MoD supports local businesses through LBD Circular

Photo Credit: MoD
Categories: Current Affairs
November 26, 2019

In realising their strategic plan to support local businesses as a pillar for growth in the construction industry, as well as to ensure the sustainable development of the businesses’ capacity, capability, competency and competitiveness, the Ministry of Development (MoD) officially launched their Local Business Development (LBD) Circular last week, on Saturday, November 25, 2019 at the Atria Simpur Hall, Public Works Department (JKR) Headquarters.

Officiated by the Guest of Honour, the Minister of Development Yang Berhormat Dato Seri Setia Ir. Awang Haji Suhaimi bin Haji Gafar, the ceremony began with opening remarks presented by Ir. Awang Haji Amer Hishamuddin bin Pehin Orang Kaya Amar Pahlawan Dato Seri Setia Haji Zakaria, Permanent Secretary (Infrastructure, Housing and Professional) at the MoD, who emphasised the need for companies participating in government projects to endeavour to meet all the local business development requirements outlined in the Circular. 


Permanent Secretary (Infrastructure, Housing and Professional) at the Ministry of Develoment, Ir. Awang Haji Amer Hishamuddin bin Pehin Orang Kaya Amar Pahlawan Dato Seri Setia Haji Zakaria presenting his opening remarks at the Local Business Development (LBD) Circular Launching Ceremony

Relevant divisions and departments under the ministry are required to identify and implement LBD initiatives throughout the project implementation stages. The implementing Departments must also identify the criteria and scope of the project in order to include company engagement, local products and services as well as promote local employment as much as possible in a project.

The Permanent Secretary further stated that the Authority for Building Control and Construction Industry (ABCi) will also be conducting several socialization programs and continuous discussions with implementing Departments to ensure effective implementation in achieving the targets set out in the Circular progressively by December 2023.

At the event, Yang Berhormat Dato Seri Setia Ir. Awang Haji Suhaimi mentioned that in leading the development of physical and social infrastructure, the MoD is aware of the importance of focusing on the development of local businesses in order to achieve a balance between the two interests.


Also speaking at the event as the Guest of Honour was the Minister of Development, Yang Berhormat Dato Seri Setia Ir. Awang Haji Suhaimi bin Haji Gafar (Left) during his opening speech

“The MoD for a long time has been hoping that local entrepreneurs would lead the construction industry, including overseas, and could compete regionally and internationally.”

With the number of companies owned by successful locals potentially contributing to the country’s development, the Minister further urged local owners to “grab this opportunity with total involvement”

“This can help the country by providing employment to locals,” he highlighted.

The Ministry’s LBD Circular, thus, focuses on three main strategic areas: ownership and development of local companies (local ownership); use of local goods and services (local content), and lastly; employment opportunities for locals (local employment).

Firstly, to ensure local company owner’s involvement, the Minister explained that “[MoD] has begun to interview company owners of Class I and Class II. The interview is a pre-requirement for registration of a new company in Class I and Class II. The ministry will continue to reassess registration when the company needs to renew the company registration certificate. If a company owner does not achieve the set score, the contractor’s registration certificate will not be renewed and will only be given the contractor license”

As for local content, the minister asserted the nation’s dependency on using materials and products from overseas. “The construction companies in the country should give priority to using local material and products,” he said, “this can support the local manufacturing and suppliers industry and indirectly benefit many parties.”

The Minister further touched on local employment, where he expressed the Ministry’s confidence that there are positions in the construction industry — such as managers, engineers, drivers and workers —that should be held by locals, despite the sector’s challenging and highly competitive employment market.

“Jobseekers must also not let go of the opportunities because the construction industry is the third largest industry that provides employment for locals,” he stressed.

“A number of targets have been set for each strategic area. A company wishing to participate and execute the government’s procurement in the construction industry under the Ministry of Development is required to achieve these targets.”

To ensure effective implementation of the Circular, MoD is also establishing a special unit under the ABCi, which will be responsible for the coordination, implementation, monitoring and enhancement of LBD under the Ministry. The Unit will ensure that the LBD progress is planned by the Departments and Divisions in accordance with the Circular as well as monitor the increase of local recruitment in the construction industry.

The implementation of the LBD programme is also in line with the nation’s fifth strategy of Vision 2035, which is local business development.


Guests and Participants at the Minister of Development's Local Business Development (LBD) Circulat Launching Ceremony


The Guest of Honour (Front Center) in a group photo with the rest of the guests and participants at the event

Sourced from: