Japanese ODA for SME Development - The Case of Malaysia - June 18th, 2015 JICA Malaysia Office Chief Representative Kojiro MATSUMOTO

Japanese ODA for SME Development - The Case of Malaysia - June 18th, 2015 JICA Malaysia Office Chief Representative Kojiro MATSUMOTO

Table of Contents 1. JICA s Activities 2. JICA s Corporation to SME Development 3. JICA s Assistance in Malaysia on SME Development 4. TCTP with the Government of Malaysia and SME Corp Malaysia 5. Appendix 1

1. JICA s Activities 2

(1) JICA s Overall Activities JICA s Overall Activities JICA Technical Cooperation < Through Government > <Japan s ODA Executing Agency> Administrating all ODA Grant Aid < Through Government > One of the world s largest bilateral aid agency (over 150 countries) 34 offices in Sub Saharan region FY 2012 JICA s Operation Scale Unit: JPY Billion Grant Aid 141.6 Loan Aid 864.6 Technical Cooperation 167.8 Technical Cooperation Loan Aid Grant Aid Total: 1,174 Japanese ODA Loans Public-Private Partnership (Incl. Private Sector Investment Finance) < Through Government > < Directly to Private Entities > FY 2012 Contribution by Sector (ODA Loans, all over the world) Unit: JPY Billion Commodity loans, etc. Social Services Mining and manufacturing Irrigation and flood control Communications Transportation Electric Power and Gas 0 200 400 600 3

(2) JICA s Operations Technical Cooperation Cooperation by training, experts, Technical Cooperation Projects etc. ODA Loan Concessional loans with low-interest and long-term funds in Japanese Yen. Grant Aid Provide funds without obligation for repayment. Public-Private Partnership Assist private companies activities which contribute to the countries development Citizen Participation Volunteers, NGOs, Local Governments Emergency Disaster Relief 4

2. JICA s Corporation to SME Development 5

JICA s Cooperation for SME Development Support for Policies for SME Development Cooperate in formulating polices and overall measures e.g. Cameroon: Study for Formulation of Master Plan for SME Development e.g. Malaysia : Study on Formulation of an Action Plan to Develop Advisory Capabilities of Malaysian Development Financial Institutions for SMEs 6

JICA s Cooperation for SME Development Strengthening of SME Management Capacity Establishment of public technical assistance institutions e.g. Paraguay: Project of Strengthening of Paraguayan Quality and Productivity center Development of SME management consulting system e.g. Indonesia: The Study on Human Resources Development for SME Focused on Manufacturing Industries 7

JICA s Cooperation for SME Development Development of Specific Supporting Industries Strengthen industrial competitiveness by implementing promotion plans in specific industries/technical fields e.g. Thailand: Automotive Human Resource Development Project for Supporting Industries Promotion of linkages between enterprises e.g. Philippine: Industrial Cluster Development in Davao Region 8

3. JICA s Assistance in Malaysia on SME Development 9

3-1 ODA Yen Loans to Malaysia 3-2 Technical Cooperation Project for SME Industry 3-3 Grassroots Cooperation Program for SME Industry 10

3-1 ODA Yen Loans to Malaysia (Two-Step Loan for SME Industry)

3-2 e.g. Tech. Cooperation Project for SME Industry (1)

3-2 e.g. Tech. Cooperation Project for SME Industry (2) Title of the Project Enhancing Customer Service Quality of Credit Guarantee Corporation Project Term: April July 2010 Project Purpose Improve quality of service for SMEs affected by economic crisis through capacity development of Credit Guarantee Corporation Expected Outcome Improvement of processing turnaround time Establishment of SME long term equity fund Introduction of credit guarantee re insurance system in Malaysia Dispatch of Advisors from Japan Team Leader Credit Guarantee System and Operation Credit Guarantee Appraisal and Human Resource Development (HRD) Counterpart in Malaysia Credit Guarantee Corporation (CGC)

