Oleh/By		:	DATO' SERI DR. MAHATHIR BIN MOHAMAD 
Tempat/Venue 	: 	LA HAVANA, CUBA  
Tarikh/Date 	: 	27/09/97 
Tajuk/Title  	: 	THE CUBAN-MALAYSIAN 
			BUSINESS LUNCHEON  



  1.   Firstly, let me thank the organisers for giving me the
  opportunity to address this important meeting of  prominent
  members of the Cuban and Malaysian business community.
  
  2.    I am delighted to be here today and feel honoured  to
  be  able  to share my thoughts on how we can enhance  Cuba-
  Malaysia   bilateral   economic  and   trade   cooperation.
  Increased  interaction between our two  countries,  through
  visits  and  meetings  such as this,  will  certainly  help
  strengthen  economic relations and bilateral  ties  between
  our two countries.
  
  3.    Consistent  with the realities of the current  global
  economic   environment,  we  must   constantly   seek   new
  partnerships  and  linkages to  grow  our  economy  through
  trade  and investments.  It is in this light that  Malaysia
  seeks  new friends in this region and this visit to  Havana
  marks  our  earnest desire to establish and develop  mutual
  economic linkages with this country and people.
  
  4.    We  acknowledge  that Cuba has  great  potential  for
  growth   and  we  want  to  participate  in  your  economic
  evolution.   We are here today in Cuba because  we  believe
  in  constructive engagement that is aimed at enriching your
  economy as well as ours.
  
  5.    This  meeting in Havana, I am sure, will enhance  the
  initial  ties established during the two earlier visits  by
  the  Cuban  delegation to Kuala Lumpur this  year,  one  of
  which  was led by the Minister of Foreign Affairs  and  the
  other  by the Vice Minister of Foreign Trade.  I am certain
  that  arising  from this meeting, the business  communities
  of   our   two  countries  can  identify  areas  of  mutual
  interests  for  possible  joint cooperation.   I  am  told,
  investment   opportunities   exist   in   such   areas   as
  construction, tourism, mining, power generation,  petroleum
  exploration  and refining, food processing and  trading  in
  consumer items.
  
  6.    Many  of the members of the Malaysian delegation  and
  their  companies  have played a key role  in  the  economic
  transformation  of Malaysia.  They represent  sectors  like
  banking,    telecommunications,    property    development,
  manufacturing,  mining, construction, energy  and  tourism.
  They  are  therefore knowledgeable about business in  areas
  which  are  important  to Cuba's own priority  sectors.   I
  sincerely  hope  that they can be given an  opportunity  to
  participate in the evolution of the Cuban economy.
  
  7.    Bilateral  trade between Cuba and Malaysia  is  still
  small.   This  is  due to the structure of trade  which  is
  concentrated  on a few products.  Last year,  according  to
  the  Malaysian  statistics, total  trade  between  our  two
  countries amounted to US$612,000 compared to US$952,000  in
  1995.   The bulk of Cuba's exports to Malaysia is  made  up
  of   industrial   alcohol  while  imports   from   Malaysia
  comprised mainly sound and telecommunication equipment  and
  air conditioners.
  
  8.    Obviously  we have not really attempted  to  identify
  items  for  imports and exports between our countries.   It
  is  important  that we identify what can  be  sourced  from
  Cuba  and  what  Cuba  needs which  can  be  supplied  from
  Malaysia.  We  need  also to look into shipping  and  other
  means   of   transportation,  as  well  as  the   financing
  arrangements which are mutually beneficial to us.
  
  9.    During this visit, the necessary framework to enhance
  trade  and  investment between our two countries are  being
  put  in  place.   This  is  in  the  form  of  a  bilateral
  `Investment  Guarantee Agreement', a `Trade Agreement'  and
  an  `Agreement  on Partial Abolition of Visa'.   Meanwhile,
  the  private  sector  of  our two countries  will  also  be
  signing  a number of Memoranda of Understanding or MOUs  to
  examine  the  possibility of joint ventures.  In  addition,
  the  recent  opening of the Cuban Embassy in  Kuala  Lumpur
  will  facilitate  greater  access  and  awareness  of  each
  other's needs and potentials.
  
