Sabah is ready to transform into a hub for technological advancement by encouraging innovation and the integration of technology, said chief minister Datuk Seri Hajiji Noor.

He said that the government intends to create an ecosystem that supports the growth of small and medium enterprises (SMEs), promotes digital transformation, and foster a culture of innovation.

“The state government’s commitment to economic growth is unwavering and we are also implementing an open-door policy for investors, while exploring new economic resources including the Blue Economy which will bring a new dimension to Sabah’s economy.

“Our focus now is to create a conducive environment for business development, attract domestic and foreign investments, and ensure our workforce is equipped with the skills needed to meet future demands,” said Hajiji.

He was speaking at the opening ceremony of Malaysian Technology Development Corporation’s Road to Growth (R2G) Sabah edition today.

Hajiji said that in the 12th Malaysia Plan and the SMJ Development Direction Plan, Science, Technology and Innovation (STI) have been identified as one of the important catalysts driving socio-economic development.

He expressed hope that the R2G 2024-Sabah programme can help produce more innovative researchers and entrepreneurs.

He said the state government welcomes the move by the Ministry of Science, Technology and Innovation (Mosti) in introducing the Local R&D Products and Services Utilisation Programme (MySTI), an initiative that will benefit entrepreneurs, universities, research institutions and the government in utilising local innovation and R&D products.

Hajiji said the initiative will also stimulate the growth of local industries, especially in Sabah in the field of technology, which is among the new economic resources that have been identified.

“I want all these opportunities to be taken and utilised as best as possible by universities, research institutions and entrepreneurs in this state to register and obtain the MySTI logo marking,” he said.

Hajiji emphasised the importance of adapting to the changing economic landscape and called on universities, research institutions, and entrepreneurs to take advantage of these new opportunities.

He also hoped that the MTDC R2G programme will empower the local workforce with necessary skills for a technology-based economy and drive innovation across various industries in Sabah.

Source: Malay Mail

Hajiji: Sabah set to become technology hub as it targets tech-driven economy

Malaysia has emerged as the most important country for businesses in the Association of South-east Asian Nations (Asean) and Greater China looking to venture into over the next three years, according to the UOB Business Outlook Study 2024 released today.

The annual study, now in its fifth year, surveyed more than 4,000 small and medium-sized enterprises (SMEs) and large enterprises across seven markets, including over 500 Malaysian businesses and found them optimistic about the country’s growth prospects.

“The UOB Business Outlook Study indicates that local businesses are gearing up for a period of growth as they are bullish on Malaysia’s economic potential.

“Overseas businesses are looking to expand into Malaysia due to the country’s strong economic fundamentals and attractiveness as a regional business hub,” UOB Malaysia CEO Ng Wei Wei said in a statement accompanying the study.

Ng highlighted several factors contributing to this optimism, including the China+1 strategy, the upcoming Johor-Singapore Special Economic Zone, and the upcycle of the global semiconductor industry.

The survey found that more than seven in 10 Malaysian businesses are positive about the current business environment, with 76 per cent expecting improved business performance this year.

The most optimistic sectors include industrials, oil and gas (90 per cent), and manufacturing and engineering (80 per cent).

Despite the positive outlook, many businesses are still recovering from the economic slowdown and are concerned about inflation and higher operating costs.

The survey also revealed that almost 80 per cent of Malaysian businesses aim to expand overseas to boost profits and enhance their international reputation.

Asean and mainland China were highlighted as the top two markets for expansion, with Indonesia being the most important country for local businesses to venture into, followed by Singapore, Thailand, and Brunei.

The survey emphasised the importance of sustainability, with over eight in 10 local businesses acknowledging its significance in attracting investors.

However, only 39 per cent of these businesses have implemented sustainability practices, with the manufacturing and engineering sector leading the way at 53 per cent.

The UOB survey found that companies are requesting more financial support, such as tax incentives, sustainable financing options, and easier access to funding to encourage better adoption of sustainability.

They are also seeking training programs to reskill employees on sustainability initiatives, which are vital for attracting investment and fostering growth.

Source: Malay Mail

UOB study shows Malaysia is top country for Asean and Greater China businesses

Malaysia’s target to achieve high-income status is realistic, given its solid growth trajectory, economic stability and strong investor confidence.

Its economic growth will continue to be driven by contributions from key states such as Selangor, Sarawak, Kuala Lumpur, and Penang over the next three to six years, said Juwai IQI global chief economist Shan Saeed.

“Selangor currently contributes 25 per cent to the nation’s gross domestic product (GDP), Sarawak is set to rise strongly and become a major contributor to the economy, while Penang remains as the manufacturing hub,” he told Bernama.

Overall, he expects Malaysia’s GDP growth to be around 4.0-5.0 per cent in the next three to five years, supported by a stronger ringgit, as the local note is expected to range between RM4.10 and RM4.40
versus the US dollar.

“The budget deficit target remains under 3.5 per cent with disciplined fiscal policy,” said Shan.

He opined that growth in information and communication technologies (ICT), oil and gas (O&G), real estate, electrical and electronics (E&E), e-commerce, and logistics sectors will support Malaysia’s bid for high-income status.

Malaysia is already a significant player in the E&E market, exporting to countries like China, the United States, Singapore, Hong Kong, and Japan.

At the same time, the O&G sector continues to be crucial to the nation’s economy, with a strong ecosystem supporting both domestic and regional value chains.

Under the New Industrial Master Plan 2030 (NIMP 2030), the country aims to transform into a high-technology nation by 2030,positioning itself as a dynamic ICT hub in Southeast Asia.

Recently, World Bank Malaysia lead economist, Apurva Sanghi said five Malaysian states, namely Selangor, Sarawak, Penang, Labuan and Kuala Lumpur, have surpassed the 2023 high-income threshold of US$14,005 (US$1=RM4.56).

According to his posting on X, Kuala Lumpur has the highest at US$29,967 gross national income (GNI) per capita, followed by Labuan (US$19,117), Penang (US$16,660), Sarawak (US$16,650) and Selangor (US$14,291).

Meanwhile, states with the lowest GNI per capita are Kelantan (US$3,850), Perlis (US$5,490) and Kedah (US$6,027).

He noted that Malaysia could reach high-income status by 2030, emphasising the need for faster reforms to speed up the transition.

Economy Minister Rafizi Ramli recently said Malaysia could attain high-income nation status from 2027 if the national economy grows 4.0-5.0 per cent every year and the ringgit strengthens to around RM4.20 against the US dollar.

Source: Bernama

Malaysia On Track For High-income Status

Malaysia and the United Arab Emirates (UAE) have reached an agreement that would improve bilateral trade and investment between the two nations.

The Malaysia-UAE Comprehensive Economic Partnership Agreement (MY-UAE CEPA) is anticipated to be implemented by the end of 2024.

“The MY-UAE CEPA, a comprehensive CEPA, encompasses areas such as trade in goods; trade in services; investment facilitation; digital trade; micro and small medium enterprises; economic cooperation, and others.

“Notably, it introduces Malaysia’s first chapter on Islamic Economy in a CEPA, paving the way for collaboration with UAE in the areas of Halal certification, Islamic finance, and digital,” it adds.

Malaysia’s delegation was led by Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz, while the UAE was represented by His Excellency Dr. Thani Bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade.

Tengku Zafrul stated that this agreement represents Malaysia’s first Free Trade Agreement with a country from the Gulf Cooperation Council (GCC).

“Given the robust trade growth and rising industrial linkages between our countries, particularly in the areas of renewable energy, digital economy, and electric mobility,.

“I am confident this CEPA will further strengthen our bilateral trade and investment ties. I look forward to the agreement entering into force by the end of 2024,” he said.

In 2023, the UAE became Malaysia’s second-largest trading partner in the West Asia region, with bilateral trade increasing by 5.4 per cent to US$8.67 billion (RM39.63 billion) compared to the previous year.

