SME MY December 2020

DECEMBER 2020 (TWIN ISSUE) MALAYSIA EDITION BUDGET 2021: CHANGING BUDGET FOR A CHANGING TIME 12 DECEMBER 2020 (TWIN ISSUE)
MALAYSIA
EDITION
RM 5

JAMES RATCLIFFE: BEYOND 2020:
RAGS TO CHEMICAL RICHES EMERGING TECHNOLOGIES

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This CONTENTSDECEMBER 2020 (TWIN ISSUE)

1 6issue of SME

Magazine is a
combined issue
for November
and December

2020.

IN SME MAGAZINE THIS MONTH

16 26
BUDGET 2021: BEYOND 2020:
CHANGING BUDGET FOR EMERGING
A CHANGING TIME TECHNOLOGIES

What is in it for SMEs? Malaysia’s As we enter a new decade,
latest Budget has to deal with SME takes a look at the
COVID-19, aside from reviving the technologies that have the
economy and growing prosperity for potential to change our world.
the people.
AND MORE…
22
JAMES RATCLIFFE:
RAGS TO CHEMICAL RICHES

22

46
LIVESTREAMING

- FTRHOENNTEIEXRT
TREND

DECEMBER 2020 (TWIN ISSUE)

68 54

REGULARS
04 NEWS
12 IDEAS BAR
14 STARTUP GUIDE
16 COVER STORY
22 PERSONALITY
26 FEATURE
32 INDUSTRY
42 FRANCHISE
44 TRADE
54 TECHNOLOGY
58 COLUMN
66 BUSINESS TRAVEL
68 LIFESTYLE
66 71 SUBSCRIPTION
72 PERSPECTIVE

GROUP PUBLISHER / EDITOR-IN-CHIEF Dato’ William Ng
EDITORIAL Editor-at-Large Jennifer Lee Associate Editor (Indonesia) Tony Kusuma Assistant Editor (Singapore) Kevin Tan
Assistant Editor (Malaysia) Ong Xiang Hong [email protected] Writer Jordan Low [email protected]
MARKETING + BUSINESS DEVELOPMENT Operations Director Dato’ Ryan Ooi [email protected] Associate Publisher Rozita Shuib [email protected]

Assistant General Manager Tan Yong Keat [email protected]
Administrator (Indonesia) Nurasiah Jamil [email protected]

ADVERTISING SALES Senior Account Manager (Malaysia) Eleen Wong [email protected] Account Manager (Singapore) Candice Lee [email protected]
Account Manager (Indonesia) Richard Sugiarto [email protected]

SPECIAL PROJECTS Senior Project Managers Daniel Loo, Sam Hew Project Managers Ivy H’ng Assistant Project Managers Ivan Kong, Jansen Chan, Jason Ooi, Jay Wu
ADMINISTRATION Senior Finance Manager Alex Yong Finance Manager Jason Tay Assistant Finance Manager Syarfa Wati
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4 NEWS

TOP GLOVE TO CLOSE SEVERAL FACTORIES AMIDST COVID-19 OUTBREAK

A total of 28 factories belonging to Top Glove in Malaysia will tested. A Top Glove workers’ dormitory and the surrounding area were
be closed in stages following a surge in Covid-19 cases linked also placed under an enhanced movement control order (MCO). Top
to the Teratai cluster. According to senior minister Datuk Seri glove also released a statement, saying that they will conduct extensive
Ismail Sabri Yaakob, there are 1,067 cases reported in these factories. screening for their workers as well as performing thorough disinfection
Said factories will be closed gradually so that their workers can be exercises at their premises and accommodations.

WHAT THE RCEP MEANS FOR THE FUTURE

R ecently, fifteen Asia-Pacific economies came together to aims to counter protectionism, boost investment and allow freer
sign what could become the world’s largest free trade movement of goods within the region. RCEP includes China, Japan,
agreement in history. The trade deal, which was signed South Korea, Australia, New Zealand and the 10 members of the
last Sunday, will cover nearly a third of the global population and Association of South East Asian Nations (ASEAN): Brunei,
about 30 percent of its GDP. The Regional Comprehensive Vietnam, Laos, Cambodia, Thailand, Myanmar, Malaysia,
Economic Partnership (RCEP) will progressively lower tariffs and Singapore, Indonesia and the Philippines.

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6 NEWS

AIA SINGAPORE CREATES UP TO 500 NEW CAREER OPPORTUNITIES

A IA Singapore announced the creation of up to 500 new career sustain job opportunities for Singaporeans, as the number of
opportunities, in-depth training and financial support aimed at retrenchments more than doubled in the second quarter of this year. Ms
fresh graduates and mid-career switchers, amid ongoing Wong Sze Keed, Chief Executive Officer of AIA Singapore, said, "At a
economic uncertainty and increasing unemployment as a result of time when so many are impacted by retrenchment or are struggling to
COVID-19. AIA's Financial Career Scheme 2020 is a reinforcement of find jobs, it is vital that we support Singaporeans and permanent
the continued efforts by the government of Singapore to create and residents by creating sustainable and long-term career opportunities.

MALAYSIA’S EXPORTS TO BENEFIT FROM INDONESIA ON THE PATH TO
IMPROVING CHINESE IMPORT DEMAND CREATING DIGITAL HEROES

M alaysia’s exports are set to benefit W ith SMEs making up a huge chunk of
from improving Chinese import Indonesia’s economy and workforce, it
demand and the electronics cycle, is no wonder that the country is doing
according to the Global Economic Outlook everything it can to make sure they make it out
report from Oxford Economics. The report, the pandemic in one piece. In a bid to help 10
which was commissioned by the Institute of million SMEs in Indonesia adopt digital
Chartered Accountants in England and Wales technology in 2020, the Indonesian government
(ICAEW), indicated that the speed of economic will be holding a three-week bootcamp for 30
recovery will likely be slow given current selected startups that can provide services such
sluggish global demand, high unemployment as supply chain and finance management for
and weak investment. “Although the nationwide SMEs. This initiative, called Pahlawan Digital,
movement control order in Malaysia the training course began on 23 September and
compounded the economic damage in the will select the 10 best startups out of 30
second quarter, the payoff has been apparent, participants as strategic partners for Indonesia’s
with the pandemic situation currently in hand, Cooperatives and SME Ministry.
which will aid the economy in regaining its
footing,” the report said. HSBC PAVES THE WAY FOR SMES VIA
THE NETWORKED TRADE PLATFORM

H SBC has recently announced that it has
closed the first receivables financing deal
on Singapore’s Networked Trade Platform
(NTP), setting the foundations for SMEs to access
funding in as quick as 15 minutes, down from a day
traditionally. According to the bank, this latest
development will allow SMEs to access and utilise
receivables financing via the platform, all the while
streamlining and ironing out the complexities and
manual processes required for SMEs to obtain and
support their cashflow needs. The launch occurs in
tandem with the bank’s strategy to scale up its SME
business in Singapore.



8 NEWS

BUY MALAYSIA CAMPAIGN ATTRACTS OVER 1800 ENTREPRENEURS

F or Malaysia, the road to economic recovery will be a stimulation of the local economy. Datuk Seri Hasnol Zam Zam
long and slow one. In an effort to speed up the Ahmad, secretary general of the Ministry of Domestic Trade and
economic recovery process, The Malaysian government Consumer Affairs (KPDNHEP) said that with the participation of
launched the Buy Malaysian Products Campaign (KBBM) back in these entrepreneurs, there are now 31,000 locally produced
July 2020. Since then, over 1,800 entrepreneurs from SMEs products in several supermarkets such as Tesco and Mydin, for
nationwide have opted to participate and contribute to the consumers to choose from.

APAC’S REMOTE WORKERS AND FRONTLINERS ONESME TO PROMOTE TRADE BETWEEN BEIJING OUTLINES FIVE-YEAR
ARE FACING BURNOUT CHINESE AND SINGAPOREAN SMEs PLAN AND 2035 VISION

W orkers in Asia Pacific are facing R ecently, OneSME, a cross-border digital C hina is set to play down the nation’s
increased burnout due to lack of trade platform for SMEs in Singapore and headline growth rate to highlight
separation between work and China, was launched in order to facilitate “growth quality” and “security” in its
personal life as well as worry of contracting trade more easily between SMEs of the two nations. development plan for 2021-25 and beyond.
COVID-19, according to Microsoft's latest Work OneSME will connect business-to-business (B2B) President Xi Jinping chaired a gathering of the
Trend Index report. On average, close to one platforms in the two countries to help local SMEs Politburo in late September, and the body
third of workers in Asia Pacific cited increased expand their overseas reach and tap significant endorsed the country’s five-year plan for 2021-25
rates of burnout over the past six months, with demand from Chinese SMEs for Singapore products. as well as a grand plan that will serve as a
the lack of separation between work duties and Developed and operated by OneConnect Financial guideline for China’s economic and social
personal obligations as negatively impacting Technology (Singapore), the fintech associate of development through 2035. Both plans were
their wellbeing. Surveying over 6,000 informa- China’s Ping An Group, and supported by the presented for approval at a major party meeting
tion and first-line workers across eight countries Infocomm Media Development Authority (IMDA), in October. As the final version of the five-year
globally including Australia, Japan, India and OneSME was launched by Sim Ann, Senior Minister of plan is expected to be published only after it is
Singapore, the study found that Singapore and State for Communications and Information and approved at the late-October meeting, Beijing has
India were the top two countries in the region National Development. This new platform comes at been busy building up a consensus on its new
with workers facing increased burnout, at 37 the right time as SMEs around the world are struggling domestically focused dual-circulation strategy.
percent and 29 percent respectively. to stay afloat amidst the COVID-19 pandemic.



10 NEWS

INDONESIA EYES F&B ON THE PATH TO RECOVERY

T he Indonesian government is urging SMEs to export food and products such as carica (mountain papaya), tempeh chips, crabs, and
beverage products that have gained popularity in overseas palm sugar; have all seemingly captured interest from foodies and food
markets in an effort to help the nation’s economy recover distribution companies from abroad. According to Victoria, the
amidst the devastating effects of the global COVID-19 pandemic. producers of such products, most of whom are based outside of Jakarta,
Victoria Simulangkit, the deputy of production and marketing at the have managed to successfully penetrate foreign markets, including
Cooperatives and SME Ministry, recently said that certain Indonesian countries such as Malaysia, Thailand, Japan, and China.

MALAYSIA’S BUDGET 2021 SET TO FAIRPRICE EXPANDS AND EXTENDS JAPAN TO GRADUALLY LIFT TRAVEL
PRIORITISE SME RECOVERY SME SUPPORT SCHEME ALERTS FROM OCTOBER ONWARDS

A ccording to Malaysia’s Finance L ocal food produce suppliers in Singapore J apan has not had a great year. Even
Minister, Tengku Datuk Seri Zafrul will continue to benefit from shortened compared to other countries, Japan’s
Abdul Aziz, the government is payment terms and promotion of their businesses and economy was struck by
committed to continue the efforts to help the products. The scheme, which was introduced by particularly bad luck in 2020. COVID-19 has
country’s SMEs on their path to recovery Singaporean supermarket chain, FairPrice, doubled caused unprecedented damage to the island
amidst the post-COVID era in the upcoming its support to S$2 million and widened its eligibility nation’s business flow, and the road to recovery
Budget 2021. Building upon the foundations criteria in order to help SMEs stay afloat. In will be an arduous one. However, Nikkei Asia
laid by the Prihatin Rakyat Economic Stimulus addition to this, FairPrice has also revealed that has recently revealed that Japan now plans to
Package (Prihatin) and other economic recovery they will be extending the scheme, otherwise known gradually lift overseas travel alerts in October in
initiatives, Zafrul said that the support for as the SME Suppliers Support and Development a bid to spur the removal of entry restrictions
SMEs would be done via continued support for Programme, for another year until 31 October implemented in other countries. According to
digitalisation and automation. The government 2021. Some 470 SMEs have benefitted greatly from Nikkei, the Japanese government is currently
will also facilitate the SMEs to accelerate the the scheme since its introduction in 2009 to help planning to prioritise 10 countries and regions
adoption of digitalisation under Budget 2021 the cooperative's SME partners overcome with low numbers of new COVID infections.
that will be tabled the Parliament on 6 restructuring challenges and tide through the global These nations include New Zealand, Australia,
November, he added. financial crisis. In 2012, the program was brought and Vietnam. However, the decision on whether
back and has since been extended annually. to accept travellers from Japan will ultimately be
up to those respective governments.

