Harness STEM for engineering

DATUK IR. LIM CHOW HOCK President The Institution of Engineers, Malaysia

AS Malaysia gears up to developed nation status by 2020, there is still much to do to get there.

One of the most direct ways to arrive at the vision is to ensure a sufficient and growing number of engineers.

Increase in the number of engineering students is paramount to meet the nation’s need for engineers who would implement and maintain the many economic development projects.

During his visit to the International Bureau of Education (IBE) in Geneva in April, Deputy Prime Minister Tan Sri Muhyiddin Yassin spoke of the need for Malaysia to harness skills and knowledge in Science, Technology, Engineering and Mathematics (STEM).

Muhyiddin also pointed out that the countries which started on the same level as Malaysia had moved much further ahead, crediting it to their wisdom in making full use of STEM to boost their country’s fortunes.

As such, he emphasised the need for human capital development in STEM, which he considers vital in the national transformation process.

To achieve this, a strategy comprising a series of actionable plans must be able to support the production rates needed for generating skilled STEM human capital at two levels, namely secondary schools and tertiary institutions, to reach the target of 500,000 STEM graduates by 2020, according to Muhyiddin.

Although the solution is apparent, its execution remains challenging.

One of the factors hindering this step to greater national development is getting students to love science, or science classes. Science and mathematics as school subjects must be made interesting, easy to understand, as well as more hands-on and exploratory. This is in line with the Government’s aim for 60% science and technology-based education by 2020.

For the engineering profession, interest in science, technology, engineering and mathematics in school will result in more qualified students who are eligible to pursue engineering courses in universities.

Through the increase in engineering students, the nation’s need for engineers would be met. This would translate into greater implementation and maintenance of the country’s economic development projects.

The Institution of Engineers Malaysia (IEM) lauds the Government’s effort to promote interest among students to study science in schools.

Without the large number of science students, there will surely be a corresponding limitation in the ability of universities to produce the number of engineers needed.

As a national association with the nation’s interests at heart, IEM has been actively involved in conducting school career awareness talks, arranging competitions and exhibiting interesting projects on engineering to school children to promote interest in engineering. IEM has also set up IEM Student to encourage students to choose sections in various universities in Malaysia.

Engineering students are also encouraged to join IEM as Student Members which will enable them to access IEM resources and activities such as talks and networking. IEM is one of the supporting members (together with AAET, MiGHT, Utar and NSC) for the Kuala Lumpur Engineering Science Fair, an annual programme to promote interest in STEM among primary and secondary school pupils.

We believe that career prospects will be a major factor in the students’ decision in their studies and career options.

Prospects for engineers include top level positions, attractive remuneration as well as status recognition, which will be a great motivation for students to take up STEM Education and thus pursue a career in engineering.

Students must be made aware that job prospects for engineering graduates remain bright as Government allocation for infrastructure development has supported the demand for engineers.

National development towards an industrial nation has also spurred the demand for engineers.

Students, and parents too, must realise that a career in engineering is not only limited to the five traditional branches of engineering, namely Civil, Mechanical, Electrical, Electronic and Chemical Engineering. Through the years, engineering has expanded into many new disciplines such as Aeronautical Engineering, Environmental Engineering, Maritime Engineering, Mining Engineering, Oil and Gas Engineering, among many others, which would be exciting career options for students.

The Government being the largest employer should provide equal opportunity and create a structured pathway for all science-based professionals, in particular engineers, to take up high positions in the civil service.

Recognition of the contribution of engineering success and seeing it as a pathway to top positions in the civil service will be a great motivator for students to pursue STEM education in Malaysia.


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The great technology transformation

AFTER a week in the Silicon Valley, California last month, I came to the conclusion that I am a dinosaur. The speed of change from technology has been so fast and so profound that we are lost in transition, translation and transformation.

The digital revolution is already upon us, but the baby boomer generation, to which I belong, is having difficulty understanding this because we still upload (read) on paper, whereas the millenials (those born between 1980 and 2000) upload information mostly on mobile phones, video and communicate through social media.

Demographics say a lot. At the turn of the 21st century, the baby boomers (born 1946-1964) were half the work force, but today in the United States, millenials and Gen X (born 1965-1979) are roughly one-third each. The baby boomers may own most of the retirement funds and wealth, but the new wealth is being created rapidly by the younger generations.

A simple set of statistics says it all. The Forbes top five US companies by revenue are Walmart, Exxon, Chevron, Berkshire Hathaway and Apple. Walmart employs over 2.1 million people, with revenue just under US$485bil, but profits of US$16bil with market capitalisation of US$265bil. Apple, with only 80,000 employees, had double Walmart profits of US$39bil and a market capitalisation of US$725bil, larger than Walmart and Exxon put together. Twitter, with only 3,638 employees or less than 0.2% of Walmart workforce, is valued at 9.2% of Walmart. Facebook, with only 9,200 employees but 1.44 billion users, is valued at 86% of Walmart.

