Oleh/By		:	DATO' SERI DR. MAHATHIR BIN MOHAMAD 
Tempat/Venue 	: 	PUTRA WORLD TRADE CENTRE, 
			KUALA LUMPUR 
Tarikh/Date 	: 	25/06/98 
Tajuk/Title  	: 	THE OPENING CEREMONY OF THE 
			SMI SHOWCASE 


  1.  Firstly,  let me  thank  the Ministry of International
  Trade  and  Industry  (MITI)  for  inviting  me  today  to
  officiate  the opening of 'SMI Showcase 98 and APEC  Cross
  Border  Linkages'.   I am told  that   the   'APEC   Cross
  Border    Linkages',   organised  back-to-back  with   the
  Showcase,  is  an  effort  by  MITI/SMIDEC  to  bring  the
  Showcase   onto   a  higher  plane  of  cooperation    and
  business  linkages among  APEC  economies.
  
  2.    Although   the  economies  of  APEC  countries   are
  varied   and  diverse,  combined  together,    the    APEC
  economies  can be  a  formidable  force   that   has   the
  potential  to mobilise  the  huge  resources  towards  the
  pursuit  of a common objective, i.e. to help each  other's
  economy   to  develop and to share the benefits  of   that
  development  through   world  trade  in  real  goods   and
  equally  real services.
  
  3.    Within  APEC,  Malaysia  will continue  to  work  on
  the  three pillars of cooperation already endorsed by  the
  Summit namely, trade and investment liberalisation,  trade
  and  investment facilitation, and economic  and  technical
  cooperation.  These  are  virtuous  words but   they  must
  be  translated  into  virtuous  deeds.  All  sides  should
  gain    from   the   liberalisation,   facilitation    and
  cooperation.  If the gains are one-sided or, worse  still,
  if   they  cause damage  to any  partner,  then the  deeds
  at  least  should be reexamined  with a view to correcting
  the  manner  of their implementation.  If  it   is   found
  that   the  principles  are  wrong,  then  we  should   be
  prepared  to examine or even revise them.  In the  history
  of  the  search for the ideal way, we have seen  too  many
  mistakes to believe that the current ideas are perfect.
  
  4.    The world is seeing a resurgence of the belief  that
  big  is  beautiful.   But  it  must  be  remembered   that
  everything  that   is  big  must  begin  by  being  small.
  Indeed  for  many  the small  size will remain  permanent.
  And  so  even as giants are appearing  in every field,  in
  industry   there  will  always   be   a   need   for   the
  small  and  the medium in size.
  
  5.     It   is   said   that  big  spells  efficiency  and
  economies  of scale.  But there is an optimum size  beyond
  which  efficiency declines and scale no longer results  in
  economies.  Although today there are effectively only  two
  manufacturers of passenger aircrafts in the world,  namely
  Boeing and Airbus, both these giants depend more and  more
  on  the  supply  of  parts from small producers  of  child
  parts,   components   and   sub-assemblies.    There   are
  literally millions of these parts and components,  meaning
  there   will  always  be  a  need  for  small  and  medium
  industries.    Indeed   such  is   the   versatility   and
  efficiency  of  small  and medium  industries  (SMI)  that
  there  has  to  be not just one producer of  a  particular
  part  or  component, but there will be a need for numerous
  producers   producing  the  same   items  separately   and
  sometimes  in  different  ways.  And  when  this  happens,
  competition  will  be  stimulated and  newer  methods   of
  production  for  greater efficiency,  precision  and  cost
  will be developed.
  
  6.    As  machine tools become more precise and easier  to
  operate  new  players  from the less  developed  countries
  will  be  able to get a piece of the action.  APEC,  which
  we   need   to   remind  ourselves   is   about   economic
  cooperation,  must play a role here, a role in  developing
  cross-border linkages so that  the  markets  of APEC  will
  benefit  all  the member countries.  The  demand  for  the
  products  of small and medium scale industries  must  lead
  to  the  setting up of some of   these industries in   the
  less     industrialised   member   countries.     Capital,
  management  and   technology should   cross   borders   in
  order  to contribute towards the development of  the  less
  developed  countries  through  SMI.  In  the  electronics,
  telecommunication   and  information   technology   (I.T.)
  industries,    the   scope  for   SMI   is   considerable.
  Innovative new products needing  venture capital  must  be
  given adequate support, not only in terms of finances  but
  through  vendor  development  and  the judicious   opening
  of  markets.   Here  the system of royalty  payments   and
  copy    rights   needs   to   be   reexamined.  The   high
  royalty     demanded    and     prolonged     period    of
  proprietorship  of  new inventions  inhibit   the   growth
  of  SMI.   Since computer  clones were permissable,  other
  products  too should allow for similar cloning.  This  way
  the   benefit   from  the  research  in  the   electronic,
  telecommunication  and I.T. industries  suitable  for  SMI
  will  be   better  spread  to  benefit  the  most   number
  of people.
  
  7.     In  the  competition  between  the  SMIs  of    the
  developed  and  the  developing countries  of   the  APEC,
  each   should   be  allowed  to  retain  its   competitive
  advantage.   Thus   the  low-cost  labour  of   the   less
  developed  countries  should not  be  regarded  as  unfair
  advantage.   If   it   is, then capital,  technology   and
  management know-how of the developed countries  must  also
  be   regarded   as  unfair  advantage.   If  we  are   not
  agreeable to retaining the competitive advantages of  each
  group,  then we should do away with both. It is  not  fair
  to  expect  one  competitive advantage  to  be  eliminated
  while  the  other is retained.  Experience has shown  that
  when  one  competitive  advantage  is  combined  with  the
  others,  the  greatest cost benefit will result.   In  the
  long   run  everyone  benefits,  including  the  consumers
  worldwide.
  
  8.    APEC  which,  let  me again emphasise,  is dedicated
  to  economic  cooperation should adopt a smart partnership
  approach  in the SMI Cross Border Lingkage Programme.   By
  smart partnership we mean a partnership that benefits  all
  the  partners.   Each one must contribute  something  i.e.
  land   and    location,    labour,  capital,   technology,
  management, raw materials etc and in return one  must  get
  a  fair share of the returns.  In the process transfer  of
  technologies and skills must take place.  Everyone  should
  be enriched due to the linkage and the transfers.
  
  9.    This  ASMI  Showcase  and  APEC Cross Border Linkage
  Programme@ provides an ideal avenue for those involved  to
  meet, discuss and share experiences in developing SMIs  in
  the  context  of establishing smart business  partnerships
  and   joint   ventures.   The  networking   and   linkages
  established   will  form  the  key  towards  strengthening
  global   economic  linkage  within  APEC   in   the   next
  millennium,  turning  the region  into  one  of  the  most
  competitive market places in the world.
  
  10.   I  would like to take this opportunity to  wish  all
  participants  success  in this 1998  Showcase  and  "Cross
  Border  Linkage".  I  hope  these events will add  another
  milestone  in   your  respective  business  strategies  in
  terms   of  fostering  new  business  linkages  and  joint
  ventures.
  
  11.   I   now   have pleasure in declaring open  the  "SMI
  Showcase '98 and APEC Cross Border Linkages" Conference.