BUTTERWORTH, Oct 26: Penang Chief Minister Tan Sr Dr Koh Tsu Koon saidtoday the State must continue to diversify and find niches to staycompetitive in the highly competitive global market.He said apart from being an international microchip centre, Penang has thepotential to be a big producer of natural resource-based industries suchas palm oil products, and even marine resources.He said for example, Penang has the potential to exploit its marineresources as it has three research facilities _ the Fisheries Institute ofMalaysia, World Fish Centre, and Universiti Sains Malaysia's marinebiology research centre."Likewise, although Malaysia is the largest producer of palm oil in theworld, we should not be contented with merely exporting crude palm oil butmust go into higher value production of downstream products," he said.Koh was speaking at the joint inauguration of two new oleochemical plants-- the biggest in the world -- at Acidchem International Sdn Bhd and FattyChemical (M) Sdn Bhd here today.Present were Palmco Holdings Berhad executive chairman Tan Sri Lee ShinCheng, Kao Corporation (Japan) Global Chemicals president KuniakiWatanabe, and Japanese Consul General Naoharu Fujii.Also present were Acidchem International Sdn Bhd managing director DrBarry Tan, and Fatty Chemical (M) Sdn Bhd managing director KunizoHashiba.In line with the Government's policy to promote resource-based andbio-technology industries, Koh urged Palmco to engage in more research incollaboration with institutions such as USM and Palm Oil ResearchInstitute of Malaysia.Meanwhile, Lee said with the new plant, the Palmco group which will have acapacity of 330,000 metric tonnes of fatty acids a year, making it thebiggest oleochemical producer and the biggest vegetable-oil based fattyacid producer in the world."This is 10 times Acidchem's capacity of producing 30,000 tonnes of fattyacid per year when we started in 1980," he said.Acidchem's products, which are sold to more than 60 countries, are used insoap, personal care products, detergents, food and pharmaceuticals as wellas rubber tyres, plastics and lubricants.Kuniaki said with the new plant at Fatty Acid (M) Sdn Bhd, of which KaoJapan owns 70 per cent and Palmco 30 per cent, its production of fattyalcohol now accounts for 31 per cent of Asia's, and 15 per cent of theworld's natural fatty alcohol production.Kuniaki who said about 95 per cent of fatty alcohol's produced at theplant is exported to Japan, Europe, United States and also Asiancountries.He added that with the latest investment of RM150 million in fatty acids,the Kao group's cumulative investment in the industry was RM622 million.