NEWS: Pikom predicts 8% growth in IT industry this year

KUALA LUMPUR: The Association of the Computer and Multimedia Industry of Malaysia (Pikom) projects an 8% growth for the industry this year thanks to incentives and tax breaks set down by the Government in the nation’s Budget 2010.

The industry only grew 5% last year as companies spent less due to the global economic slowdown, according to the association.

C.J. Ang, Pikom president, said the Government’s RM500 tax relief for every Malaysian subscribing to broadband and the RM5,000 loan to civil servants for PC purchases every three years (instead of five years previously) are some of the initiatives that will spur IT spending.

“Another factor that will contribute is the netbooks for university students programme, where up to 100,000 students will be provided with a portable computer and broadband connection each for just RM50 a month over two years,” he said.

Pikom also believes that the national rollout of High Speed Broadband (HSBB) and related services, such as Internet Protocol TV (IPTV), will also stimulate IT spending.

HSBB, which is undergoing trials, promises websurfing speeds of at least 10Mbps (megabits per second), compared to current speeds of up to 4Mbps.

Such high surfing speeds would mean smoother videoconferencing, streaming video, e-commerce transactions, and multiplayer gaming on the Web.

Fuelling the industry

Pikom pointed out that there are other government initiatives that will help push the IT sector forward.

“The implementation of the petrol subsidy system, for example, will require information technology to enable it,” Ang said.

The Government is planning a fuel pricing mechanism to ensure that only targeted groups, particularly those in the lower income group, will receive the subsidised petrol.

“Also, preparation work for the introduction of GST (Goods and Services Tax) will require investments in IT solutions,” he added.