Positioning Malaysia As The Heart Of Investments In ASEAN
28 Dec 2021
As a strategically placed country with a diversified economy and robust offerings, Malaysia as a country has proven time and time again as a country that is ripe for investments in many areas.
A key driver in positioning Malaysia as the preferred destination for quality investments and enhancing the nation’s rising status, the Ministry of International Trade and Industry (MITI) Through it’s agency Malaysian Investment Development Authority (MIDA) and InvestKL, has elevated all efforts over the years to enhance all investment attractions.
As highlighted in the Bank Negara Malaysia’s (BNM) “Economic and Financial Developments in Malaysia in the Second Quarter of 2021”, the quarter experienced a 16.1% year-on-year GDP growth. In terms of investment performance, Malaysia charted a jump in private investment in Q2 2021 of 17.4 percent totalling RM59.3 billion compared to corresponding period last year.
The central bank’s report further highlighted that Malaysia remains on the right trajectory for further economic recovery, boosted by the surge of external demand supported by primary sectors such as electrical & electronics (E&E), petroleum, rubber products, palm oil and chemical products.
Foreign Direct Investment (FDI) net inflow on the other hand totalled RM8.2 billion in Q2 driven by larger reinvestment of earnings mainly in the manufacturing sector and higher equity injections, underscoring that Malaysia continues to remain as a preferred investment destination in the region.
The Investment and Trade Mission to Europe has successfully attracted investment from Posche AG, Germany which will make Malaysia its first facility in Asia as well as make Malaysia a production hub in the ASEAN region .
Infineon has also expressed that it will continue to be a strategic partner to Malaysia in accelerating the growth of electrical and electronics (E&E) industry, particularly towards moving up the value chain in areas of packaging, testing integrated circuits, and wafer processing
In September, Porshe AG, announced that they will establish a production plant in Kedah, in partnership with Sime Darby Berhad. The establishment of a manufacturing facility in Malaysia has been deemed as a strategic decision by Porsche signifying its commitment to build a long-term presence in the ASEAN region.
“Porsche’s decision in choosing Malaysia as its first production plant outside of Europe is an embodiment of the company’s confidence in Malaysia’s conducive.
Economic Frontliners For The Nation
Through-out the year, MITI’s successful Trade and Investment Mission (TIM) played a key role in placing Malaysia on the international platform to attract more investors.
YB Dato’ Seri Mohamed Azmin Ali, Senior Minister and Minister of International Trade and Industry, says the trade missions strengthens the bilateral economic relations between Malaysia and top European economic powerhouses such as Germany and France.
Infineon Technologies, Germany’s global semiconductor producer announced its expansion- related investments of RM11.53 billion worldwide in the fiscal year of 2022 and has chosen its silicon carbide and gallium nitiride epitaxy production to Kulim HI-Tech Park and expand its manufacturing base in Malaysia ecosystem and our strength to support their long- term growth. It also acknowledges the capability of our local talent of highly skilled engineers and technicians.
“We are very pleased to welcome Porsche to Malaysia and MITI as well as its agency, the Malaysian Investment Development Authority (MIDA), will continue to deliver our best in facilitating their endeavors here,” he says.
In the east, Kuching has been selected as part of Taiyo Yuden Co. Ltd.’s strategic move to expand its multilayer ceramic capacitors manufacturing facility, marking another milestone for Malaysia as the preferred hub for global manufacturers and an ASEAN gateway.
“Taiyo Yuden’s decision to inject RM680 million capital investments for their new facility reflects booming investors’ confidence in our ecosystem’s readiness to support global production. This achievement demonstrates the success of the Government’s aggressive and effective strategies to welcome and facilitate high-quality FDIs. MIDA has been working closely with Taiyo Yuden in ensuring the smooth implementation of their expansion project that will generate an additional 2,000 job opportunities,” said Dato’ Seri Azmin.
The facility will begin construction next month and is expected to be in operation by March 2023.
A Country of Growth
Recently, the Cabinet has approved the National Investment Aspirations (NIA), a forward-looking growth framework that aims to form the basis for comprehensive reforms of the country’s investment policies.
According to MITI, the NIA will focus on coherence and cohesiveness and is committed to reflect these aspirations across all national policy initiatives related to investment, including the Fourth Industrial Masterplan and the 12th Malaysia Plan.
“The NIA will be central to revitalise Malaysia’s investment climate, attract high quality investments into the country and create high income jobs, particularly in a post-Covid era.
“MITI is committed to spearhead national-level efforts to review policies and restructure the nation’s investment strategies, as mandated by the NIA,” says Dato Seri Azmin Ali.
Under the NIA, five core parameters will be focused on to enhance Malaysia’s competitiveness and to constantly ensure the country remains a preferred investment destination. The core parameters will include increasing economic diversity and complexity, create high skills jobs, expand and integrate domestic linkages, develop new and existing clusters focusing on high productivity sectors and improving inclusivity.
“In order to enable further diversification and ventures into more complex industries, emphasis should also be accorded towards fostering a robust and dynamic tax and incentives regime, building our talent pool in close collaboration with the relevant industries, improving our licensing and regulatory frameworks and augmenting the facilitation elements such as customs procedures”, said the Senior Minister and Minister of International Trade and Industry.
Additionally, in line with the changing times, the NIA’s focus on sustainability and inclusivity aligns with the Environmental, Social and Governance (ESG) goals. This MITI believes will build a pathway for investors to access new market opportunities, particularly in developed countries that mainstream sustainability throughout their value chain.
This was evident with Taiyo Yuden’s move to pick Kuching as the Kuching facility spans over 36,500 square meters and will include the usage of high-tech equipment with state-of-the-art features, support high-energy conservation and incorporate solar- powered roof, in line with ESG Goals.
MITI’s continuous efforts to position Malaysia as the heart of investments in ASEAN will enable more opportunities not just in economic growth for the country.
MITI has recently concluded the Trade and Investment Mission (TIM) to Germany, France & United Kingdom from 12-23 October 2021 led by YB Dato’ Seri Mohamed Azmin Ali, Senior Minister of International Trade and Industry (MITI) as part of the continuous effort to draw investments into the country.
Source: Business Today
