PETALING JAYA: The proposed Digital Free Zone (DFZ) that Prime Minister Najib Razak mentioned in his budget speech last Friday is meant to be an equalizer that enables businesses to benefit from e-commerce regardless of where they are in Malaysia, according to Minister in the Prime Minister’s Department Abdul Rahman Dahlan.
Abdul Rahman said the concept would mirror the existing free trade zones, where businesses enjoy tax exemptions and other incentives. Malaysia currently has four free trade zones, located in Pasir Gudang, Tanjong Pelepas, Port Klang and Bayan Lepas.
“The establishment of DFZ would stimulate the economy as it gives room for online traders to compete in a healthy environment,” Abdul Rahman said.
“The location of a business will no longer be a hindrance. For instance, a trader in Kota Belud and a trader in the Klang Valley will have equal opportunities to market their items.
“This is the future of the digital economy.”
In his speech, Najib said the DFZ would merge physical and virtual zones to facilitate international e-commerce and encourage Internet-based innovation.
He added that digital connectivity as an economic activity was already contributing nearly 16 per cent to the country’s gross domestic product (GDP).
Najib said the Malaysian Digital Economy Corporation (MDEC) would be allocated RM162 million to implement programmes to boost this new digital economy effort.
MDEC, formerly known as Multimedia Development Corporation, currently oversees MSC Malaysia and is responsible for promoting it locally and globally.
MSC Malaysia, formerly known as the Multimedia Super Corridor, was established in 1997 to revolutionise the ICT industry in Malaysia. It provides strategic support to MSC-Malaysia-status companies, which are given tax exemptions and various other incentives.