Speech by the Chief Minister of Penang At The Signing Ceremony of The German Dual Vocational Training Programme between PSDC and The Industry in Penang 6 October 2015:
On the 18th of September, the State Government signed a RM 2 million sponsorship agreement with the Penang Skills and Development Centre (PSDC) to support the German Dual Vocational Training programme in Penang. I am proud to say that Penang is the first State government to have initiated the German Dual Vocational Training and is even supporting its development in kind and in money.
Once again Penang Leads, In other words, these students are exempted from paying fees and with the monthly stipend of RM900 from the participating companies here, they are practically paid to study.
As the next milestone of the implementation of the German Dual Vocational Training Programme in Penang, today I am pleased to witness the signing ceremony between the vocational training school, PSDC, and the participating local training companies; plus welcoming the students in the first batch. We hope to have open application from students not working in companies because the state government hopes to take in 500-600 students through our sponsorship.
Malaysia is undergoing challenging times. The Ringgit has dropped a quarter of its value against the US Dollar this year. Falling oil price and a slowing Chinese economy put further pressure on our economic growth. Therefore, with the RM 2 million state contribution, I am pleased to see that the industry players do its part to commit themselves to a sustainable educational development of their staff and towards a higher skilled workforce in Penang. The State’s sponsorship is a significant step for increasing our talent pool in Penang and keeping Penang as the most competitive State in Malaysia.
Our competitiveness has weathered past economic uncertainties. The previous financial crisis hit in 2008. Nevertheless, during the 7 year period from 2008 to 2014, we managed to achieve RM48.2 billion worth of investments, which is almost double the RM24.9 billion invested from previous 7 year period from 2001 to 2007. I strongly believe that good ideas and innovative enterprises can only prosper within a good conducive environment. Hence, my government has embarked on a change in governance towards clean, accountable and transparent governance. So, since taking over in 2008, our good governance policy has proven to be received well by international investors.
Whilst many businesses in Penang are exported orientated, many Small and Medium Enterprises are not. But to remain competitiveness, all businesses have to continue to invest in capital and in talent. As such, the Penang State Government has realized that the commonality of all these businesses is that they tap on talents in Penang. Therefore, I am proud to say that the State Government’s sponsorship is open to all companies in Penang, irrespective of whether it is a SME or a MNC. The students however, have to be Malaysians but with a preference being given to Penangites.
Ladies and gentlemen.
The American President Barack Obama praised Germany for its Dual Vocational Training System in his State of the Union address in 2012. The country has been long famous for its well-developed work-based education.
All over the world, people regard the words “Made in Germany” as a seal for high quality products. It is now the State Government’s aim to establish “Trained in Penang” as a new benchmark for high quality training in Malaysia and globally. This will increasingly become more relevant as the ASEAN Economic Community takes form and Penang plays a regional role.
The State government also believes in inclusive training. Hence I am very happy that half of the first batch of students is female. Besides, I also found out that out of the first 22 students, 20 students are Malays and two are Indians.
Ladies and gentlemen.
The German Dual Vocational Training programme in Penang is truly unique within the Malaysian education system. While being hired by the training company as a regular staff with a monthly salary, the students get trained concurrently at the training institution to enhance their theoretical knowledge. This means, that while learning on the job and benefit from experiences of senior colleagues, the trainees will also acquire a comprehensive picture of general business and economic connections. With this, students will become generalists and specialists at once. This combination of theory and practice gives the students a real head start in their career.
This dual concept of learning, while working, generated a world-class workforce in Germany. The fact that more than two thirds of all school leavers in Germany go on to start a vocational training programme is a proof for this. With Mechatronics being the first programme under the GDVT scheme in Penang, the State Government sets high standards for itself and follows the German model by partially funding the vocational school.
An essential characteristic of the dual system is the cooperation between private companies, on the one hand, and public vocational schools on the other. Support and enthusiasm from parties are important. Therefore with a strong manufacturing cluster in Penang built up over the past 40 years, we have a higher chance of replicating the German system successfully. This will serve several private and public objectives well and with the end result being a stronger manufacturing cluster that is hard to replicate elsewhere.
In Germany, one can choose from a variety of more than 350 officially recognized training programmes. Therefore, I hope more programmes will be offered in the future and the variety will result in more specialists for our local labour market.
Ladies and Gentlemen.
Penang’s unemployment figures offer encouraging signs. Penang has been constantly experiencing lower unemployment rates than the country as a whole. Despite the global economic crises between 2007 and 2009, Penang’s unemployment rate remained well below the natural rate of unemployment of four per cent. It fluctuated between 2.4% and 1.7%. We now record the lowest unemployment rate in Malaysia and Malaysian history at 1.2%. This shows that the labour market in Penang has been competitive and robust thus far. With this programme – the first of its kind in Malaysia – the State Government will ensure that Penang remains the country’s premier destination to invest, learn, work and live.
Introducing the German Dual Vocational Training in Penang also serves a social objective by upskilling another segment of our workforce. This is important to reduce income inequality in Penang. Although Penang’s income inequality, as measured by Gini Coefficient, is lower compared to that of Malaysia, I believe that all segments of Penang’s labour force should be given the right support to improve and increase their wage level further. On this, I am confident that the German Dual Vocational Training will narrow income inequality further.
Ladies and gentlemen.
I would like to end my speech by thanking all participating companies for making this programme possible in Penang. I am very confident, that our Penang-based business community and PSDC will take their responsibility with their usual excellence and I wish all the participating students good luck as well as a fruitful and exciting training period. I hope, that more of our companies will join this program as a training company and I am delighted to see that more Malaysians will begin their careers on German high standards “Trained in Penang”.