Abstract: Reinterpretation of State-owned Enterprise: Transformation of SOE in Malaysia

Fary Akmal Osman

Abstract

Graduate School of Economics Kyoto University, Japan faryosman.fa@gmail.com Abstract State-owned Enterprise (SOE) has become a pivotal domestic development strategy in many emerging economies globally, in particular Asia. Today, many SOEs operate in wide variety of approaches and play an active role including as cross border investors. They are among the largest and fastest expanding multinational corporations. The UN recorded at least 650 state-owned multinational companies with 8,500 foreign affiliates of which more than 50 percent are from emerging economies (UNCTAD, 2011:28). This is in stark contrast to established literature on SOE alike describes that SOEs were inefficient, poorly managed, bureaucratic and heavily subsidized by the government. The rise in the number of SOE is a cause of concern for global firms. Thus, it is important now to reassess the purpose and role of SOE in the global market. For the purpose of this paper the author will look at one specific SOE in Malaysia known as Johor Corporation (JCorp) aims to study the growth and distinctive performance of SOE at the state level, a concept that is contrast with federal SOE. This case suggests a possibility of reinterpretation of SOE and to revisit the conventional study on its characteristic. Key words: Business Group, Diversification, Emerging Economy, Holding Group, Industrial Policy, Innovation, Strategic Investment, MNEs and SOE JEL: L1, L3, L25, M1 and G11