GEORGE TOWN: Penang needs to think globally and act locally to transform itself into an international city, a knowledge-intensive and high-income economy, said Chief Minister Lim Guan Eng.

He said there were six aspects of "think globally, act locally" for Penang to become a successful international city.

They included openness in the pursuit of knowledge, people-centric approach of government and nurturing social cohesion and inclusiveness to achieve a harmonious society.

"We must also seek new sources of growth such as a green economy, which refers to a sustained growth model that features environment-friendly technologies, renewable energy resources and low carbon emissions," Lim said on Monday at the 5th Asia Economic Summit in Singapore.

"In Penang, we aspire to be the first green state in Malaysia by reducing plastic bag consumption, implementing green buildings and finding alternatives such as manufacturing of bio-degradable food containers made from padi or sugar cane husks so organic that it can be eaten."

In his paper at the summit themed Strengthening Economic, Trade & Investment Ties After the Crisis — Reconnecting Asia with Europe and USA, Lim also said standards of service in all industry sectors, including good governance, must be at the highest level if Penang were to beat the competition.

Meanwhile, he said it was heartbreaking that the current economic crisis, caused by the collapse of key financial institutions in the West, saw the culprits, seldom the victims.

"This is one of the negative effects of globalisation where abuses by those involved in the collapse of the Western financial system can have dire consequences of deep financial distress, losses and sufferings to innocent people half a world away in Asia.

"Worse, those involved often escaped unpunished and can go back to have their exorbitant bonuses," he added.

Lim said there were five lessons to learn from the episode.

Without transparency and accountability, arrogance would take over and invariably end in disaster, for everyone, he said.

"The second lesson we have to learn is that it was we — the small developing nations — who made ourselves vulnerable.

"We failed to move out of the middle-income trap, and forgot that we have to continue climbing the value-added ladder, high-technology and knowledge-intensive high-income economy in order to develop the skills level of our people."

He also noted that a new balance of power would emerge out of every crisis, as well as the necessity to build for the future, not the present.

"The fifth lesson we have had to learn is to concentrate on basics at the local level. Economics, like politics, begins at home," Lim said.

"Local economic innovations must take place. That is why we must invest in education, in tourism, in lifestyle enhancement, investing in regional ties rather than international ties," he added.