Malaysian Chinese Businesses in An Era of Globalization

MALAYSIAN CHINESE BUSINESSES AND GLOBALIZATION 205
Malaysian Chinese Businesses

in an Era of Globalization
Leong Kai Hin
1. INTRODUCTION
People often see globalization as the formation of a global village. The
advent of information and communication technology (ICT) has shortened
the distance between different parts of the world. We have closer contact
and speedier flows of information, enabling the creation of a global
civilization, with freer trade, freer flows of people, of capital and of
technology. IMF defines globalization as the growing economic
interdependence of countries worldwide through increasing volume and
variety of cross-border transactions in goods and services, freer
international capital flows, and more rapid and widespread diffusion of
technology.
The recognition of comparative advantages conferred to each country
leads to increasing specialization of nations in exports, and pressure to
trade liberalization, such as ending protective tariff and other barriers
to trade.
In the nineteenth century, trade liberalization was facilitated by adoption
of the gold standard along with the growth of industrialization.
Globalization has been disrupted since World War I. In the era since
World War II, globalization has been driven by trade negotiation rounds,
which led to a series of agreements to liberalize trade. The Uruguay
Round led to a treaty to create the World Trade Organization (WTO) to
mediate trade disputes. Other bilateral trade agreements and regional
trade treaty such as the ASEAN Free Trade Area has also been signed in
pursuit of the goal of reducing tariffs and barriers in trade.
Since World War II, globalization has manifested itself through the
reduction of trade barriers, increase in international trade and foreign
direct investments besides increase in international cultural exchanges,
international travel and tourism and immigration.
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206 LEONG KAI HIN
In this era of information and communication technology, globalization

is here to stay. The advent of information and communication technology
such as Internet enables vast amount of information to be processed and
transmitted speedily through an e-commerce portal. Producers can access
to global sources of inputs and screen for the most cost-effective producers
of such inputs. Thus, the components of a product can be sourced from
several different countries. The producer just has to integrate these inputs
to produce his final products for his consumers. Not only can the producers
take advantage of the ICT, consumers can also purchase through an
e-commerce network. Thus in this era, competition becomes global. A firm
will not be able to survive the competition if it is not globally competitive.
Globalization brings both advantages and disadvantages. To a nation,
globalization increases competition which makes the firm more innovative
in order to adapt to the changes and compete in the market. Globalization
eliminates the middlemen and the firm can directly source for the most
efficient suppliers. This will cut down the cost of production. The reduction
in the cost of production coupled with the global competition will benefit
the consumers who will be able to enjoy cheaper goods.
The disadvantages of globalization are that a firm might not be able
to survive the global competition. The cheaper imported goods will kill
the domestic industry. This will bring about problems of unemployment
and current account deficit to the affected country. The import of cheap
shoes and garments from China into the Southeast Asian countries is an
example. The domestic industry could be wiped out by such an impact.
Malaysia is an open economy, with international trade constituting
200 per cent of its GDP. The major trade partners of Malaysia are
Singapore, Japan and the United States. These countries are also the
major contributors of FDI to Malaysia.
Malaysia is a member of the ASEAN FTA. This free trade area has
a population of 500 million and a total GDP of US$683,891 million in
2003. The intra-trade among the ten member countries has been
increasing significantly. The rise of China in the recent decades has
also had an impact on this region. We have seen increasing trades
between China and Malaysia. In 1999, the trade between China and
Malaysia was only US$5.2 billion. In 2003, it reached US$20.1 billion.
It is an increase of about four times. The full implementation of the
Ten+1 (ASEAN + China) Free Trade Area in 2010 will produce a
market with a population of 1.8 billion.
Malaysia is the chair country of the NAN (Non-Alignment Nations)
organization and the OIC (Organization of Islamic Countries). Malaysia
has a good relationship with the developing and the Islamic countries.
This relationship provides a good opportunity for the country to trade
with these countries. With its well-known racial harmony and its political
stability, together with its currency peg to the U.S. dollar, Malaysia was
able to have 6 per cent growth in 2004. It has surplus in its current
account and continuous increase in its foreign reserves. Its foreign reserve
is sufficient to support 8.5 months of imports.
The Malaysia Chinese businesses in Malaysia have been playing
important roles in the economy, especially in the small and medium
manufacturing industries and the retailing and wholesale industries.
There are also large Malaysia Chinese corporations such as the Genting
Group in the entertainment and hotel industries, IOI Group in the
plantation industry and the Public Bank and Hong Leong Bank in the
banking industry.
2. OBJECTIVES AND METHODOLOGY