SINGAPORE’S PLANS FOR INTERNATIONAL MALAYSIA REMAINS PRIME INVESTMENT DESTINATION SINGAPORE’S SMEs LEAD
THE PACK IN DIGITALISATION
T he global aviation industry has been M alaysia has been hit hard by the Covid-19
among the hardest hit business pandemic. The economy is facing new and T he Fourth Industrial Revolution did
sectors amidst the Covid-19 oppressive challenges that threaten to ruin not end with the Covid-19 pandemic.
pandemic. Singapore has not been spared its business ecosystem. Despite this, the Malaysian Rather, the coronavirus has merely
either, and is now scrambling to revive its Investment Development Authority (MIDA) is accelerated it. Above all else, it was Singapore’s
crucial airline industry. Singapore is a small confident that Malaysia continues to be a preferred SMEs that digitalised their businesses and
city-state in Southeast Asia with little to no investment destination by the international business leveraged data at higher rates than their peers in
natural resources. The nation’s wealth stems community. Deputy chief executive officer Ahmad countries such as Australia, New Zealand, North
from being an indispensable financial hub for Khairuddin Abdul Rahim said as at December 2019, America, and Canada. This is according to a
the SEA and APAC region. Ong Ye Kung, the there were 4,764 manufacturing projects study of more than 1,000 SME owners and
transport minister, said that for a small country implemented in Johor with investments totalling 1,000 SME customers across the five markets,
like Singapore, the aviation sector needs “all RM166 billion. He also stated that within the first half commissioned by Xero, a cloud accounting
these connections in order to be economically of 2020, Johor remained among the top states in platform that focuses on small businesses. The
viable”. At the moment, the Southeast Asian regards to manufacturing projects with the highest study itself was conducted by Forrester
nation has set up bilateral arrangements with approved total investments. Consulting. Up to 62 percent of Singapore SMEs
several countries to allow business travel, surveyed utilised online business solutions
including China, South Korea and Malaysia. during the pandemic, as they sought out new and
innovative ways to better engage with customers
during the pandemic. This yielded a 30 percent
increase in overall cloud adoption from 2019,
the largest increase among the five markets
surveyed.

THAI TAX BREAKS GETS THE GREENLIGHT

T hailand’s Centre for Economic Situation Administration (Cesa), projected to inject about 120 billion baht into the country’s economy, said
has recently approved a proposal to offer taxpayer income tax Danucha Pichayanan, deputy secretary-general of the National Economic
deductions of up to 30,000 baht for purchasing products and and Social Development Council. About 4 million people are expected to
services with a 7 percent value-added tax (VAT), in another bid to help take advantage of the programme, which, however, will cost the state
boost domestic spending and consumption. As of 23 October until the end about 12 billion baht in missing tax revenue, he said. Overall, the tax
of 2020, the tax deduction offer will apply to the 2020 tax year and is deduction will cover almost every product and service.

12 IDEAS BAR

BY
JORDAN

LOW

ZOOMMAKER FHD 3D PRINTER

3 D printing has taken-off over the past few years. Its usefulness cannot be understated. The ZoomMaker is a high-
performance 3D printer is a low-cost peripheral for makers and designers alike that will enable them to perform print jobs
in a speedy manner. The unit has a relatively compact design, and features a built-in LCD that will let users make changes
or monitor its functionality. The precision printing prowess of the unit will create highly detailed jobs, while still being able
to complete work in a speedy manner. This would make a perfect emergency tool for last-minute jobs or requests.
TIKTAALIK TABLET CASE
F or many iPad users, this fancy
magnetic case provides users
with options to enhance
productivity. The case works
by being magnetically attached
onto the tablet and will go to work providing
users with a full QWERTY keyboard to type
from. The case utilises a lightweight design
using aramid fibre and leather, ensuring low
weight combined with amble protection.
magnetic tablet case is capable of offering
up to 286 hours of use per charge to help
users enjoy less downtime and more time
spent being productive.

GOVOCE VC100

T he GoVoce VC100 voice assistant car charger is
an aftermarket solution for drivers that will enable
them to integrate the latest technology in their
vehicle's cabin to enjoy increased productivity and
more. It works by being plugged into an existing
12V outlet and will immediately go to work offering access to
an array of apps including the Google Assistant and Siri voice
assistants. This will allow drivers to perform digital tasks
without having to take their eyes off the road.

ZERGOTECH FREEDOM ERGONOMIC KEYBOARD 13

M echanical keyboards are popular among DOODLIGHTS
many users, but they often lack the
ergonomics department. The Zergotech A new development in projectors may
Freedom aims to alleviate the issue. The help pave the way into the future.
keyboard has a two-part design that works While there are notebook scanners on
by being positioned onto a workstation and providing the market to help digitise analog
users with a way to keep their hands naturally positioned. work, the conceptual Doodlight works
The ability to position the two halves of a keyboard in a different way to help make the artistic or
further apart could drastically reduce the instance of strategic process a little easier. The projector works
fatigue created by having to keep hands close together to with an accompanying app that will allow users to
type on a conventional keyboard. map or sketch out their plan before toggling the
unit on to see a laser rendering of the work on the
page. Users can then trace the projection to ensure
their work is near-perfectly ‘printed’ onto the paper.

BLUEBREATH SMART FACE MASK

OVID-19 has certainly caused many problems for everyone around the world. However, mask manufacturers took the

C opportunity to design even more practical and advanced masks for personal use. The BlueBreath face mask is integrated
with a miniature blower that will circulate fresh air within the unit during wear to eliminate the occurrence of feeling
hot or experiencing breathing problems. The five-layer filter system is capable of capturing 99 percent of particles that
come into contact with it to provide enhanced peace of mind for wearers.

14 START-UP GUIDE T he logistics industry is control of chain management.
experiencing The first thing aspiring entrepreneurs
ONGBXYIANG disruption like never
HONG before. At its heart, need to know is how much money they
logistics is a field of need to have to organize the logistics, how
activity related to the many people are needed for this, where it
efficient movement of is advisable to begin the production, to buy
final products from the a storage place, with whom it is good to
end of the production line to the customer. cooperate, where and how much to order and
But in the quest to reduce delivery times how to drive. The logistics company has to
down to almost instantaneous, logistics has understand of these peculiarities of work.
undergone a significant overhaul. In the
context of start-ups, there are some serious When organising the logistics
and significant problems: the company processes, it is necessary to have a
should solve all the scheduling, procurement, management system to control the
transportation, storage, delivery and return couriers, a clear route. It is necessary to
problems, but the startup has no data to take into account the weight and volume
predict future demands, and it is limited in characteristics of the goods. Finally, there is
resources, financial and human power. The a need to define the payment system clearly.
product, industry and potential customers
directly influence the choice of the strategy of In recent times, when we think about
logistics startups, one particular company
comes to mind: Amazon. It pioneered
today’s just-in-time delivery paradigm; smart

warehousing; next-day delivery; of trying to create an end-to-end solution, these companies are solving a single problem at the
and even drone delivery. Closer to middle of the logistics equation only.
home, startups like Grab and Gojek
are utilising their vast pool of on- For example, Ezyhaul is a leading digital road freight platform in Southeast Asia. Using its
demand drivers to deliver parcels and online platform, clients can make bookings with Ezyhaul for B2B domestic short haul, long haul
groceries, among others. and cross-border shipments. With this, shippers have the freedom of choice of a marketplace
and the security and convenience of a digital freight forwarder.
The COVID-19 induced
e-commerce boom is an important part The service includes a real-time tracking system for their dispatches, and access to electronic
of the paradigm shift. Online retail in documentation and e-PODs (proof of delivery).
Southeast Asia is a than US$38 billion
industry by the end of 2019, up from As it is common for lorries to ply the roads with half loads and their return trips are often emp-
US$23 billion in 2018. This is only ty, if they register with Ezyhaul, the transportation companies would have better load utilisation.
projected to grow larger on the back
of the COVID-19 pandemic. Sales LAST-MILE LOGISTICS
are expected to mushroom to more
than US$150 billion by 2025 – that is On the short-haul side of the spectrum, last-mile delivery is another fertile niche.
US$50 billion more than predictions Traditionally, it would be the postman walking up to your doorstep and handing you the letter or
made over a year ago – on the back parcel. Now, third-party logistics providers are filling in the niche due to the explosive growth of
of stronger-than-anticipated growth, e-commerce in the region.
according to Google and Temasek.
Zeek, a “smart-mile” logistics platform managed by Kin Shun Information Technology
In turn, Southeast Asia’s third- Limited focuses on last-mile delivery for businesses. Using AI in an intelligent logistics platform,
party logistics market accounted Zeek focuses on enterprise clients, saving business owners the development time and cost by in-
for US$36.4 billion in 2017 and is tegrating value chains in food delivery business including online ordering, POS operations, order
expected to grow at a compound dispatch, delivery and operational monitoring. Its tailored O2O business solutions consolidate
annual growth rate of 5.5 per cent online and offline business processes to enhance delivery quality and smoothen operations.
through 2025. This makes it a soon-to-
be US$55.7 billion industry, according CONNECTING SHIPPERS
to Research and Markets.
Logistics is often an unoptimized field. Infrastructure like warehouses and trucks often run
MID-MILE LOGISTICS empty due to a mismatch of demand from various shippers, carriers, and customers.

New and innovative companies are Waresix is focused on optimizing logistics by making the process more transparent for
cropping up in the mid-mile logistics clients and more efficient for haulage companies and truckers. It provides a one-stop solution for
space (e.g. B2B trucking). Instead transportation by land or sea, as well as cold storage and general cargo handling.

The company connects shippers and businesses with available warehouses and trucks across
Indonesia, providing better transparency, quality of service, and improved incomes for asset
owners. Its technology will seamlessly merge data analytics with the logistics infrastructure to
give businesses complete control of their goods and maximise suppliers’ space utilisation.

EZYHAUL ZEEK WARESIX

F ounded by Mudasar Z eek, managed by Kin Shun A ndree Susanto,
Mohamed, Raymond has its roots as a technology CEO of Waresix
Gillon, and Nicky Lum, enterprise found in 2017 led the start up
Ezyhaul is focused on providing crowdsourcing to become the
improving efficiencies in the highly delivery, Software-as-a-Service (SaaS) leading logistics tech
fragmented $150 billion road business solutions and last-mile delivery platform in Indonesia for
freight industry in South Asia. The for international food and beverage trucking and warehousing.
three co-founders, who earlier brands, fast-moving consumer goods, Prior to Waresix, he started
worked at a logistics corporation lifestyle services and e-commerce his own commercial vehicle
in Singapore, decided to start up platforms. KK Chiu, Cliff Tse, and distribution business in
to solve the supply-and-demand Vincent Fan will be bringing the Indonesia with a network
problem for large businesses, and development of smart delivery options of more than 200
now plies 30,000 trucks in the for lifestyle goods to offer swift service distribution centres.
Southeast Asia market. experience to both buyers and sellers.

16 COVER STORY

ONGBXYIANG
HONG

17

round this time THE 2021 FEDERAL GOVERNMENT BUDGET
every year, all
A eyes are on the WHERE IT COMES FROM
Finance
Minister as he BORROWINGS AND USE
tables the latest OF GOVERNMENT’S
Budget for the ASSETS
coming year. 26.5%
With the
COVID-19 DIRECT TAX
situation wreaking havoc on the economy, it 40.9%
was widely expected for the Government to
table another expansionary Budget. Budget RM 322,5401
2020 largely planned to allocate investment MILLION
for SMEs amidst economic headwinds, but
the rise of COVID-19 in March derailed
those plans.
Budget 2021, themed “Stand United,
Together we Prevail”, saw some of the NON-TAX
most economically vulnerable groups given REVENUE
19.4%

focus, especially with regards to long-term
goals aimed at elevating living standards.
Education and digital growth in particular INDIRECT TAX
13.2% WHERE IT GOES

received a huge allocation in order to provide GENERAL
future-proofing for the future. ADMINISTRATION
Economically, 2021 is widely seen to 1.2% COVID-19 FUND3
DEVELOPMENT SECURITY 5.3%
EXPENDITURE 2.4%
be a challenging year ahead. Aside from
the COVID-19 pandemic, domestically, SOCIAL
high Government debt levels and an ever- 5.7%
increasing wealth gap are plaguing Malay- EMOLUMENTS
26.2%

sians. Externally, the prospect of a full-blown
US-China trade war, a cooling worldwide
economy, as well as global strife and tensions ECONOMIC
present a unique set of challenges for contin- 12.1% RM 322,5402
ued Malaysian economic growth. MILLION
In line with the country’s aim of OTHERS
becoming a highly-skilled, high-income nation 8.0% DEBT SERVICE
and achieving its Shared Prosperity Vision CHARGES
12.1%

2030, Budget 2020 also included several
allocations for various groups—from the
bottom 40 per cent (B40) income segment, SUBSIDIES AND O P E R AT I N G
to corporate Malaysia, public transport, SOCIAL ASSISTANCE EXPENDITURE
technology, and of course SMEs. 5.8% SUPPLIES AND SERVICES
RETIREMENT 10.2%
GRANTS AND TRANSFERS CHARGES
UNPRECEDENTED CHALLENGES TO STATE GOVERNMENTS 8.6%
2.4%
2020 has been a tumultuous period for
Malaysia. The spread of COVID-19 has not 1 Consists of revenue and borrowings
only taken lives, but also stifled economic 2 Excludes contingency reserves
activity. This is an unprecedented crisis, and 3 COVID-19 Fund under the Temporary Measures for Government Financing (Coronavirus Disease 2019 (COVID-19)) Act 2020
the world has no guidelines or measures that Source: Ministry of Finance, Malaysia
can be used as reference.
Closer to home, Bank Negara Malaysia has estimated that during the movement
Both supply and demand have received control order (MCO), the economy will lose between RM2 to 2.4 billion per day. Malaysia’s
great shocks, exerting immense pressure on GDP nosedived 17.1 percent in the second quarter of 2020 as the effects of the MCO bit.
the business ecosystem. Falling commodity
prices, disrupted supply chains, and extreme Budget 2021 is designed to tackle these challenges, with a three-pronged strategy
uncertainty have weighed on the minds of focusing on:
many business owners. 01. The well-being of the 02. Business continuity 03. Economic resilience post COVID-19

The International Monetary Fund SUPPORT FOR SMEs
meanwhile has projected the global economy
to contract by 4.4 percent this year. Global Budget 2021 has received mixed reactions from SMEs. Associated Chinese Chambers of
trade, meanwhile, is set to decline by 10.4 Commerce and Industry of Malaysia (ACCCIM) SME committee chairman Koong Lin
percent. Described as the worst economic Loong said that, “If you look at the budget alone, the measures for SMEs may not be
crisis since the 1930s’ Great Depression, enough. But the budget needs to also take into account other things like the rakyat’s needs
the COVID-19 pandemic has upended the and the fight against COVID-19. So, we saw a big allocation for those needs.”
economies in over 150 countries.
“But we should also look at all the stimulus packages that have been announced since
February because this budget is a continuation of those efforts and measures,” he continued.