Malaysia’s main exports to the UAE included electrical and electronic products, jewellery, palm oil and palm oil-based agricultural products, palm oil-based manufactured products, and processed foods.

On the other hand, major imports consisted of crude petroleum, petroleum products, jewellery, metal manufactures, and chemical products.

In terms of investment, 2023 saw 34 manufacturing projects in Malaysia involving Emirati participation, valued at US$0.4 billion (RM 1.5 billion).

These projects, covering sectors such as machinery and equipment, Halal pharmaceuticals, chemicals and chemical products, and food manufacturing, have created 2,039 jobs in Malaysia.

Dr. Thani mentioned that Malaysia is a long-standing and trusted trade partner, similar to the UAE, as both countries aim to boost their economic prospects through expanded trade and targeted investment.

“As the fourth largest economy in the Southeast Asia region, and with economic growth in 2024 set to outstrip forecasts, Malaysia offers substantial opportunity for our exporters, industrialists, and business leaders, especially in high-growth sectors such as energy, logistics, manufacturing, and financial services.

“I look forward to working together with Tengku Zafrul to secure a swift ratification of the CEPA and to realise long-lasting benefits for us both—and our respective regions,” he added.

Source: NST

Malaysia, UAE to increase bilateral trade and investment

Chief Minister Chow Kon Yeow is leading Penang’s investment and trade mission to the United States (US) from Sunday until Aug 14, to renew ties and forge relationships with the corporate headquarters of American investors in Penang.

Penang Chief Minister’s Office said in a statement that the mission organised by InvestPenang, the Penang state investment promotion agency, also aims to encourage the expansion of their Penang sites and attract new investments.

“Additionally, the mission seeks to update American companies on the latest developments and opportunities available in Penang, including information on recent advancements in infrastructure and policy changes, to facilitate investment.

“By enhancing visibility and further promoting Penang as a prime location, the mission also targets potential investors in the electrical and electronics (E&E), semiconductor, equipment, medical devices, integrated circuit (IC) design, digital global business services (DGBS) and digital economy industries,” the statement said on Sunday.

Throughout their visit, Chow and delegates will participate in a series of meetings and site visits to the corporate headquarters of American investors, to showcase the state’s strengths, innovations and commitment to being a resilient and sustainable investment location.

Meanwhile, Chow, who is also the finance, economic development, land and communications state executive councillor, expressed enthusiasm on the investment and trade mission, besides looking forward to strengthening relationships with American investors.

“[I] eagerly anticipate the positive outcomes resulting from this mission,” he added.

According to the statement, during the chief minister’s absence due to this investment and trade mission, Penang’s administrative affairs will continue to operate seamlessly.

Dubbed as the “Silicon Valley of the East”, Penang recorded RM71.9 billion in investment inflows in 2023, the highest in Malaysia, driven by foreign direct investments, which accounted for RM61.7 billion or 85.8% of state’s manufacturing investment inflows.

Source: Bernama

Penang CM leads investment and trade mission to US

JP Morgan says the Johor-Singapore special economic zone (SEZ) will likely be a multi-year growth story just as how Shenzhen SEZ has developed over the past 45 years.

It also said the Johor-Singapore SEZ provides high-growth sector specific opportunities, outside of property land bank play.

The SEZ is promising given a more conducive regulatory and policy environment with proactive collaboration, the US investment bank added.

The firm expects regulatory harmonisation and tax incentives to pave the way.

“The JS-SEZ has had several working visits by the country officials, and government agencies have been involved in discussions and feedback sessions with private-sector representatives, with proactive follow-up actions.

“If the JS-SEZ moves ahead, it is likely to be a multi-year growth story with refinements along the way, just as how Shenzhen SEZ has developed over the past 45 years,” it said.

JP Morgan noted that the development of the SEZ aligned with its increasingly constructive outlook in Malaysia.

“The positive response to the Johor-Singapore SEZ initiative is evident in rising property share prices, with the KL Property index overall up 65 per cent since July 2023 and companies with large land-banks in Johor having seen two to four times share price increases,” it said in a note. 

The firm highlighted five sectors that have value proposition and growth potential namely real estate investment trusts, infrastructure and transportation, healthcare, renewable energy and tech-related.

It also noted that connectivity via the Rapid Transit System (RTS) Link marks the start of more infra projects to unlock the full economic potential of the SEZ. 

The Johor-Singapore SEZ officially commenced with a Memorandum of Understanding (MOU) signed on Jan 1 this year.

Negotiations are in their final stage for a legally binding Memorandum of Agreement expected in September, with fiscal package incentives to be incorporated into the 2025 Budget announcement on Oct 18.

Source: NST

Johor-Singapore SEZ may turn into multi-growth story like Shenzhen: JP Morgan

To propel the Malaysian economy to a high level amid uncertainty in the global economic landscape, investment in infrastructure is needed to attract long term foreign investment as this will have spillover effects on the other economic sectors, economists say.

Bank Muamalat (M) Bhd chief economist Mohd Afzanizam Abdul Rashid said infrastructure investment is important to ensure the inflows of long term foreign investment.

Furthermore, he says investing in infrastructure also has positive spillover effects to other economic sectors.

“Infrastructure is very capital intensive and it’s project based.

“It would easily create excitement among investors as there will be various players to be involved in the projects.

“To some degree, it would be a source of attraction just like in Indonesia when they decide to shift the capital city to Kalimantan i.e. the Ibukota Nusantara. It’s about a spark but it has to be realistic and credible,” he told StarBiz.

He said the local economy has yet to reach the advanced economic stage.

Therefore, he said investing in key infrastructure such as expressways, rail related projects, telecommunication, renewable energy (RE) and electric vehicle (EV) charging stations and many more are critical for improving the growth potential for the country’s economy.

Afzanizam said infrastructure projects would help to increase the country’s productivity level which, in turn, would translate into higher income as there would be more skilled labour to be employed.

He said, for example, the Mass Rapid Transit projects have garnered a lot of interest in the Malaysian market as they are expected to have spillover effects on other sectors.

Similarly, projects like the east coast rail line which is supposed to focus on the transportation of cargo between Kuantan port and Port Klang.

The spillover effects, he said would be felt in the construction, building material and services sectors like the financial, architecture and engineering consulting.

“These projects become a spark which has resulted in strong interest among foreign investors in the Malaysian capital markets. And we saw the foreign ownership in listed shares at one time was in excess of 20% for considerable periods,” he noted.

Malaysia’s gross domestic product (GDP) grew 5.8% in the second quarter from a year ago, according to advance estimates released by the Statistics Department.

This follows a 4.2% expansion seen in the first quarter of this year, which reflects the economy is on track, and possibly to surpass the government’s projection of between 4% and 5% economic growth this year.

Juwai IQI global chief economist Shan Saeed said an important economic strategy in the modern era is infrastructure. He added global investors have found a new way of analysing the country’s ability to invest in infrastructure, the new asset class for sustainable growth parameters.

“All the governments basically, among others, are focusing on reducing debt and improving their fiscal side of the balance sheet (fiscal discipline) to entice the global investors for long term investments.

“Countries like China, Indonesia, Australia, Vietnam and India are investing heavily into infrastructure and treating it as an asset class where pension, endowments and institutional investors can park funds to get solid returns.

“Asean needs US$1.2 trillion, Africa needs US$2.5 trillion in infrastructure investment in the next three to five years and that makes the regions very attractive for global smart and sophisticated investors,” he said.

Shan said overall Malaysia has done well in terms of maintaining macroeconomic stability and focusing on infrastructure investment.

Highlighting the importance of infrastructure investment, he said such investment would send positive signal to the market, adding that debt reduction, fiscal management and prudent monetary policy play the groundwork in the macro equation.

