Penang building outsourcing centre of its own after S’pore firms pull out

Penang Chief Minister Chow Kon Yeow (right) tasting a Korean dish after announcing the inaugural Penang Asian Food and Culture Festival today. With him is state Tourism Development Committee chairman Yeoh Soon Hin.

GEORGE TOWN: Penang Chief Minister Chow Kon Yeow said the state government was building an outsourcing centre of its own after it mutually agreed to cancel a RM11.3 billion project with two Singaporean companies.

He said a smaller Business Process Outsourcing (BPO) centre was being built next to the Penang Development Corporation (PDC) headquarters in Bayan Baru.

Chow anticipated a better and bigger BPO building being built in the future. He did not give further details.

Recently, PDC, Singapore’s Temasek Holdings Pte Ltd and Economic Development Innovations Singapore Pte Ltd (EDIS) announced that they were dropping a RM1.3 billion BPO project dubbed “BPO Prime” at Bayan Baru.

The parties in the BPO project decided to mutually cancel their plans due to the “soft market”.

As part of the 2015 agreement, Temasek, EDIS and PDC were also to undertake a RM10 billion project to build a technology park in Batu Kawan, subject to the completion of the BPO in Bayan Baru.

Today, Chow said PDC did not incur any losses due to the cancellation of the BPO project as there were no earthworks or holding costs involved.

“The total abortive cost is about RM8 million by the PDC due to the engagement of consultants and other works done,” he said.

On a different matter, Chow said it was too early to say that many Hong Kong businesses were migrating to Penang as a result of the civil strife in the Chinese special administrative region of late.

However, he said Hong Kong investors have shown a keen interest in Penang’s properties over the years and their number is continuing to grow over the past few years.

“The private sector should take this opportunity to woo HK companies and businesses to Penang.”

On last week’s storm damage, Chow said the Penang government was looking at ways to help the 2,022 affected families.

Last Friday’s freak storm saw strong winds as fast as 100kph but little rain. The winds ripped off roofs and uprooted many trees.

Chow also announced the inaugural Penang Asian Food and Culture Festival.

This will see Japanese, Thai, Chinese, Indonesian and Korean food being served at five shopping malls in the state from Sept 13 to 15.