This chapter intends to study the impact of globalization on the Malaysian
Chinese businesses and the strategies adopted by them to face such
challenges. The impact could be measured by looking at their financial
performance over this period of globalization. Their reaction to the
phenomenon of globalization could be studied by looking at their
involvement in global business. Since there are both big tycoons and
small and medium firms among the Chinese businesses, it is necessary
to study both these groups of Chinese businesses.
For the group of big Chinese tycoons, a sample of six prominent
tycoons is selected. The global perspective and performance of the
conglomerates of these six tycoons will be studied. For the small and
medium industries, the most badly affected industries and the industry
that benefited most will be studied. The shoes and garment industries
have been selected for it is well known that they are the most badly
affected industries. For the industry that benefited the most, the rubber
glove industry has been selected for its outstanding performance.
The data are collected from the company websites, company annual
reports, magazines and newspaper.
3. THE IMPACT ON THE CHINESE TYCOONS

The table below lists the six Chinese tycoons selected and their
conglomerates.
208 LEONG KAI HIN
TABLE 8.1
Six Selected Chinese Tycoons and their Conglomerates
Tycoon Group Estimated Wealth
Tan Seri Quek Leng Chan Hong Leong Group RM8.17 billion
Tan Seri Lee Shin Cheng IOI Corporation Bhd RM3.5 billion
Tan Seri Lim Goh Tong Genting Bhd RM6.89 billion
Tan Seri Teh Hong Piow Public Bank Bhd RM3.62 billion
Tan Seri William Cheng Lion Group NA
Tan Seri Yeoh Tiong Lay YTL Corporation Bhd RM3.13 billion
3.1 Hong Leong Group

Hong Leong Group comprises fourteen listed companies in various stock
exchanges around the world. Its total market capitalization was US$12
billion in 2004. Hong Leongs business focuses in three main core business
activities manufacturing and distribution, financial services, and
property and development industries.
MANUFACTURING AND DISTRIBUTION SECTOR

In the manufacturing and distribution sector, Hong Leongs listed
companies are Hong Leong Industries Berhad, Malaysian Pacific Industries
Berhad, Hume Industries Berhad, OYL Industries Berhad and Narra
Industries. Their operations span the globe and the products are represented
and distributed by a worldwide network of branches, appointed distributors
and agents.
Hong Leong Industries Berhad is principally an investment holding
company for the companies in this sector. Activities of its subsidiaries
include the manufacture, testing and sale of integrated circuits,
semiconductor devices, electronic components and lead frames,
manufacture, and assembly of motorcycles, electric scooters and related
parts and products, distribution of motorcycles and motorcycle
components, manufacture and sale of ceramic tiles, manufacture and sale
of polypropylene and polyethylene products, duplex board boxes and
flexible packaging products.
The manufacturing and distribution activities can be divided into the
following segments:
(a) Heating, Ventilation, Air-conditioning and Refrigeration

OYL Industries Berhad owns AAF-McQuay in the United States and
J&E Hall in the United Kingdom.
(b) Semiconductor Assembly and Testing

Malaysian Pacific Industries Berhad is one of the top six
semiconductor sub-contracting assembly operators in the world. It
owns Carsem in Suzhou, China.
(c) Motorcycle Manufacturing, Assembly and Distribution

Hong Leong distributes Yamaha motorcycle and it owns a German
motorcycle brand MZ.
(d) Building Materials