“We at Juwai IQI project that Malaysia should be able to achieve a GDP growth of between 4.3% and 4.8% in 2024. One of the Nobel laureates, the late Robert Fogel, advocated about infrastructure in 1964 and how it has a positive impact on the GDP growth equation.

“Now infrastructure is the new asset class for the governments to focus upon to attract global investors. The Belt and Road Initiative is a good live example in the modern era for global connectivity, lifting masses out of poverty and offering good dividends for economic growth in the long run.

“In my opinion, Asean would become the growth story for the global economy in the next three to five years due to its demographics (young population), strong consumption pattern and above all economic stability at the macro level,” Shan said.

On the measures needed to undertake firm investments into infrastructure, Afzanizam said the government needs to strategically arrange the narratives so that the investors would clearly see the end game.

“The end game for investing in infrastructure is to be urbanised without compromising the sustainable features. So, this would include how RE and EV would come into the picture. Another end game would probably be on improving connectivity between the two nations , Singapore and Malaysia, such as the Kuala Lumpur-Singapore High Speed Rail project.

“Energy security could also be the end state as Sarawak for example is aiming to export to the regional market. The narratives would allow the investors to connect the dots and would be able to appreciate which ultimately would make them more convinced to invest in Malaysia.

“Establishing a clear and credible storyline of our economic development is crucial in attracting the foreign capital. It’s like a sales pitch but with a broader scale as we are looking at the country’s development and endeavor to transition towards an advanced nation,” he added.

Source: The Star

Infra investment key to sustaining growth, FDI

Sabah is full of investment opportunities, according to a business delegation from Wuhan, China.

The delegates, who were in Sabah for business exploration, plan to revisit the State to seek more cooperation and investment opportunities.

They will bring China’s excellent educational resources, courses, teachers, and equipment to Sabah.

The aim is to cultivate Malaysian students, familiarize them with Chinese culture and technology, help them secure higher wages in China enterprises in Malaysia, and increase their employment rate.

The Wuhan business delegation whose visit to Sabah was hosted and arranged by the Sabah China Chamber of Commerce (SCCC), sees potential in various fields such as agriculture, seeding, human resource education and capital investment.

They believe Sabah is a place full of opportunities and plan to revisit to explore more cooperation opportunities.

The delegates included Cai Qin, Chairman of Wuhan Junyijia Property Management Co., Ltd.; Xie Canhui, General Manager of Wuhan Tianhong Exhibition Co., Ltd.; Li Yuanyuan, Partner of Mingde Capital (Wuhan) Operation Center; Miiya, Business Director of Shenzhen UFO Power Technology Co., Ltd. (Malaysia); Shelly, Marketing Manager of Shenzhen UFO Power Technology Co., Ltd. (Malaysia); Deng Changjing, Operations Director of Jingrui Technology Cross-border E-commerce Co., Ltd.; and accompanying staff Zhou Lingzi.

With the assistance and arrangements of Datuk Frankie Liew, President of the SCCC, they recently paid courtesy visits to Datuk Dr Roland Chia, Political Secretary to the Chief Minister of Sabah, and Datuk Frankie Poon Ming Fung, Chairman of Sabah Development Bhd, to express their views on Sabah after this visit.

“In view of the lack of information about Malaysia in Hubei, Wuhan, we initially had no knowledge of East Malaysia and West Malaysia,” said Li Yuanyuan.

“After Datuk Frankie Liew and others visited us to promote Sabah-China cooperation in May this year, we realized that Sabah also has excellent talents and resources, which led to the planning of this study tour.

“After our exchanges here, we found that although the Sabah market has certain limitations, Hubei, Wuhan might be 10 to 15 years ahead of Sabah in economic development. “However, from the perspective of investors, Sabah is a place full of opportunities. We definitely will revisit multiple times in the future,” Li Yuanyuan added.

Cai Qin expressed gratitude to Liew for leading the delegation and providing strong support during this period.

She revealed that her company focuses on human resources services for Chinese enterprises, including human resource education.

During this visit, they also discussed cooperation with educational institutions such as University Malaysia Sabah (UMS), Sabah Institute of Arts, and SM Tshung Tsin.

“We will bring China’s excellent educational resources, courses, teachers and equipment to Sabah in the future, collaborating with vocational and technical colleges in Sabah to jointly cultivate Malaysian students.

This will help them understand Chinese culture and technology, secure higher wages in Chinese enterprises in Malaysia, and improve their employment rate,” said Cai Qin.

During the trip, the Wuhan business delegation, arranged by Liew, also visited the Kota Kinabalu Hardware Association.

Cai Qin mentioned that after understanding the needs of the hardware industry in Sabah, they plan to bring hardware industry players from Wuhan for future visits and exchanges.

Source: Borneo Post

Sabah full of investment opportunities – Wuhan delegates

Effective collaboration between Malaysia and Japan is essential to driving sustainable economic growth and development, said Prime Minister Anwar Ibrahim.

Anwar said that in this context, Malaysia appreciates the critical role played by Japan in its early industrialisation through large-scale investments and technology inflows.

“The firm and lasting bond between Malaysia and Japan is most evident as Japan continues to be one of Malaysia’s largest trading partners, demonstrating a noteworthy relationship that has endured the challenges of the global pandemic and its lockdowns, as well as geopolitical tensions and conflicts,” he said in his keynote speech at the 41st Malaysia-Japan Economic Association (MAJECA)-Japan-Malaysia Economic Association (Jameca) joint conference here today.

Deputy Secretary General (Industry) of the Ministry of Investment, Trade and Industry, Datuk Hanafi Sakri, read the text of the prime minister’s speech.

Anwar said that on the investment front, Japan has been one of Malaysia’s top foreign investment sources in terms of implemented manufacturing projects since the 1980s.

“As of March 2024, a total of 3,730 manufacturing projects have been approved with total investments worth RM138.23 billion, mainly in the electrical and electronics, chemicals and chemical products and non-metallic mineral sectors, creating a total of 482,381 employment in Malaysia,” he said.

The prime minister said it is heartening to observe the sustained interest and appetite from Japanese investors towards Malaysia as the country continues to welcome increasing foreign investments from Japan.

In this regard, he hoped that the Malaysia-Japan relations would continue to expand and bring prosperity to both countries and the region.

“Our businesses assume a pivotal role in driving economic growth, fostering innovation, and creating employment opportunities. It is through their concerted endeavours that we can unlock the full potential of our bilateral relations,” he said.

Anwar said that as Malaysia prepares to assume the chairmanship of Asean next year, there is a proposal to inculcate an inclusive approach to common global problems while championing inclusivity and interconnectivity within Asean, Asia, and the rest of the world.

“In 2022, we celebrated the 40th anniversary of the Look East Policy introduced by Malaysia in 1982, which over time has successfully strengthened cooperation between Malaysia and Japan across various sectors, including the economic, educational, cultural, and tourism domains.

“Although substantial progress has been made, there remain unexplored opportunities for further collaboration for both countries,” he added.

Source: Bernama

PM Anwar: Strong Malaysia-Japan ties key to sustainable economic growth

Malaysia’s first free trade agreement (FTA) with a member of the Gulf Cooperation Council (GCC) is expected to be signed in two months, said Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.

The minister said the first Comprehensive Economic Partnership Agreement (CEPA) would pave the way for more FTAs with the GCC countries.

“From today, it takes two months for agencies to do the legal scrubbing,“ he told Bernama after the Economic & Public Finance Conference organised by the National Institute of Public Administration.

Earlier in his speech, Tengku Zafrul said he and his UAE counterpart achieved conclusions on the CEPA today.

“In two months, both prime ministers will witness the final signing,“ he said.

Malaysia will be the fifth nation, and the third in Southeast Asia, to sign a CEPA with UAE.

Source: Bernama

Malaysia-UAE CEPA on track for year-end enforcement – Tengku Zafrul

Services, manufacturing and agriculture major contributors to estimated 5.8% expansion in Q2

Malaysia’s advance GDP estimates indicate a 5.8% expansion in the second quarter of 2024, an increase from 4.2% in the preceding quarter, said Chief Statistician Malaysia, Datuk Seri Dr Mohd Uzir Mahidin.

