KUALA LUMPUR (Dec 23): The Edge weekly in its 2017 year-end cover story looks at the key issue of rising cost of doing business, which is expected to increase further in 2018.

The magazine said several new government-led inititiaves relating to labour are set to kick in — the Employment Insurance Scheme, shift of the foreign worker levy burden to employers and a review of minimum wage levels.

It said when one adds to that an expected increase in gas prices, adjustment in electricity tariffs and an increasingly efficient taxman, it is clear that businesses are in for a tougher time.

The ascertain the extent to which costs are set to increase and how businesses are to navigate these troubled waters, the Edge asked several influential individuals and associations from key industries — including manufacturing, construction and plantation — to give their views on the business outlook.

It said their prognosis is that managing rising costs is likely to be their biggest challenge next year, adding that it will take a delicate balance to grow profits as before.

The weekly said that to be sure, as Ruben Emir Gnanalingam, CEO of Westports Holdings Bhd, pointed out, this is not a Malaysian phenomenon as business everywhere is getting more challenging.

Quoting him, it said Malaysians need to be smarter about competition going foward.

“Trade barriers are no longer enough and consolidation to face global threats is probably the way forward,” he says.

Meanwhile, it said Second Finance Minister Datuk Seri Johari Abdul Ghani’s message to the private sector is that it must embrace technology and innovation or risk falling behind in competitiveness.

On its part, the government will provide targeted incentives for businesses to embrace Industry 4.0.

The Edge quotes Johari as saying companies must look beyond the cost factor and embrace the use of technology and nurture the right talent.

“They should seek to move up the value chain, focus on high value-added activities and embrace automation as much as possible,” he says.

Further, Opposition lawmaker Wong Chen advises businesses not to hold back on investment plans as they are wont to do ahead of a general election.

The 14th general election is expected to take place in the early part of next year and no later than August. “Corporations should just focus on building their own internal strength and become less reliant on the government,” the MP for Kelana Jaya says.

For more detailed insight into how to navigate rising costs, get a copy of the year-end Edge for the week of Dec 25- Dec 31 available at newstands now.