectors is defined as Crude Oil, Natural Gas and Mining Sector. Palm
Oil and Rubber is included in Agriculture sector and Healthcare is included in Services Sector.
The IO Modeling suggested that Services and Agriculture sectors being the first and second most important output
generating sector for Bioeconomy with the multiplier of 2.346 and 2.133 respectively.
The model also translated the output impact generated by the identified six sectors of the Malaysian economy from
the Bioeconomy revenue of USD33 billion (RM106.7 billion). Services sector had obtained the greatest output impact
of USD77.42 million (RM250.287 million) followed by Agriculture USD70.37 million (RM227.506 million) generated by
Bioeconomy revenue.
The total number of employment generated by RM106.7 billion of the Bioeconomy revenue is found to be 12,549.
This contributed 0.095% of 13.21 million total employments in Malaysia. The most important contrib-uting sector in
terms of employment generation in Bioeconomy was supported by Service sector with 4,160 employments (0.031%).
GENERAL INFORMATION
(Key Facts & Figures regarding Malaysia)
DEMOGRAPHY/ POPULATION
Census 2010 revealed that the total population of Malaysia was 28.3 million, compared with 23.3 million in 2000.
This gives an average annual population growth rate of 2.0% for the 2000-2010 period. The rate was lower compared to that of 2.6 % during 1991-2000 and 1980-1991. Population density stood at 86 persons per square kilometre in 2010 compared with 71 persons in 2000.
Total population of Malaysia
Average annual population growth rate, Malaysia
As of 2010, total population was 28.3 million, 91.8% were Malaysian citizens and 8.2% were non-citizens. Malaysian
citizens consist of the ethnic groups Bumiputera (67.4%), Chinese (24.6%), Indians (7.3%) and Others (0.7%). Among
the Malaysian citizens, the Malays was the predominant ethnic group in Peninsular Malaysia which constituted 63.1%
of the total citizens. The Ibans constituted 30.3% of the total citizens in Sarawak while Kadazans/Dusun made up
24.5% in Sabah.
Percentage Distribution of the population by ethnic group, Malaysia, 2010
Malays are the majority citizens in Peninsular Malaysia,
Ibans in Sarawak and Kadazans/Dusuns in Sabah
The proportion of working age population (15 to 64 years) increased to 67.3% (2010) from 62.8% (2000). The median age increased from 23.6 years in 2000 to 26.2 years in 2010, while the dependency ratio dropped from 59.2% to
48.5%. These trends indicate aging population of Malaysia. Men outnumbered women with the sex ratio of 106 in
2010. Similar pattern was observed in year 2000 (104).
Number of population by sex and age group, Malaysia, 2000 and 2010
Islam
was
the most widely professed religion in Malaysia with the proportion of 61.3% in 2010. Other religions embraced were
Buddhism (19.8%), Christianity (9.2%), and Hinduism (6.3%).
Percentage distribution of the population by religion, Malaysia, 2010
ECONOMY/ GDP
Based in 2013, Malaysia’s economy grew at 4.7% with all sectors registered positive growths. The Services and Manufacturing sectors remained as the key engine in supply side. The GDP in 2013 has increased by 4.7% which is
RM986.7 billion from its previous year RM941.9 billion.
ECONOMY STRUCTURE
Percentage Share to GDP by Kind of Economic Activity at Current Prices, Malaysia, 2005 to 2013
GDP by Kind of Economic Activity at Current Prices (RM million), Malaysia, 2005 to 2013
SOCIAL/ EMPLOYMENT/ UNEMPLOYMENT
Labour force participation rate (LFPR) in Malaysia continue to rise to 67.0% in 2013, or a total of 13.63 million persons from 20.34 million persons of the working age population. Of these, a total of 13.21 million persons were employed while 424,600 persons were unemployed in 2013. The unemployment rate in Malaysia there-fore stood at
3.1% of the total labour force.
Principal statistics of labour force, Malaysia, 2012 and 2013
Malaysians aged 25-34 years showed a productive age in economic activity with highest LFPR as compared to other
age groups (2012: 82.9%; 2013: 83.8%). Also to note that LFPR for women workers has increased significantly from
2012 to 2013 by 2.9%.
Labour force participation rate by sex and age group, Malaysia, 2012 and 2013
Among major ethnic groups in Malaysia, Chinese remained the highest LFPR (2012: 65.4%, 2013: 66.8%), followed by
Malay (2012: 62.7%, 2013: 64.3%) and Indians (2012: 61.9%, 2013: 62.6%). In terms of ethnic composition, Malay
dominated the employment with a share of 46.1% in 2013, up 0.4 percentage point from 45.7% in 2012. Chinese
remained the second largest ethnic at 22.7%, followed by Indians at 6.4%.
Labour force participation rate by ethnic group, Malaysia, 2012 and 2013
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