Penang has earned its international reputation as the “Silicon Valley of the East”, riding on an economic structure pivoted around the electrical and electronics (E&E) industry for over 40 years.
However, Penang is facing many new challenges, especially finding new growth and sustainable development areas. Rising industrialisation in Vietnam, Thailand and Indonesia is eroding Penang’s competitiveness in attracting foreign investment and creating more jobs in the E&E sector.
The need to re-invigorate the economy
For decades, brain drain issues remain a continuous concern for Penang as it impacts the transition to a knowledge and innovation-based economy. A lack of high-quality jobs is causing our brightest minds to leave the country for better prospects overseas.
Talent shortage will result in certain sectors of the economy not being able to innovate and move up the value chain.
Reinvent to avert regional economic threat
For a small state that relies on global trade and tourism predominantly, the threat is real, and something needs to be done to safeguard its economic sustainability. Putting a multidimensional growth strategy that focuses on cities, people and the economy is mission critical. Reinventing by moving up the value chain is the way forward.
The good news is that there are plenty of opportunities for Penang to move up the value chain. A forward-thinking approach is what Penang needs to get to the next level. Adapting to the shifting trends with reinvented capability and flexibility is a crucial formula to strengthen Penang’s economy and development in the next 50 years.
The Penang2030 vision
The Penang2030 vision lays the foundation for such aspirations. Advancing people’s liveability and economy, promoting civic participation and balanced development constitutes the core of the Penang2030 vision, which focuses on shaping a “Family-Focused, Green and Smart State that Inspires the Nation”.
With 2030 arriving soon, there is no time to ‘wait and see’ as the ever-changing technological landscape opens up ‘new growth’ opportunities like never before. Empowering digital economy is the key agenda. Many initiatives need to be in place today to secure the future of Penang and the well-being of its people.
A balanced development on the island and mainland
A balanced development between Penang Island and Seberang Perai is a prerequisite for sustainable economic growth and shared prosperity. 50 years of industrialisation have been pushing Penang from strength to strength.
Industrial parks - Mak Mandin, Perai, Bayan Lepas, Seberang Jaya, Bukit Tengah, Bukit Minyak, Penang Science Park, Penang Science Park North and Batu Kawan Industrial Park 1 & 2 - are a testament to Penang's five decades of industrial success.
Penang has been thriving on a long-term industrialisation plan that began in 1972, transforming from a traditional seaport economy into the Silicon Valley of the East. Take Seberang Jaya, Perai, Juru and Bukit Minyak in Seberang Perai for example, those were swampy areas that have today become a hotspot for industrialisation and urbanisation, driven by massive job opportunities, mainly in the E&E sector.
Knowledge economy to drive new growth
50 years down the road, a new wave of industrialisation is taking shape, which requires new, strategic thinking to foster economic growth. In the digital era where smart solutions dictate our lives, data-driven knowledge economy is the key enabler to drive new-value economy.
Transitioning from manufacturing-based industries to innovation-intensive sectors such as information technology, research and development, and services is a pragmatic way to diversify Penang’s economy while creating more higher-skilled and higher-income job opportunities.
Human capital development such as education, training and skills enhancement in the fields of science, technology, engineering, and mathematics (STEM) will help nurture a skilled workforce. By fostering a knowledge-based environment, Penang can attract and retain talent to advance its technology industry, hence increasing its competitiveness in the region.
PSI/ Silicon Island to fulfil future needs
All eyes will be on the 2,300-acre Silicon Island of the scaled-down Penang South Islands (PSI) project - to reinvent Penang as a desired place for living and work that embraces what shapes the socioeconomic landscape in the next 50 years.
Out of the 2,300 acres, 30.44% is earmarked for industry and global business services, 45.3% for public facilities, infrastructure and blue-green network, and 24.26% for housing and commercial. More specifically, the land use breakdown goes this way: Global Business Services Belt (700 acres), public spaces, infrastructure and blue-green network (1,042 acres), and housing and commercial (558 acres).
The key elements
With key elements including the 700-acre ‘Green Tech Park’ (GTP), digital technology infrastructure, e-Commerce, and Business Process Outsourcing (BPO) facilities, Silicon Island will be a new technological hub that champions the Internet of Things (IoT), Big Data Analytics (BDA), robotics, Artificial Intelligence (AI) and Machine Learning (ML) to advance the digital economy.
“The targeted sectors for the 700-acre land Green Tech Park allocated for industry and GBS Belt include semiconductor IC Design; software development; embedded systems design; product design and development; high-tech manufacturing: semiconductor and systems product; assembly, testing and packaging; automated test equipment and equipment fabrication; medical devices; and GBS,” said Penang Infrastructure Corporation Sdn Bhd chief executive officer Datuk Seri Farizan Darus.