18 COVER STORY

GOALS OF BUDGET 2021

WREALKL-YBAETI’NSG CBOUNSTIINNEUSITSY ECONOMIC
RESILIENCE
Overcome the COVID-19 Driving investments
pandemic and protect Strengthening Expansionary budget with
key sectors multiplier effect
public health
Safeguarding the welfare of Prioritising automation Development under the 12th
and digitalisation Malaysia Plan
vulnerable groups Enhancing access
Generating and retaining jobs to financing Enhancing the role of GLCs
and civil society
Prioritising Ensuring resource
inclusiveness sustainability

Institute for Democracy and Economic AMONG THE HIGHLIGHTS FOR SMEs ARE:
Affairs (IDEAS) senior fellow and Centre for
Market Education CEO Dr Carmelo Ferlito RM150 RM150 million RM95 million RM2 billion in RM1 billion will be
said the budget has offered support for the million will will also go will be targeted aid will allocated towards
SMEs and wages for a limited time, but it is be allocated towards the Shop allocated to be provided for encouraging
missing “a change in pace”. for training Malaysia Online micro-credit SMEs, and tax investments
programmes initiative, and financing incentives for in technology,
In a statement, he said that the budget and assistance RM35 million to for women certain industries including R&D for
could have offered containment to recovery for 100,000 promote Malaysia- entrepreneurs. will be extended the electronic and
measures, such as opening more of the entrepreneurs. made products. to 2022. aerospace industries,
markets, rather than closing them. among others.

“These containment measures will be Those in the agricultural The government Employers Under the Penjana Kerjaya
effective, only if there is a wider strategy for sector will have a slice will allocate RM1.5 who hire fresh initiative, employers will
recovery,” he said. He also added that the lack of the RM60 million billion to extend graduates for be given an additional
of such a strategy could also be a detriment for for modernisation the wage subsidy apprenticeship incentive of 20 percent
any reskilling initiatives. programmes in the programme for programmes to encourage job
supply chain, and another 3 months, will get opportunities for people
However, peer-to-peer (P2P) financing RM100 million for high- in a targeted manner RM1,000 per with disabilities, those who
platform for SMEs Funding Societies co- impact and high-value particularly for those month for 3 are unemployed long-term,
founder and CEO Wong Kah Meng said the agriculture and livestock in the tourism sector. months. and workers who have
company resonates with all three of the Budget operations. been terminated.
2021 main thrusts of people’s wellbeing;
business continuity; and economic resilience. A High Technology The National Development The Human Resource RM1
Fund of RM500 Scheme (NDS) worth RM1.4 Development Fund will levy billion
“Particularly, we laud the government’s million will be billion will be allocated to exemptions for companies will go
recognition of the P2P financing industry’s provided by Bank support the implementation in the tourism sector and towards
contribution of almost RM1 billion in SME Negara to support of domestic supply chain those still affected by a digital
financing opportunities with the additional high-tech and development and increase the COVID-19 for 6 months. transfor-
allocation of RM50 million in matching innovative sector production of local products This will be effective on mation
investment grant for invoice financing. companies. such as medical equipment. January 1, 2021.
scheme.
In a statement, homegrown apparel
brand Oxwhite founder CK Chang said the RM150 million The To encourage more individual Micro-SMEs with loans of
Budget is quite a comprehensive plan as in grants will government investors to participate in up to RM150,000 are given
it will help drive Malaysians further in the be given for the will also equity crowdfunding (ECF) the option of a 3 month
adoption of e-commerce through connectivity digitalisation allocate nearly platforms, an income tax repayment moratorium or
enhancement such as Prihatin Connectivity and RM1.2 billion exemption of 50 percent from a 50 percent reduction on
Plan (Program Jalinan Prihatin) and National automation of for micro-credit the invested amount or limited their monthly repayments
Digital Connectivity (JENDELA). SMEs. schemes. to RM50,000 will be given. for 6 months

Due to the importance of their role
in driving the economy and providing
employment, the government has indeed
focused on elevating and recovering SMEs to
play a bigger role in the overall economy. This
is in line with the government’s goal of raising
the share of SME contribution to GDP from
38 per cent to 50 per cent.

19

WHO GETS WHAT
FROM BUDGET
2021?
WHOTALCIXVLIEEMDSREIINNVTESRABAH WHO IRSETMAFAIALRDRAZSIIESLDAISHITNAHNETR 40s
Household income: below RM2,001 Household income: below RM4,001
Six children, between 7 and 17 years old Earns RM2,000 per month from her job
Has a house loan Three children, all below 6 years old
Contributes to EPF and Socso Has a car loan

UNDER BUDGET 2021, CLEMENT GETS: UNDER BUDGET 2021, FADZILAH GETS:
RM500 monthly withdrawal from EPF Account 1 Wage subsidy of RM600 per month

RM900 in financial assistance Subsidised pneumococcal vaccinations for her children

BPR assistance of RM1,800 BPR assistance of RM1,200, plus RM650 for her children

Telecommunications credit worth RM180 Telecommunications credit worth RM180

Prihatin Special Grant of RM1,000 3-month loan moratorium, or 50 percent
reduction in loan payments
3-month loan moratorium, or 50 percent for 6 months
reduction in loan payments
for 6 months
ROSHNI
SINGLE
20 YEAR OLD
Retrenched from her job due to COVID-19
Has a hearing disability
Does not have any loans
Contributes to Socso

UNDER BUDGET 2021, ROSHNI GETS:
Incentive allowance of RM450 for disabled workers
(if she finds work)

Financial scheme under Employment Insurance System
(EIS) administered by Socso where she will receive
80 percent of her previous monthly salary in the first
month, 50 percent for the second to sixth month, and
30 percent for the last three months.

BPR assistance of RM350

Telecommunications credit
worth RM180

HELPING SOCIETY
In the same vein, Budget 2021 also has many items to help society, especially vulnerable groups, youths, and working adults. Among the highlights are:

Minimum employee Bantuan Prihatin Rakyat Income tax rate paid by Stamp duty exemption One-off RM50 RM15 billion
EPF contribution (replacing Bantuan Sara those earning between on instrument of e-wallet credit for allocated for
rate is reduced from Hidup) cash assistance RM50,001 and RM70,000 transfers and loan those aged between transport
11 to 9 percent ranging from RM350 will be lowered by one agreements for first 18 to 20 years old. infrastructure
from January 2021. to RM1800 for single percentage point. home buyers extended RM1.5 billion to projects including
Withdrawals of individuals aged 21 RM24 billion for Socso’s to 31 December ensure Internet Pan Borneo Highway,
RM500 per month with monthly earnings employment injury 2025 and the duty connectivity for the Gemas-Johor Bahru
from EPF Account of up to RM2500 and scheme. Delivery riders limit increased up to B40 group in the project and Klang
1 will be allowed for households with monthly will also be included in RM500,000. form of credit of Valley Double Track
up to 12 months. income under RM5000. this scheme. RM180 per person. project.

20 COVER STORY

“As Malaysia navigates the impact “We are confident that these “At RM322.5b, Budget 2021 is the
of COVID-19, we are pleased to see steps are integral to accelerate largest budget in Malaysian history
the government’s firm commitment and did not see any new taxes being
Malaysia’s path to recovery proposed or any existing taxes being
on an expansionary stimulus for and realise its vision of
2021, continuing the fiscal injections increased. It is a fit-for-purpose
becoming an inclusive high- Budget which meets the immediate
made in 2020. The government tech nation via an innovation- needs of the country to encourage
spending today is necessary given recovery, growth and investment. It is
the unprecedented environment. driven economy. Across now key to monitor and measure the
Malaysia, we are witnessing implementation of the Budget closely
We welcome that Budget 2021 against the desired objectives and
continues to comprehensively build technological adoption at also consider how our neighbours
blazing speed as businesses, in the region are reacting, especially
on Malaysia’s focus on reducing startups, and enterprises turn in terms of incentive offerings. As
income inequality, healthcare to innovation to navigate these
spending, and targeted assistance to uncertain times. The proposals we saw at the beginning of this
businesses. Proactive measures by in Budget 2021 will ensure that year, the COVID-19 pandemic has
the government include deepening these entities are well-guarded created significant uncertainties and
engagements for job creation, and will continue to deliver economic conditions may change very
training and reskilling, investing impactful innovations and rapidly, depending on the continued
further in broadband connectivity create jobs for the economy.” impact of the virus and the length
and accelerating development of time it takes to develop a vaccine.
in e-commerce. These long-term – As such, the Government needs to
investments will reduce the digital Dzuleira Abu Bakar be agile and prepared to revisit and
divide at both levels of human capital supplement the Budget measures as
and technological infrastructure.” CEO of MaGIC
and when necessary.”
– –
Dato’ Abdul Rahman Ahmad
Group Chief Executive Officer, Amarjeet Singh
EY Asean Tax Leader and Malaysia
CIMB Group
Tax Leader, Ernst & Young

“We are pleased that the government continues to recognise the value of e-commerce
enterprises and their role in bolstering the nation’s digital economy. Having
onboarded around 50,000 local SMEs onto Lazada this year, we remain committed
to supporting local businesses to shift gears to online solutions. We have been
working closely with the government on their PENJANA Micro & SMEs eCommerce,
PENJANA Shop Malaysia Online, Buy Malaysia and Selangor e-Bazar initiatives,
and have seen the positive business benefits for SMEs during this challenging
period. As such, we are appreciative of the total allocaation of RM300 million for
the continuation of the PENJANA Micros & SMEs eCommerce and Shop Malaysia
Online Campaigns, which will further encourage online shopping and serve to benefit
over 500,000 local SMEs to help them reap the benefits of the digital economy.”
–
Leo Chow, CEO
Lazada Malaysia

21

REACTIONS TO BUDGET 2021

“FMM is a strong advocate “As Malaysia reopens for business, the “We applaud the focus to encourage
of Buy Made-in-Malaysia ‘Stand United, We Shall Prevail’ themed entrepreneurial activities among gig
workers and the self-employed in the
products to stimulate budget is both timely and bold as it recently announced Budget 2021,
domestic demand and we will accelerate the nation’s economic such as the allocation of an additional
recovery and build resiliency. The budget RM110 million under the Micro
thank the Government anchored on ensuring rakyat’s prosperity Enterprises Facility under Bank Negara
for taking heed of our call Malaysia. With the current pandemic
and wellbeing, business continuity impacting many families, individuals
to promote the exports and economic resilience, underpins and businesses across Malaysia,
of Malaysian products Malaysia’s determination to overcome SOCAR Malaysia believes that the gig
and services through the economy is primed to fill an economic
allocation of RM35 million the immediate challenges while gap by providing Malaysians with
for Trade and Investment addressing the long-term aspiration of both income and job opportunities,
Missions. In addition, FMM our nation to be competitive, prosperous during such unprecedented times.
lauds the Government’s effort and sustainable with an inclusive future.” At SOCAR Malaysia, we strongly
in strengthening the Off- believe that the peer-to-peer (P2P)
Take Agreement Programme - financing concept is a move in the right
by the Ministry of Health K. Raman direction for Malaysians especially as
(MOH) to facilitate local Managing Director, Microsoft Malaysia we seek to realise the benefits of the
manufacturers in developing decentralised sharing platforms. We
a vibrant pharmaceutical also feel that the national employment
industry in Malaysia. FMM council is an area where the sharing
believes that the allocation of economy participants would be able to
RM1.4 billion to support the contribute ideas and make an impact.”
development of the domestic –
supply chain and increase Leon Foong
the development of local CEO of SOCAR Malaysia
products including medical
devices would further develop
the local medical devices
industry. FMM also welcomes
the strengthening of the
Multi-Agency Taskforce to
curb smuggling and trade
of illicit goods to address
the loss of revenue to the