In fact, if it wasn’t for the fact that Silicon Valley is booming in terms of wealth creation, California would be suffering from the economic effects of the worst drought in years. But at US$2.3 trillion, California is growing at 2.8% per annum, faster than US real gross domestic product growth of 2.2% in 2014. The Western Pacific states of Oregon and Washington are growing faster at 3.6% and 3% respectively, thanks to growing trade and services from the boom in technology.

Two things that stand out in the Digital Disruption – speed and scale. The speed and scale of the digital transformation is so fast and so wide and deep that we are all having problems valuing what it means – which is why we have a tech bubble in the making.

It is quite normal for us to accept that the Silicon Valley is the world leader in digital change, but what was eye-opening as I dug into the data is that the next waves are already happening in China and India. This has mind-boggling implications on a geo-political basis, especially for smaller economies, such as Malaysia, Hong Kong or Thailand.

What struck me from delving into the pattern of growth in the Internet Revolution is the speed and scale of change in China and India. Who would have expected even five years ago that four out of the top 15 global public Internet companies, ranked by market capitalisation would be Chinese (Alibaba, Tencent, Baidu and JD.com) with a combined value of US$542bil or 22.4% of the total market valuation of US$2.4 trillion of these 15 companies as of May, 2105.

Scale and speed

The reason for this valuation is scale and speed of the Chinese transformation, already overtaking the world leader, the United States. The rate of Internet penetration is over 80% for the United States, only 40+% in China and 20+% in India. But China already has more Internet users (618 million), double the US population and its growth in smartphones is double (21%) that of the United States (9%).

Although incomes in China and India are far lower than the United States, Chinese and Indian millenials (for that matter, millenials in all emerging markets) are beginning to spend more time on their smartphones than the advanced countries.

There are two implications from this broad trend, which the Chinese Internet platforms like Alibaba and Tencent are beginning to exploit.

The first is the ease and convenience of buying, selling and paying using the smartphone – an all service tool. Partly because of regulation, the US leaders such as eBay, Amazon and Facebook are still in their core areas of strength, but Alibaba and WeChat (part of Tencent) have developed eco-systems that are simultaneously social networks, chatrooms, trading and investing platforms combined.

When I lost my Blackberry, MacBook and camera recently in Latin America, I was staggered that using WeChat on iPhone, I could go on video and instant chat with friends across half the world for free. My only constraint was the battery on my iPhone and that I had not set up to get funds transfer in case of need.

The second implication is that traditional service providers are way behind in this technology. My credit card companies are still on outdated phone-banking, which meant that in order to report lost cards, I was frantically trying to Press one, Press two and Press self-destruct! These companies are at least two generations behind in customer service technology.

Internet Revolution

My conclusion from this survey of the Internet Revolution is that the disruption from technology on conventional businesses is yet incomplete. In the 1990s, the Internet changed the music, photography, book sales and video rental business. Today, we book airline and hotel travel on the web.

But with the arrival of the iPad and iPhone, healthcare, finance, investing, education and social communications are being combined into one gadget (the mobile phone) to do what we have to.

This disruption is happening very fast in China and India, because these late-comers have no pre-conceived legacy ideas on what cannot be done with technology.

If China is currently going through its tech bubble, watch out for the next tech bubble in India.

Those who think only in terms of risks think that bubbles are to be feared. I have come to realise that the animal spirits in us change the game through excesses. But those who learn from their mistakes will create the new.

Silicon Valley is not a place but a mindset – nothing ventured, nothing gained. That mindset is truly the New Digital Transformation.

Watch this space in Asia.

Andrew Sheng comments on global trends from an Asian angle

BRICS and SCO: Seizing the Eruasian moment

While the West is distracted by the Gulf region and Ukraine, moves are afoot in parts of Asia and Europe to empower emerging regions in the future

IF there is still any doubt that Russia and China are cultivating their global presence together, events in recent days come as a timely antidote.

The five emerging BRICS economies of Brazil, Russia, India, China and South Africa, spanning nearly as many continents, had their seventh summit in Ufa, south-western Russia on Thursday.

Any lingering uncertainty over Moscow-Beijing relations would also have been dispelled by the fact that the BRICS summit was held back-to-back with the 15th Shanghai Cooperation Organisation (SCO) summit on Friday.

The SCO is an association of six countries – Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan – and prime movers China and Russia, which also happen to be dominant. Its summit this time saw a growth in membership with the inclusion of India and Pakistan.

The BRICS countries have certain shared concerns and objectives, such as national development and international commerce that need not conform to the strictures of the Washington Consensus.

Strictures imposed by the Bretton Woods institutions, the World Bank and the International Monetary Fund (IMF), have bled already anaemic economies and destabilised countries in the developing world on the basis of ideological prescriptions.

At the same time, these Western-dominated financial institutions failed to give emerging economies, epitomised by China, their rightful voice according to their global economic importance. Thus a cash-rich China has had to evolve financial institutions of its own.

