BIOMASS INDUSTRY NETWORKING SEMINAR - Funding & Business Development Opportunities

Transcription

1 BIOMASS INDUSTRY NETWORKING SEMINAR - Funding & Business Development Opportunities INCENTIVES & INVESTMENT OPPORTUNITIES IN THE BIOMASS SECTOR By: Azlina Hamdan Malaysian Investment Development Authority (MIDA)

2 Content Outline MIDA in Brief Economic Transformation Programme (ETP) Performance in the Manufacturing & Biomass Sector Incentives & Investment Opportunities in the Biomass Sector Domestic Investment Strategic Fund 2

3 FUNCTIONS OF MIDA Promotion Foreign Direct Investment Domestic Investment Manufacturing Services 3 Evaluation Planning Follow-up / Monitoring Manufacturing licenses Tax incentives Expatriate posts Duty exemption OHQ, RDC, IPC and R&D status Planning for industrial development Recommend policies and strategies on industrial promotion and development Formulation of strategies, programmes and initiatives for international economic cooperation Assist companies in the implementation and operation of their projects Facilitate exchange & co-ordination among institutions engaged in or connected with industrial development Advisory Services

4 MIDA ONE STOP CENTRE Based In MIDA Immigration Department Royal Malaysian Customs Department of Environment Tenaga Nasional Berhad Telekom Malaysia Berhad Labour Department Based Outside of MIDA Department of Occupational Safety and Health Ministry of Finance Ministry of Health Ministry of Tourism Ministry of Human Resource Ministry of Higher Education Multimedia Development Corp. (MDeC) Construction Industry Development Board of Malaysia (CIDB) 4

5 MIDA ONE STOP CENTRE Functions of Advisory Services Based In/Outside MIDA Advise and assist investors on matters relating to tax, labour, immigration, customs, utilities, occupational, safety and health, and environment Coordinate applications for approval and other matters under the purview of the relevant ministries and departments 5

6 MIDA S STATE OFFICES ALOR SETAR KOTA BHARU PENANG IPOH KUALA TERENGGANU KOTA KINABALU KUANTAN SEREMBAN MELAKA MIDA HEADQUARTERS JOHOR BAHRU KUCHING 6

7 MIDA WORLDWIDE NETWORK Stockholm San Jose Los Angeles Chicago Houston Boston New York London Paris Frankfurt Munich Milan Dubai Mumbai Seoul Tokyo Shanghai Osaka Guangzhou Taipei Bangkok Johannesburg Singapore Sydney 24 Overseas Centres 7

8 Electronics & Electrical Industries : High-technology based products using wireless and convergence technology Mobile application Solar wafer / cells / modules Semiconductors INVESTMENT OPPORTUNITIES IN THE MANUFACTURING SECTOR Petrochemical Industry : Alpha-olefins & fatty alcohols, propylene oxide & caprolactam Renewable & biodegradable materials Aerospace Industry : Maintenance, Repair and Overhaul (MRO) Aerospace Manufacturing Machinery & Equipment: Automated equipment for semiconductor, solar, medical & automotive industries Process machinery for food & beverages and oil & gas Packaging machinery 8

9 INVESTMENT OPPORTUNITIES IN THE MANUFACTURING SECTOR Palm Oil Industry : Oleochemicals Palm-based nutraceuticals, constituents of palm oil/palm kernel oil & palm biomass Palm-based food products specialty animal fat replacer, mayonnaise & salad dressing Food Processsing Industry : Processed meat & seafood Beverages, food ingredients, dairy products & confectionary Resourced-based industries : Food & Agro based Value-added products from natural resources 9 9

10 TARGETED SERVICES SECTORS Regional Establishments Operational Headquarters (OHQ) International Procurement Centre (IPC) Regional Distribution Centre (RDC) Logistics Integrated Logistics Services Cold Chain Facilities Tourism Hotel Tourist project Recreational camp Convention centre 10 10

11 TARGETED SERVICES SECTORS Environmental Management Energy conservation/efficiency Energy generation, using renewable energy sources Storage, treatment and disposal of hazardous waste Recycling of agricultural waste and agricultural byproducts Business Services Shared services outsourcing Research & Development (R&D) ICT Services Market Support Services Film & Video Production & Post Production 11 11

12 TARGETED SERVICES SECTORS Education Technical, Vocational & Science Training Healthcare Travel (Medical Tourism) Private hospitals 12 12

13 Performance of the Manufacturing Sectors Total Approved Manufacturing Projects ( 2011 Sept 2012) Year Number of Projects Approved Investments (RM Billion) Domestic Foreign Total Jan - Sept TOTAL

14 Performance of the Biomass Sectors Total Approved Investments Biomass Projects ( 2011 August 2012) Year Number of Projects Approved Investments (RM Billion) Domestic Foreign Total Jan - Aug TOTAL

