“As for the whole year, we are on track to beat last year’s numbers," Tengku Zafrul said.
KUALA LUMPUR: Malaysia hopes to buck the global trend to attract further investment inflows even as competition for such capital is getting keener, especially within the Asean/Asian region.
During the announcement of the country’s investment performance for the first nine months of this year, Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz said there is a need to reposition Malaysia on this front so it can continue attracting the right type of investments it wants.
“As for the whole year, we are on track to beat last year’s numbers. It is not easy now, the trade figures we have will have some correlation to world trade. For investments, it’s not so easy as global foreign direct investment (FDI) was down last year,” Tengku Zafrul said at a press conference yesterday.
“For us to beat the trend, we need to try to position Malaysia as a different kind of investment destination. The investments for the first nine months of this year compared to the first nine months of last year were actually up by 6.6% despite the negative global FDI figures last year and this year,” he added.
The global FDI statistics that showed a decline is taken from the United Nations Conference on Trade and Development, he pointed out.
In his speech during the announcement of the country’s trade performance, he said the International Trade and Industry Ministry (Miti) is actively looking into new markets for investments, including countries such as Ecuador and Kazakhstan.
“As for priorities in 2024, Miti will give focus to quickening the process to approve investments. We also aim to complete the rationalisation of our agencies so we can attract the desired investments. In terms of trade, we target a 5% growth next year despite the World Trade Organisation forecasts showing a rather challenging trend moving forward,” Tengku Zafrul said.
“The new markets we aim to focus on include the Middle East, Africa and the South American continents,” he added.
Tengku Zafrul also noted that based on recent data since 2021, about 80% of these approved investments eventually became actual realised investments.
“We have these investment commitments – then we do the cost benefit analysis, incentives and on what guidelines to give them.
“If they (investors) agree, it will become investment that we approve. And it is approved. We also monitor how much of these is realised and it is about 80%,” he said.
“We should try to improve on this, we are not so satisfied with this.
“Apart from companies deciding not to actually invest eventually due to their own reasons, sometimes there are also challenges on our end that we need to address,” Tengku Zafrul added.
Miti said Malaysia attracted RM225bil of approved investments in services (RM117.7bil), manufacturing (RM99.8bil) and the primary sectors (RM7.5bil).
This is a 6.6% increase as compared to the RM211bil approved investments in the same period last year.
“FDIs accounted for a substantial 55.9% or RM125.7bil of the total approved investments, while domestic direct investment (DDI) contributed 44.1% or RM99.3bil. DDI recorded an impressive surge of 45.2% as compared to the same period last year,” it said.
Miti said the five sources of FDI was led by The Netherlands (RM35.0bil), Singapore (RM20.4bil), the United States (RM18.9bil), China (RM11.6bil) and Japan (RM11.2bil).
The top five states that have recorded significant investment value to the total approved investments include Kuala Lumpur (RM48.9bil), Penang (RM44.9bil), Selangor (RM41.6bil), Kedah (RM22.6bil) and Johor (RM20bil), it said.
Miti said the impressive rise in DDI was testament to local players’ confidence in the country’s prospects.
Tengku Zafrul also said in a statement: “The RM225bil, which represents a 6.6% year-on-year increase, is Malaysia’s best achievement for the corresponding period over the past decade, and is a marked increase against the 10-year average of RM222.6bil for approved private investments.
“This achievement is testament to Malaysia’s continued attractiveness as an investment destination, as well as our collaborative whole-of-government and the whole-of-nation efforts in attracting, facilitating and retaining investments, while enhancing the ease of doing business under the Madani Economy framework,” he added.
He said the recent investment inflows from countries such as the Netherlands, Singapore, the United States, China, and Japan reflect the type of high-tech, strategic investments that Malaysia is targeting from global players.
“But this is no time for complacency. Miti and its agency, the Malaysian Investment Development Authority (Mida), will continue to position Malaysia as a highly viable and stable destination to strategically capture more inflows from the redesigning of supply chains in the global investment landscape, in line with our industrial transformation as stipulated in the New Industrial Master Plan (NIMP) 2030,” Tengku Zafrul said.
Miti, meanwhile, also pointed out that one of the standout ventures within the services sector was Envico Enterprises Sdn Bhd, which is a strategic regional establishment within Malaysia’s services sector and a division of The Valiram Group – a local retailer specialist.
It said another investment project that stood out in the semiconductor/tech manufacturing space in the period include by Lumileds Malaysia Sdn Bhd with a hefty investment of RM25.7bil earmarked for the manufacture of LED chips, devices, sub-assemblies and LED-based lighting products, systems and modules.
Datuk Wira Arham Abdul Rahman, chief executive officer of MIDA said the manufacturing sector’s stellar performance, notably for the electrical and electronics industry, strategically positions Malaysia as a pivotal hub for global manufacturing giants.
“These accomplishments are a testament to the synergistic collaboration between public and private entities in advancing a robust industrial landscape and enablers,” Arham said.
