Saturday September 29, 2012

Raising innovation skills seen to help propel industries

WITH one of the budget focus fixed on raising the innovation skills among Malaysians, the Government has assured a number of stimuli to propel industries and the society towards increased productivity.

Prime Minister Datuk Seri Najib Tun Razak revealed efforts to be taken to enable SMEs to further expand their businesses by using intellectual property rights (IPR) as a collateral to obtain financing.

He said that a valuation model would be created to enable IPR to be valued and commercialised in the market as well as utilised as collateral to get financing from financial institutions.

The Government will then establish an Intellectual Property Financing Fund scheme amounting to RM200mil to be offered through Malaysian Debt Ventures Bhd (MDV).

“The Government will provide a 2% interest rate subsidy and guarantee of 50% through Credit Guarantee Corp Malaysia Bhd,” he said in his speech, adding that RM19mil will be allocated for training programmes for local intellectual property evaluators conducted by Intellectual Property Corp of Malaysia and create an intellectual property right market platform.

To this, nanotechnology developer Nanopac (M) Sdn Bhd CEO Datuk Cheng Kok Leong said it was a “tremendously welcomed move” especially for SMEs which had difficulty getting financial assistance to start new projects.

“When we start to develop something new, we spend a lot to get the IP before we want to reveal the product. Not everyone have the capital to do that and banks don’t lend based on how good our technology is but how much we are earning,” he told StarBizWeek. Cheng added that with more IP evaluators, banks can then employ their expertise to approve financing for SMEs that need and deserve it.

Malaysian Biotechnology Corp CEO Datuk Mohd Nazlee Kamal said that the announcement bodes well for the further development of biotechnology in Malaysia.

“Besides the RM200mil fund placed under MDV, the additional RM19mil fund allocated by the Government for training programmes and the creation of an IP market place will provide the necessary framework and ecosystem needed for this initiative to succeed and thrive,” he said in an email, “We look forward to encourage and guide Bionexus status companies to avail themselves to this opportunity.”

Nazlee added that BiotechCorp would leverage on the training programme to equip experts to assist financiers in valuating the biotechnology IPs that entrepreneurs would be putting up as collateral for their loans.

The Prime Minister also noted that research and development (R&D) activities will continue to be emphasised as many R&D findings and output of public research institutions had the potential to be commercialised.

To support this effort, the Government will allocate RM600mil to five research universities to conduct high-impact research in strategic fields such as nanotechnology, automotive, biotechnology and aerospace.

The current tax incentives for the commercialisation of resource-based R&D findings be extended to commercialisation of non-resource based findings which are products promoted under the Promotion of Investment Act 1986.

The tax incentives would be for any company which invest in its subsidiary company undertaking the commercialisation of R&D findings to be given a deduction equivalent to the total investment made in that subsidiary.

The subsidiary company that undertakes the commercialisation of R&D findings will also be given income tax exemption of 100% on the statutory income for a period of 10 years.

To encourage direct participation of angel investors in the early stage of businesses with innovative ideas, the Government proposed that a deduction equal to the amount of investment made by an angel investor in a venture company be allowed to be set off against all his income.

For the development of green technology, the fund for the Green Technology Financing Scheme will be increased by RM2bil from the initial RM1.5bil in 2010.

News

Saturday September 29, 2012

Raising innovation skills seen to help propel industries