NAJIB’S JACK MA SHOW – ALL THUNDER BUT NO RAIN: DIGITAL FREE TRADE ZONE IS OPPORTUNITY BUT FOR WHOM?

Digital Free Trade Zone (DFTZ) in Malaysia is definitely an opportunity. To be more exact, it is one of the chip coins placed under the Ali Baba Group, Jack Ma’s electronic world trade platform (e WTP) in the region under its globalized set up. It is definitely a lever to achieve the vision.

For sure this is something good to cheer as the main hub for backbone for data, close-knit logistic network, payment, customs clearance, big data trade process and e-chain.

Based on the official version, DFTZ will assist in coordinating e-commerce, help small and medium enterprises (SMEs) in Malaysia to penetrate the export market via trans-border e-commerce. It offers unlimited potential and ample opportunities for the SMEs in Malaysia.

This helps to increase the 18% of SMEs in Malaysia involving in export business to be upgraded to 30%. Malaysia has drafted its e-commerce path to move forward.

Ma, who is the advisor of DFTZ and also a partner, especially stresses his vision of letting SMEs and young people to gain from globalisation, especially the SMEs and young people in Malaysia.

As globalisation receives opposition in the West, Ma seems to be labelled as a globalisation mover for the new generation. One of the versions is that currently globlisation has not been able to let corporations to shoulder its responsibility to improve the economic situation in the world. Ma’s eWTP helps to move the next wave of development in globalisation. In other words, Ma has been labelled as the main leader for the next phase of globalisation.

His thought centres on Ali Baba as the true case of success. Hence it is convincing. The rise of SMEs is facilitated by the e-commerce global platform to be the next major force for the next phase of globalisation. This will rectify loopholes and weaknesses of globalisation led by trans-border corporations in the last 20 years. The development of SMEs help to cushion off poverty gap in the world. It also benefits in stabilising job and develop regional economy.

This is what Ma said in Malaysia.

Do not only sing praises, opportunity is not just a pie.

Back to the crux of original point, no doubt the DFTZ in Malaysia is an opportunity, but this leads one to ponder – whose opportunity?

Everyone says: “Opportunity is reserved for those who are ready” or “Those who are prepared are offered the chance.”

The question lies with whether you are ready. How ready are you? Even if you have prepared, are you equipped with those criteria to seize the opportunity and make good use of the opportunity?

Even if we have some sort of emotional bond, we should not be following the crowd to sing praises. No matter how good the opportunity is, it is not a piece of cake which falls from sky.

DFTZ in Malaysia will see an intense battle of products, right from the cost of manufacture, size of manufacture, export channel, tax incentive to competitive edge and also the capability to compete. These segments and details are casting an impact on the scenario and the unavoidable zero sum game in the economic market. This allows more SMEs and young people to participate in globalized trade. Selling products outside the country remains as ideal.

It is also an opportunity to learn dealing with the world. However, if one is not ready or underqualified, or any Malaysian manufacturers who are unable to meet up with the competition, then it will end up as a station to sell external products as well as the transfer hub for products from China. Under such circumstances, how would our SMEs face such impact? How much market share and profit margin have been taken up (by those products)?

This is not a case of over worrying but an unavoidable hurdle! The key does not lie with opportunity (can’t deny this is opportunity) but to ask these three questions: “Are you ready?”, “How ready are you?”, “What kind of criteria do you have to seize the opportunity and make good use of this opportunity?”

E-commerce and big data technologies are definitely not window-dressing move or any shallow gimmick. One can’t be thinking of this but doing a different thing in this no nonsense business or he would never be out of old school of thought.

Reflection on black swan back in 2016. Isn’t globalisation in the 90s a good opportunity? Then why do waves of anti-globalisation take place in the West recently?

Despite the shock, the 2016 black swan isn’t as simple as black swan stemming out from rock. It must have its gene which covers the setback in the first round of globalisation.

The impact on Malaysia is limited as the country is still embroiled in conflicts in politics. But globalisation created huge waves in developed countries such as United Kingdom and United States.

Development in globalisation has yet to be able to depart from zero sum game. The concept of “win-win” for in the future remains as building castles in the sky.

When the rights of middle and lower class in United Kingdom and United States are giving painful infringements, the basic reaction of anger and getting rid of outsiders are naturally reflected with the rise of anti-establishment sentiment to capture the market.

The 2016 black swan is seen as a wave of anti-globalisation with the outburst of populist sentiment. In other words, setback in the first round of globalisation states clearly that this is still a zero sum game. A delicious meal for A is actually poison for B. For instance, the rise of China’s economy and its corporations see it penetrating into global market in a stronger manner to be the very few winners. This does not mean that it have not caused direct and indirect impact to other countries and other sectors.

The Chinese SMEs in Malaysia should get ready fast. Ultimately, to embrace opportunity one still needs to meet certain criteria.

– Mysinchew