26/10/2012 (Bernama) - Sabah has been urged to position itself to tap the growing investor interest in the Southeast Asia region which has a combined population of 600 million people and gross domestic product (GDP) of about USD$1.5 trillion.

In making the call, Chief Executive Officer of Sabah Economic Development and Investment Authority (SEDIA) Datuk Dr Mohd Yaakub Johari said the move is timely and appropriate as Malaysia has emerged as one of the top foreign direct investment destinations in the region.

"With this interest, Sabah has to position itself in terms of what should be our niche areas so that we will be able to engage investors' interest and thereby participate with us in the development in their investment in Southeast Asia.

"(But) other economies have been catching up very fast, for example Indonesia and Vietnam have been able to court foreign investors," he told Bernama here today.

Mohd Yaakub, who chaired an investor roundtable here yesterday hosted by SEDIA in partnership with International Investor, a UK-based business intelligence and publishing organisation, said Sabah needs to leverage itself on what it can offer foreign investors better than these two other economies.

"If you are talking about attracting investors to Sabah because of our cheap labour, no way we could, they would have go to Vietnam and Indonesia.

"So, we have to position ourselves, if we just talk about resource-based, maybe we have elements of competitiveness in areas such as palm oil and oil and gas, which is relatively new.

"In the longer term, we have really no other choice but to build up the people that we have, because it is human capital that can drive innovation and competitiveness in the current global economy," he said, adding Sabah could leverage on areas like tourism.

"We have been very successful in tourism because of our endowments such as proximity to the golden triangle and also because of our location in the heart of Borneo which is regarded as one of the oldest rainforests in the world, and we are host to many endangered species like orangutan, and our multicultural people.

"So we have a vibrant tourism sector and we are rich resource-wise, so we come up with this tagline -- this is your preferred destination for business, culture and nature," he said.

Mohd Yaakub said total cumulative investments in the Sabah Development Corridor (SDC) have been "quite substantial".

"However, we have to accept the reality that for investors to move forward into the implementation stage they need a lot of other things, they want to negotiate on incentives, and these are things beyond our control," he said.

SEDIA is a one-stop authority entrusted to drive the corridor.

Asked on the challenges in luring foreign investment, Mohd Yaakub said the investing community has started getting concerned about labour availability.

"This is something peculiar. On one hand, there are parties who say that there is 5.3 per cent unemployment and this is very serious, and in comparison to the national rate we are slightly on the high side.

"This is a manageable level and we have the opportunity to retrain people so that we can position them to areas where there is a shortage. That means we need to be a lot more aggressive in identifying who the unemployed are and look at their characteristics and see whether they can be emplaced, particularly the locals," he said.

Mohd Yaakub said in the past, Sabah was too dependent on foreign labour especially in the plantation sector, and the time has come for everyone, including the state government, to address this problem for the good of the local people and the state.