3-3 e.g. Grassroots Cooperation Program for SME Industry Title of the Project Hokkaido Food Zone food Valley Tokachi, Human Resources Development for the Southeast Asian Food Industry with Support for Overseas Expansion Project Term: March 2014 March 2016 Project Purpose Expected Outcome Implementing Organisations Counterpart Promotion of the food industry in Malaysia by raising the awareness of a safe regional brand and adding value to food. Improvement of the foundation for mutual exchanged by forming a network of food related parties including businesses. Clarification of the agenda for product development by advancing an understanding of related people/organizations in Tokachi about the regulations of export designations and halal. Improvement of policy making ability through exchange of opinions about policies for promoting food industries and agricultural regions. Promotion of regional revitalization measures through food safety and value adding. Promotion of technology to add value to food. Promotion of the importance of brand image of food. Study to enhance understanding halal by concerned people/organizations in Tokachi for better achievement of Outcomes above Obtaining knowledge of effective policy making to promote agriculture and food industries The Obihiro Chamber of Commerce and Industry SME Corp Malaysia

3-3 e.g.grassroots Cooperation Program for SME Industry Exhibition at MIHAS (MALAYSIA INTERNATIONAL HALAL SHOWCASE)

4. TCTP with Government of Malaysia and SME Corp Malaysia 16

Malaysia s Technical Cooperation The Government of Malaysia officially launched Technical Cooperation Malaysian Technical Cooperation Programme (MTCP) in line with the spirit of South-South Cooperation through the Economic Planning Unit (EPU) under the umbrella of Prime Minister s Department in September 1980. Short-term specialized courses Long-term courses (Scholarships) Study visits and attachments MTCP Philosophy: Development of a country depends on the quality of its human Resources MTCP Objectives: To share its development experiences and expertise with other developing countries

Japan-Malaysia Development Partnership JICA Malaysia is extending its assistance and cooperation with East Asian, African and Islamic countries by strengthening its partnership with the Government of Malaysia. 1983 JICA Third Country Training Programme (TCTP) in Malaysia 1992 Joint TCTP with the Government of Malaysia thru EPU under MTCP Scheme 2002 First TCTP on 50-50 cost sharing basis between Government of Japan and Government of Malaysia 2010 Ministry of Foreign Affairs Malaysia (MFA) took over MTCP including the Third Country Training Programme (TCTP) 2012 First training programme for Palestine under Japan-Malaysia- Palestine Triangular Cooperation

TCTP Courses in Malaysia (2015) East Asian Regional Cooperation High priority area in this region are the promotion of economic partnership, bridging the developmental gaps among ASEAN member countries. Occupational Safety and Health for Laos, Myanmar and 1 Vietnam 2 Tax Administration for Cambodia, Laos, Myanmar 3 Training Management for Myanmar Customs Capacity Development for Technical Education and 4 Training for Cambodia, Laos and Myanmar 5 Investment Promotion Asian-African Cooperation (TICAD): In Africa, JICA identifies their development needs where Malaysia s experience can be applicable as a reference. 6 Trade Promotion 7 SME Development Enhancement of Productivity and Competitiveness 8 through TQC and Kaizen Approach 9 Primary Science and Mathematics Teachers Trainers Training Global-scale issue 10 Integrated Biodiversity and Ecosystem Management

TCTP on SME Development for African Countries Objectives: Provide understanding on the importance of formulating and implementing sound policies and strategies required to promote SME development Learn the role of various government ministries or agencies in providing support to strengthen the capacity and capability of SMEs Share Japan s and Malaysia s experience in managing and promoting SME development

TCTP on SME Development for African Countries Participants Involved: 2011: 18 participants completed (Botswana, Ethiopia, Ghana, Kenya, Mozambique, Nigeria, Tanzania, Zambia & Zimbabwe) 2012: 16 participants completed (Botswana, Ghana, Kenya, Namibia, Nigeria, Rwanda, Tanzania, Uganda, Zambia & Zimbabwe) 2013: 18 participants completed (Botswana, Cameroon, Ethiopia, Ghana, Kenya, Mauritius, Namibia, Rwanda, South Africa, Tanzania & Uganda) 2014: 16 participants completed (Cameroon, Ghana, Kenya, Mauritius, Tanzania & Uganda) 2015: TCTP to be conducted from 12 August to 24 August 2015