Hong Leong group manufactures and distributes a diverse range of
building materials such as floor and wall tiles, fibre- and cement-
based particleboard products, roofing tiles, steel products, and medium
density fibreboard products.
(e) Newsprint
Hong Leongs Malaysian Newsprint Industries produces newsprint.
(f) Furniture
Hume Furniture Industries manufactures and exports furniture to the
United States.
TABLE 8.2
Financial Performance of Hong Leong Industries Berhad, 200204
2004 2003 2002

RM000 RM000 RM000
Revenue 2,438,572 2,044,420 1,950,268

Profit after tax 199,249 58,117 (80,822)
Basic Earnings per share (Sen) 45.95 0.28 (36.21)
Dividends (Sen) 6.25 2.50 14.70
Source: Companys annual reports.
210 LEONG KAI HIN
FINANCIAL SERVICES
Hong Leong Credit Berhad is the investment holding company for the
firms in this sector. Its subsidiaries are Hong Leong Bank Berhad, Hong
Leong Assurance Berhad and HLG Capital Berhad. Hong Leong Bank
Berhad is one of the ten anchor banks in Malaysia. It has 179 branches
in Malaysia, and one branch each in Singapore and Hong Kong. Hong
Leong Assurance Berhad is in the life and general insurance services.
HLG Capital Berhad is involved in stocks and shares broking, agent and
nominee for clients, corporate advisory services, fund management, unit
trusts, share financing, futures and options broking.
PROPERTY AND DEVELOPMENT INDUSTRIES

Hong Leong Properties Berhad has significant interests in properties
located in the United Kingdom, India, Malaysia, Singapore and China. In
the U.K., its Thistle Hotel has 56 hotels in key U.K. locations and 24 in
TABLE 8.3
Financial Performance of Hong Leong Credit Berhad, 200204
2004 2003 2002

RM000 RM000 RM000
Revenue 2,539,628 2,460,978 2,554,698

Profit after Tax 546,000 563,416 553,120
Basic Earnings per Share (Sen) 37.3 36.0 37.9
Dividends per Share (Sen) 11.3 8.6 11.5
TABLE 8.4
Financial Performance of Hong Leong Properties Berhad, 200004
2004 2002 2000

RM000 RM000 RM000
Revenue 199.0 439.1 255.9

Profit Attributable to Shareholders 33.9 25.6 57.7
Net Earnings per Share (Sen) 4.8 3.7 (8.2)
Net Tangible Assets per Share 1.06 1.02 0.97
London. In Singapore, it has sold 20 residential projects yielding more

than 6,800 apartments and homes. In China, it has property development
projects in Shanghai and Beijing. Its Guoman Hotel and Resort Holdings
Sdn. Bhd. own Guoman Hotel in Hanoi.
Hong Leong group has extended its manufacturing and distribution
activities to the United States and United Kingdom to acquire more
advanced technology and to gain entry into foreign markets. Its entry
into China enables it to gain advantage from the cheap labour supply
and the large market. Its property development in the United Kingdom,
Singapore and China are successful and profitable. Its financial
performance in all the segments is encouraging and shows good growth
over the past five years.
3.2 The IOI Group

The IOI Group comprises three listed companies: IOI Corporation Berhad,
IOI Properties Berhad and IOI Oleochemical Berhad. Its core businesses
are in palm oil plantation, oleo chemicals, and property development.
IOI has acquired Loders Croklaan from Unilever to integrate forwards
the downstream palm oil-based manufacturing capabilities into producing
specialty oil and fats. Then Loders Croklaan further consolidated its
position in the growing palm ingredients market by acquiring Soctek, a
Malaysian palm oil specialties company. Loders Croklaan has announced
the building of Europes largest palm oil-processing plant in Rotterdam
in the second half of 2004. This will position itself as a preferred supplier
to its global customers and enable it to be more competitive in an evolving
and challenging global market.
In 2004, the group has an operating profit of 1.16 billion ringgit,
which shows a 33 per cent growth over the previous year on the back of
good performances from all the three core business segments.
In Table 8.5, the 17.5 per cent growth of the plantation segment is due
to higher crude palm oil prices and higher production volume contributed
by recent acquisition of other plantations.
The 32 per cent growth in the property segment is due to improving
economy and buoyant property market. The 50.8 per cent growth in the
resource-based manufacturing is due to volume growth, improved cost
efficiencies, raw material price hedging and improved results from
specialty fats business unit.
IOI has expanded its business globally by acquiring Loders Croklaan,
which will enable it to expand into the palm oil-based specialty oil and
212 LEONG KAI HIN
TABLE 8.5
Growth of Operating Profit by Core Segments
of IOI Group, 200304
2003 Operating Profit 2004 Operating Profit Growth

