UBS said Malaysia’s competitiveness in the electrical and electronics sector, as well as energy policies leading to net-zero targets are other factors attracting investors.
KUALA LUMPUR: Malaysia has become increasingly attractive to foreign investors due to several factors, such as the country’s political stability and track record in exercising fiscal responsibility, says UBS Global Research.
UBS said Malaysia’s competitiveness in the electrical and electronics (E&E) sector, as well as energy policies leading to net-zero targets are other factors attracting investors.
In a note, its analyst Nicole Goh said the country also had a deep talent pool, numerous free trade agreements and good scores regarding ease of doing business factors.
“Localisation of foreign direct investment (FDI) has been fairly successful in Malaysia. For example, the E&E ecosystem had benefitted from demand from large multinational company investments; the positive spillovers also extended to construction companies and the labour market,” she added.
Goh opined the implementation of the global minimum tax of 15% in 2025 would have a negligible impact on competing for FDI.
She noted that although de-globalisation trends have intensified, with many countries seeking to reshore companies through subsidies, it would not stop large players from expanding globally.
“However, Malaysia has implemented a 40% local content criteria, which is in line with World Trade Organisation standards,” she said. — Bernama
