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MRT Corp to dish out RM4b jobs to local players

KUALA LUMPUR: Mass Rapid Transit Corp Sdn Bhd (MRT Corp) expects to dish out RM3.53 billion worth of jobs to local contractors over the next five years as part of its offset programme. MRT Corp signed its first offset programme yesterday — the Klang Valley MRT offset programme (KVMRT OP) — with six work package contractors in collaboration with the Malaysian Industry-Government Group for High Technology (MiGHT).

The six contractors are Meidensha-Meiden Malaysia Sdn Bhd joint venture (JV), Bombardier (M) Sdn Bhd, Siemens Malaysia Sdn Bhd-Siemens AG-SMH Rail Sdn Bhd JV, MMC Gamuda KVMRT (T) Sdn Bhd, Affiliated Computer Service Solutions France SAS, and Mitsubishi Heavy Industries Ltd.

The KVMRT OP, which consists of 32 offset projects, is expected to benefit more than 50 local companies over the next five years.

MRT Corp’s offset programme allows local companies to benefit from an existing relationship created through the acquisition of high technology, high value assets from foreign entities by the government.

The programme seeks to contribute to areas that support national economic development, where local work packages take up the highest contribution of 26% or RM913 million, followed by transfer of technology of RM667 million, and the remaining areas of global market access, parts and component manufacturing, human capital development, design and development.

Beneficiaries of the programme are not only those directly linked with MRT Corp, but also stakeholders such as the Land Public Transport Commission (SPAD), railway industry players and local manufacturing companies.

According to MRT Corp CEO Datuk Wira Azhar Abdul Hamid, the company has made purchases with different contractors for the MRT project.

“This includes the purchase of trains from Germany’s Siemens which cost us RM1.37 billion, power supply by Meidensha of Japan at more than RM400 million, and 10 tunnel boring machines each costing more than RM35 million,” he said. “With such an amount spent, the idea of the offset programme is to derive more value from these acquisitions, and more pertinently to derive the extra value to help Malaysia’s economy and industries move up the technological and knowledge level.”

He said that with the government’s establishment of the national offset policy in March 2011, the programme aims to ensure the country does not remain merely a consumer of high technology, but starts to develop its own technology sector.

Mohd Yusoff Sulaiman, president and CEO of MiGHT, said the offset programme has been around for the past 30 years, but the government only began strict enforcement two years ago. “From now on, all government procurement of more than RM50 million will require offsets,” he said.

 

This article first appeared in The Edge Financial Daily, on November 13, 2013.

 

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