  10.   We  in  Malaysia are encouraged by the  economic  and
  fiscal  reforms undertaken by the Government of Cuba.   The
  pragmatic  approaches  of  the on-going  Economic  Recovery
  Programme  and  incentive schemes for  foreign  investments
  and  joint  ventures have already laid the  foundation  for
  increased growth in the key sectors of the economy.   I  am
  told  that,  last year, Cuba's GDP grew by 7.8  percent  --
  the  highest  in  Latin  America.  Foreign  trade  too  had
  expanded by about 33 percent.
  
  11.   Last  year also saw the strengthening  of  the  Cuban
  national  currency  and  the establishment  of  nearly  300
  joint  venture  associations with  foreign  enterprises  in
  Cuba.  Indeed, Cuba's economic evolution in  the  past  few
  years   has   been   remarkably   positive,   taking   into
  consideration  the  exceptionally  harsh  conditions  under
  which these results were achieved.
  
  12.   To  date, I understand that no Malaysian company  has
  invested  in  any kind of business in Cuba.   I  therefore,
  would  like  to  take  this opportunity  to  reiterate  our
  interest  and  readiness to participate in various  sectors
  of development in Cuba.
  
  13.   I  note that the Republic of Cuba is in the forefront
  of  medical, biotechnological and pharmaceutical  research.
  Through  years  of  dedicated research and well-coordinated
  programmes  amongst the various research  institutes  here,
  this  country  has not only emerged as a major manufacturer
  of   interferons  and  vaccines  but  also  has   generated
  treatment  methods, medication and diagnostic equipment  of
  world standards.
  
  14.   Malaysia,  on  its part, would like  to  explore  the
  possibilities  of  sharing and exchanging  information  and
  results  in these areas of research.  For a start, Malaysia
  could  be  a launching pad for these products and  services
  in  the ASEAN region with a market of almost half a billion
  people.
  
  15.   In  this respect, I am happy to note that a  business
  arrangement   has  been  made  between  Raza  Manufacturing
  Berhad  of  Malaysia and Heber Biotec S.A.,  the  marketing
  arm  of the Centre of Genetic Engineering and Biotechnology
  (CIGB)  of  Cuba.   I  am  told  that  this  project   will
  initially  undertake to market CIGB range of pharmaceutical
  and  diagnostic  products in Malaysia.  Hopefully,  in  due
  time,   this  project  will  grow  to  a  level  where   it
  necessitates  the  setting  up of  joint-manufacturing  and
  research  facilities in Malaysia, thus,  allowing  for  the
  possible technological transfer from Cuba to Malaysia.
  
  16.   I  also  note  that tourism is the most  dynamic  and
  fastest  growing  industry in  Cuba.   Last  year  saw  the
  arrival,  for  the first time, of one million  tourists  to
  the  Island.  Today, Cuba's tourism industry has become the
  major  source of national income and it is seen as a  major
  contributor  to  Cuba's future economic growth.   Malaysia,
  on  its part, has acquired useful experiences in this field
  and  would like to exchange information and participate  in
  the   construction   and  management   of   tourism-related
  facilities in Cuba.
  
  17.  Yet another possibility for joint venture activity  is
  in  the field of agri-business and food-related industries.
  I  am  told  that the Malaysian Padi Beras Nasional  Berhad
  (BERNAS),  a rice production and trading company,  has  had
  an  agreement with the Cuban Ministry of Foreign Trade  and
  the   Ministry  of  Agriculture  to  produce,  procure  and
  distribute rice in this country as well as in the region.
  
  18.   Malaysian  entrepreneurs who are present  here  today
  would  also like to explore other possibilities  of  joint-
  venture  projects,  such as in textiles  and  garments  and
  footwear  manufacturing, mining, oil  and  gas  exploration
  and  refining, power generation, construction and  property
  development, and the production of construction  materials,
  industrial    chemicals,    plastics,    detergents     and
  fertilisers.
  
  19.   Malaysia's economic development over  the  last  four
  decades  was  grounded on sound policies and  the  people's
  efforts.   Looking back, it can be said that  Malaysia  has
  undergone  significant  changes  from  being  the   world's
  largest  producer of tin and natural rubber  to  a  rapidly
  industrialising   country.   Malaysia  now   produces   and
  exports a wide range of manufactured goods, and these  make
  up  80  percent of total export amounting to US$76 billion.
  The performance of the Malaysian economy has been mainly  a
  result   of   our   industrialisation   drive,   with    an
  unprecedented  growth  in the output of  the  manufacturing
  sector particularly in the last ten years.
  