15 POLICIES, INCENTIVES & INVESTMENT OPPORTUNITIES IN THE BIOMASS SECTOR 15

16 Guidelines on Manufacturing Licence The Industrial Coordination Act, 1975 (ICA) requires manufacturing companies with shareholders funds of RM2.5 million and above or engaging 75 or more full-time employees to apply for a manufacturing licence. Fast Track Approval for Manufacturing Licence Approval of manufacturing licence is given within two (2) days for non-sensitive industries. 16

17 Equity Guidelines 100 % foreign equity ownership is allowed, irrespective of level of exports Guideline on Repatriation of Profits No restriction imposed on foreign companies investing in Malaysia with regard to: Repatriation of Capital Interests Profits Dividends 17

18 Incentives for the Manufacturing Sector General Promoted Products / Activities Small scale Companies High Technology Projects Strategic Projects Specific Incentives for Selected Industries 18

19 BIOMASS INDUSTRY IN MALAYSIA Major Biomass Industry in Malaysia: Oil Palm Biomass Agricultural By-Products/Waste Energy Generation from Biomass 19

20 OIL PALM BIOMASS Estimation of 80 million tonnes of fibrous biomass (dry weight) yearly from plantation and processing activities. Shredded and left to biodegrade in the fields i.e. EFB, stems, saps, fronds, etc. Potential Business Opportunities: Wood-based products such as Plywood, Palm Flooring, Furniture and Furniture Parts, Pellet, Biofuel, Briquettes, Pulp & Paper Biotechnology processing such as Biofuels, Biochemical, Biopolymers, Biopharmaceuticals, etc. Energy Generation from Biomass sources. Agricultural By-Products Waste such as sawdust, rice husk, coconut fibre, sugar cane, palm oil mills, etc. 20

21 MAJOR INCENTIVES FOR BIOMASS PRODUCTS & RENEWABLE ENERGY Pioneer Status (PS) Tax exemption on statutory income of 70% to 100% for a period of 5 to 10 years. Investment Tax Allowance (ITA) 60% to 100% on the qualifying capital expenditure incurred for a period of 5 years to be utilised against 70% to 100% of the statutory income for each year of assessment. Reinvestment Allowance (RA) 60% on the qualifying capital expenditure incurred for a period of 15 years; commencing from the 1 st year the reinvestment is made. 21

22 EXEMPTION ON IMPORT DUTY ON RAW MATERIALS / COMPONENTS 22 Raw materials / components which attract import duty can be considered for exemption, provided: Raw materials / components are NOT produced locally; or Locally produced raw materials / components are not of acceptable quality and price. Exemption from Import Duty and Sales Tax on Machinery & Equipment Machinery & Equipment which attract import duty and/or sales tax can be considered for exemption. For Machinery & Equipment produced locally, sales tax exemption will be given.

23 DOMESTIC DIRECT INVESTMENT (DDI) INITIATIVES 5 INCENTIVES Announced: Domestic Investment Strategic Fund Incentives for Acquiring a Foreign Company for High Technology Incentives for Small Scale Companies Incentives for Companies in Production (Desirous Issue) Incentives for Merger Among Malaysian Services Providers 23

24 1 Domestic Investment Strategic Fund 24

25 Domestic Investment Strategic Fund Domestic Investment Strategic Fund of RM1 billion Objectives 25 To accelerate the shift of Malaysian-owned companies in targeted industries to high value-added, high technology, knowledge-intensive and innovation-based industries The fund aims to: Harness and leverage on outsourcing opportunities created by MNCs operating in Malaysia Intensify technology acquisition by Malaysian-owned companies Enable Malaysian-owned companies to obtain international standards/ certifications in strategic industries

26 Domestic Investment Strategic Fund Mechanism The fund does not offer an outright grant and is contingent on the investments of the applicants Matching grants (1:1) on reimbursable basis To be granted on a negotiable basis based on the request of the companies and the merits of each case Provided under the Customised Incentive Scheme, Section 127, Income Tax Act

27 Domestic Investment Strategic Fund Scope of the Fund The fund will provide matching grants to cater for expenditures incurred for the following activities: Training of Malaysians R&D activities carried out in Malaysia Obtaining international standards/certification Licensing or purchase of new/high technology Modernisation and upgrading of facilities and tools to undertake manufacturing or services activities for Multinational Corporations (MNCs) and Malaysian conglomerates (outsourcing activities) 27

28 Domestic Investment Strategic Fund Eligibility Criteria Incorporated under the Companies Act, 1965 New and existing companies in the manufacturing and services sectors with Malaysian equity ownership of at least 60% Companies producing promoted products/engaged in promoted activities in the following priority sectors: Aerospace Medical Devices Pharmaceuticals Advanced Electronics Machinery and Equipment Renewable Energy Services including design, R&D, testing, quality and standard certification, engineering services, technical and skills training and logistics service providers (3PL) Other industries, on a case by case basis 28

29 Domestic Investment Strategic Fund Effective Date of Application Applications received on or after 3 July 2012 are eligible to be considered for this incentive 29

30 Thank You