Core Segments (RM Million) (RM Million) (%)
Plantation 543.4 638.7 17.5

Property 255.2 336.8 31.8
Resource-based
Manufacturing 123.5 186.2 50.8
Source: IOI Company website.
fats market in Europe. The 50.8 per cent operating profit growth of the
firm in this segment indicates the gain of the firm from this globalization
strategy.
3.3 Genting Group

The Genting Group comprises the following five listed companies: Genting
Berhad (US$3.7 billion); Genting International PLC (US$0.33 billion);
Resorts World Berhad (US$2.9 billion); Asiatic Development Berhad
(US$0.35billion) and Star Cruises Limited (US$1.6 billion).1 Its key
business activities are in leisure and hospitality, power generation,
plantation, properties, paper and packaging, and oil and gas.
During this era of globalization, Genting group has extended its
business globally. In 2002, Star Cruises acquired Norwegian Cruises
Lines and became the third largest cruise line operator in the world
comprising a fleet of twenty cruise ships. Through Genting International,
Genting expanded its casino business to Australia, Bahamas, Philippines,
the United Kingdom, Egypt, Lebanon and South Africa. In 2004, Genting
International acquired Maxims Casino Club, a top-end casino in
Londons West End. It has also extended into a joint venture with
Stanley Leisure, the largest casino operator in the United Kingdom
with 41 casinos and over 600 betting shops.
Table 8.6 shows that although there was a steep fall in the business in
2000, it recovered since 2001. This indicates that during this era of
globalization, Genting has adopted an appropriate strategy to expand to
foreign markets to sustain its growth.
TABLE 8.6
Financial Highlights of Genting Group
1999 2000 2001 2002 2003
Profit before Taxation

(RMmillion) 1,521.4 (322.7) 1,034.6 1,559.6 1,562.3
Total Assets Employed

(RMmillion) 9,440.2 9,307.2 10,230.0 11,445.8 14,207.4
Basic Earnings
per Share (Sen) 156.40 (34.96) 64.20 107.41 101.34
Tangible Assets
per Share (RM) 8.26 7.68 8.18 9.12 10.00
Source: Genting Group website.
3.4 Public Bank Group

The group provides all banking and financing services that include
commercial banking , hire purchase, merchant banking, credit cards, cash
management services, leasing and factoring, stock-broking, sale of trust
units and management of unit trust funds, and related financial services
such as nominees and trustee services. The group also provides a wide
range of Islamic banking products and services. As at 31 December
2003, the banks market capitalization stood at 18.7 billion ringgit,
representing a 70 per cent increase from 11.0 billion ringgit as at
31 December 2002.
The group has overseas presence in five Asian countries. It has
branches in Hong Kong, Sri Lanka and Laos and subsidiaries in Hong
Kong and Cambodia. In Vietnam, it has a joint venture bank. Its
international operations contributed 248 million ringgit or 13 per cent
of the groups pre-tax profit for 2004. Its Cambodian Public Bank
Limited was voted the Best Bank in Cambodia for the fourth
consecutive year in 2004. The groups profit before tax has increased
from 1,415 million ringgit in 2003 to 1,848 million ringgit in 2004,
that is, an increase of 30.6 per cent.
JCG is the investment holding company for all the overseas and offshore
companies of the group. Table 8.7 shows that the group gains the most
from JCG, with a tremendous growth of 89.8 per cent. This indicates
how much the group gains from its globalization strategy.
214 LEONG KAI HIN
TABLE 8.7
Profit before Tax by Company
2004 2003 Growth