Government.”
–

Tan Sri Dato’ Soh Thian Lai
President, Federation of
Malaysian Manufacturers

“The alignment of Budget
2021 with the 17 Sustainable
Development Goals 2030 is timely.
This includes the commitment to
create the Sustainable Finance
Hub and to put Malaysia as a hub
for sustainable living. The issuance
of Sustainable Bonds to finance
environmentally friendly and
social projects in 2021 is keenly

awaited.”
–

Tan Sri Abdul Wahid Omar
Chairman of Bursa Malaysia

22 PERSONALITY

23

COMPILED
BY

JORDAN
LOW

RATCJLAIMFFEES
RAGS TO CHEMICAL

RICHES

ovid-19 is an unprecedented disaster that has

C completely changed the way the world works, for
better or for worse. For the better part of 2020,
the pandemic has caused unimaginable damage
and disruption to the world’s economy. No
industry has been left unscathed. While some
have fared better than most, and even a handful
who are thriving amidst such a horrible business
climate; all companies will at some point have
faced some negative effects from the pandemic.
As mentioned, only a handful of businesses and industries have
managed to thrive during this economically trying times. Those that have
survived either have enough financial clout to pull through, the ability
to adapt and transform digitally, or provide a service that is still in high
demand despite the sharp drop in consumer spending. One example of
such an industry is petrochemicals
Not too long ago, any businessperson who is even remotely familiar
with the petrochemicals industry would most likely have thought the
sector’s future prospects were not looking good. Despite their useful
application in our everyday lives, the growing global realisation of the
consequences of environmental damage has put new hurdles for the
petrochemicals industry to tackle.
The topic of climate change first gained prominence in the mid-
1950s, and has since only grown. Concerted efforts have been made in
order to ensure businesses and organisations limit the amount of pollution
that their respective industries create. Plastics in particular gained an
especially bad reputation due to its incredibly long lifespan and durability;
which ironically is also technically why plastics are so useful. And since
petrochemicals are heavily involved in the production of plastics, the
sector has come under intense scrutiny as well.
In recent years, both the petrochemicals and plastics industries have
been making efforts to limit their carbon footprint and waste production
in order to conform to the environmental demands of both the public
and governments. As such, growth for these industries has been less than
stellar as of late.
However, The Covid-19 pandemic may bring with it opportunities
that might elevate the industry back into prominence.
In this edition of SME, we will be taking a look at one of the world’s
largest and most prominent petrochemical companies, Ineos, and the man
who built it from the ground up, Sir James Arthur Ratcliffe.

A HUMBLE MAN FROM A HUMBLE BACKGROUND

James Ratcliffe was born in 1952, in the suburbs of Failsworth, in
Greater Manchester. Along with his family, he lived in a council house,
a form of public housing commonly found in the UK at the time. His
father was working as a joiner and his mother worked in an accounts
office. They were not poor per se, but they lived modestly, with

24 PERSONALITY

Ratcliffe’s father later coming to run a factory that made laboratory furniture. While the Ineos we know today is an
Interestingly enough, Ratcliffe’s fascination with industry began at an early age. industrial powerhouse with 51 productions
facilities across several countries, the Ineos
He used to spend plenty of time looking out his bedroom window and counting the back then was no slouch either. Within
many smokestacks belonging to factories in the distance. When Ratcliffe was ten its first decade, the company made more
years old, his family made to move to Yorkshire, where he would later attend the than 20 acquisitions, buying unwanted
Beverley Grammar School. This would be where Ratcliffe develops his fascination commodity businesses from the likes of
with science and engineering. BP, ICI and BASF when these industry
giants restructured. Ineos took on their
Living in Hull until he was 18, he then studied chemical engineering at debts to fund the purchases and reduced
Birmingham University. His parents encouraged him to make the most of his them through immediate measures, such as
abilities – it was “frowned upon” if the children’s capabilities weren’t met, according cost savings.
to his brother, Bob.
In order to fund its acquisition spree,
During the 1970’s in the UK, there really were not many life choices to make, Ineos utilised debt markets.. The formula
especially with regards to higher education. You could choose the “red-brick” was fairly simple: take on a lot of debt to
universities, the polytechnics, or get a job. Fortunately for Ratcliffe, who had fund the purchase, reduce it through cost
managed to achieve a chemical engineering degree, he went on to study for an MBA savings and other measures, and start all
at London Business School. over again. Once secured, Ineos would pull
out all stops and stop spending overnight.
BEFORE THE RISE Many of the companies would have
excessively high costs and the aim was to
After working in industry at Courtaulds and Esso, Ratcliffe was headhunted by the stop waste immediately.
private equity group, Advent International. He described this move as one of life’s
“crossroads”, that spurred him into doing something for himself. As said by Tom Crotty, Ineos group
director: “It’s a short, sharp, shock
He began looking for investment opportunities, until in 1992, he joined forces tactic, but means the business remains
with former chemicals executive John Hollowood to lead a buyout of a chemicals viable. We remove company credit
business from BP. Despite having two young sons by this time, Ratcliffe took a cards, raise spending level approvals.
gamble and risked everything he had to succeed. Some people get it, some don’t, and the
majority are confused for a short time
After mortgaging his house, he ploughed every penny into the deal. He said before adjusting”.
it was a “critical part” of his career path, because if it went wrong, he had lost
everything, including all his money and his career. After a year of deliberating, his THE WAR ON COVID-19
wife and family agreed to take the risk together.
By 2020, Ineos is the world’s largest
With the backing of Advent, the deal went ahead, forming Inspec, with manufacturer of materials that are
Hollowood as chairman and Ratcliffe the chief executive. Hollowood described his essential to daily life as we know it. As
business partner as “very stubborn and very determined”. such, when the Covid-19 pandemic hit, the
company was among the first to recognise
Ratcliffe believed in the “ownership philosophy”, in which he believes that the dangers the pandemic posed and
venture capitalists had to put some of their own money into something if they ever reacted accordingly.
hope to gain something else in return. He said commitment and responsibility were
good – an ethos he instilled when he went on to launch Ineos in 1998. “We take our responsibility as a global
manufacturer of essential products to
BIRTH OF AN EMPIRE every-day life very seriously, with health
and safety our top priority,” said Ratcliffe,
Ratcliffe built Ineos up from scratch, after again risking everything he had to raise who led the charge.
the finance, with a combination of venture capital equity and loans. The company
manufactures the raw materials for products that we use in our everyday life, Ineos also became a key player in the
including everything from toothpaste and bottle tops, to cars and computers. push for a more hygienic workplace. In
May 2020, Ineos had announced that it
had built two new hand sanitiser facilities
in Arkansas and Pennsylvania. Both the
plants produce 1 million bottles of sanitiser
each per month on average in order to
meet desperate shortage requirements.

Once again, Ratcliffe proves himself
to be a fast and effective leader, appearing
at the forefront of the company in order
to meet consumer expectations and
strengthen confidence in his brand.

Sir James Arthur Ratcliffe’s story is not
over as he remains a strong figure within
Ineos. It is widely known that he intends to
expand his business further, with big plans
in place for the automotive industry. While
we may never know what the future holds,
what we know for certain is that if anyone
can make lightning strike twice, it would be
the risk-taker known as James Ratcliffe.

PRIMARY

T here have been of serving our customers.” to their normal instalments when SECONDARY
several trends “In the past, people may think the economy has recovered and
shaping the business we have passed the COVID-19 business. Our aim is to build
world over the past of us as a smaller bank, maybe storm,” he continues. a relationship and their trust
decade: digitalisation, not as agile. With this rebranding, to continue banking with us
workplace flexibility, sustainability, we hope that this perception will LOOKING FORWARD TO THE FUTURE as they get bigger and more
and the falling cost of disruption, change, and our SME customers successful,” he continues.
among others. will understand that it is about the 2020 has been a rough year, so
Though these trends have initiatives we take in understanding many organisations are looking SPEDCiIgALitaEXl EbCaUnTkIOinNg is also
been accelerating slowly over and prioritising our stakeholders; forward to 2021 and beyond to another area of focus for
the past few years, the COVID-19 our customers, employees and be a better year. AFFIN BANK AFFIN BANK as more and
pandemic has turned them into shareholders,” he continues. is just as eager, and has been more customers turn to
overdrive. Every organisation, big making plans to focus on high- remote banking due to the
and small, has had to embrace Rebranding in the midst of a growth areas. pandemic. “We intend to
this change, while staving off vulnerable time for the economy launch an SME mobile banking
the financial hardship that has may be tough, but as it is often Datuk Wan Razly explains app by before New Year,”
come with government-imposed said, there is no time like the that the startup segment is a says Datuk Wan Razly. “For
lockdowns and reduced trade. present. Datuk Wan Razly says, focus area in 2021. “We’re a big enterprise and corporate
Affin Bank Berhad is no “What better time to do it than advocate of startup businesses. customers, you can do your
exception. The pandemic has now: if you want to do something, I We offer startup financing up to day-to-day banking online,
caused the government to announce think it’s best to do it immediately – RM300,000 for new companies, such as checking balances
a moratorium on loans until regardless of COVID-19. With this operating for 6 -36 months, to aid and making payments. It can
September of this year, while sales in place, we can launch our new them in terms of their operating also be customised for smaller
of banking products and insurance products going forward.” cash flows. Although startups are businesses, or for larger SMEs
business have also dropped due to considered a high-risk sector, with approval mechanisms
a lack of customer-facing contact. HELPING SMEs RIDE THE STORM we do want to support this which will work like the Internet
This has resulted in a 20 percent underserved segment. We want to banking that we are all used to.
year-on-year drop in profit before tax AFFIN BANK’s new SME-focused grow with our customers from the
for the first six months of the year. products come at a time when the beginning with products such as COVID-19 has been
Datuk Wan Razly Abdullah bin COVID-19 pandemic has without a the BizDana-i financing scheme,” a watershed moment for
Wan Ali, President & Group Chief doubt hit SMEs the hardest. SMEs he says many organisations, and
Executive Officer of Affin Bank in certain sectors like travel, sports, many are strapping in as
Berhad explains that AFFIN BANK entertainment, and the retail sector “Obviously we do a credit the pandemic continues into
has been concentrating on focusing have been hit particularly hard, but score check on any potential 2021. Nevertheless, Datuk
and improving key business areas. industries across the board are applicants, and we judge them on Wan Razly is confident that
“We are looking at improving feeling the pain. business viability and business the economy will rebound
our services, and also our digital model before they are eligible next year. “We are hopeful
processes. We’re improving But AFFIN BANK is stepping for a loan with us. Aside from that there is a vaccine on the
our Internet banking processes, up to the plate to assist SMEs in financing, we will also advise horizon, and by the middle
especially during this pandemic any way possible. Datuk Wan Razly them on how to grow their of 2021 it will be available to
period to encourage online says, “We need to ensure that all everyone,” he concludes.
transactions and applications and our SME customers are able to
reduce the need for our customers ride the COVID-19 storm. We don’t
to come to the bank in person, know how long the storm will last,
and therefore, help to protect but we think it will last into the good
themselves as well,” he says. part of next year. Therefore, we
need to help SMEs safeguard their
A NEW LOOK cash and business viability.”

To further strengthen its brand “In the first part of the MCO,
image, especially among SMEs, SMEs were supported by the
AFFIN BANK has undergone a six-month moratorium announced
rebranding exercise – reaching by the Government. Now, in the
into its history to project a second phase, we at AFFIN BANK
customer-centric brand. are rolling out the FAIR program,
which stands for Financial
Datuk Wan Razly explains, Assistance & Instalment Relief.
“We went back to our heritage, With this program, we are basically
inspired by the Bunga Raya extending the loan duration, and
(hibiscus) which has a long we also offer grace periods for
association with AFFIN BANK. principal repayments. We can
The Bunga Raya is a fast-growing even adjust the instalments to
flower, very strong, and can stand be lower and SMEs can reinstate
the temperaments of Malaysian
weather. That symbolises to us
courage, life, and rapid growth.
We also have a new customer-
centric tagline: Always About You.
Together with the new Bunga Raya
logo, we want to highlight our
dedication and passion, in terms