This growth, he added was propelled by the services, manufacturing and agriculture sectors. Overall, he said, the economy grew by 5% in the first half of 2024, compared to 4.1% during the same period in 2023.

For the monthly economic indicators performance, the Industrial Production Index (IPI) in May 2024 recorded a year-on-year growth of 2.4%, moderated from 6.1% in April 2024. This growth was mainly driven by the manufacturing sector, which grew by 4.6% (April 2024: 4.9%) and a 4.2% rise in electricity output (April 2024:7.8%).

Furthermore, the mining sector declined to 6.9% impacted by a double-digit decrease in natural gas production at negative 10.3% and a drop of 1.9% in the crude oil & condensate output. Simultaneously, the manufacturing sector’s sales increased by 5.5% year-on-year to RM154.9 billion in May 2024, following a 5.7% growth in the previous month. This growth was largely supported by double-digit increases in the electrical & electronics products sub-sector (12.2%), the non-metallic mineral products, basic metal & fabricated metal products subsector (8.9%) and the food, beverages & tobacco sub-sector (7.7%).

Malaysia’s wholesale and retail trade sector achieved a sales value of RM147.9 billion in May 2024, marking a 7.1% year-on-year growth driven by all sub-sectors: retail trade grew by 8.7% to RM64 billion, wholesale trade rose by 4.7% to RM65.1 billion and motor vehicles registered 10.5% increase to RM18.8 billion. The volume index for the wholesale and retail trade sector increased by 5.7% year-on-year, with motor vehicles up by 9.6%, retail trade by 6.8% and wholesale trade by 3.4%.

Assessing the price levels, Malaysia’s inflation rate rose to 2% in May 2024, with the index reaching 132.8, compared to 130.2 in the same month the previous year. This increase was mainly driven by higher costs in housing, water, electricity, gas & other fuels (3.2%); restaurant & accommodation services (3.2%); and personal care, social protection & miscellaneous goods & services (3%). The inflation rate remained at 2% in June 2024, with the index at 133, compared to 130.4 in June 2023.

Malaysia’s Producer Price Index (PPI) in May 2024 increased by 1.4% year-on year, as against 1.9% in the previous month, with the mining sector rising by 6.6% (April 2024: 10%) and the agriculture, forestry & fishing sector increased by 1.3% (April 2024: 5.4%).

Concurrently, the manufacturing sector grew by 1% (April 2024: 0.8%), the water supply index surged by 8.7%, and the electricity & gas supply index rose by 1.5%.

In June 2024, the PPI went up by 1.6%.

As to the external sector, Malaysia’s merchandise exports in May 2024 maintained a positive trajectory, growing by 7.3% year-on-year, from RM119.5 billion to RM128.2 billion. Imports surged by 13.8% to RM118.1 billion, compared to RM103.8 billion in May 2023. As a result, the trade balance fell by 35.4% year-on-year to RM10.1 billion. Total trade reached RM237.8 billion in June 2024, reflecting 8.7% growth compared to the same month the previous year. Imports increased by 17.8% to RM111.8 billion, while exports rose by 1.7% to RM126 billion, leading to a trade balance surplus of RM14.3 billion.

Malaysia’s labour market scenario in May 2024, the labour force increased by 1.7%, reaching 17.15 million persons, up from 16.86 million in May 2023. The number of employed persons rose by 1.8% to 16.58 million, compared to 16.28 million in the previous year.

Accordingly, the Labour Force Participation Rate (LFPR) climbed by 0.3 percentage points to 70.3%, from 70% in May 2023, while the unemployment rate remained steady at 3.3%, the same rate as the previous month.

Mohd Uzir Mahidin stated, “Malaysia’s Leading Index (LI) demonstrated robust growth for six consecutive months, increasing by 3.8% year-on-year to 114.2 points in May 2024. The smoothed growth rate of the LI consistently remained above 100 points, signalling a resilient economy bolstered by rising tourism and strong external demand.”

Source: The Sun

Malaysia’s economic growth propelled by three sectors

Malaysia could do more in integrating behavioural insights (BI) into public policy by examining ways to attract investments, boost international trade and advance industrial reforms, said Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.

He said Malaysia started integrating BI into public policy in 2020 and has been working hard to improve policies to benefit the business community, investors as well as fellow Malaysians.

“The key question is this: How can we leverage BI to improve policies and good regulatory practices to enhance our supply chain and create a robust industrial talent pipeline to drive higher productivity and global competitiveness?” he said in his opening remarks at the National Conference on Behavioural Insights 2024 today.

The minister said BI could transform good governance by simplifying procedures and making forms and documentation more user-friendly through automation.

“In short, making government operations more efficient,” he added.

Tengku Zafrul said this streamlines operational requirements, reduces the burden on businesses and promotes compliance, which frees up resources for innovation and better services.

“Secondly, in education and industrial skills development, we can provide timely reminders about educational opportunities and deadlines to improve reskilling or upskilling efforts,” he said.

He noted that the Kerian Integrated Green Industrial Park project, which has already been implemented, will also have “greener” features such as renewable energy and sustainable industrial waste recycling as its “default settings.”

“This is how leveraging BI will nudge industries towards supporting our net zero goal, as stipulated by the New Industrial Master Plan 2030 (NIMP 2030),” he said.

He also said that it is crucial to include BI in achieving the 12th Malaysia Plan national productivity growth target of 3.7 per cent.

“By leveraging BI, we can better understand the underlying factors influencing productivity at both individual and organisational levels, enabling the creation of more targeted and effective policies,” he said.

In his view, BI is an approach that could also significantly boost government efficiency, particularly by utilising the right tools, techniques and technology that must evolve with the times.

“Deployed correctly across public services, these will generate lowcost and economical interventions to improve service outcomes,” he said.

Tengku Zafrul cited the Kulim initiatives as among an example of BI-based enhanced efficiency, saying that construction of factories has been accelerated from 36 months to just 10 months.

“This increased investments by RM24.56 billion or almost 92 per cent (91.64 per cent); enhanced revenue by RM77 million or 105 per cent; and created an additional 7,225 or over 75 per cent (75.24 per cent) more job opportunities,” he said.

The minister also noted the Kulai initiative, which saw the construction timeline being shortened to just 14 months.

This has significantly boosted investment by RM40.7 billion or 171 per cent, generated RM161 million or 80 per cent more revenue, and created up to 7,000 or 112 per cent more job opportunities, he added.

Source: Bernama

Use Behavioural Insights To Improve Policies, Good Regulatory Practices, SaysTengku Zafrul

Penang has received increasing inquiries from Chinese companies seeking investment opportunities over the past year.

Penang Chief Minister Chow Kon Yeow said this surge reflects growing confidence in the region’s economic potential and business-friendly environment.

“Many Chinese companies are looking to invest in Southeast Asia, including Penang and Malaysia. At the moment, we do not see many successful investments yet, but we have received a lot of inquiries.

“It is possible that companies in China are cautious about bringing their investments outside their home country as it involves capital outflows,” Chow said at a press conference announcing the 2024 Asia Pacific Semiconductor Summit and Expo (APSSE) here on Monday.

The APSSE will take place from Oct 16 to 18 at the Spice Convention Centre.

The event is hosted by the Malaysia Semiconductor Industry Association (MSIA) in strategic partnership with the China Electronic Production Equipment Industry Association (CEPEA) and supported by the Penang government.

Meanwhile, MSIA president Datuk Seri Wong Siew Hai said there may be a surge in inquiries in Penang and Malaysia due to the state’s existing ecosystem.

He said there are many companies in China in technology sub-sectors not present in Malaysia.

“We want companies that can add value to us and strengthen our ecosystem, and China has a lot of such technology sub-sectors that can enhance our ecosystem.