TCTP on SME Development for African Countries

5. Appendix 23

Brief History of JICA Malaysia Office 1956 Malaysian participant for training in Japan 1958 Dispatch of Japanese Expert to Malaysia 1966 Dispatch of JOCV to Malaysia 1966 First ODA Yen Loan Project 1975 Establishment of JICA Office in Kuala Lumpur 1982 Acceptance of Malaysian participants under Look East Policy 1991 Dispatch of Senior Volunteer to Malaysia 2008 JICA merged with the overseas economic cooperation section of the Japan Bank for International Cooperation (JBIC)

Japan s ODA Disbursements to Malaysia (Gross disbursements, Ybn) Fiscal Year ODA Yen Loan Grant Aid Technical cooperation 2006 0.01 3.04 (1.40) 2007 0.51 2.42 (1.05) 2008 1.02 2.42 (0.89) 2009 0.03 2.46 (1.11) 2010 0.02 1.83 (1.01) 2011 6.70 0.02 2.05 (1.29) 2012 0.03 1.51 (0.87) 2013 0.03 (0.70) Cumulative Total 976.04 13.95 125.77 (113.48) Note 1: Note 2: Note 3: The yearly figures for Loan Aid and Grant Aid are based on the amount of assistance agreed to through exchange of notes during the fiscal year. However, Grant Assistance for Japanese NGOs, Cultural Grassroots and Grassroots Human Security projects within Grand Aid depends on grant contracts (G/C). The figures for Technical Cooperation up to the fiscal year 2012 indicate the amount of Technical Cooperation carried out by all relevant authorities. The amount of Technical Cooperation implemented by JICA is noted in brackets. Accumulated totals may not always add up due to rounding. (Source: Ministry of Foreign Affairs Japan, Japan's ODA Data by Country 2014 )

JICA s Technical Cooperation in Malaysia (new projects) JICA Technical Cooperation 2006 2007 2008 2009 2010 2011 2012 2013 Cumulative Total Technical Cooperation Expenses (Ybn) 1.399 1.046 0.889 1.113 1.013 1.292 0.865 0.704 1,134.76 Training Participants (pax) 456 344 334 394 384 448 371 287 16,554 Experts (pax) 108 74 98 86 107 164 110 182 3,454 Study Team Members (pax) 63 55 26 41 53 57 28 10 6,633 Japan Overseas Cooperation Volunteers (pax) 57 43 38 14 12 8 5 4 1,282 (JOCV) Senior Volunteers (pax) 40 36 22 18 10 5 8 6 191 Provision of Equipment (Ymn) 6.12 0.4 2.76 8.2 2.6 25.4 22.9 32.0 13,655 Technical Cooperation Projects Developments Study Projects (number of project) (number of project) 7 6 3 3 2 2 1 2 65 0 0 1 0 0 0 0 0 98 (source: JICA Annual Report 2014)

Priority Area in Malaysia 1. Supporting a balanced development towards Malaysia becoming a high-income nation Program for Promotion of High-Value Added Economy Program for Improvement of Quality of Life 2. Response to common issues in East Asian region Program for Promotion of ASEAN Integration 3. Japan-Malaysia Development Partnership beyond the East Asian region Program for Promotion for South-South Cooperation

Technical Cooperation Program Social Welfare Promotion of Job Coaching and Disability Equality Training (DET) Environment Conserving Biodiversity & Ecosystem in Borneo Development of mechanism for Household E-Waste management

ODA Yen Loan Infrastructure Pahang Selangor Raw Water Transfer Project Human Resource Development Malaysia-Japan International Institute of Technology (MJIIT)

JICA Volunteers JICA Overseas Cooperation Volunteers (20-39 years old) Senior Volunteers (40-69 years old) Currently approx. 20 volunteers throughout Malaysia

Contacts Japan International Cooperation Agency Malaysia Office TEL: +603-2166 8900 E-mail: ms_oso_rep@jica.go.jp URL: http://www.jica.go.jp/malaysia/english/index.html Japan International Cooperation Agency South Africa Office TEL: +27-(0)12-346-4493 E-mail: so_oso_rep@jica.go.jp Masao.Shino@jica.go.jp URL: http://www.jica.go.jp/english/index.html 31

Thank you for your attention. 32