[COLUMNIST] The future of Malaysia's digital economy: 'Jangan melepas batuk di tangga'

The strategy was to create an ideal environment, infra and infostructure to attract world-class companies and enable Malaysian IT companies to grow and become world-class ,over time.

The digital economy drives innovation, competitiveness and growth.

Most importantly, it brings enormous opportunities for individuals, entrepreneurs and small and medium-sized enterprises to thrive in a fair and competitive manner in the digital space. We recently have a new government.

As with any government, ours is comprised of both old and young idealistic leaders, with carrying ideologies, customs and practices.

And like in previous administrations, whom we had three times in one electoral term, the digital economy has been among the highest priorities.

It is fascinating to observe contrasting views of leaders who are digital immigrants (the old) versus digital natives (the young) regarding the development policies to support the advancement of Malaysia’s digital economy.

Observing the previous governments, it is hard not to notice, several recurring patterns that we can do without.

If a publication from a prominent global telecom equipment company, “Malaysia: Towards Becoming ASEAN Capital Digital” accurately reflects government’s efforts, at least 30 digital and digital-related plans, frameworks and strategy papers have been developed over the last five years.

In addition, both the five-year national plan and the 2030 Shared Prosperity Vision contain significant digital-related references.

At the risk of sounding petty, most of them overlap, due in part to their ownerships by multiple ministries and agencies.

Excellent, we have sufficient strategic direction; let us synthesise them and get to work! This ambitious mission and vision must be accomplished.

Or else, these blueprints remain only as checked KPIs.

Typically, these so-called collaborative agreements lack outcome-driven deliverables and have unclear intended outcomes.

Media would usually be invited to events held at fancy hotels. CEOs from both sides smile, KSUs witness or , the minister, shake hands and exchange documents.

When asked, the typical comeback, would be that we will work closely together and further agree to discuss and work on collaborative items.

Instead of agreeing to immediately tie the knot, perhaps go on 'dates' for a couple of times.

Figure out each other’s needs and ways to address them, then you can sign the agreement in the seventh heaven.

There are so many of them, but none par excellence.

There have been reports that telcos and tech companies are establishing 5G centres in partnership with various government agencies, announcing shared facilities or providing leadership, best practises, research, support, and training.

They will serve as testbeds for future-proofing 5G connectivity applications. It makes one wonder what applications have been developed and whether they have even been tested on 5G networks, given that coverage is still quite limited.

Numerous ministries and agencies have launched digitalisation initiatives for the rakyat.

Even Datuk Rosyam Noor participated to encourage women's participation in digital entrepreneurship through a gangster-themed spectacle that was widely shared on social media.

It was a race to have the most participants, with bonus points if the majority of them were women, chanting slogans like "Aku Digital"; however, participants left with no knowledge of digital entrepreneurship and only a T-shirt bearing the program's logo.

Photos of ministers and agency CEOs and chairmen on the backdrop of the stage would be a plus.

This is a textbook example of output versus result. The number of attendees was used as the KPI instead of the multiplier effect that the entrepreneurs would generate.

Perhaps, a pause and a second look at the actual obstacles these entrepreneurs face. As digital intermediaries play an increasingly important role in their sales chain, their profit margins are dwindling because they must pay fees for services such as payment gateways and algorithms.

Some 20 per cent of a RM10 nasi lemak purchased through an app will never reach the auntie who cooks it, and I've been told that the percentage has increased over time.

Government subsidies can aid in addressing the issue, but they must be targeted based on reliable data, as opposed to being channelled to a single organisation that distributes them based on political directives.

With the end of the pandemic, microentrepreneurs would rather return to the conventional means of recovering their lost margin.

Strategic directions from the government can no longer be top-down; as to remain relevant, the involvement of those who are actively participating in the economy must be considered.

And this includes the nasi lemak seller.

Now, we understand why the best nasi lemak in town is only available on the premises.

Well, enough with the tongue-in-cheek opinions!

Malaysia is at a bastion of democracy, enabled by digital technology where voices of the people can now be easily expressed.

Technology and information rapidly continue to be democratised, and made more accessible to people.

Improved user experiences have empowered many to use technological products and services; such as our smartphones.

Increasing numbers of these consumers are becoming digital creators, demanding, and indirectly participating in meaningful discussions of innovation that would result in more accessible and affordable technological use.

For the government to future proof the country’s digital economy, an actionable mandate must come from the prime minister as it helps to consolidate and coordinate efforts and reduce bureaucracy.

We already have initiatives such as the Malaysian Government Central Data Exchange (MyGDX) and the data.gov.my open public data repository.

Additionally, the Department of Statistics Malaysia has made available the newly launched Open DOSM.

These are commendable efforts to facilitate data sharing and increase coordination between ministries and government agencies to avoid duplication of operations in the interest of enhancing service delivery and decreasing data access and processing time.

The government's role is to alleviate the difficulties of the people, but this must be done strategically.

If these data owned by various ministries are tracked and validated to prevent double-dipping, leakages in subsidies and financial aids can be prevented.

Various sources of duplicate data must be streamlined and cleansed. If these data stored in the exchange are legitimate and effectively validated, immediate measurable results can be achieved to respond to resource allocation emergencies.