“These sub-sectors include materials, interface, semiconductor and insulation layers. These sub-sectors will be able to fill in the gaps in the local supply chain,” he said.

Wong said Chinese companies are keen on investing in Penang and Malaysia in many ways, including collaborations, co-investing, and even outsourcing.

He said the CEPEA decided to hold the APSSE in Penang after surveying Malaysia, and due to the significant presence of the electrical and electronics, and semiconductor industries in Penang.

He said the conference will be a crucial platform for stakeholders, not only for Penang, but also Malaysia.

“They want to hold it here to broadcast to the world about China’s interests and to show their presence in the Asia-Pacific. We hope that more collaborations will result from it, with a spillover effect into the ecosystem,” he said.

CEPEA branch secretary general Steven Huang agreed that Chinese companies are interested in collaborating and investing in Malaysia and Penang.

He said the CEPEA hopes to promote friendship and mutual collaboration between China and Malaysia as well as with other countries in the Asia-Pacific region in the upcoming APPSE.

“This is the first time that the CEPEA is partnering with the MSIA with the support of the Penang government to hold the two-day international conference,” he added.

Source: Bernama

More Chinese companies keen on investing in Penang, says CM

Malaysia has the potential to regain its status as an Asian Tiger due to its strength in emerging economic sectors, said Economy Minister Rafizi Ramli.

Rafizi said this hinged on the country’s ability to thrive in future economic sectors, particularly sustainable energy, rather than relying on gross domestic product measurements.

He said Malaysia’s achievement in data centre development, as well as the potential for expansion in the electronics and chip industries, were critical aspects in revitalising the economy.

“Our initiatives to support these data centres are strategically aligned with the anticipated dominance of artificial intelligence and chip technologies in the global landscape.

“Considering these factors, Malaysia possesses great potential (to reclaim Asian Tiger status,” he said at the launch of Economy Census 2023 here today.

Rafizi added that the nation would reap substantial economic gains if it efficiently leveraged new technology sectors.

He said the international community, including major investors, was closely watching Malaysia’s potential to lead in economic development.

“Therefore, I believe Malaysia’s perception and prospects as an Asian Tiger must be grounded in the future economy.

“If we can successfully leverage these advantages, Malaysia will undoubtedly be far ahead of other regional and global nations.”

Yesterday, Finance Minister II Datuk Seri Hamzah Azizan said a positive outlook from analysts and rating agencies, supported by encouraging economic figures, signalled that Malaysia was making great strides to reclaim its Asian Tiger status.

Hamzah said he received positive feedback regarding Malaysia’s strong economic performance during meetings with investors and analysts, who expressed optimism about the country’s future growth.

The term “Asian Tigers” was used in the 1980s and 1990s to describe the rapidly growing economies of Taiwan, South Korea, Singapore and Hong Kong.

Malaysia was poised to be the fifth Asian Tiger, but the 1997 Asian financial crisis derailed the country’s economic growth.

Source: NST

Rafizi: Malaysia has potential to reclaim Asian Tiger status

Sarawak has recorded a total approved investment of RM10.4 billion in the first half of 2024, said Deputy Premier Datuk Amar Awang Tengah Ali Hasan.

He said these investments, including those approved by the Industrial Coordination Committee, comprised foreign direct investment (FDI) amounting to RM5.7 billion and domestic direct investment (DDI) worth RM4.7 billion.

“This is what we have recorded in Sarawak for the months of January to June this year,” he said at a press conference after the Joint Committee on Industrial Coordination (JBI) meeting between the federal Ministry of Investment, Trade and Industry (Miti) and the Sarawak government at leading hotel here today.

The meeting co-chaired by Awang Tengah and Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz provided an opportunity to discuss joint strategies and approaches to coordinate trade, investment and industrial development in Sarawak.

Meanwhile, Tengku Zafrul said his Ministry will soon announce the investment performance in the first six months for Malaysia.

He nonetheless pointed out that based on data from January to March 2024, Malaysia has recorded a 13 per cent increase in investment value compared to the same period last year.

“We only have the data for the first three months which showed growth of 13 per cent compared to same period of last year. It shows good improvement.

“For the second quarter, we will announce after we receive the data. Usually, in September,” he added.

Source: Borneo Post

Awang Tengah: Sarawak records total approved investment of RM10.4b in H1 2024

South Africa, like Russia and other key fast-developing countries, is keen for Malaysia to join Brics soon, given Putrajaya’s strong and consistent stand in supporting the interests of developing nations on major international matters.

South Africa’s High Commissioner to Malaysia Dave Malcomson said as a proponent of the South-South movement, Malaysia’s role in Brics would be further enhanced as 2025 Asean chair and with its prominence in the Non-Aligned Movement as well as Organisation of Islamic Conference countries.

He said with South Africa itself holding the G20 presidency, both countries could lead other nations in taking a collective stance in areas such as reforming institutions of global governance and propagating the interests of developing countries.

“There’s definitely a lot of work that Malaysia and South Africa can do together, which is why the more representative and inclusive Brics is, the better it is,” he said on Bernama TV last week.

Prime Minister Datuk Seri Anwar Ibrahim said yesterday that Malaysia has sent an application to the grouping’s current president, which is Russia, to join Brics.

Malcomson said the media has a narrative that some countries might not be too happy with Malaysia joining Brics.

“I don’t necessarily stand by that myself,” he said.

“Brics is not against anything (and) we’ve not been set up to counter anything. We are not in the business of making binary choices of either with us or against us. We can be friends with all.

“But as long as we maintain a strong strategic relationship with all our partners, be it the United States or the European Union, we don’t foresee an issue.”

Brics not about de-dollarisation

Malaysia must be careful not to buy into such a media hype, which also includes the much-talked about the untrue narrative linking Brics to de-dollarisation, he said.

“You won’t find the word ‘de-dollarisation’ in the Brics document,” he said.

When the Brics New Development Bank was set up, he said, its first president did a study on loans for infrastructure projects over the long term.

The study revealed that borrowers were paying a major proportion of the costs servicing their (currency) fluctuations relative to the value of the United States dollar because the loans were dollar-based.

They were paying for the appreciation of the dollar versus their own currencies rather than purely paying back the cost of the loan.

The United States currency has been appreciating sharply against regional currencies in recent years, no thanks to the Federal Reserve raising interest rates to combat inflation.

This has raised the costs of imports and loans which are transacted or denominated in the greenback.

“What we’ve tried to do in Brics, particularly through the New Development Bank, is raise local bonds so we use our national currencies to service loans as well to pay for trade and investments.”

Joining forces to tackle global issues

He said it is not really a new idea, as the former Soviet Union and India used to trade in their own national currencies.

This was an idea Prime Minister Datuk Seri Anwar Ibrahim had been alluding to within Asean.

If Southeast Asian economies were to use their national currencies, it would be to their own advantage as it would lower the risk of currency fluctuations.

They could also join forces in the ongoing debate on climate change, dealing with pandemics and international health crises, and cross-border crime.

These are issues which cannot be dealt with individually but collectively, Malcomson said.

Besides Malaysia’s impending inclusion, Thailand has applied to join Brics, while other Asean countries have shown interest in the bloc.

He said Brics could also help move forward the Indian Ocean Rim Association, which aims to strengthen regional cooperation and sustainable development within the Indian Ocean region, of which Malaysia is a part.

Anwar has expressed keen interest for Malaysia to join Brics, whose original members were Brazil, Russia, India, and China in 2009, and South Africa in 2010.

Anwar said Malaysia’s priority in joining up is to reinforce trade and investment relations and expand its business linkages globally, a move designed to benefit traders, investors and the business community.

Brics won’t shift global power away from West

One of the advantages of Brics is that countries can make collective decisions on key issues of the day ahead of big meetings such as in the United Nations, Malcomson said.

