The Knowledge Economy is Penang’s Future
By Lim Chee HanPENANG ECONOMIC OUTLOOK
On November 30 last year, news broke that four young inventors from SJKT Ramakrishna had won six international awards and a gold medal for their problemsolving, functional “noise reducer” at the 3rd Hong Kong International Student Innovation Contest 2015-2016. Many Malaysians took to social media to praise these Year 6 students.
According to their science teacher, Syiamala Durairaj, their school has Science, Robotics and Innovation clubs in which many students participate. Competitions are also held for young inventors to air their ideas. The point is, whatever the age, language and background, young students can be innovative and creative if the environment allows it.
However, the drop since 2003 in the standard of science and mathematics among Malaysian students is reflected in the Programme for International Student Assessment (Pisa) and Trends in International Mathematics and Science Study (TIMSS). Former Minister of Education Muhyiddin Yassin had admitted in public that he was shocked at the dismal performance of Malaysian students. This was despite the fact that the Ministry had been receiving the largest share of budget allocation over the years. Clearly, higher monetary investment in education does not guarantee higher standards of education or creativity.
The thing is, there is no better time to learn science than at a young age. With well-thought initiatives and early exposure, school children should be inspired and amazed by science. Children cannot be expected to gain good scientific knowledge if their textbooks are boring and their school lessons are rigid, nor could high marks in examinations spur the passion and interest of some young kids for science and technology.
Starting them young
To enhance science education, the Penang state government formed the Penang Science Cluster in 2010 to rekindle the spirit of innovation in science, technology and engineering. Tech Dome Penang, scheduled to open in the middle of this year and located at Komtar’s geodesic dome, is another initiative by the state government to create a hub for technology learning and the exchange of ideas. Regular programmes will be specially designed and conducted for schools, colleges and families to improve scientific literacy and technological ability.
Since the establishment of the Penang Science Cluster, approximately 15,000 youths have been involved in and have benefited each year from the programmes offered (see Table 1). Science cafes were subsequently launched in 2013 at Krystal Point and in December 2015 at Wisma Yeap Chor Ee. The latter is the biggest and most sophisticated STEM education and innovation centre to be established by the Cluster. Many fun, interactive science-related workshops will be held regularly at the science cafes, which are open to all members of the public.
Penang International Science Fair (PISF) is the culminating event of the year for the Cluster. Now in its fifth year, the latest fair was held on November 14-15 last year at SPICE Arena. A string of exhibitions, competitions, activities and workshops as well as the MakerFest attracted a crowd of about 60,000 people.
MNCs supported the MakerFest and had their young engineers proudly present their own original ideas. The most eye-catching inventions featured by Intel, one of the participating companies, for example, were the “Dollar Bin” and “City on the Go”; the former is a rubbish bin design that can categorise collected rubbish into different material classifications and pay the user for recycling; the latter is a smart traffic light control system that maximises traffic flow.
Each maker has his or her story to tell; they invent things because they want to solve certain real life problems. Creativity is, after all, an intellectual asset for society.
Penang’s economy has diversified over the years, moving slowly away from E&E products. The services sector is in fact set to outpace and take over as the major contributor to the state’s GDP. To increase the real income for Penang households, the state has to make sure that the right strategies and adequate measures are taken to create high value jobs. The key is to transform Penang into a high-skilled and technologydriven knowledge-based economy.
As it stands, the percentage share of the workforce in the “professional, scientific and technical activities” and “information and communication” industrial categories in Penang is still small – only 4.08% (Figure 4, page 70). Jobs in these two categories, which include lawyers, accountants, consultants, architects, engineers, scientific researchers, programmers, multimedia editors and producers, and IT service providers, have doubled over the last five years. Table 1 on page 71 shows that the median and mean monthly salaries and wages of these job holders are substantially higher than the national median and average for all jobs. Hence, it is not difficult to understand why the state policymakers wish to create more jobs in these categories.
The growth potential for these two categories is immense, and domestic and foreign investments into the relevant sectors are very encouraging. A comparison of the first half of 2015 to the year before reveals that sub-sectors such as MSC status, support services, global operations hub and education services registered a 100% to 245% increase in approved investments (Table 2, page 71).
