The globalisation of economic activities and the dynamic growth of Asia Pacific region- linkages between transnational corporations (TNCs) in the manufacturing sector and engineering services in Klang Valley region of Malaysia

School of Geography, University of Leeds


Student

Sharipah Dawood

Supervisors

Dr Paul Waley

Dates

1st October 1997 - 30th September 2001

Grants

University of Malaysia

Summary

Globalisation of the world economy has transformed the various facets of urban life in many parts of the world. In Pacific Asia the significance of transnational corporations (TNCs) especially in manufacturing investment has moulded the economy of cities and its linkages with other sectors particularly of producer services. The central argument is that these linkages signify the growth trajectory of contemporary world economy which is changing the pattern of local economy and restructuring of metropolitan regions. It is in this respect that cities like Kuala Lumpur have been repositioning themselves within the global system of cities by restructuring their industrial growth to achieve higher levels of manufacturing and services activities. These processes can be seen from three strands of activities:

  1. The network relationship between TNCs (manufacturing firms) and producer services, in particular in the nature of services outsourcing by manufacturing firms
  2. the evolution of local producer services firms as a consequence of foreign capital;
  3. regional economic changes- role of the city, regional industry and urban planning.
The importance of outsourcing services to increase competence in technological adequacy is vital for firms in the emerging era of globalisation and the dynamic economy of the region. Thus the linkages between manufacturing and service economy are significant and inspire a new era of investigation in the field of economic geography. Therefore, in this research the linkages between TNCs manufacturing and their outsourcing activities will particularly focus on engineering services firms as the sector has become one of the fastest growing advanced producer services in Malaysia and a significant contributor to industrial and metropolitan growth. Analysis of manufacturing firms will include a rapidly expanding sector with international links. The aim is to examine to what extent business transactions and the nature of linkages between TNCs and engineering firms create a system of network relationships and how this results in changes to local economy and role of the city in the regional context. The research method employed consists both of quantitative and qualitative approach. The quantitative approach will involve data collection from various census/statistics and the qualitative method will basically involve inputs from designed postal questionnaire to TNCs followed by telephone interviews (with TNCs) and face to face interview with engineering consultancy firms and government agencies/local authorities. The result of the research will contribute to the knowledge of the expanding role of advanced producer services in Malaysia and East Asian region in general. It will also be of significance in helping us to explore to the role of business networks amongst foreign and the local firms as well as restructuring of the city region.


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