26 FEATURE

T ransplant someone BY problem of pollution and a degraded
from the year 2000 ONG XIANG environment to deal with.
to our current
time, and he or she HONG Futurists thought that as technol-
will be completely ogy became more advanced, our human
bewildered by the “THE FUTURE needs would be more than adequately
advances that we WILL BE BETTER satisfied, and that we would have more
have made since. TOMORROW.” leisure time. Of course, that is not the
The Internet, smartphones, AI and other – case now. If anything, we are working
developments have changed our society DAN QUAYLE, more than ever, but we are also more
so drastically. FORMER VICE productive than ever. New jobs, new
Go back to the dawn of the 20th PRESIDENT OF THE skills, and new demands have grown
century, and things are even more UNITED STATES as a result of technological progress.
drastic. Consider that, in America: And as a species, our innate dynamism
In 1900, <10 percent of families owned the spread of COVID-19 has necessitated ensures that we will never stop progress-
a stove, or had access to electricity or the use of such technology for the sake of ing. Will that stop us from destroying
phones public health. ourselves as well? Only time will tell.
In 1915, <10 percent of families owned
a car Looking further in the future, there Hence, in this issue, SME showcases
In 1930, <10 percent of families owned are possible breakthroughs that will our pick of emerging technologies that
a refrigerator or clothes washer dramatically alter the human condition. has the greatest potential to disrupt the
In 1945, <10 percent of families owned Sooner or later, medicine will figure out business world as we know it.
a clothes dryer or air-conditioning how to cure cancer and other diseases,
In 1960, <10 percent of families owned dramatically increase human life, and
a dishwasher or colour TV directly interface the human brain with
In 1975, <10 percent of families owned machines. Cheap, clean forms of energy
a microwave will be discovered. Computers will get
In 1990, <10 percent of families had a faster and smaller.
cell phone or access to the Internet
Today, at least 90 percent of Americans On the flip side, entertainment
own a stove, electricity, car, fridge, and media will become more engaging
clothes washer, air-conditioning, colour and immersive – and some might say,
TV, microwave, and cell phone. insidious. New, more efficient ways
And technology marches ever onward. of killing each other will be invented.
Indeed, the pace of technological Assuming World War III hasn’t broken
advancement in recent years has not only out before then, we still have the
been gathering pace, but is at a positively
breakneck speed. There are even more
advanced technologies on the horizon,
that will make today seem quaint. Of
course, many of these technologies are of
use to SMEs. Not just because they are
a business opportunity – any SME that
fails to keep up with the times will be left
behind, and consigned to fail.
Nevertheless, these are exciting times
we live in. In the next few decades, we
will see interesting developments and
progressions in pretty much every area
of technology that will matter. Enhanced
functionality, more capable devices, and
new online services will be made available
to users on a continual basis.
Not only that, but the nature of work
has also changed. Before, one needed
to come into the office to get work
done. Factories were staffed by armies
of workers. Now, work can be done
remotely, and just a few skilled employees
can oversee an automated assembly line.
Video calling and teleconferencing used to
belong to the realm of science fiction, but

27

“I’M
INCREASINGLY

INCLINED TO
THINK THAT
THERE SHOULD

BE SOME
REGULATORY

OVERSIGHT,
MAYBE AT THE
NATIONAL AND
INTERNATIONAL
LEVEL, JUST TO

MAKE SURE
THAT WE DON’T
DO SOMETHING
VERY FOOLISH.

I MEAN WITH
ARTIFICIAL

INTELLIGENCE
WE’RE

SUMMONING
THE DEMON.”

–
ELON MUSK

T hough AI was invented mation, and even generate greater prof- tailor their strategies towards it. For
several decades ago, its. Digital marketing experts predict that example, an AI text analysis engine can
computing power has now customer service representatives won’t quickly analyse thousands of tweets,
allowed reality to catch up to be required to manage over 85 percent reviews, and online comments, using
the AI dreamers. of customer support communication by algorithms to identify recurring themes
In the past, AI was mainly associated 2025. Companies can use programs and and topics.
with robots. In Isaac Asimov’s seminal applications with AI to build brand repu-
work, I, Robot, its description of positronic tation and loyalty. They will help them Beyond that, banking and financial
brains and robot psychology deeply increase their revenue. services companies are using chatbots
impacted the public’s perception of AI. or virtual assistants to help customers
Today, AI is embedded more than AI becomes more powerful the with routine tasks like scheduling
ever in our lives. Personal gadgets, media more data is fed into it. The conver- payments and automating the most
streaming platforms, smart cars, and home gence of this trend, known as Big frequently asked questions. Predictive
appliances all use AI. Data can enable businesses to capture analytics is used to reduce the risk of
In business, AI has the potential to previously unseen trends, and capital- loan defaulters. Machine learning can be
streamline operations, enable greater auto- ise on it. Marketing teams can utilise used to identify patterns of transactions
AI to analyse customer feedback, and that might indicate fraudulent activity.

28 FEATURE

“THERE WAS A TIME
WHEN HUMANITY
FACED THE UNIVERSE
ALONE AND WITHOUT
A FRIEND. NOW HE
HAS ROBOTS TO HELP
HIM; STRONGER
CREATURES THAN
HIMSELF, MORE
FAITHFUL, MORE
USEFUL, AND
ABSOLUTELY DEVOTED
TO HIM. MANKIND IS
NO LONGER ALONE.”
–
ISAAC ASIMOV IN
I, ROBOT

A long with AI, robotics Human-robot collaboration is Research currently focuses on methods
has the greatest potential another important trend in robotics. to enable robots to respond in real-time.
to change the course of With the ability to work in tandem Just like two human workers would
our lives. with humans, modern robotic systems collaborate, the R&D teams want them
Many don’t realise that are able to adapt to a rapidly changing to adjust its motion to its environment,
robots are all around us now. Driverless environment. The range of collaborative allowing for a true responsive
mass transit trains are an example of a applications offered by robot collaboration. These solutions include
robot. When they arrive, driverless cars manufacturers continues to expand. voice, gesture and recognition of
are also considered robots. Currently, shared workspace applications intent from human motion. With the
For now, from 2020 to 2022 are most common. Robot and worker technology of today, human-robot
almost 2 million new units of industrial operate alongside each other, completing collaboration has already a huge
robots are expected to be installed tasks sequentially. potential for companies of all sizes and
in factories around the world. New sectors. Collaborative operations will
technology trends and market Applications in which the human complement investments in traditional
developments enable companies to and the robot work at the same time on industrial robots.
react to changing requirements. the same part are even more challenging.
Programming and installation of
robots will also become much easier.
How this looks in practice: Digital sensors
combined with smart software allow direct
teaching methods, so-called “Programming
by Demonstration”. The task that the
robot arm is to perform is first executed by
a human: He or she will literally take the
robot arm and hand-guide it through the
movements. This data is then transformed
by the software into the digital program of
the robot arm. In future, machine learning
tools will further enable robots to learn by
trial-and-error or by video demonstration
and self-optimize their movements.

29

“THE DAY
WILL COME

WHEN
THE MAN

AT THE
TELEPHONE

WILL BE
ABLE TO
SEE THE
DISTANT
PERSON
TO WHOM

HE IS
SPEAKING.”

–
ALEXANDER

GRAHAM
BELL

A I and robotics do not exist The promise is that 5G will bring automated, where even the slightest
in isolation – they are part speeds of around 10 gigabits per second delay can be problematic in situations
of a connected whole. They to your device. That's more than 600 where there is no room for error.
are part of an ecosystem times faster than the typical 4G speeds
which will make our lives on today’s mobile phones, and 10 times Examples of this will be self-
easier, safer, and healthier – but will faster than Google Fiber's standard home driving cars, which will rely on an
need high-speed, always-on Internet broadband service. array of sensors embedded in urban
connections. environments, and communicating
To keep up with the explosion of But more than speed, 5G is about with each other via 5G connections.
new connected gadgets and vehicles, ultra-low latency. To put it simply, A patient could remotely work with a
not to mention the deluge of streaming latency is gap time, or transmission doctor on physical therapy exercises,
video, the mobile industry has introduced time for a packet of data. Current just as if they were together in the
something called 5G—so named because 4G connections have latency around office. The ability to play video games
it's the fifth generation of wireless 20-30 milliseconds. 5G connections on-the-go can be reality, as can
networking technology. will reduce it to 1 millisecond. This multiplayer gaming experiences with
will enable critical operations to be almost zero lag.

30 FEATURE

“A DESIGNER
KNOWS
HE HAS
ACHIEVED
PERFECTION
NOT WHEN
THERE IS
NOTHING
LEFT TO ADD,
BUT WHEN
THERE IS
NOTHING
LEFT TO
TAKE
AWAY.”
–
ANTOINE
DE SAINT-
EXUPERY

3 D printing, also known as dimensional objects one superfine layer using 3D printing to ramp up
additive manufacturing, is a at a time. Each successive layer bonds production are GE (jet engines,
transformative approach to to the preceding layer of melted or medical devices, and home appliance
industrial production that partially melted material. Objects are parts), Lockheed Martin and
enables the creation of digitally defined by computer-aided- Boeing (aerospace and defense),
lighter, stronger parts and systems. design (CAD) software that is used to Aurora Flight Sciences (unmanned
It is yet another technological create computer files that essentially aerial vehicles), Invisalign (dental
advancement made possible by the "slice" the object into ultra-thin layers. devices), Google (consumer
transition from analog to digital processes. This information guides the path of electronics), and the Dutch company
In recent decades, communications, a nozzle or print head as it precisely LUXeXcel (lenses for light-emitting
imaging, architecture and engineering deposits material upon the preceding diodes, or LEDs). Watching these
have all undergone their own digital layer. Or, a laser or electron beam developments, McKinsey has noted
revolutions. Now, 3D printing can selectively melts or partially melts in a that 3D printing is “ready to emerge
bring digital flexibility and efficiency to bed of powdered material. As materials from its niche status and become a
manufacturing operations. cool or are cured, they fuse together to viable alternative to conventional
The term “additive manufacturing” form a three-dimensional object. manufacturing processes in an
references technologies that grow three- increasing number of applications.”
Among the numerous companies

31

“YOUR
FOOTPRINTS
– YOU LEAVE
THEM ON THE

SANDS OF
TIME. YOUR
FINGERPRINTS
– YOU LEAVE
THEM WITH
THE POLICE.”

–
NKWACHUKWU

OGBUAGU

T he username and password also impossible to obtain a biometric But biometrics has long been
system has been in use marker from a person. dogged with a spate of privacy and
since the dawn of implementation issues. These have made
computing. Yet time and Because biometrics can provide it harder for the technology to permeate
again, it has been proven to a reasonable level of confidence in through society, with corporations being
be less than ideal for even the most basic authenticating a person with less the major beneficiaries of advances in
security applications. friction for the user, it has the potential this area.
We tend to forget passwords more to dramatically improve enterprise
often than we think, and many people use security. Computers and devices can Despite the challenges, a lot still
the same password for multiple logins. unlock automatically when they detect goes on in the world of biometrics.
However, when (not if) a security breach the fingerprints of an approved user. Most banks have fully integrated one or
occurs, the same username/password Server room doors can swing open more aspects of biometrics for access
combination is now compromised. when they recognize the faces of control or other areas of operations for
Hence, biometrics has arisen as a trusted system administrators. Help security purposes. It's also common to
much more secure alternative. It’s next to desk systems might automatically pull find fingerprint scanners for accessing
impossible to forge a fingerprint or retina. up all relevant information when they many buildings, including warehouses
Short of coercion or outright murder, it’s recognize an employee's voice on the and production facilities that deal with
support line. sensitive materials.

32 INDUSTRY

BY
ONG XIANG

HONG

33

L ike most other challenge for the sector, which is currently outbreaks in confined warehouses.
industries, lagging many of its customers in this ALTERNATIVE MODES OF TRANSPORT: Many
transportation respect. Attracting the right skills is one
and logistics issue, but developing the right strategy is companies are using creative
is currently even more crucial. alternatives to their go-to transport
confronting modes. Since the reduction of
immense change; An increasingly competitive passenger flights has reduced airplane
and like all environment is another big factor in the belly cargo capacity, companies such
change, this mix. Some of the sector’s own customers as DHL have used charter flights
brings both risk and opportunity. are starting up logistics operations of to transport shipments to and from
And like most industries, COVID-19 their own, and new entrants to the China. Airlines are also repurposing
has also supercharged the pace of change industry are finding ways to carve out passenger aircraft for cargo. Some
for the logistics sector. Government- the more lucrative elements of the value observers are even forecasting a boom
imposed lockdowns have dampened chain by exploiting digital technology or for the China-Europe rail as 60 percent
the demand for freight; but on the other new ‘sharing’ business models, and they of the air freight capacity between
hand, explosive e-commerce growth has don’t have asset-heavy balance sheets or China-Europe has vanished.
driven great demand for courier and cumbersome existing systems weighing ADAPTING SERVICE OFFERINGS TO current
express logistics. them down. demand and safety protocols: Some
Supply chain disruptions and the larger players have been playing an
lockdowns are already affecting logistics ‘Sharing’ is a big story for logistics important role in delivering medical
companies. Operational constraints now – from Uber-style approaches to supplies. For example, UPS provided
are expected to lead to delivery delays, last-mile delivery, to more formal JVs free air transport for two million
congestion, and higher freight rates. And and partnerships at corporate level, the masks and protective gear to Wuhan
as mentioned, not all segments will be whole sector is redefining collaboration. in February. Companies are also
impacted equally – companies that serve But much of this is hampered by adapting to demand. Warehouses
e-commerce are seeing increased activity inconsistencies in everything like shipment and retailers are focusing on grocery
as consumers opt for online shopping of sizes, processes or IT systems. The deliveries since demand is high for
essentials, while those that serve other Physical Internet promises great things for essential products, while companies
sectors (such as auto and consumer the sector, coming along with increased in the last-mile segment are offering
goods) will see a downturn. One mitigant: standardisation in logistics operations. no-contact delivery options (some of
record-low fuel prices should provide which include robots).
some relief to transport operators. CRISIS RESPONSE
Overall, the uncertainty will exert LOOKING TO THE FUTURE
downward pressure on revenues. For the most part, governments have
With new technology, new market responded to the crisis by designating Post COVID-19, the global logistics
entrants, new customer expectations, and ports, shipping, and trucking services market size is projected to grow from
new business models – there are many as essential, thereby exempting them US$2.734 trillion in 2020 to US$3.215
ways the sector could develop to meet from lockdown measures. For example, trillion by 2021, at a year-on-year growth
these challenges, some evolutionary, the Indian government exempted the of 17.6 percent, according to research
others more revolutionary. movement of cargo through ports, supply house Research and Markets.
chains, and the transport of essential
MARKET DISRUPTION commodities from lockdown rules. The major drivers of this market will
Although many airports around the world be the increasing focus on the continued
Customer expectations are increasing are closed to passenger flights, most are supply of essential commodities, creation
greatly. Both individuals and businesses still open to cargo, which can be essential of supply chain stabilization task force
expect to get goods faster, more flexibly, to the COVID-19 response (for example, to fight COVID-19, and growing demand
and – in the case of consumers – at low to transport medical supplies). Closer and distribution of personal protective
or no delivery cost. Manufacturing is collaboration between governments and equipment. The factors that restrain the
becoming more and more customised, third-party logistics companies has also market will be a labour shortage and a
which is good for customers but hard been necessary to address supply chain shortage of COVID-19 testing kits.
work for the logistics industry. Add it bottlenecks and facilitate clearances.
all up and the sector is under acute and Fast-moving consumer goods
growing pressure to deliver a better Third-party logistics companies have (FMCG) and healthcare are among
service at an ever lower cost. adopted a range of responses to these the major industries facing prominent
uncertainties, including: logistics challenges. Most consumers
It can only hope to do this by NEW SAFETY PROTOCOLS: To protect their are experiencing the fear of limited
making maximum and intelligent use availability of food, consumer goods
of technology, from data analytics, to staff’s health, some companies have as well as healthcare goods such as
automation, to the ‘Physical Internet’. introduced new protocols on social disinfectants. Countries are experiencing
This promises lower costs, improved distancing at warehouses, disinfecting supply pressure due to panic buying by
efficiency, and the opportunity to make work areas, or providing protective consumers amid the COVID-19 impact.
genuine breakthroughs in the way the gear, while giving staff unlimited As a result, FMCG companies are
industry works. But ‘digital fitness’ is a unpaid time off. However, these efforts, continuously tracking the current situation
which come at a higher financial cost,
cannot guarantee protection against