Such multilateral efforts are best done together with like-minded nations. So besides BRICS, SCO countries that span Eurasia – with a collective focus on Central Asia and now also South Asia – have come together to develop alternative funding agencies.

In addition to the Beijing Consensus of rapid growth that is politically conscious, defined and directed, there is now the “Shanghai Spirit” of mutual respect, trust, benefit and consultation with equality.

These values broadly mirror the Five Principles of Peaceful Coexistence adopted by China and India (Panchsheel Treaty) two generations ago.

But even as SCO membership sees steady growth, it is clear enough that its main drivers and those of BRICS are China and Russia. By dint of sheer size and capacity, particularly those of China, Beijing and Moscow have come to lead the rest.

The way Washington has managed to alienate China and Russia at the same time has helped develop their partnership. Following years of US criticism of both countries, the US navy chief lately branded Russia as the greatest threat while presidential hopeful Hillary Clinton accused China of hacking US sites.

Russia and China were thus prodded by the US to work more closely together. US foreign policy is often said to be defined by domestic interests, or perceived interests, and this is seldom more true than when a presidential election campaign approaches.

However, improving relations between China and Russia are not thanks solely to US posturing. Moscow and Beijing are not without common interests of their own.

On Thursday, Russian Foreign Minister Sergei Lavrov rallied member countries of both BRICS and the SCO to fight terrorism together. International terrorism today is a clear and present danger, a substantive threat and a common scourge requiring close cooperation particularly among neighbouring countries.

While BRICS’s terms of reference are more economic, the SCO’s are broader and more strategic. Within BRICS, member nations have formed a Business Council and formulated an Economic Partnership Strategy. Key sectors are manufacturing and infrastructure besides clean energy and agriculture.

But the star attraction at Ufa was the launch of the New Development Bank (NDB), also known as the BRICS bank, with an initial capital of US$100bil (RM378.2bil).

To be based in Shanghai with its first president in India’s K.V. Kamath, the NDB would be raising funds locally and internationally. It is set to issue its first loans next April. This is among four new financial institutions championed by China, the others being the Asian Infrastructure Investment Bank, the Silk Road Fund and the SCO’s Development Bank.

In the SCO context, member countries had made strides in the energy, telecommunications and transportation sectors. Now such gains needed to be affirmed while also developing opportunities in agriculture. Russia places a special priority on the Eurasian Economic Union (EAEU), which also covers Armenia, Belarus, Kazakhstan and Kyrgyzstan, with Russia dominant. China has prioritised its Silk Road Economic Belt initiatives linking Asia with Europe.

Working together, the EAEU and the Silk Road projects would be promoted jointly by the SCO. The proposed financial institutions, to which China would be contributing the most, would finance these and other related projects.

The fortunes of BRICS economies however have dipped in recent months. The Ufa summit did not deny the current challenges but chose to emphasise the positives.

Although numbering just five countries, the BRICS group had contributed half of the world’s economic growth over the past decade and produced 20% of total global output. No less than IMF findings show that until 2030 at least, BRICS growth would outperform developed and other emerging economies.

For Russia, the plans and initiatives have a more immediate tactical purpose – to alleviate economic pressures brought on by Western sanctions against its moves in Ukraine.

For China, the longer-term strategic purpose covers efforts to facilitate more trade, expedite internationalisation of the renminbi and generally build and solidify China’s global stature.

In investing massively in the new financial institutions however, Beijing will be competing against the IMF, the World Bank and the Asian Development Bank.

In doing so it will have to be more borrower-friendly, minus the strictures so synonymous with the Western-run rivals. The official word is that these new lending agencies are not going to challenge the Bretton Woods institutions, but the practical effect is nonetheless to offer borrowers more choice.

To substantiate the claim that the new institutions will neither rival nor replace the older ones, China is also calling for more open international accountability of the IMF and the World Bank. Somehow that may still not come as comforting news to Western power brokers.

But after all the platitudes and hurrah in Ufa, there are now the realities to contend with.

Strategic analysts prefer to gauge the viability of regional institutions based on the common interests shared among member states. In this respect, the future of BRICS may seem less promising than the SCO’s. Precisely because of the broad spread of the BRICS countries, there is little they have in common besides an affinity with alternative modes of development.

Their economic growth has been significant, but achieved independently of other BRICS nations and – except for China – with little support from (integration with) other countries in their respective regions.

The obvious question arises as to how sustainable can BRICS as an entity be. The fortunes of international associations depend on more than goodwill and bravado.

The SCO by comparison holds more prospects for success. By comprising a contiguous region that includes Eurasia and a substantial chunk of the Asian land mass, cross-border concerns are shared and can be attended to jointly.

Furthermore, practical projects like the Silk Road Economic Belt and the EAEU require constant attention, commitment and contributions from the 60 countries and regions that are involved.

This may mean more obligations to begin with, but consistent maintenance will ensure better management and success.

By Bunn Nagara Behind the headlines

> Bunn Nagara is a Senior Fellow at the Institute of Strategic and International Studies (ISIS) Malaysia.

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