(RM Million) (RM Million) (%)
Public Bank Berhad 1,512 1,111 36.1

JCG Holdings Ltd. 241 127 89.8
Public Mutual Berhad 65 55 18.2
PB Securities Sdn Bhd 32 26 23.0
Public Merchant Bank Berhad 15 14 7.1
Source: Companys website.
3.5 The Lion Group

The groups core activities comprise five manufacturing activities: Steel
division, motor division, tyre division, computer anbd communication
division, and pulp and paper and plantation division. The group is also
involved in two service activities retailing, distribution and trading
division, and property and community development division. The group
has operations in several countries.
(a) Steel Division: It has steel operations in Indonesia, Singapore and

Malaysia. In 2004, the division had a total sales value of 8,505 million
ringgit.
(b) Motor Division: Its countries of operation are China and Malaysia.
In 2004, its total sales value was 14,889 million ringgit.
(c) Computer and Communications Division: This division has operations

in China, Mexico, The Netherlands, Singapore, the United States and
Malaysia. In 2004, its total sales value was 2,294 million ringgit.
(d) Pulp and Paper, and Plantation Division: This division has operation
only in Malaysia. The main crops of the plantations are forest, oil
palm and rubber. Its total sales value in 2004 was 922 million ringgit.
(e) Property and Community Development Division: It has operations

in China, Hong Kong, Singapore and Malaysia. Its total gross
development value was 11.8 billion ringgit.
(f) Retail and Trading Division: It has operations in China and Malaysia.
In 2004, its department stores and super-centres contributed total
sales revenue of 3,751 million ringgit. Its trading activities contributed
a sales value of 254 million ringgit.
The group has operations in foreign countries, especially in China and

Singapore. Due to its high debt, it was facing financial distress after the
financial crisis. Lately, after its asset and financial restructuring, it has
recovered and re-emerged. This large conglomerate has survived the
financial crisis and has benefited from its early entry into the China
market.
TABLE 8.8
The Financial Performance of Lion Group, 200004
2004 2002 2000

(RM000) (RM000) (RM000)
Revenue 2,445,442 1,205,105 525,852

Profit after Tax 55,118 (138,355) (265,036)
Dividend per Share (Sen) 15.2
Net Tangible Assets per Share (Sen) 4.6 (267.6) (113.7)
Earnings per Share (Sen) 4.7 (50.2) (141.4)
3.6 The YTL Group

The YTL group comprises the following listed companies: YTL
Corporation Berhad, YTL Land & Development Berhad, YTL Cement
Berhad, YTL Power International Berhad and YTL E-Solutions Berhad
(Mesdaq Market). The YTL groups core businesses are in construction
contracting, property development, cement manufacturing, power
generation, water and sewerage services and IT and e-commerce initiatives.
YTLs power division owns 33.5 per cent stake in ElectraNet Private
Limited, which owns and operates the electricity transmission network
of South Australia under a 200-year concession. ElectraNets
transmission network provides electricity supplies to over 99 per cent
of the states population. YTL has acquired Wessex Water, which provides
216 LEONG KAI HIN
water services to 1.2 million customers and sewerage facilities to 2.5

million customers over an area of approximately 10,000 square
kilometres in the southwest of England. Wessex Waters Regulatory
Asset Base increased by 7.2 per cent to 1,580 million in the last
regulatory year ended 31 March 2004, from 1,474 million in the
previous year. YTL E-Solutions Berhad has one company in Singapore
in its stable of incubates: Hipmobile Singapore Pte. Ltd.
YTL has expanded its power transmission business to Australia and its
water and sewerage services to England. Table 8.9 shows that, over the
years from 2000 to 2004, YTL has performed very well, with more than
100 per cent improvement in its revenues, and profit after tax. Its earnings
per share have also increased by about 88 per cent.
The above study on the businesses of the six selected tycoons shows
that, in this era of globalization, these tycoons have also ventured into the
global markets. They have built up their core competitiveness in the
home country. They acquire foreign firms for their technology and their
market network. This in turn improves their competitiveness. An example
is the acquisition of Loders Croklaan by the IOI Group.
TABLE 8.9
Financial Performance of YTL Group, 200004
2004 2002 2000
Revenue (RM000) 4,409,344 2,547,941 2,189,096

