Malaysian manufacturers should be able to maintain their output for the rest of the year notwithstanding major upheavals in the foreign markets, says Federation of Malaysian Manufacturers (FMM) president Tan Sri Mustafa Mansur.
The Industrial Production Index (IPI) for manufacturing sector dropped slightly to 6% in the first quarter from 6.6% in the last quarter of 2010.
The drop is contributed by the decline in electrical and electronics; transport equipment; wood products; furniture paper; and printing sector due to weak demand.
However, many manufacturers have mitigated the tough business environment by emphasising on greater automation that not only reduced their dependence on foreign labour but also enhanced productivity and efficient use of resources, Mustafa told Bernama.
He said the tough business environment also called for labour-intensive manufacturers to shift their operations to countries where labour cost is cheaper while maintaining Malaysia as their hub for marketing as well as research and development.
Mustafa said Malaysian manufacturers should venture into the fast-emerging Africa and reduce their dependence on traditional markets like the United States and Europe which were currently facing economic woes.
The FMM has sent some delegations to Africa, with countries like South Africa and Tanzania being top on its list.