34 INDUSTRY

and are coming up with new strategies to models could have as much of an impact gistics offerings to fill their own needs and
ensure continued supply. on the sector as new technology. And beyond, effectively moving from customers
the industry’s current customers and to competitors. They purchase small logis-
Furthermore, the challenge of suppliers may end up being the biggest tics players to help cover major markets,
transporting the COVID-19 vaccine will new entrants. and draw on their deep understanding of
also be a huge challenge for logistics customer behaviour to optimise supply
companies. An estimated 10 billion doses How will this work out? Incumbents chains. Technology firms who used to be
need to be delivered worldwide at a may increase their efficiency and suppliers to the industry enter the logistics
temperature of minus 70 degrees Celsius. reduce their environmental impact by arena too, offering logistics services and
This is an immense, once-in-a-generation collaborating more, and developing turning into competitors.
challenge, and to tackle it requires new business models, such as sharing
collaboration with governments and networks. They will be streamlining their Thus, any logistics company will need
transnational agencies. Technology like operations and taking full advantage of to do the delicate balancing act of meeting
data and analytics will also play a part, as new technology. They fund promising new the growing expectations of customers, re-
well as unconventional approaches like technologies with venture capital cash, maining profitable and generating growth.
working with disaster recovery agencies and attract new staff with critical skills
or quick-response teams to transport the and expertise in competition to create a The COVID-19 outbreak has shown
fragile vaccine. dominant market position. Major players the industry how delicate the supply
merge to extend their geographical scale chain has become. The heightened safety
Looking further into the post and enhance their cross-modal coverage. precautions have required the logistics
COVID-19 future, there will only be Access to capital to fund these investments industry to work in emergency services,
more disruption and uncertainty. becomes increasingly important. as governments and logistics associations
Like individual consumers, industrial work hard to keep the essential supplies
customers now expect to get shipments On the other hand, new entrants flowing. During this difficult time, it
faster, more flexibly, and with more may also become significant players and essential for logistics companies to have
transparency at a lower price. No surprise take market share from the incumbents an immediate focus on enabling end-to-
that across the industry, both operating through new business models based on end visibility, agility, process flexibility,
models and profitability are under strain. data analytics, blockchain, or other tech- and collaboration to support their
And the pace of transformation for large nologies. One or two become dominant customers in anticipating disruptions and
manufacturing and retail customers may in specific segments. Last-mile delivery mitigating the respective impacts.
turn out to be even faster than for private becomes more fragmented, with crowd-
final consumers. Platform technology delivery solutions gaining ground. These With the global maritime and air
has given rise to new business models, start-ups collaborate with incumbents and freight industry experiencing capacity
often driven by start-ups that enter the complement their service offers. constraints, logistics service providers
logistics industry. New ‘sharing’ business should drive transparency by assessing
Big retail players may expand their lo- “what-if” scenarios with customers to
understand planned volume and strategic
needs. Advanced capacity bookings for
air cargo could mitigate supply risks for
customers on emergency shipments.
Freight forwarders and small and medium-
sized freight operators should emphasize
building digital capabilities to evaluate
alternate route-to-market models and
address potential operational gaps. Digital
logistics is essential to drive the adoption
of e-freight to combat the spread of the
virus through paper documentation.

In the retail industry, order
backlogs are creating inventory stocking
issues. However, the adoption of the
Internet of Things (IoT) in warehousing
and distribution operations would
facilitate inventory accuracy, ensuring
the placement of the right products
in the right place at the right time. In
the long term, robotics systems for
warehouse operations, SaaS platforms
for transportation management and
control tower operations, and artificial
intelligence-powered technology platforms
for customer management will allow
logistics companies to anticipate supply
chain risk and promote sustainability
goals with enhanced operational
efficiency.

BY
SC
CHONG

SC CHONG IS MANAGING DIRECTOR, stringent safety measures in pandemic as an essential service. solutions at scale and driving
FEDEX EXPRESS MALAYSIA. place and is actively boosting the At the onset of the pandemic, end-to-end supply chain
drivers of recovery: namely cross activating comprehensive health management. A few initiatives
A ccording to the border trade that will aid growth and safety Standard Operating we’re leveraging towards SME
International for the Intra-Asian economy, Procedures (SOPs) was our support include:
Monetary Fund (IMF), supporting and working with foremost priority - particularly for FedEx Global Trade
the global economy small and medium enterprises our frontliners who were in direct
will contract by 3% (SMEs), and facilitating best contact with customers. Manager (GTM) giving
this year as countries around the ways to tap into the e-commerce the shipper access to
world shrink at the fastest pace in boom, for instance last mile- We continue to procure and information such as the
decades, further describing the delivery solutions. allocate supplies of face masks, estimate of the Duties and
decline as the worst since the Personal Protective Equipment Taxes at the destination
Great Depression. In Malaysia, the implemen- (PPE) and hand sanitizers, and countries, documentation
The impact from the COVID-19 tation of the Movement Control have facilitated ‘Working from needed and access to
pandemic is not only an unprec- Order (MCO) led to a temporary Home’ where possible for our regulatory information.
edented global health and humani- suspension of numerous retail 1,500 employees throughout the FedEx Electronic Trade
tarian crisis, but is an event that businesses. While businesses country. We have equipped our Documents (ETD) facilitating
continues to create economic hurried to re-strategize and put employees with the necessary the submission of all
shockwaves around the world. It is in place stop-gap measures to means and platforms required customs documentation
also anticipated that global econo- pivot and adapt, we sought to to ensure that remote working electronically.
mies will only recover by late 2022, ensure uninterrupted support for would be seamless for our staff Another key solution is
one that’s heavily dependent on our customers. We undertook and for our customers, experience the FedEx Delivery
the success of a viable vaccine. multiple delivery attempts to minimal to zero interruptions. Manager International
customers who worked from home (FDMi) which is a global,
RETHINKING DISRUPTION or alternate addresses, quickly fa- Further, we have isolated our interactive delivery
cilitated contactless deliveries for cross-border drivers to minimize management solution
The pandemic has indeed brought enhanced safety, and enhanced contact with employees in the that notifies recipients of
global markets to a halt in waves, storage space to ensure capac- facilities where they are stationed. pending deliveries via email
with gradual pauses causing ity in handling increased inbound The drivers only need to take over or SMS text message and
great disruptions to the worldwide volume as required. their vehicles at the start of their allows them to proactively
logistics and distribution industry. assignments. We also ensured that customize the final delivery
On the flipside, it highlighted On a global level, running our pilots who handle the routes date and time.
the value of logistics in bringing our own cargo fleet has allowed us to and from Kuala Lumpur and Apart from facilitating in-
relief to those who need it most to continue operating amid Penang are in strict adherence creased digitization for the
while concurrently underscoring COVID-19, as we are able to flex to the SOPs and guidelines customer’s ease of shipping,
the need to help facilitate the our network in different ways issued by the authorities. We take we continue to engage closely
immediate resumption of our to meet different needs. We #KitaJagaKita to heart. with the SMEs in order to ob-
customers’ business operations as increased our flight operations tain a deeper understanding of
economies gradually open up. to and from our APAC Hub in STAYING CUSTOMER FOCUSED their increasingly specialized
Guangzhou, North Pacific Hub in requirements. We regularly
As an essential service Osaka, and South Pacific Hub in All around the world, as countries organize webinar sessions and
provider, FedEx has operated Singapore. Additionally, we also that previously experienced the participate in digital exhibitions
throughout the pandemic with increased flights between Asia and tapering of COVID-19 cases now as part of our outreach strat-
Europe by almost 50% in April. see a resurgence of infections, egy – thus regularly connect-
there is a realization that recovery ing with the SMEs to counsel
These efforts are made pos- is not going to be linear. Rather, and equip them with shipping
sible by our people. Our employ- we will experience new waves information and solutions
ees across the board are commit- that temporarily reverse the they can use to expand their
ted to our Purple Promise which is direction of recovery. business into new markets and
to make every FedEx experience gain new customer bases.
outstanding by continuously deliv- That said, support for SMEs The new normal has indeed
ering possibilities for our custom- will continue to be critical in posed enduring challenges
ers and continuing our opera- building business resilience along to adapt to the new normal.
tions despite an unprecedented the road to recovery. Singapore As we facilitate the increased
healthcare crisis. is one of our core markets as digitalization of logistics, we will
SMEs account for 98.5% of remain in lockstep to maintain
PROTECTING OUR PEOPLE businesses in the country with a our continued commitment to
Gross Domestic Product (GDP) our people, customers – from
As the world’s largest express contribution of 38.9% . SMEs to large enterprises – and
transportation company, we are the broader community.
heavily reliant on our entire team. With our global experience,
With them, we are able to continue FedEx is committed to support the
our operations throughout this continuing growth of e-commerce
by providing sustainable

FEDEX EXPRESS IS THE WORLD’S LARGEST EXPRESS TRANSPORTATION COMPANY AND CURRENTLY RANKED THE 14TH SPOT ON FORTUNE’S MOST
ADMIRED COMPANIES AWARD 2020. WITH ITS STRONG FOCUS ON ITS PEOPLE, PROCESSES AND THE COMMUNITY, FEDEX EXPRESS MALAYSIA IS AN
AWARD RECIPIENT OF THE KINCENTRIC BEST EMPLOYERS AWARD 2019 AND THE SUSTAINABILITY & CSR MALAYSIA AWARD 2020.

