Selangor aims to become hub for foreign investors via SIBS 2021interest
06 Jul 2021
SIBS 2021, which will run virtually from Oct 7-10, 2021, is a key global trading hub initiative to showcase local businesses to Asean and international markets
Selangor is focused on becoming a hub for potential investors to expand their investment plans in the country, while seeking solid grounds in the Asean region and the global markets despite the economic uncertainties brought by the pandemic.
The state government has planned to draw in more foreign investors this year via Selangor International Business Summit 2021 (SIBS 2021) which will run virtually from Oct 7-10, 2021.
Being the second hybrid event due to the outbreak, Invest Selangor Bhd CEO Datuk Hasan Azhari Idris said the team had built multiple channels to keep engaging potential investors.
The pandemic, which has pummelled global economies, has caused many multinational corporations (MNCs) to temporarily halt their investment plans.
He said external trade figures, however, indicated that movement of goods globally remained high — mainly in sectors related to electrical and electronics, life sciences and medical-related products, as well as food and beverages — which revived MNCs’ confidence to proceed with their expansionary investment plans.
“Regional trade and investment forums such as SIBS may become the conduit and networking platform for these potential investors to look at Selangor as their possible growth destination, by providing the opportunity to the state to present itself accurately and discuss the suitability of the expansion projects directly.
“SIBS is also a key global trading hub initiative by Selangor to showcase local businesses to Asean and international markets.
“Continuous efforts in connecting local businesses to new markets is important to ensure many of these businesses will remain and expand their operations here in Selangor,” he told The Malaysian Reserve recently.
SIBS 2021 is expanding its offerings with new programmes, such as the Selangor International Expo (MEDIC), which focuses on medical equipment, pharmaceutical products and services; and the Selangor Industrial Park Expo which shines light on industrial parks operators in the state.
The Malaysian Investment Development Authority (Mida) revealed that approved investments in the country last year totalled to RM164 billion via 4,599 projects in the manufacturing, services and primary sectors.
Domestic direct investments (DDIs) accounted for the bulk of the total investments with a contribution of 60.9% or RM99.8 billion, while foreign direct investments (FDIs) made up the remaining 39.1% or RM64.2 billion.
Selangor recorded an FDI of RM38.7 billion last year where the manufacturing sector contributed RM18.4 billion, while the remaining came from the services sectors.
Hasan Azhari noted that last year’s performance was a result of efforts made in 2019 as the pandemic curtailed the state’s efforts to attract foreign investors in terms of trade missions in 2020.
He expected FDIs in Selangor to drop this year due to the movement restrictions in place and the global uncertainties brought by the Covid-19 pandemic, which continue to dampen foreign investors’ appetite in choosing their next growth base.
Despite acknowledging the challenges that the state will face this year to rake in investments, Hasan Azhari said Invest Selangor is still cautiously projecting RM12 billion worth of investments in the manufacturing sector into the state for 2021.
“Mida revealed that Selangor recorded a total of RM4 billion worth of investment in the manufacturing sector for the first quarter of the year (1Q21).
“We are optimistic that we are on track to achieve our target for the year,” he said.
Approved investments in the country totalled to RM80.6 billion in 1Q21, a surge of 95.6% from the same period last year which stood at RM41.2 billion.
Of the total, approved FDI in the manufacturing, services and primary sectors rose 383.4% to RM54.9 billion in 1Q21 from RM11.4 billion in the corresponding period last year.
Attractive Setting for Foreign Investors
Selangor would be attractive to foreign companies that have plans to expand in Asean
markets as the state boasts 3.6 million skilled and multilingual workforces, many of whom are university graduates.
The presence of well-established supply chains within numerous industries in the state could also support the demand from manufacturers and investors, noted Hasan Azhari.
Besides having reliable digital connectivity, Selangor is strategically located as it is served by two major international airports and the second-busiest container port in the Asean region, which is Port Klang, that could enhance a company’s physical reach.
“It also has multiple advanced domestic rail networks, road and air links to economic hubs within the country, which provides the comparative advantage to the manufacturers that are looking at serving the regional market,” he said.
Despite the attractive offerings, Selangor has lost industries that are labour-intensive over the years as they relocate to other markets in the region due to lower labour costs.
However, Hasan Azhari underscored that the advancement of technology in the manufacturing sector requires a wide range of skill sets from their workforce which may include technology and digital knowledge, along with other machine-related or engineering skills.
Selangor’s present workforce, supported by 160 higher learning institutions that produce over 60,000 graduates annually, gives the state a competitive edge among other countries in the region.
“In addition, for industries that require a workforce with specific skill sets tailored to their requirements, the Selangor Human Resources Development Centre provides training services that can match the industry requirement with the participating trainee.
“The Selangor Technical Skills Development Centre (STDC) is the state’s technical education institution focusing on the field of TVET (technical and vocational education and training) to meet the needs of the industry by forging collaborations that move towards Industrial Revolution 4.0,” he said.
STDC offers courses in various fields certified and recognised by the Department of Skills Development, Ministry of Human Resources and the Energy Commission, as well as short-term professional courses in collaboration with industries.
STDC had recently inked a strategic partnership with Aerodyne Group to develop specialised skills training with a focus in developing drone and data experts in Selangor. The programme took place between November 2020 and April 2021.
SIBS 2021 to Spur Employment
Invest Selangor aims to spur job creation and chart employment growth in the country via this year’s event.
SIBS 2020 managed to attract 170,000 viewers regionally and had 286 exhibitors from 12 countries despite being held virtually amid the pandemic.
Hasan Azhari said the state had successfully attracted more than 5,660 manufacturing projects from 1999 until 2020 that are valued at more than RM180 billion.
The projects created a total of 426,878 job opportunities for the population in Selangor.
As Selangor is determined to achieve the World Bank’s projection for the country to become a high-income status nation between 2024 and 2028, he said the state is focusing on key areas such as boosting innovation, improving productivity and institutional quality, as well as its human capital by upskilling and reskilling according to the industry’s requirements.
SIBS 2021 will provide the avenue recognition and acknowledgement to education innovation and research-industry collaboration through its “Selangor Research and Development and Innovation Expo”.
“These collaborations may become the catalyst in developing a more advanced workforce that is highly productive and profitable.
“Identifying more technologically advanced industries to be able to collaborate with universities within the state and in the country will subsequently create higher-income jobs in the state,” he said.
He added that the team would still be unable to anticipate a specific number of unemployment opportunities that would crop up from the FDIs and DDIs following the event.
“However, based on 2019’s records of approved manufacturing projects in Selangor, we secured 315 projects which created a total of 21,085 employment opportunities for the workforce in Selangor,” Hasan Azhari concluded.
Source: Malaysian Reserve