Considering the fact that members of Penang’s workforce tend to have tertiary education (Figure 5, page 71), it is likely that job market demand for higher academic qualification and skills will be met.
Besides, in order to develop a knowledge economy, infrastructure and facilities have to be top-notch as well – especially in the very demanding Information Technology sector. Currently, Penang has one location with MSC Cybercity status: Penang Cybercity 1 (PCC1), which encompasses the Bayan Lepas Industrial Park. This puts PCC1 on par with the likes of Cyberjaya, Putrajaya, KLCC and Kulim Hi-tech Park. Two other locations in Penang, Spansion and One Precinct, have also been recognised by the Multimedia Development Corporation (MDeC) as MSC Cybercentres. These places serve as a conducive business environment to catalyse the growth of ICT and ICT-enabled industries.
Instead of relying on technology MNCs and local big firms to create more jobs and boost the economy, the state government encourages young, creative and aspired talents to set up their own business. The incentives and assistance come in many forms, often as soft loan, training or professional advice. Several agencies are willing to reach out and assist new businesses, especially tech and creative start-ups. InvestPenang is the onestop centre in Penang for all business or investment-related queries.
Within the strategic planning of the state government, the restored Wisma Yeap Chor Ee is poised to be the hub of the creative industry in Penang. Level 1 is leased out to the Penang Science Cluster, while Level 2 is home to the Creative Animation Triggers project. Penang’s Accelerator for Creative, Analytics and Technology (@CAT) is located at Level 3, where various programmes are ongoing such as the Accelerator Lite on IoT programme and the Founder Institute’s series of events. @CAT is a project carried out by the Penang state government through InvestPenang, targeted at accelerating tech and creative start-ups, entrepreneurs and founders. The @CAT initiative programmes provide start-up entrepreneurs with access to mentors, and let out shared facilities and space for training, professional assistance and other value-added services.
The Accelerator Lite on IoT programme selected 15 teams of start-ups in November 2015 to go through a two-week free programme run by Brinc. Brinc is a global platform led by a dedicated team of experts designed to accelerate IoT start-ups through the four key areas of IoT businesses: viability, desirability, feasibility and validation.
The Founder Institute is a global movement organisation well known for providing startup launch programmes for entrepreneurs who are eager to set up web-based or mobile app start-ups focused on marketplaces, business-to-consumer and e-commerce. The Founder Institute (Penang Chapter) is recruiting learners for their upcoming first semester in March 2016. It first set foot in KL in 2013, and since then has graduated three batches of entrepreneurs totalling 33 founders. According to its co-director, Heislyc Loh, the average age of startup entrepreneurs who took part in their programme is 30-35; most are degree or postgraduate degree holders. The Institute’s goal is to graduate 10-15 founders each year from Penang. Hopefully through the initiative, more young and highly educated entrepreneurs will lead the way and contribute to the expansion of tech SMEs in Penang.
Funding opportunities and professional assistance are not the limitations in Penang for the growth of the creative industry and knowledge economy; rather, the limitations take the form of creative ideas and talents. The good news is that Penang attempts to offer fair and equal opportunities for all to realise their potential. Under such conditions, creativity and innovation should flourish.
Albert Einstein once famously said, “Imagination is more important than knowledge. For knowledge is limited to all we now know and understand, while imagination embraces the entire world, and all there ever will be to know and understand.” Penang in the 21st century has what it takes to rise to the next level. Just imagine and be prepared.
 Nurul Huda Jamaluddin, “Penang young inventors bring home six awards, gold medal”, Malay Mail, November 30, 2015.
 Diyana Ibrahim, “Muhyiddin ‘shocked’ by local students’ poor scores in global tests”, Malaysian Insider, March 13, 2015.
 Speech by Penang Chief Minister Lim Guan Eng during the launching of Penang Science Cafe @ Heritage on December 5, 2015.
 Ong Wooi Leng, “Ripples from global events threaten local economy” in Penang Economic Outlook 2015, Penang Monthly, January 2015.
Lim Chee Han
received his PhD in Infection Biology from Hannover Medical School, Germany. He is currently a senior analyst in the economics section at Penang Institute.