“If it does join Brics, we can work with Malaysia to develop some common positions in reforming the international financial and political architecture,” he said.

He also said global institutions like the United Nations must reflect the shift in global power as there are new economic powers and new political powers.

As for traditional western powers, Malcomson questioned why they should be the ones leading global change and setting the rules.

“Brics has just been an after-reflection of that change (and) I don’t think that it’s necessarily been the driving force of that change (as) that has been happening anyway.

“We don’t see Brics shifting global power away from western countries,” he said.

Brics’ other members include Iran, Egypt, Ethiopia, and the United Arab Emirates.

Anwar had said that cumulatively, the gross domestic product (GDP) of Brics amounted to US$26.6 trillion (RM123.4 trillion), which is 26.2 per cent of the world’s GDP — almost the same as the economic strength of the G7 — and Brics comprises 3.54 billion people, or 45 per cent, of the world’s population, so it makes economic sense for Malaysia to join up.

Source: Bernama

S. African envoy says Malaysia’s Brics membership will make bloc more inclusive

Malaysia, especially the greater Kuala Lumpur, has the potential to be the business hub or regional headquarters for the Global South, said Deputy Investment, Trade and Industry Minister Liew Chin Tong.

He noted that Malaysia boasts experienced business leaders and employees who have collaborated with Western, Japanese, and Korean industries for decades, in addition to having strong cultural connections with Arab, Chinese, Indian, and other international businesses.

“Admittedly, we need to engage more with Africa and South America as a nation and through our businesses.

“Not many countries are as culturally rich as Malaysia. We must leverage this strength to help the multipolar world connect and do business with each other,” he said at the National Chamber of Commerce and Industry of Malaysia (NCCIM) Annual General Meeting today.

Liew said that a long-time observer of the Malaysian economy told him that of the last 20 years, the current government is the most purposeful government with the clearest economic agenda.

“Of course, clarity on the economy doesn’t mean that our nation will get rich overnight and all the past problems would be swept away,” he said.

Nevertheless, he emphasised that the market and investors appreciate the clarity of policy intentions.

He noted that last year, approved investments rose to a historic high of RM329.5 billion, and the economy is estimated to have grown by 5.8 per cent in the second quarter of 2024.

“It is now not far-fetched to envisage growth at closer to five per cent this year, a bit higher in 2025, and even above six per cent in 2026 if we get our acts together and if the global conditions are in our favour.

“The Madani Economy Framework has clearly articulated the need to raise the ceiling and raise the floor, and Prime Minister Datuk Seri Anwar Ibrahim is very clear in his approach. The nation would not grow if the people were not sharing the fruits of growth,” he added.

Source: Bernama

Malaysia has potential to be business hub for global south – Liew

Johor, Sarawak, and Penang, which collectively accounted for 25.9 percent of the gross domestic product (GDP) in 2023, are expected to remain key contributors to the national economy with stronger growth.

Although Selangor had the largest share of GDP at 25.9 percent, or RM406.1 billion, and exceeded the national growth rate with a 5.4 percent increase, economists foresee stronger growth in those three states.

Bank Muamalat Malaysia Bhd chief economist Dr. Mohd Afzanizam Abdul Rashid attributed the robust performance of these states to substantial inflows of direct investment and government development spending. 

“Judging from the current and ongoing projects, it is likely that the three states will continue to thrive,” he told the Business Times. 

Putra Business School economic analyst Associate Prof Dr Ahmed Razman Abdul Latiff said several factors make these states major contributors to the national economy. 

Ahmed Razman said Penang has seen a surge in foreign direct investments (FDIs) from electronics and technology companies, bolstered by the state’s reputation as a technology hub. 

“The reclamation land project in Penang, aimed at creating a huge industrial park, further enhances its economic prospects. 

“As for Sarawak, financial strength has enabled significant investments in infrastructure and capital development, while Johor benefits from its strategic proximity to Singapore, offering potential economic advantages from the High-Speed Rail (HSR) project and the Forest City’s status as a financial zone,” he said.  

Meanwhile, Maybank Investment Bank Bhd (Maybank IB) said newsflow on the three states was aplenty in the first half of 2024 (1H24), and the firm continued to see excitement ahead driven by catalytic developments and their longer-term growth proposition. 

“Economic cluster plans under the New Industrial Master Plan 2030 (NIMP 2030) will further help raise industrialisation and economic activities in these three states,” it said. 

*Johor – JSSEZ to be catalytic on many fronts*

Both Malaysia and Singapore governments inked the memorandum of understanding (MoU) to work on the Johor- Singapore Special Economic Zone (JSSEZ) on January 11, 2024. 

Following the MoU, both governments will work towards a full-fledged agreement, with a deal expected to be reached in September 2024. 

Maybank IB believes that JSSEZ will sharpen Johor’s longer-term prospects as potential beneficiaries of higher economic activities and infrastructure needs in Johor are many. 

“The construction sector stands to gain from new demand for industrial and commercial buildings, and supporting infrastructure in Johor.

“For the property sector, the JSSEZ should help lift real estate prices in and around the identified JSSEZ zone, and support future demand for industrial, commercial, and residential properties,” it said. 

*Penang – Malaysia’s high-tech powerhouse*

Penang has been among the top foreign direct investment (FDI) recipients in Malaysia – in 2023, it ranked number one with RM71.9 billion of approved investments, or 21.8 per cent of the RM329.5 billion approved investments in Malaysia. 

Maybank IB believes that the upcoming infrastructure support for higher levels of economic activities in Penang will continue to be a key catalyst for its development. 

In the construction space, the firm said Gamuda Bhd and Sunway Construction Bhd are among those vying for a role in the Mutiara LRT works. 

“This LRT project is expected to cost RM10 billion to RM13 billion over three work packages (two civil and one system). 

“Mutiara LRT line ought to have its construction completed by 2029 and be operational by 2030.

“For Penang’s property market, the Mutiara LRT project will be an immediate game changer, in our view,” it said. 

*Sarawak – new economic Power-house*

A key development in 1H24 was the appointment of state-owned company, Petroleum Sarawak Bhd (Petros) in Feb 2024 as Sarawak’s sole gas aggregator.

Elsewhere, after taking on 4.8 per cent equity holding in Affin Bank Bhd in 2023, the Sarawak state is poised to take on a larger stake, which could make Affin Bank a dominant bank in Malaysia.

Maybank IB said this will effectively give Sarawak full control over the distribution of gas resources in the state, in-line with Sarawak’s 10-year Gas Roadmap.

It also said that a larger stake in a banking group should help mobilise more financing to industrialise and develop the state over the longer term.

In addition, Maybank IB said Sarawak remains committed to its hydrogen economy aspiration – the state is poised to be a commercial hydrogen producer by 2027, according to its Premier. 

“In November 2020, Petroliam Nasional Bhd (Petronas) and Sarawak Energy signed an MoU to explore the commercial production of green hydrogen and its supply chain in Asia – this would position Sarawak as a hub for the hydrogen value chain,” it added. 

Source: NST

Johor, Sarawak and Penang: Malaysia’s engine of growth

The Ministry of Investment, Trade And Industry (MITI) is always working with the Sabah Government and its relevant agencies to address issues facing the state’s investment.

Minister Tengku Datuk Seri Zafrul Abdul Aziz, who visited the SK Nexilis and Kibing Solar factories in Kota Kinabalu Industrial Park on Sunday, said he sees big potential in Sabah, which is evident when the two companies have shown high commitment to invest and expand in the state.

However, he said there are challenges in the industry that need to be urgently addressed such as infrastructure woes, and his ministry has been working with the Sabah Government and relevant agencies at both Federal and State levels to resolve them.

Zafrul said Sabah ports are seen to be quite active, so two main issues are ensuring the industries here are supplied with sufficient and constant electricity, as well as from the aspect of infrastructure.