Profit after tax (RM000) 1,012,410 588,163 551,160
Total Assets (RM000) 26,546,010 21,774,569 10,117,436
Earnings per share (Sen) 48.31 25.06 25.69
Gross Dividend per Share (Sen) 16.00 15.00 10.00
Net Tangible Assets per Share (RM) 3.34 2.70 2.70
Source: YTL Group website.
4. THE CHINESE SMALL AND MEDIUM INDUSTRIES

For the Chinese small and medium industries, some industries benefit
from the globalization while some are badly affected. Top Glove Berhad,
which is a rubber glove manufacturer, is selected for illustration for its
marvellous performance in the global market. The most badly affected
industries are the shoes and garments industries.
4.1 The Industry that Benefited Most
Top Glove Berhad

Top Glove claims to be the largest natural rubber glove manufacturer in
the world. It has eleven factories, with two in Thailand, one in China,
while the rest are located in Malaysia. It has 164 production lines (as at
1 April 2005). Its total capacity can produce 13.38 billion pieces of
rubber gloves and it is running at 8590 per cent utilization rate. With its
current capacity, Top Glove accounts for 13.4 per cent of the global
market share. Currently, its products are exported to 160 countries. Its
FIGURE 8.1
Top Gloves Growth between 2003 and 2004
Year-to-Year Comparison (12 months)
218 LEONG KAI HIN
plan is to increase to fourteen factories by December 2006, with 260

production lines, producing 24 billion pieces of gloves for exporting to
175 countries. Top Glove aims to increase its current market share to 24
per cent by December 2007.
Table 8.10 shows that over the nine-year period from 1996 to 2004,
the sales of the company have increased from 29.1 million ringgit to 418
million ringgit, showing a growth of 13.4 times.
In 2004, the firm achieved more than 50 per cent annual growth in its
sales revenue, net profit and earnings per share. The global markets have
given the company performance a big boost. In fact, about 70 per cent
of the production of the firm is original equipment manufacturing (OEM)
for most famous brands in the world. This is an example of a Chinese
small and medium firm growing to be a multi-million giant in the
manufacturing industry in this era of globalization.
TABLE 8.10
Sales Turnover of Top Glove, 19962005 (RM Million)
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005*
Sales
Turnover 29.1 35.5 48.5 70.2 103.2 138.9 181 266 418 590
* Estimate
4.2 The Most Badly Affected Industries

Malaysia has been losing its competitive edge in industries that are labour
intensive such as the shoes and garments industries. Malaysia now has to
depend so much on foreign labour that officially it has about 1.5 million
foreign workers in the country, mostly from Indonesia and Pakistan.
These foreign workers have also created social problems.
The emergence of China and its entry into the WTO has enabled it to
embark onto the globalization bandwagon. It has abundant supply of
cheap labour which has given China a competitive edge in the labour-
intensive industries. The Malaysian market has been flushed with imports
of cheap shoes and garments from China, making a very big impact on
the shoes and garments industries in Malaysia. Many of them found that
their production cost is higher than the selling price of the imported
goods. Take one example. Bata is a household shoe brand in Malaysia.

