Tengku Zafrul: Service sector received over half of all FDI this year; the Netherlands leads in investment here

Tengku Zafrul: Service sector received over half of all FDI this year; the Netherlands leads in investment here

06 Dec 2023

Malaysia’s service sector contributed 52.3 per cent of the total approved investments for 2023 by bringing in RM117.7 billion in investments from a total of RM225 billion of approved investments, Minister of Investment, Trade and Industry (Miti) Datuk Seri Tengku Zafrul Abdul Aziz said today.

This he said was a 6.6 per cent increase from last year’s RM211 billion approved investments. Malaysia’s foreign direct investments (FDI) accounted for 55.9 per cent or RM125.7 billion of the total approved investments while the domestic direct investment (DDI) contributed 44.1 per cent or RM99.3 billion, which is a 45.2 per cent increase compared to last year.

“With an impressive number of 3,949 projects approved, a 35.3 per cent increase as compared to January-September 2022, these approved projects will generate 89,495 new jobs in the country,”

“Investment inflow from countries such as Holland, Singapore, the United States, China and Japan reflect the type of high-tech, strategic investments that Malaysia is targeting from global players. But this is no time for complacency. Miti and its agency,” Tengku Zafrul said during a presentation on his ministry’s performance after one year in office here.

Tengku Zafrul listed the country’s top five sources of FDI as the Netherlands (RM35 billion), Singapore (RM20.4 billion), the United States (RM18.9 billion), China (RM11.6 billion) and Japan (RM11.2 billion).

Meanwhile, the top five states with approved investments were the Federal Territory of Kuala Lumpur (RM48.9 billion), Penang (RM44.9 billion), Selangor (RM41.6 billion), Kedah (RM22.6 billion) and Johor (RM20.0 billion).

Of the total approved investments in the services sector, he said RM78.7 billion or 66.8 per cent came from DDI while the remaining 33.2 per cent or RM39 billion were from foreign sources.

Information and communications technology (ICT) was the largest recipient of investments in the services sector, with RM45.6 billion approved. Other major sub-sectors were real estate (RM44.4 billion), distributive trade (RM9.2 billion), utilities (RM6.3 billion) and financial services (RM6.0 billion).

In line with the transition to the green agenda as outlined in the National Transition Energy Roadmap (NETR) and the New Industrial Master Plan (NIMP) 2030, investments in green technology have grown significantly, by 24.6 per cent to RM1.5 billion year-on-year.

These investments encompass various green technology initiatives, including renewable energy generation, energy conservation, waste management, green buildings and green services.

Apart from that, the manufacturing sector attracted a total of RM99.8 billion accounting for 44.4 per cent of total approved investments across all sectors marking a significant increase of 53.9 per cent from the 64.9 billion recorded in the same period of 2022.

These investments are spread across 607 projects, poised to generate an estimated 48,496 job opportunities. FDI takes a significant lead, contributing RM84.8 billion or 85.0 per cent, while DDI accounts for RM15.0 billion or 15 per cent.

“What’s important to note here is that this year’s investments have been the best in the past decade. Our first nine months have averaged higher investment averages compared to the previous 10 years which shows that Malaysia is still an attractive investment hub.

“We also may announce a collaboration with Boeing to expand their business here. At the moment, from what I’m told 55 per cent of all Boeing plane’s wings are assembled in Malaysia, hopefully we can grow and expand this in the coming years,” he added.

Source: Malay Mail