He said not only parties such as MITI, Ministry of Energy Transition and Water Transformation, Ministry of Human Resources and Home Ministry are involved in resolving these problems, the Sabah Government also plays a vital role.

“Every year, we hold a meeting involving all relevant agencies and ministries, at the Federal and State levels, to discuss the strategies to be taken, but what is important is to address these issues at all times.

“We also have a Malaysian Investment Development Authority (MIDA) office here, where operational issues are raised every week.

“Such issues have to be discussed on a weekly basis, not only in monthly meetings, so I think Sabah has done a lot of work to coordinate this. The Federal and Sabah governments also have a joint one-stop centre to look at the matter.

“My ministry will continue to work with the Sabah government to improve infrastructure and logistics so that companies can come and invest in Sabah, at the same time increasing the country’s earnings and investments,” he said after officiating the Umno Penampang annual general meeting at the Sabah International Convention Centre here on Sunday.

Comment on the tendency of foreign investors to put money into the State, he said they would have no issue in finding the required manpower considering Sabah’s talent pool, while in terms of demography, it is close to countries such as Korea and China.

In fact, he said Sabah is closer to the two countries compared to the Peninsular, so if the State can strengthen its infrastructure and logistics, there will be more companies coming in to support the economic overflow from not only China and Korea, but also Japan.

Zafrul stressed that the increase of investments in Malaysia not only needs to be inclusive, but also equitable, resilient and sustainable.

Source: Borneo Post

Sabah has big investment potential – Zafrul

InvestKL secured RM3.3 billion in investments in the first half of 2024, creating 3,389 high-value regional jobs through the establishment of six global services hubs.

In a statement today it said these investments, secured amidst global challenges, reaffirm Greater Kuala Lumpur’s  appeal as a top investment destination. This is thanks to its ease of doing business, robust infrastructure, skilled talent pool, and vibrant ecosystem driven by collaboration and innovation.

The new investments include the establishment of service hubs from the Americas, Europe, and Asia region.

“The first-half results demonstrate InvestKL’s continued impact in solidifying Greater KL’s status as a top investment destination in the region. This aligns well with our 2024 target to attract global services hubs with a focus on technology and cutting-edge activities that will spur high-skilled jobs for Malaysians. Through our engagements, it is evident that more eyes are now on Malaysia, and global companies are eager to capitalise on the country’s strength to deepen their investments and broaden their regional presence from Greater KL,” InvestKL CEO Datuk Muhammad Azmi Zulkifli said.

As of today, InvestKL has attracted over 140 Global Services Hubs by leading companies employing more than 27,000 executives with an average monthly salary of RM17,000.

InvestKL said Malaysia’s stable outlook and recent rationalisation efforts have contributed to a surge in foreign direct investments followed by growing investments in digital technologies, including software, Generative AI, green innovations, and data centres.

The country also anticipates a wave of investments in green energy and sustainability through the National Energy Transition Roadmap (NETR), further building capabilities in the digital technology sector.

Invest KL said its strategic direction will focus on attracting global services from key sectors such as digital and technology, engineering, health tech, and renewable energy, while also emphasising human capital development.

Malaysia recorded RM83.7 billion investment progress in the first quarter of 2024, a 13 per cent increase over the same period last year.

About 47 per cent or RM39.3 billion investments were for the services sector.

Source: NST

InvestKL secured RM3.3b in investments in the first half of 2024

Selangor attracted RM12.4bil in investments in the first quarter, a 66.8% hike from RM7.44bil recorded during the same quarter of last year.

These investments are expected to create 29,000 new jobs for Malaysians.

Selangor Mentri Besar Datuk Seri Amirudin Shari said the state government will continue working with partners such as the Investment, Trade and Industry Ministry and the Malaysian Investment Development Authority (Mida) to achieve its targets including to become a RM500bil economy in the next two to three years.

“To go about achieving that, we cannot rely purely on services, but reinvigorate Selangor’s manufacturing capacity, to not only fulfill local needs but also for a bigger South-East Asian and the larger Asian markets,” he said at the Mida Invest Series–Selangor: Unfolding Its Business Potential event.

Mida reported that as of 2023, the state contributed 25.9% of national gross domestic product and 17.67% of national exports.

“The state’s economic contributions are driven predominantly by the manufacturing sector, particularly electrical and electronics such as semiconductors, positioning it as one of the major exporters in the country.

“Selangor’s impressive investment achievements underscore its strategic importance and economic resilience,” it said.

Source: The Star

Selangor attracts RM12.4bil investments in 1Q24

Selangor needs to reinvigorate its manufacturing capacity to fulfil local needs and the bigger Asian markets to reach its RM500 billion gross domestic product (GDP) target in two to three years target, Selangor Menteri Besar Datuk Seri Amirudin Shari said.

He said while services and manufacturing sectors remain valuable components in Selangor economic contribution to Malaysia, at 32.6 per cent and 26.7 per cent respectively, the state government cannot be purely satisfied or complacent.

“According to multiple reports, based upon the recovery of the world economy, the International Monetary Fund (IMF) expects the emerging and developing Asia to grow by 4.3 per cent in 2024.”

“The World Bank also projected that Malaysia would grow its economy by 4.3 per cent this year and 4.5 per cent in 2025. We need to continue working hard, and working with partners like MITI and MIDA, to rise to the challenge and find ways to build a RM500 billion ringgit economy in the coming two or three years.To go about achieving that, we cannot rely purely on services, but reinvigorate Selangor’s manufacturing capacity, to not only fulfil local needs but also for a bigger Southeast Asian and the larger Asian markets,” he said in his keynote address at MIDA Invest Series here today.

Amirudin said Prime Minister Datuk SeriAnwar Ibrahim’s commitment to Malaysia exploring a strategic partnership with BRICS economies should be seen an opportunity for companies especially thosewho are already present in Selangor.

He said Brazil, Russia, India andSouth Africa represent a greater opportunity while traditional Europe is at the crossroads socially and economically.

He also said  Selangor took up the challenge to be the first state in Malaysia  to embark on a medium-term socioeconomic plan which is outlined in the First Selangor Plan.

The plan aims to uplift living standards for families, increase environmental resiliency based on sustainability, and  building a 21st century system of government which is digital first and more responsive.

Amirudin tabled the Mid-Term Review of the plan earlier this month, which was passed in the Selangor State Legislative Assembly.

“After it was passed unanimously in August 2022, last week was the culmination of an effort to achieve two things; firstly, to review our performance and ability to execute some of the big plans we made, and secondly, to recalibrate some new focus areas, in line with the latest needs both by the business community and Selangorians at large.”

“And I am glad to report that as of the end of June, 33.7 per cent of the main projects and initiatives have been completed, while the remaining 66 per cent are at various stages of implementation with key areas like the Integrated Development Region in South Selangor (IDRISS), Sabak Bernam Development Area (SABDA) or even the new Shah Alam Sports Complex,” he said.

Source: NST

Selangor MB says state needs to reinvigorate manufacturing capacity to achieve RM500b GDP target

Selangor should leverage on national policy push and enablers to reach its RM500 billion gross domestic product (GDP) in two to three years target, Investment, Trade and Industry (MITI) minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said.

Highlighting the various national level plans, like the recently announced Green Investment Strategy (GIS), he said, all these policy push and enablers will be able to help Selangor achieve its objectives, including that of developing its green manufacturing industry.

“In fact, Selangor’s  approved investments in the first quarter of 2024 (Q1 2024) of RM12.4 billion makes it one of the biggest investment contributors to Malaysia’s first quarter,” he said in his keynote address at the 8th Selangor Asean Business Conference (SABC 2024).

Tengku Zafrul said with strong coordination and collaboration between MITI, Invest Selangor and Malaysian Investment Development Authority, he is confident more investments can be attracted into Selangor, and realise these approved investments quickly, and possibly at a realisation rate higher than the national rate.