36 FEATURE

BY
KAWAL
PREET

37

T on transportation resources. With healthcare shipments, like the vaccines,
our extensively connected network, between more than 100 countries.
here’s no denying it. 2020 has been technology and healthcare expertise,
a year of immense difficulty and FedEx is in a strong position to help Just as important is the emergence
disruption. Many now look forward alleviate some of that pressure. But we of new technology, which can help
to 2021 and the much-anticipated recognize that transportation is just with the shipping of vaccine doses.
prospect of COVID-19 vaccines as one link in a complex logistics chain. For instance, we recently launched
the gateway to global recovery. Responding to the scale of the challenge our next-generation sensor-based
will also require innovative storage and proprietary technology in the U.S.,
We recognize that shipping data management solutions. FedEx SenseAware ID, which allows
COVID-19 vaccines will be near real-time access to shipment data,
complex and critical work with Like many companies that have tracking, light exposure, humidity levels
many moving parts. This vaccine transformed parts of their business in and – crucially for vaccines - accurate
will aid not only economic and response to COVID-19, FedEx has been temperature control.
business recovery, but also quick to invest in digital transformation
rebuilding communities and and enhance technologies and our INTERNATIONAL COLLABORATION
societal recovery globally. We network is well positioned to ship IS A MUST
as a logistics provider are keen vaccines with our temperature-control
to make a defined contribution solutions in our cold chain, real-time Finally, the vaccine program will need
at a human level, as people look tracking capabilities – supported at all the highest levels of coordination and
to heal mentally and physically times by a dedicated healthcare team. collaboration across multiple work
and emerge stronger from the We have been transporting and handling streams – plus constant guidance from
pandemic. But as we prepare vaccine shipments for a long time. After healthcare experts - to ensure vaccines
to meet that challenge, we’re all, for over a decade we have shipped flu are able to reach their target markets.
left in no doubt of the immense vaccines each flu season. Stakeholders include not just traditional
complexity of the undertaking - in players within the logistics industry,
scale and in the technical and TEMPERATURE CONTROL WILL BE but also pharmaceutical companies,
administrative (read customs) CENTRAL TO SUCCESSFUL DELIVERY governments and healthcare providers
requirements to ship billions of – who will all need to work cohesively
vaccine doses across continents. Not only will there be billions of toward one common goal.
vaccines in global circulation, but
GLOBAL SCALE FOR VACCINE each and every one will need strict COUNTING THE HUMAN COST
DELIVERY WILL CHALLENGE US temperature control protocols. AS WELL AS ECONOMIC

Finding a vaccine, then, is merely The COVID-19 vaccines currently We’re under no misapprehension of the
the first step. Next comes the task being tested need to be kept at scale and complexity of the challenge
of building and managing a global temperatures as low as minus 80 degrees we will face in 2021 and beyond. We
supply chain that will transport Celsius from the moment they are bottled are entering a transportation and
vaccine doses from laboratory until the time they are administered to distribution environment like no other
to end user; in short: the largest patients. There is a high risk of spoilage before. But with the planning and
vaccination program in history. if vaccines fall outside of the prescribed resources we have in place, as well as
More than 150 COVID-19 vaccines ranges for even a brief period of time. our massive network and deep vaccine
are currently in development and A World Health Organization (WHO) distribution experience, we will not go
an estimated 10 billion vaccine study estimates that up to 50 percent of into the challenge unprepared.
doses must eventually be delivered vaccines are wasted globally each year,
around the globe. And all this in large because of lack of temperature And it’s important to keep focus on
needs to be done at extremely control and the logistics to support an the why as well as the how: we want to
exacting temperature requirements unbroken cold chain. contribute not only to global economic
from start to the very end. recovery, but seek near-term benefits
In the past three years, we have for struggling communities and societies
On the most basic level, added ten cold chain facilities throughout across Asia and worldwide.
it will put significant pressure our global network. We now have more
than 90 such facilities across the world, The logistics industry has an
with more to come in the near future. To important part to play in the fight
complement our cold chain capabilities against COVID-19 and the road to
in support of the vaccine distribution, economic and human recovery. We are
we are exploring a combination of cold ready to dive in – it is who we are and
storage solutions. what we do.

At the same time, we have KAWAL PREET IS PRESIDENT – ASIA, MIDDLE EAST AND
significantly increased our capability AFRICA (AMEA) REGION, FEDEX EXPRESS
to carry dry ice aboard cargo aircraft,
allowing us to service more healthcare
shippers. On average, we now transport
approximately 500,000 dry ice shipments
a month, which allows us to move critical

38

midst uncertainties that the to be able to adapt to the changes and ‘Optimising Human Potential towards a
accelerate more collaborations to work on Resilient Future of Shared Prosperity’, here
A pandemic COVID-19 has common priorities and exchange in best are some of the areas crucial to rebuild the
brought upon the entire practices to new find solutions to new region’s economy, in a more sustainable and
global citizens, one thing is challenges ahead. inclusive way.
for sure, economic activities
need to resume operations While leaders, industry captains DIGITAL ECONOMY
to safeguard the future of business owners. and experts continue to push for better
The COVID-19 pandemic if anything economic cooperation, elimination of trade Some of the valuable lessons that COVID-19
has emphasised the need for stronger barriers, cross border movements, safety has taught us would be on the importance of
collaboration in creating a more resilient and other plans that would help pave the digital transformation for business survival.
Asia-Pacific Economic Cooperation (APEC) way for a smoother post COVID-19 recovery As social distancing becomes the new norm,
region that can overcome the impact of effort, it is crucial for the outcome of much of interactions with customers and
pandemic, speed up economic recovery and APEC’s high-level discussions to be shared employees are taking place virtually.
to be better prepared for future global crisis. at the grassroot level.
In doing this, member economies need Having a digital platform is becoming
In line with the APEC 2020 theme an increasingly important tool to stay in

39

business, especially now following the APEC governments and industry thirds of major companies are now using
Conditional Movement Control Order leaders should start looking out for freelance contracts to lower their human
imposed. While talk on digital economy new business areas, that is beyond the resources costs.
isn’t new; the pandemic has served as the traditional trade activities, namely
push factor to accelerate the shift towards in service-based areas such as app It is estimated that in 2018, freelancers
digitalising businesses. development as well as content creation. account for about US$1.28 trillion to the US
economy and 2020 onwards, this number is
Another plus side of digital economy, DIGITAL INFRASTRUCTURE For digital expected to see a tremendous increase.
it allows small business to reach out to the
potential customers from across the globe. economy to thrive, it requires strong The gig economy now is viewed as an
The internet blurs geographical borders. commitment from government of APEC ideal solution that support remote working
When used correctly, supported with a good countries to ensure that they have adequate to reduce the number of people moving
digital marketing strategy, even a Makcik communication and internet infrastructure around cities and gathering in workplaces.
Kiah batik enterprise based in Kelantan has and to seriously address issues concerning In the case of Malaysia, the COVID-19
the opportunity to promote its product and digital gaps. scare that has resulted in months of
services internationally. lockdown, has bolstered popularity and
There is simply no two ways to go about spurred a lot of job opportunities and
This could certainly contribute it. Infrastructure is the backbone to thrive in healthy competition in the gig economy.
towards improving the livelihood and today’s digital-centric economy and failure
wealth creation of the ordinary folks and to do so will deprive the people of the Industry players from various sectors
consequently contribute towards the enormous wealth creation potential that the such as manufacturing, education, finance,
economic recovery process. digital economy has to offer. as well as retail and logistics have to be fast
in exploring the gig economy to tackle the
INNOVATION APEC economies should At the same time, it is also important present economic crisis and as a preparation
for economies to monitor and ensure that for post-COVID-19 period that would
also work towards the creation a thriving internet services provided are affordable certainly be more difficult.
eco-system that would promote innovation, and of high quality to as to provide equal
creativity and the creation of new talents, in opportunity for the people to participate in Meanwhile, the Committee of Trade
its post recovery plan. digital economy. and Investment (CTI) of APEC, had earlier
stressed that facilitating trade is a critical
The region is certainly not lack of GIG ECONOMY The gig economy is another response to ascertaining that the COVID-19
talents. To date, the region has seen the pandemic will not result in a long-term
birth of successful innovative businesses area that is projected to see tremendous economic crisis.
like GRAB and GOJEK, which had proven growth, moving forward, as working from
to be resilient even in trying times, and we home (WFH) is becoming a new norm. The CTI also calls for other several
certainly need more of such companies trade and investment commitments from
around to make the region’s economy According to a report by Forbes, more APEC leaders including facilitating flow
more dynamic. than 30 percent of adults in the United of essential goods and services to fight
States engage in some sort of gig work or the pandemic, making supply chains
GRAB is valued at US$14 billion in freelance work. Labour trends at enterprise more resilient, ensuring that trade and
2019 while the Jakarta-based GOJEK is now companies suggest that the gig economy has investment is sustained, identifying
valued at US$9.5 billion. a lot of room to expand and around two- and tackling unnecessary barriers to
trade, upholding WTO’s notification
commitments, as well as boosting
electronic commerce and related services.

During the APEC Ministers Responsible
for Trade (MRT) meeting in July organised
virtually, have given their commitment to
ensure that there will be no disruption in
trade and investment. The meeting was
chaired by Senior Minister and Minister of
International Trade & Industry YB Dato’
Seri Mohamed Azmin Ali.

In a joint statement, the MRT said
they will work to facilitate the flow of
essential goods and services to fight the
pandemic including medicines, medical
supplies and equipment, agriculture and
food products and other supplies across
borders, and minimise disruptions to the
global supply chains.

The Ministers have given the assurance
that trading links remain open and explore
ways to facilitate essential movement of
people across borders, without undermining
the efforts to prevent the spread of the virus
and will work closely to identify and resolve
any unnecessary trade barriers.

40 FEATURE I t is business,
but it’s far
BY from usual.
JAMES COVID-19
LESTER has
transformed
our ideas
about how
and where we work, and put
flexibility, adaptability and
technology at the heart of the
workplace. Our work cultures,
have therefore, been transformed
as a result of this change.
Leaders set the culture
of a team and are responsible
for fostering an environment
of connection and cohesion,
regardless of where everyone
is located. With the pandemic,
people from all around the world
were suddenly requested to work

41

from home overnight. With the In addition, I’ve continued to set THE MOST IMPORTANT LEADERSHIP
implementation of remote work, clear and achievable goals, encourage SKILL TO POSSESS, ESPECIALLY WHEN
we are physically separated, and active engagement from everyone in the IT COMES TO A REMOTE WORKFORCE,
people miss out on casual hallway team, have open communication and IS COMMUNICATION
conversations, the quick desk ensure that every single member of my
huddle or ad hoc whiteboard team can directly attribute their effort No two people are the same, so it’s been
sessions. Because of this, I’ve made and output to our greater team purpose. important for me to work out the most
sure to keep inclusiveness and effective method of communication for
team connectivity front of mind. WHAT I’VE BEEN DOING TO each of my team members.
FCOASRTEEWR ICTOHNMNEYCTTEIVAIMTY AND
As South Asia Country I believe that my communication
Managing Director, I connect daily Despite being physically apart, I’ve as a leader should be consistent
with teams located in different been working to keep my team feeling and regular for certain things, like
geographies across the region connected by doing the following things: performance discussions. Aside from
and globally. Given the travel Launched a series of webinars, to that though, ad hoc conversations can
restrictions, technology is the really be left up to the relationship
best way to connect with people. share with our team members, about I have with the individual and their
To keep team members engaged how to connect and look after their personal needs and style. I also think
through COVID-19, we constantly health and well-being when working that remote work and technology have
send out a ‘Stay Healthy, Stay from home. been a great communication tool, as
Home’ weekly newsletter to keep Sharing tips on managing emotions we all get to see each other’s partners,
employees updated in changes in at home, imparting knowledge on kids, pets and homes and try harder to
company policy and updates to how to implement self-care, and help keep those relationships strong. The
their medical and health benefits. parents learn ways to keep their connections we make are real, and the
Beyond this, we have been children happy. links genuine.
conducting virtual coffee sessions, Several virtual workouts have also
webinars, and virtual workouts to been arranged for people to stay REMOTE WORKING IS
give staff the support they need active and connected. MADE EASY FOR OUR PEOPLE
during this time. Making sure that the team has a AND CUSTOMERS
clear purpose. I continue to set
ambitious but achievable goals and Telstra has always been supportive
make it clear to every person in the of leaders and teams when it comes
team exactly how their contribution to flexible and remote working. The
will deliver part or all the outcome. COVID-19 restrictions have just
I take into consideration the reinforced this.
business climate and check in with
my team members to see whether We have always believed that
they are realistic. work flexibility means different things
to different people, so remote work
Since we entered phase two arrangements need to be tailored
and now almost phase three of to the individual. Our leaders are
circuit breaker, it has been easier proactively and regularly talking to
to interact and connect with my their teams, to understand their needs
team members in Singapore. We and adjust accordingly.
schedule small catch-up sessions
in groups of five and ensure We have top-notch collaboration
there are some facetime. While tools, which I appreciate more each day.
we are a telco and technology I have realised during the circuit breaker
company, I believe strongly that how lucky I am to have such readily
it’s the social interactions that available and effective tools that help me
make people feel valued. to do my work.

In a time of increasingly remote
workforces, I’ve been reminded
how crucial it is to continuously
approach the leadership of my
team with their connectivity top of
mind. By maintaining appropriate
communication patterns and inclusive
initiatives, I’ve ensured that my team
remains cohesive, no matter how
physically far apart we may be.

