CE recently took a group of North Koreans to Malaysia for a study trip. Malaysia is one of a handful of countries with reciprocal visa-free arrangements with the DPRK. This, combined with the recent strides Malaysia has made towards creating an environment that supports entrepreneurs makes us think it may not be our last such trip. Highlights included:
1. Visit to MaGIC
This is Malaysia’s flagship initiative on entrepreneurship and startups, launched when Obama visited Malaysia. They kindly hosted us and told us how MaGIC is organized, the programs they did and how they supported startups. The Koreans had tons of questions.
- In particular, one guy was very curious about why MaGIC sponsored foreign entrepreneurs to come to Malaysia and how it benefited locals. The reply was that they wanted these people to share expertise with locals and inspire them, to attract them to Malaysia by helping them find business opportunities for them there, and if they go back, act as brand ambassadors for Malaysia.
- Funding and organization - everyone very curious about how MaGIC was funded and organized and whether the company made money from programs. They explained that MaGIC was a government agency and its mandate was not to make money or to invest in companies, but acted as a coordinator for startup activities in the country.
- MaGIC looks to be expanding their programs and network regionally and is keen to help in building the startup ecosystem and entrepreneurship culture in DPRK.
2. Visit to MDEC
MDEC was set up to implement Former Prime Minister Mahathir Mohamad's concept of an MSC (Multimedia Super Corridor) - i.e. to push forward the development of tech sector in Malaysia. Participants were particularly interested in this as it provided a broad policy framework for investment attraction and development of the tech sector, as well as lessons on how to implement this in a specific political context. Companies that get MSC status face a lot less restriction in hiring foreign workers, ownership (needs not be majority locally-owned, government subsidies…etc.) MDEC talked about a phased plan: once MSC tech companies were only allowed to be located in Cyberjaya, but now companies are allowed to acquire MSC status anywhere in Malaysia. This is interesting in that Malaysia is a proof of concept for how key elements of SEZ status for a very specific sector can then be broadened to create a more favorable business environment in the country as a whole.
- The Koreans showed lots of interest on how MDEC acted as a one-stop shop for tech investments in early days and how they established this process. MDEC mentioned the importance of high level access, and that their reports go directly to Prime Minister, who approves initiatives. This allows MDEC to approach other agencies and push things through.
3. Visit to Sunway Lagoon
We visited the largest water park in Malaysia built on an old tin mine. They learned a lot about property development and tourist attraction, and how Sunway Lagoon played a big part in branding the entire development in the area, which included malls, shops and housing. The water park had huge operating expenses, but there were intangible benefits in boosting the value of the surrounding development. Also, for many tourists from the Middle East, visiting Malaysia is often synonymous with visiting Sunway Lagoon.