High-technology trade mission will head to Southeast Asia: recruitment begins for U.S. companies - September 7-19, 1998 - related articles on international trade

Business America, July, 1998 by Paul Kullman

Ambassador David L. Aaron, Under Secretary for International Trade, will lead a High-Technology Trade Mission to Malaysia, Singapore, Thailand, and the Philippines, September 7-19. This trade mission is designed to lend high-profile U.S. Government advocacy to American companies, particularly small- and medium-sized firms, seeking business opportunities in high-technology sectors in Southeast Asia, and to demonstrate U.S. support of countries in the region as they seek to recover from their financial difficulties.

The current financial problems affecting Southeast Asia are slowing growth in the short term. However, as these economies implement financial reforms, their rates of economic growth can be expected to resume a more dynamic pace, thereby providing U.S. companies with exceptional high-tech export opportunities, especially in the relatively robust high-tech sectors of:

* Information technology,

* Telecommunications, and

* Environmental technology.

Government leaders of Malaysia, Singapore, Thailand, and the Philippines base many of their plans for industrial modernization, increased competitiveness, and economic recovery in their high-tech sectors, and they often look to the United States first to meet their needs in these sectors because U.S. companies possess cutting-edge technology and know-how. Guided by reporting on best export prospects from the Department's overseas offices, this mission endeavors to meet foreign demand for information technology, telecommunications, and environmental technology products and services.

The mission will visit Kuala Lumpur and Penang, Malaysia, September 7-10; Singapore, September 10-12; Manila, Philippines, September 12-16; and Bangkok, Thailand, September 1619. The program for the mission includes embassy briefings on the commercial/economic environment; meetings with potential buyers, agents, distributors, and strategic alliance partners; and appointments with Asian ministers and business leaders as well as American business executives based in Southeast Asia. The International Trade Administration's web site at www.ita.doc.gov/doctm/hitech.html contains participation criteria, the application deadline, and more information on the trade mission.

Each of the countries that the trade mission participants will visit places a high priority on development of the high-technology sector, but with somewhat different emphases. Following is a brief summary of the status of these industries in each of the four countries.

Malaysia

The Malaysian Government procurement in connection with the Multimedia Supercorridor (MSC) project serves as a catalyst for the development of information technologies (IT). Malaysia's IT market is still growing at a spectacular rate and is expected to offer very good export opportunities for personal computers and peripherals, networking and Internet systems, and IT applications/solutions. The subsectors identified for special targeting for this mission are software (including financial applications and Year 2000 solutions), electronic commerce, multipurpose "smart" cards, electronic government, distance learning, telemedicine, computer parts, value-added telecommunications, robotics and automation, franchising of IT applications, and virtual reality.

In the telecommunications sector, five companies are fully licensed (fixed-line, wireless, satellite, and international gateway), while many others have wireless or other value-added service licenses. Telephone density should increase to 25 per 100 persons by the year 2000, up from 16 in 1995. The sector has recently begun to experience some rationalization and consolidation given the large number of players, a trend expected to continue for the near- to medium-term. Although Malaysia committed to only 30 percent foreign ownership of existing operators during the latest WTO round, it has since relaxed those restrictions, and 61 percent foreign ownership is now allowed. Areas of opportunity include cellular service for rural areas, value-added services, convergence systems (dual-mode cellular systems conforming to a recently issued equal access policy), and other services such as text and video communications with applications in distance learning and electronic commerce.

Today's vision of the MSC is strategic to the competitive future of Malaysia. But today's vision is blinded by the poor environmental air quality caused by uncontrolled peat fires. IT offers a solution with state-of-art surveillance capability and surface-to-air resolution capable of finding "hot-spots" before they grow to dimensions detrimental to the quality of air and, hence, the future of Malaysia.

Malaysia's environmental market is estimated to be worth $700-750 million. Water utility development comprises nearly half of the country's total environmental market. Senior officials in the Malaysia Department of Environment have listed eight priority areas for public-private collaboration in the environmental sector: water treatment technologies, site remediation, air pollution control, commercial production of pollution equipment, total quality management, resource training and development, research and development, and promotion of energy efficiency and conservation.