  20.   However,  we recognise that success  also  carries  a
  cost  and  creates problems and issues of its  own.   Where
  these   involve  the  domestic  economy,   they   are   not
  impossible  to  manage but external problems  do  not  lend
  themselves  to  easy solutions.  Wherever adjustments  have
  to  be  made in order to accommodate international demands,
  they  will  be  made.   At  the same  time,  Malaysia  will
  participate  fully in the search for a more  equitable  and
  open world trading regime.
  
  21.   Vision  2020  is  the crystallisation  of  Malaysia's
  ambitious  target  to  become  a  fully  developed  nation.
  Hence,  the  thrust  of  our current industrial  policy  is
  towards  developing industries which have high value-added,
  high  technology,  high  local content  and  having  strong
  linkages  with  the  domestic economy  apart  from  foreign
  markets.   Having  outgrown the  era  of  labour  intensive
  industries,  our  emphasis is now  on  the  development  of
  capital   intensive   and   technologically   sophisticated
  industries.   There  will also be  a  growing  emphasis  on
  productivity  and  quality-driven  growth  through   skills
  upgrading,  capital deepening and research and  development
  to increase Malaysia's competitiveness.
  
  22.    Accordingly,  a  nationwide  IT  agenda   is   being
  implemented  to accelerate the wider usage  of  IT  in  the
  various  sectors  of  the  economy.   In  line  with   this
  strategy,  Malaysia  is  developing  the  Multimedia  Super
  Corridor  or  MSC  as the perfect test  bed  for  companies
  wanting   to   create,  distribute  and  employ  multimedia
  products  and  services.   Thus far,  we  have  managed  to
  attract  the  interest and support of some of  the  world's
  biggest multimedia corporations.
  
  23.   With  the various development projects that  we  have
  put  in  place  and the 2020 vision that we  have  set  for
  Malaysia,  opportunities  both  in  trade  and  investments
  abound  for  foreign business enterprises.   Malaysia  will
  continue  to  offer  a stable, strong and business-friendly
  government,   consistent   policies,   a   forward-looking,
  dynamic  and  innovative economic regime to help  investors
  succeed without undue constraints.  These are some  of  the
  factors  that have encouraged more than 3,000 manufacturing
  companies  from  over 35 countries to make  Malaysia  their
  offshore production base.
  
  24.   We  in  Malaysia have found that foreign  investments
  have  helped  to  transform our economy.  Such  investments
  have  created jobs, increased foreign exchange and transfer
  of  technology, expanded our industrial base  and  provided
  linkages  between the agricultural and industrial  sectors.
  It  also  spawned  the  growth of  medium  and  small-scale
  industries.  As a result Malaysians are now able to  invest
  in other developing countries.
  
  25.   Guided  by this experience, Malaysia has  endeavoured
  to   play   a  somewhat  similar  role  advocating  greater
  cooperation through trade and investments among  developing
  countries  who  share  the  common  aspiration   for   self
  reliance.   It is also our belief that developing countries
  should  work  together to improve their  condition  through
  mutually beneficial trade and other economic activities.
  
  26.   Malaysia's globalisation strategy also encourages its
  industries  to  relocate in countries of  the  South  where
  viable  and  appropriate.  Malaysian industries are  moving
  to  new  locations in search of resources  and  factors  of
  production  which  are  abundant and competitively  priced.
  Malaysian   companies   have  also  successfully   ventured
  worldwide  into  the services industries like  banking  and
  tourism related projects.
  
  27.    As  Cuba  and  Malaysia  are  countries  with  small
  domestic  markets, it is imperative that we adopt a  global
  outlook  to  achieve and sustain growth.  Therefore,  apart
  from  exploring  the  economic potential  in  each  other's
  country,  the  Cuban and Malaysian private  sectors  should
  also   explore  opportunities  for  cooperation  in   third
  countries.
  
  28.   Finally,  I  urge  the Malaysian  business  community
  doing  business in the Republic of Cuba to  take  a  longer
  term  view of their business interests in this country  and
  seek  to  establish lasting business relationship that  are
  reciprocally   beneficial.   I   am   certain   the   Cuban
  Government  will continue to create the necessary  enabling
  environment to make this country an attractive place to  do
  business.