JAMES LESTER IS COUNTRY MANAGING DIRECTOR,
TELSTRA, SOUTH ASIA

42 FRANCHISE

BY
JORDAN

LOW

n a post-Covid-19 world, future skills are ROBOTHINK

I becoming more and more important. O riginally launched in Chicago in 2016,
Skills such as robotics, AI, automation, RoboThink has since expanded its
and the like are few and far between, but operations worldwide, especially in
are also skills that companies are now Asia. It was a passion project by
desperate to have. entrepreneur, Danny Park, who wanted to build a
When the pandemic first hit, the company that lays the foundation for young kids
economic roof came crashing down on businesses. Supply to pursue careers in STEM-based occupations
chains were destroyed and all manner of commerce slowed to (Science, Technology, Engineering, Medicine).
a crawl. Companies began to see where the inefficiencies truly
laid within the business. Kids use the materials provided by the
Many companies, especially SMEs, were either still in the company to learn a concept code, build a
process of digitalising, or had yet to even begin the process. robot from RoboThink’s Lego-esque plastic
This has proven fatal for a fair few companies. Those that components, and then apply the concept code to
were able to survive the initial onslaught have scrambled to the build to make it perform certain functions.
initiate and complete their digital transformation. The franchise heavily emphasises its commitment
The Industrial Revolution 4.0 was not halted by to teaching young children the essential skills
Covid-19. Rather it was accelerated. The technology, systems, that will prepare them for an advanced career in
and innovations that this revolution brought has served as the sciences.
a lifeline for businesses amidst the troublesome economic
climate. Demand for future skills skyrocketed as businesses RoboThink franchises are available for
rushed to obtain these talents in order to further push their purchase in a number of countries including
digital evolution. Without a doubt, these are the kind of skills Malaysia. Total investment is not too high
that will push business to the next level in the near future. at approximately US$50,000. This includes
As such, education is becoming increasingly important inventory costs, supplies, and training, which
with regards to future skills. Many parents will want to equip will be assisted by RoboThink main office
their children with at least some basic knowledge of things professionals. For more information, you can
such as robotics. email RoboThink via their website.
In this edition of SME, we will be taking a look at
some youth education franchises that focus on bestowing
the knowledge of future skills to better prepare the next
generation for what’s to come.

43

E2 YOUNG ENGINEERS KREATIV ROBOTICS

E 2 Young Engineers had humble beginnings in K reativ Robotics began when one father
Israel, being founded by Amir Asor, who himself tried looking for a “robotics” school for his
had learning disabilities as a child. While creative-year-old son, in their small city of
volunteering as a paramedic in local emergency Dumaguete, Philippines. Unfortunately, he
rooms, he was inspired to create e2’s exclusive edutainment failed to do so, but that did not deter him. After
teaching methods. As such, e2 truly believes in personalising discovering a Korean company that sells robotics
the education experience based on each student’s individual products, he decided to bring robotics to the
learning style. Philippines in 2015. This was how Chester Gerald A.
Olivar founded Kreativ Robotics.
Young Engineers enrichment programs adopt a rational
edutainment approach. The company has developed a The company’s mission is to help enhance the
variety of different programs that can be used to teach the creativity of children and adults through robotics
most important subjects. Children joining their educational and provide its customers high quality products and
community can learn and enjoy the likes of arithmetic, services at affordable rates. While not as well know
physics, and mechanical and software engineering. As the as some of the other STEM related education centres
standard of teaching in STEM subjects slowly declines, e2 out there, Kreativ Robotics are dedicate to becoming
hopes to fill the gap with their unique teaching style in order recognised as on of the best robotics centres in the
to prepare the next generation for the growing demand for region; preparing the youth of the nation with the
scientists and engineers. skills needed to survive in the future.

e2 Young Engineers is an international franchise and With an initial term of 4 years and total setup
can be found all around the world, particularly in Singapore. cost of approximately Php340,000, buying into the
Franchisees can expect to see quite a number of benefits Kreativ Robotics franchise is very affordable. The
from buying into the franchise. Not only is e2 an established company is also more than happy to assist franchisees
and award-winning brand, franchisees can expect multiple with site selection, setup, training, and openings.
revenue streams, a modest initial investment, and Applications for the franchise can be easily initiated
comprehensive training provided by the main office. by sending the company a letter of intent.

44 TRADE

BY
ONG XIANG

CHINAHONG

Population: 1,394,015,977 (July 2020 est.) Capital: Beijing Major Languages: Standard Chinese or Mandarin (official), various local dialects, English widely
understood Currency: Chinese renminbi (RMB) Major Industries: world leader in gross value of industrial output; mining and ore processing, iron,
steel, aluminium, and other metals, coal; machine building; armaments; textiles and apparel; petroleum; cement; chemicals; fertilizer; consumer products
(including footwear, toys, and electronics); food processing; transportation equipment, including automobiles, railcars and locomotives, ships, aircraft; telecommunications
equipment, commercial space launch vehicles, satellites Major Export Commodities: electrical and other machinery, including computers and telecommunications
equipment, apparel, furniture, textiles Major Export Partners: United States, Japan, South Korea, ASEAN Major Import Commodities: electrical and other machinery,
including integrated circuits and other computer components, oil and mineral fuels; optical and medical equipment, metal ores, motor vehicles; soybeans Major Import
Partners: South Korea, Japan, United States, Germany, Australia GDP: US$12.01 trillion (2017 est.) GDP Per Capita: US$18,200 (2018 est.) Country code top-level domain: .cn

S ince ancient times, the Chinese civilisation has of key sectors, and a restrictive investment regime. From 2013
traded with faraway lands. Chinese silk was to 2017, China had one of the fastest growing economies in
traded for Roman glass across the Silk Road, and the world, averaging slightly more than 7 percent real growth
her mariners profited from the lucrative trade per year. Measured on a purchasing power parity (PPP) basis
with India and the Middle East via Southeast Asia. that adjusts for price differences, China in 2017 stood as the
In modern times, China has moved from a largest economy in the world, surpassing the US in 2014 for the
closed, centrally planned system to a more market-oriented one that first time in modern history. China became the world's largest
plays a major global role since the 1970s. China has implemented exporter in 2010, and the largest trading nation in 2013.
reforms in a gradualist fashion, resulting in efficiency gains that
have contributed to a more than tenfold increase in GDP since The government's 13th Five-Year Plan, unveiled in March
1978. Reforms began with the phaseout of collectivized agriculture, 2016, emphasizes the need to increase innovation and boost
and expanded to include the gradual liberalization of prices, fiscal domestic consumption to make the economy less dependent
decentralization, increased autonomy for state enterprises, growth on government investment, exports, and heavy industry.
of the private sector, development of stock markets and a modern In this regard, China has made huge strides in innovation
banking system, and opening to foreign trade and investment. and technology – especially in the nascent fields of AI,
China continues to pursue an industrial policy, state support supercomputing, aeronautics and other fields.

Chinese leaders in 2010 pledged to double China’s GDP by

45

2020, and the 13th Five Year Plan east Asian region’s 640 million
includes annual economic growth people allow growing numbers of
targets of at least 6.5 percent through Chinese goods, such as smart-
2020 to achieve that goal. In recent phones, to thrive in the market. In-
years, China has renewed its support dustrialization of ASEAN member
for state-owned enterprises in sectors countries has spawned factories
considered important to "economic that buy Chinese raw materials
security," explicitly looking to foster and make finished goods, often for
globally competitive industries. resale in China.

The slight acceleration in Electronics have been a
economic growth in 2017—the first major contributor to the numbers,
such uptick since 2010—gives Beijing with China importing US$14.9
more latitude to pursue its economic billion worth of integrated circuits
reforms, focusing on financial sector from ASEAN countries, up by
deleveraging and its Supply-Side 25 percent in the previous year.
Structural Reform agenda, first This includes chip capacitors,
announced in late 2015. microprocessor chips, and
analog-to-digital converters; China
CHINESE TRADE WITH ASEAN exported some US$6 billion worth
of integrated circuits to ASEAN.
The Association of Southeast Asian
Nations (ASEAN) became China’s With the increasing economic
largest trading partner in the first uncertainties caused by the US-
three months of 2020, surpassing China trade war, many Japanese
both the EU and the United States. and South Korean companies
began transferring production
During this period, ASEAN- to ASEAN, attracted by lower-
China trade increased by 6 percent wage structures as well as
year-on-year to US$140 billion improving infrastructure and legal
and accounting for 15 percent of environment. These businesses
China’s total trade volume. This have established integrated circuit
comes as the country’s traditional, factories in Malaysia, Vietnam,
largest trading partner, the EU, has and Thailand, which in turn have
been on lockdown. China’s imports been able to cater to the demand
from Vietnam and Indonesia rose of the Chinese market.
by 24 and 13 percent year-on-
year, respectively, highlighting the As China slowly returns to
increasingly integrated supply chains pre-COVID-19 production levels,
between the two regions. the country’s demand for min-
ing products will benefit major
ASEAN had already become producers in ASEAN, such as In-
China’s second largest trading donesia, Malaysia, Myanmar, and
partner in 2019 with trade valued Laos. Other sectors set to benefit
at US$644 billion, overtaking from the resumption of China’s
the US amid friction between the manufacturing are the region’s
world’s largest economies. To offset semiconductor and electronics
the impact of the trade war, China industries, spurred by the develop-
looked to other regions to fill the gap, ment of 5G technology and the
most notably ASEAN nations. textiles and garment industry.

Rising incomes among the South-

46 FEATURE

BY
ONG XIANG

HONG

47

E Livestreaming is an unrivalled as corporate sponsorships for the
growth phenomenon. The more popular streamers.
nergy! Energy! Energy!” These medium can trace its roots back
are the exhortations of Jerry to ‘webcasts’, of which an early The livestreaming trajectory
Hang, our trainer for the day. example was Apple streaming in China follows a similar, yet
Metallica live from San Francisco diverging path. From gaming,
“Remember to keep it up! via its QuickTime platform. streamers in China evolved to
Speak loudly! And clearly!” become hosts, who earn money
he says to the class. We repeat In 2007, Justin Kan strapped a through ‘tips’, where viewers buy
after him – a tactic Jerry webcam to his hat and customized gifts with real money and ‘tip’
frequently uses to keep the a laptop for his backpack to live streamers with these gifts.
class engaged. Some dutifully continuously stream his life 24/7. Soon, enterprising hosts started
take notes, while others nod He interacted with his viewers to sell products on their stream to
affirmatively, and the more via a chat system. The website supplement their tips. Thus, the
enthusiastic ones do indeed he founded, justin.tv, eventually e-commerce livestream was born.
repeat Jerry’s urgings quite became twitch.tv – one of the
energetically. largest livestreaming sites on the BILLION-DOLLAR GROWTH
Internet today.
This is not an ordinary Selling products by video is not
training course: this is a Twitch.tv mainly focuses on new – TV shopping networks
course on livestreaming – a video gaming, where viewers watch have been doing it for decades.
core medium in the future of streamers play games while giving But livestreaming takes it to
e-commerce. Specifically, we a running commentary. Each another level. Viewers don’t watch
are trained to become KOLs, streamer has an individual style, passively – instead they interact
or key opinion leaders. The but the most successful streamers both with the presenter and with
Alibaba LiveNOW KOL focus on audience interaction – each other. They chat and share
Livestreaming Training responding to comments, shoutouts their opinion about the products.
Programme, as it is to loyal fans, doing fan requests The two-way interaction builds an
known, is run by MODEN etc. Streamers earn money through instant community.
Academy, a talent platform platform advertisement revenue, fan
and training centre for subscriptions or donations, as well The number of livestreaming
KOLs, in conjunction with viewers in China reached 560
Alibaba Group. And Jerry
is the founder and CEO of Jerry Hang, founder and CEO
MODEN Academy. of MODEN Academy during
the training programme
My classmates are a
motley bunch, ranging from
university students to retirees.
But all of us share an interest
– if not a passion, in getting
on the hottest bandwagon in
town: livestreaming.

It is the first day of a two-
day course. Today, we only
learn the basics. Tomorrow,
we go in front of the camera.

Liew Sieow Juin aka Jaclyn Yee (right) and
Thera, makeup and Xue En during the mock
livestreaming session
cosmetics livestreamer

48 FEATURE

WHAT SHOULD BRANDS LOOK FOR WHEN LIVESTREAMING

QUICK SALES /PRSMEBEOFOESFCODOEISANIRATLCTSE

ECCPN/UURGTSSOAUITTSNGOORPTEMMNOEWICEENTRRIGTSSSH AOBURGSCTAWOHSUNOWTASADDRPTNHSAOETWATMTYTEAAOOGENYYRUYFDOISFRNUODRR

million in March 2020, accounting for Hilfiger, Lancôme, Levi’s, Louis Vuitton, in China (and the world) is e-commerce
62 percent of the country's total number L’Oréal, Burberry and more. behemoth Alibaba. Livestreaming is
of Internet users, according to a report conducted on its two flagship platforms,
released by the China Internet Network Mike Pritchett, CEO of Shootsta, a Taobao and Tmall. There are myriad
Information Center. Of this figure, 265 video production platform for brands, setups for livestreaming – from a
million engage in viewing e-commerce says,” Viewers retain 95 percent of a single light and phone camera in
livestreaming shows. This translates message when they watch it in a video one’s bedroom, to elaborate ‘shop in
to big bucks: according to Coresight, compared to 10 percent when reading shop’ setups where consumers get the
livestreaming generated US$63 billion it in text. We’re seeing more tech experience of being in-store virtually.
in 2019 and, according to iResearch, platforms include streaming as part of There are even themed, outdoor
will double to US$138 billion in 2020. their features - Instagram Live, Facebook locations like a fresh water pearl farm
Over 100,000 brands have used it, Live, even LinkedIn Live, and this where different types of pearls are
including international brands like demonstrates a demand for this type of shown or vineyards where multiple wine
Ralph Lauren, Clinique, Tommy content from brands.” brands are sold.

The largest livestreaming facilitator