In addition, authorities can detect anomalies and irregular behaviour to prevent fraud, which drains taxpayer funds that could otherwise be used for citizen-helping programmes.

MAMPU's role in managing these data exchanges is of the utmost importance, regardless of whether it is to provide discounted gasoline or household assistance to a deserving community or to prevent the loss of sensitive information or intellectual property.

Well-managed data can have a significant impact on the ability to make informed analytical decisions; this would make government operations more efficient.

Malaysia's mobile broadband penetration rate has exceeded 100 per cent for several years.

The Jendela Digital Infrastructure plan has resulted in the connection of more than 7 million premises to fibre.

These are excellent initiatives undertaken by the government to provide access to high-speed broadband, particularly for the underserved.

We are all aware that the future of connectivity will be on mobile devices; therefore, it is not just a matter of accessibility, as any deficiencies in speed, reliability and latency will impede productivity.

According to MCMC data, the average download speed of mobile broadband in Malaysia is 4.1 megabits per second, placing us 66th worldwide.

While these numbers may not mean much to some, our neighbours, including Singapore is enjoying a staggering 125.7 mbps; and Thailand, and even Vietnam and the Philippines, offer significantly faster mobile download speeds.

We have a plan to cover 40 per cent of populated areas with 5G by the end of 2020 and 80 per cent by 2024.

As a mobile user, I have not experienced the presence of 5G on my authorised network, let alone its significance, due to the lack of applications that require high bandwidth.

Deliver on the promises of Digital Nasional Berhad to reduce infrastructure duplication and lower user costs.

Digital infrastructure is fundamental to all other things we are doing in digital economy.

I've heard numerous rhetorical campaign slogans, such as "Malaysia as the ASEAN digital hub."

Creating differentiators is essential and aspirational, but it must also be practical.

Malaysia is afflicted with what I referred as the middle-child syndrome.

We lack the sophistication of Singapore, which has historically been the economic centre of ASEAN, and we lack the sheer economic size and consumption power of a growing market like Indonesia.

Malaysia is stagnant and investors frequently disregard it because it is sluggish and uninteresting. We cannot dwell on the past achievements of semiconductor assembly and testing; rather, we must create new high-order values in integrated circuit design and production processes.

We are at the forefront of Islamic finance, but if we do not embrace digitalization, we risk falling behind.

We produce digitally generated animation and creative content for international distribution. Upin and Ipin are available in at least 30 markets with multiple language dubs.

In Kuala Lumpur, Sony PlayStation established its South East Asia development centre for video games.

These are a few of the sectors in which we should invest more to increase digitalisation, cultivate skilled talent, and attract foreign investment.

Calling it an ASEAN hub is meaningless when we have nothing to boast about.

Before uttering jargonlike, grandiose assertions, we should therefore reconsider.

It is encouraging to see that traditional brick-and-mortar organisations such as banks, insurers, constructions, and manufacturing firms have begun to recruit digitally skilled professionals in data science, software development, design thinking, and other analyticrelated fields.

However, do we have sufficient local talent to meet these needs? Malaysia is likely one of the very few countries that welcomes foreign skilled workers to fulfil the needs of companies.

The true intention of these investors who establish a presence in Malaysia is to hire local talent, as they face fewer operational complexities and are more sensitive to cultural nuances than their foreign counterparts.

A trip to Cyberjaya would easily confirm the veracity of the hypothesis.

When I prayed Jumaat at the Cyberjaya mosque, I felt like I was in a colony of Pakistanis and Iranians, the majority of whom are employed by the local tech companies.

A visit to any multinational technology and shared service facility will reveal that Indians and Filipinos dominate the software development and call centre departments.

Like infrastructure, talent is essential to economic expansion. Malaysia allocates a sizeable portion of its budget to education on an annual basis.

A total of 16 per cent of government expenditures were included in the last budget approved in 2022.

With all this focus, I do wonder where we went wrong. Several years ago, a comprehensive plan focusing on strengthening the link between demand and supply of skills, continuous access to modular programmes allowing individuals to develop and practise skills, diversification of routes and flexibility of certification and qualification, as well as their interoperability across these routes, was introduced.

Challenges in education and the skills gap frequently appear insurmountable. Small successes are precursors to large-scale transformations, but only if they are preceded by an open dialogue and a dogged commitment to coordinated execution.

Initiatives such as Teach for Malaysia, Techlympics, and the industry-driven Forward School should be scaled up further.

These small successes are the foundation for larger transformational endeavours that require a greater amount of effort and coordination among stakeholders.

Instead of pushing the boulder up the hill, permit the soft bush's roots to dig deep and spread upward to split it (the boulder),

There have been rumours that the current administration is considering consolidating the various functions and agencies across ministries with technology, innovation, and digital economy portfolios.

It is a mammoth undertaking, but a necessary strategy to avoid duplications.

Focus initially on better integrated coordination and national mandates, followed by concerted efforts to ensure their fulfilment.

No one can play a symphony by themselves; it requires an entire orchestra.

And a seasoned and reliable conductor to lead the orchestra.