On the green initiatives alone, 405 acres of land will be allocated for the development of public parks, wetlands, floodplains, and bioswales; together with the creation of a mangrove forest for locals and tourists for recreation; construction of water canals with a blue-green network for water taxi connection; a 100% usage of renewable energy at GTP; installation of 110km of bicycle and pedestrian network for green mobility by creating; implementation of electric public bus services; and construction of ‘super low-energy’ buildings with efficient cooling systems and smart features.
The future economic growth enabler
Within a 30-year timeframe, Silicon Island is expected to generate RM1.1 trillion of GDP with foreign direct investment hitting RM70 billion while creating more than 220,000 jobs in various sectors, according to him.
Neighbouring the Bayan Lepas Free Industrial Zone (FIZ), Penang International Airport (PIA) and the Sultan Abdul Halim Muadzam Shah Bridge, Silicon Island is strategically located and primed for becoming a new-growth hotspot for businesses and investors.
With Batu Kawan coming of age on the mainland while the island side is facing the challenge of land scarcity, a fully master-planned township with green thinking at heart will usher in a new age of sustainable living, supported by a network of waterways in a harmonious waterfront setting.
On a proud note, Silicon Island’s master plan has successfully obtained a ‘5-Diamond’ recognition for the Design Category from the Malaysian Green Technology and Climate Change Corporation (MGTC) in the Low Carbon Cities 2030 Challenge.
Challenges towards sustainable development
While Silicon Island has been carefully planned to fulfil Penang’s future needs with various sustainability features, taking into consideration the environmental, social and governance policies, there are many challenges lying ahead.
The outspoken criticism from certain politicians, non-governmental organisations, activists, and other anti-project individuals stands in the way of enhancing the quality of life and sustainability, championing innovation and entrepreneurship, and lifting the global competitiveness of Penang.
Fishermen get 24-hour access to sea
Stoking the fear of losing livelihood among the fishermen has been the loudest all the while.
The reality is that the Silicon Island project will not stop fishermen from going to the sea, during and after the reclamation work, as assured by Penang Infrastructure Corporation (PIC).
In fact, they will be facilitated by a 250-metre-wide navigation channel for 24-hour access to the sea, regardless of the tide. This translates into an improvement for the fishermen as they no longer need to wait for high tide to go to sea.
For fishermen who support the project, the recent Environmental Impact Assessment (EIA) report approval serves as a hopeful game changer that envisions a better future for their children and grandchildren.
Social Impact Management Plan (SIMP)
The Penang State Government has already taken socioeconomic uplifting initiatives through the Social Impact Management Plan (SIMP) to safeguard the well-being of fishermen from Permatang Tepi Laut, Sg Batu, Gertak Sanggul, Teluk Kumbar, Seri Jerjak, Batu Maung, Kuala Sg Burung, Teluk Tempoyak and Pulau Betong.
“The state government has allocated inshore fishermen with ex-gratia payments, new boat engines, and navigation equipment, as well as education opportunities for their children,” explained Fajinah Jaafar, secretary of Bayan Lepas Fishermen Welfare Association, reminding all quarters to listen to the views of genuine fishermen instead of the unsubstantiated claims raised by certain politicians and fishing hobbyists posing as fishermen.
“The reality is many of the so-called fishermen are hobbyists. Unlike us and our association, they do not do it for a living. When we accept state aid, we are criticised for believing in a future that can increase our earning capabilities,” she said.
“Some of the anti-PSI groups talk about losing fishing ground, but the PSI site is not where fishermen get their 20kg to 40kg of shrimps. They get them around the piers of the first and second Penang bridges where artificial reefs attract a lot of shrimps,” she added.
Fishermen can continue fishing during and after reclamation
Based on Fisheries Department data, more than 90% of the local fishermen operate in the deeper sea from 15 nautical miles and beyond, which is far from the project site. Therefore, the impact on fish landings (catches) during and after reclamation is minimal.
“A well-planned development that brings long-term economic benefits to our children, grandchildren and Penang as a whole is what we need to think and decide today, not tomorrow. Let’s shed this backward-thinking mindset,” urged Fajinah.
Transforming for a better future
Creating more land for industrial, commercial and residential use for a small island like Penang is crucial for transforming its economic landscape from remaining stagnant into a dynamic and sustainable force. It is all about unlocking new-growth possibilities for a better future.
For more details on the Silicon Island project and how you can make Penang a role model for sustainable living, browse through: https://penanginfra.com/penang-south-islands/