It used to employ more than a thousand workers in its factory to produce
canvas shoes for schoolchildren and has also subcontracted its shoe
production to the small shoe cottage industry around its factory in Klang.
At one time, a small shoe cottage industry flourished in Klang. This
scenario has now disappeared; the same thing happened to the garment
industries too. Many of them find that they are no more competitive
in the market.
Bata has changed its strategy and has transformed itself into a trading
company. It does not produce most of the shoes now as it contracts its
production to countries with cheap labour such as China and Vietnam.
Most of Malaysias Chinese firms in these industries resort to this strategy,
although they still do the designing but outsource the production to the
manufacturing firms in China or other low labour cost countries.
Some firms have joint ventures and open their own factories in China.
This strategy sometimes does not work due to both management and
partnership problems. A shoe components manufacturer opened ten
factories in China within one year. However, due to some management
problem, he lost about ten million ringgit in the end. He has since sold
all these factories and resorted to outsourcing. By doing this, he does not
have to worry about management problems and can now choose to buy
from the cheapest suppliers.
Indeed, the Chinese small and medium industries have adapted to the
challenge and adopted changes to face the impact of globalization. They
either moved their factories to countries with lower production cost or
outsourced their production. In fact, the falling prices of shoes and
garments have benefited the consumers. Recently due to the increasing
price of petroleum, there is an upward trend in inflation. The June 2005
inflation was a record high of 3.2 per cent. All the components of the
consumer price index show an upward trend except for shoes and garments,
which shows a negative trend of 1.1 per cent.
5. CONCLUSION
This study shows that the Chinese tycoons have actually taken full
advantage of the opportunity arising from globalization. They have
acquired foreign firms or entered joint ventures with foreign firms to
improve their technology or gain access into the global market network.
Their groups show sustainable growth.
220 LEONG KAI HIN
For the Chinese small and medium industries, not all are equally lucky.
Some are badly hit, such as the shoes and garments industry. However,
they have adapted to the changes and adopted a strategy to stand on their
feet again. They have either moved their factories to countries that have
lower cost of production, or have outsourced their production. They found
that outsourcing is a better strategy than relocation. However, some have
become traders and have no more headaches in production. The lucky
one benefits from globalization. Like the tycoons, they take full advantage
of the opportunities arising from globalization. Their firms flourish and
achieve tremendous growth.
Note
1
The figures in brackets refer to the market capitalization of the
companies in 2004.
References
1. Companies annual reports of various years.
2. Companies websites.
3. <http://www.klse.com.my/>.

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MALAYSIAN CHINESE BUSINESSES AND GLOBALIZATION 205

Malaysian Chinese Businesses

In this era of information and communication technology, globalization

2. OBJECTIVES AND METHODOLOGY

3. THE IMPACT ON THE CHINESE TYCOONS

Tycoon Group Estimated Wealth

3.1 Hong Leong Group

MANUFACTURING AND DISTRIBUTION SECTOR

(a) Heating, Ventilation, Air-conditioning and Refrigeration

(b) Semiconductor Assembly and Testing

(c) Motorcycle Manufacturing, Assembly and Distribution

(d) Building Materials

2004 2003 2002

Revenue 2,438,572 2,044,420 1,950,268

Source: Companys annual reports.

PROPERTY AND DEVELOPMENT INDUSTRIES

2004 2003 2002

Revenue 2,539,628 2,460,978 2,554,698

Source: Companys annual reports.

2004 2002 2000

Revenue 199.0 439.1 255.9

Source: Companys annual reports.

London. In Singapore, it has sold 20 residential projects yielding more

3.2 The IOI Group

2003 Operating Profit 2004 Operating Profit Growth

Plantation 543.4 638.7 17.5

Source: IOI Company website.

3.3 Genting Group

1999 2000 2001 2002 2003

Profit before Taxation

Total Assets Employed

Source: Genting Group website.

3.4 Public Bank Group

2004 2003 Growth

Public Bank Berhad 1,512 1,111 36.1

Source: Companys website.

3.5 The Lion Group

(a) Steel Division: It has steel operations in Indonesia, Singapore and

(c) Computer and Communications Division: This division has operations

(e) Property and Community Development Division: It has operations

The group has operations in foreign countries, especially in China and

2004 2002 2000

Revenue 2,445,442 1,205,105 525,852

Source: Companys website.

3.6 The YTL Group

water services to 1.2 million customers and sewerage facilities to 2.5

2004 2002 2000

Revenue (RM000) 4,409,344 2,547,941 2,189,096

Source: YTL Group website.

4. THE CHINESE SMALL AND MEDIUM INDUSTRIES

4.1 The Industry that Benefited Most

Top Glove Berhad

Source: Companys website.

plan is to increase to fourteen factories by December 2006, with 260

4.2 The Most Badly Affected Industries

goods. Take one example. Bata is a household shoe brand in Malaysia.

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