He said Selangor can leverage on Malaysia’s chairmanship of Asean and Asean’s position as “darling destination” for investments in manufacturing for the world to attract  more investments.

He said Asean has a collective GDP of almost US$3.7 trillion (2022) and ranks as the third largest regional economy in Asia and the fifth largest in the world.

Despite global challenges, foreign direct investment (FDI) inflow into Asean was US$155 billion in 2023.

“Thanks to Asean’s neutral stance – FDI flows looks set to remain steady in the coming years, particularly amidst the continued geopolitical conflict between US and China, as well as Ukraine and Russia,” Tengku Zafrul said.

He added that Asean also has many other things going for it to attract more FDI into this region, such as its combined population of over 670 million people, out of which 213 million, or 31 per cent, are youths aged 15 – 34 years old, which make up for a young talent pool.

“This demographic dividend is also seen in Selangor, whose working people make up 67 per cent of its population, partly due to its popularity as a ‘land of opportunities’ for workers from other states,” said the minister.

On Malaysia’s Asean chairmanship next year,Tengku Zafrul said it was a crucial opportunity to align Asean’s direction with our national and state economic policies.

“MITI will lead Malaysia’s Chairmanship in the economic pillar, guided by the overarching objectives of the Asean Economic Community (AEC) Council. MITI is in the process of crafting Malaysia’s Priority Economic Deliverables or PEDs,” he said.

PEDs will be framed around four key strategic thrusts namely  enhancing trade and investment between Asean member states, integrating and connecting economies, forging inclusive and sustainable future and transforming the digital future.

“Given Selangor’s location within the Klang Valley, its businesses stand a strong chance of leveraging on key events to be held in Kuala Lumpur to elevate themselves and build their regional profile, particularly as MITI and its agencies have been working hard towards making Malaysia a manufacturing and services hub for the region,” said Tengku Zafrul. –

Selangor’s gross domestic product (GDP) growth at 5.4 per cent in 2023, surpassed national GDP growth of 3.6 per cent.

Source: NST

Selangor should leverage national policy push and enablers to reach RM500b GDP target – Tengku Zafrul

Selangor remains focused on maintaining its performance as the country’s largest investment contributor by state through the organisation of the Selangor International Business Summit (SIBC 2024), said Selangor Menteri Besar Datuk Seri Amirudin Shari.

For the first quarter, Selangor was in third place with an investment of RM12 billion, while for the whole of 2023, Selangor was in second place with an investment of RM55 billion

“So the target this time is to maintain the large amount of investment and create significant economic opportunities for the people,” said Amirudin following the opening of the 8th SIBC at the KL Convention Centre on Thursday.

At the same time, Amirudin said the state government will cooperate with the Ministry of Investment, Trade and Industry as well as other ministries in programmes that will bring economic benefits to Selangor.

“With Malaysia set to be the Asean chair in 2025, Selangor stands ready to support and complement the federal government and Miti in every way possible,” he added.

Meanwhile, commenting on Malaysia as the Asean chair, he said Asean countries should build trust and commitment through sharing technology goals to strengthen cooperation among Asean countries.

“Asean should no longer be a region where big players look to offshore their manufacturing hubs to lower costs, but be leaders in innovation and create technologies of our own to solve the grand challenges of our time,” he added.

Source: Bernama

Selangor plans to be the country’s biggest investment contributor this year — Amirudin

Country leads from the perspective of infrastructure and stability

Malaysia is increasingly seen as the epicentre and gateway to the broader Asean region by investors, underpinned by its relatively advanced infrastructure and stable business environment.

Penjana Kapital Sdn Bhd chairman Tunku Alizakri Raja Muhammad Alias said while the country’s yield flow may not be as high as some other countries, the nation is quite advanced from an infrastructure perspective for investments compared to many of its Asean counterparts.

“There are a lot of opportunities in Southeast Asia and Malaysia. I think the country is much more advanced in terms of stability and ability for companies to conduct their business.

“We might not be as advanced as Singapore but Malaysia is definitely cheaper. This is what is generating a lot of interest among investors,” he said at a panel discussion on “Malaysia’s government-backed funds and their investment strategies” at the Tech in Asia conference yesterday.

Penjana Kapital is a sovereign venture capital fund.

Alizakri said the key question now is whether Malaysia and Asean as a whole will be able to “get its act together” to unlock the true value of Asean.

“I think this question is still being answered and this is where the Malaysian government attempts to give that perspective, with an ambition to position Malaysia as a hub for venture capital and startups, specifically for Asean. This is also taking into account that the country is going to be the chairman of Asean next year,” he said.

Alizakri said when it comes to investment, it is important to have a whole-ofasean approach and not just on individual countries.

He noted that instead of competing over ownership of companies, like Grab, countries should embrace the idea that Asean owns these individual companies

“In the early days, which was about five to 10 years ago, we used to look at what is happening in the West, and try to replicate it in Malaysia, not really taking into account that we do not have the same fundamentals.

“What worked in the United States and Europe does not necessarily work for Malaysia. Some of our companies had gone into a ‘cash-and-burn’ model.

“We should look at Asean as a whole. So if you want to go on a cash-and-burn model, start in a country which actually has its core fundamentals in place, like Malaysia. Use Malaysia as a testbed for prototypes into targeted businesses.

“Once a company reaches a certain saturation point, it can then seamlessly transition to a larger market like Indonesia where you actually scale up.

“So in that case, you will be able to unlock the true potential of Asean itself rather than any individual country in its own right,” he said.

In response to what success would look like, Alizakri said it would be when the true promise of Asean is realised, using Malaysia as a partner, given that the country is an unexplored launchpad into Asean for global funds at this point in time.

“Some people assume that when they establish their headquarters in Singapore, they automatically know the whole of Asean. This is a mistake because each country is very diversified with very different cultures, religions and practices.

“Malaysia has the potential to be a solid hub, especially for impact investmenting, because I believe this is going to be the next generator of not only financial returns but also social returns.

“I also hope, in terms of success, that at long last, we will see solid global partners who will look at Malaysia as their home.”

In a separate panel discussion on “Digital banking in emerging markets: What’s next?”, GXS Bank Pte Ltd group chief executive officer Muthukrishnan Ramaswami said while what digital banks offer is not significantly different in terms of digital capacity, their products and services have been significantly reinvented, as they have started afresh.

“Digital banks can make a big difference in the sense that users have the flexibility of putting money into a digital bank and earning interest that is much more competitive than what the big banks pay.

“What the regulators have done is to provide the central-bank guarantee or the insurance guarantee for deposits held in digital banks and therefore hold us to the same high standards as any big bank.

“So I don’t think we get any regulatory slight. The ratios are the same, we are pretty much governed like a big bank but we are able to extend services that are much more far-reaching for the underserved customers,” he said.

Muthukrishnan said the key thing for digital banks is the simplicity of products and services in bringing banking to underserved segments.

“The products are geared to cater for what I would call non-complex needs. Because most people do not have very complex needs early in their financial journey.

“The quid pro quo for that is the service costs are very low, acquisition costs are very low and we do not have a branch network, therefore our cost to service is low.

“Hence, if we can keep our costs small and if we can keep our products simple, then I believe it’s a win-win,” he said.

Boost group chief executive officer Sheyanta Abeykoon said if one were to look at digital banks that are successful around the world, having a robust ecosystem – whether captive or through a partner – is a major contributing factor.

“Ecosystems play two important roles. The first is bringing an existing customer base where digital banks can seamlessly integrate an onboarding journey or products in an already familiar environment to customers.

“Secondly, it offers data, especially of the underserved segment, that is not publicly available. This unique customer data gives digital banks a competitive advantage in our customer-centric strategies as well as in product design.

“Boost Bank is doing the same by tapping into our own and partner ecosystems to bring banking directly to our customers by seamlessly embedding our digital banking products and services within these ecosystems,” he said.

Source: The Star

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