Malaysia Maintains its Status as the Preferred Investment Hub: RM71.4 Billion of Approved Investments in the First Quarter of 2023

Malaysia has once again established itself as a top investment destination, attracting RM71.4 billion in approved investments during the first quarter of 2023. These investments, spanning across the manufacturing, services, and primary sectors, are set to bring prosperity and create 23,977 job opportunities nationwide. Foreign Direct Investment (FDI) continues to outpace Domestic Direct Investment (DDI), with FDI contributing RM37.5 billion, accounting for 52.5% of the total approved investments.

In terms of major sources of FDI, Singapore takes the lead with RM11.5 billion, followed by the British Virgin Islands at RM7.1 billion and the People’s Republic of China (PRC) at RM6.5 billion. Hong Kong SAR and the Republic of Korea recorded RM2.9 billion and RM2.5 billion, respectively.

For projects approved by states, five (5) states contributed a significant portion of the approved investments for the month of January to March 2023, namely the W.P. Kuala Lumpur with RM21.8 billion, followed by Johor (RM10.6 billion), Selangor (RM7.4 billion), Perak (RM7.1 billion), and Sabah (RM6.3 billion).

In the first three (3) months of 2023, the services sector was the leading sector for approved investments, surpassing all other sectors. With an impressive value of RM53.6 billion, accounting for 75.1% of the total approved investments, it showcased remarkable growth compared to the previous year’s figure of RM16.4 billion for the same period. This surge in the services sector had 1,058 approved projects, expected to create 12,051 new job opportunities.

Within the services sector, the information and communications sub-sector was the most prominent, attracting approved investments worth RM24.9 billion, representing a substantial 46.5% share. The real estate sub-sector followed closely with RM15.5 billion (28.9%), followed by distributive trade with RM6.7 billion (12.5%), financial services with RM2.2 billion (4.1%), and support services with RM1.8 billion (3.4%).

Notable projects approved within the services sector include:

• GDS IDC Services (Malaysia) Sdn. Bhd.: Investing RM2.2 billion in a hyperscale data centre projects.
• Seri Yakin Logistics Sdn. Bhd.: Received approval for their RM1.4 billion investment in the development of a smart warehouse, including an e-fulfillment hub.

The government’s focus on green investment was evident, with several projects approved under green technology for renewable energy initiatives. This highlights the diverse and promising opportunities within the services sector, attracting significant investments and contributing to Malaysia’s economic growth.

Malaysia continued to attract a healthy level of investments in the manufacturing sector, with a substantial value of RM15.6 billion or 21.8% of the total approved investments. This commitment was evident through the approval of 192 manufacturing projects, poised to generate over 11,900 new job opportunities.

Majority of the approved investments in the manufacturing sector were allocated to key industries. Transport equipment took the lead with RM4.4 billion (28.2%), followed by machinery and equipment (16.6%), basic metal products (14.7%), electrical and electronics (E&E) (13.2%), and non-metallic mineral products (10.3%), accounting for a total of 83.1% of the total approved investments in the sector.

Notably, the manufacturing sector in Malaysia received approval for several innovative, high value-added and high-technology projects, showcasing MIDA’s serious intent to utilise investments to re-orientate our industry technologically, redefine the country’s industry standards and fuel future economic growth sustainably.

Remarkable projects approved within the manufacturing sector include:

• EVE Energy Malaysia Sdn. Bhd.: An impressive investment of 2 billion to develop cutting-edge Cylindrical Li-Ion batteries for power tools and E-bikes. This project reflects a commitment to sustainable energy solutions and positions Malaysia as a leader in advanced battery technology.
• LOTTE EM Malaysia Sdn. Bhd. (formerly known as IMM Technology Sdn. Bhd.): With an investment worth 3 billion, LOTTE EM Malaysia is set to revolutionise lithium-ion batteries by introducing Electro-deposited copper foil. This breakthrough innovation promises enhanced performance and reliability, contributing to the evolution of the electric mobility industry.
• Xinyi Solar (Malaysia) Sdn. Bhd.: A significant 5 billion investment to produce Photovoltaic functional glass (coated). This project signifies Malaysia’s dedication to renewable energy and showcases its capability to manufacture state-of-the-art solar components.

The primary sector garnered investments valued at RM2.2 billion for the period January to March 2023. These investments have the capacity to drive positive economic impact. The key highlights include:

• Mining Sub-sector: Approved investments of RM2.1 billion were allocated to mining projects, underscoring our established capacity to extract and utilise valuable minerals from Malaysia’s resource-rich landscape.
• Plantation and Commodities: Garnering investments of RM65.1 million, the plantation and commodities sub-sector demonstrates ongoing efforts to enhance productivity and sustainability in agricultural practices.

These investments pave the way for future growth and innovation for the nation.

Malaysia’s investment landscape presents promising opportunities with a pipeline of proposed investments and lead projects overseen by MIDA. Currently, as at 31 May 2023, there are 743 projects in the pipeline, with proposed investments totaling RM50.6 billion, and RM150.4 billion for lead projects. These figures reflect businesses’ and investors’ confidence in Malaysia’s potential.

Moving forward, sustaining this momentum by attracting new investments that are aligned to the objectives of the New Investment Policy (NIP) under the framework of the National Investment Aspirations (NIA), towards sustainable and inclusive economic growth for Malaysia is our utmost importance.