Malaysia gets $9 bn FDI in ‘challenging year’
KUALA LUMPUR - Despite a weaker global environment, Malaysia remains as a competitive investment location for foreign investors, with an increase of 28 per cent in this quarter, said International Trade and Industry Minister Mustapa Mohamed.
Malaysia recorded 37.3 billion ringgit (US$9 billion or Bt320 billion) of approved investments in the services, manufacturing and primary sectors in the first quarter and, if fully implemented, they will create 39,990 jobs.
Mustapa said the investments involved 1,271 projects, but he expected 2016 to be another challenging year for the country.
“As a diversified economy, we believe we can withstand these challenges and overcome them, especially with the continued inflow of foreign investments into the country. We are definitely doubling our efforts in achieving the country’s investment target,” he said.
Elaborating on the first-quarter investments, he said that despite a weaker global environment, Malaysia remained as a competitive location for foreign direct investment, with an increase of 28 per cent in this quarter.
“Year on year, FDI increased to 12.8 billion ringgit in the first quarter this year from 10 billion ringgit in the corresponding period of 2015. Domestic investments led with 24.5 billion ringgit or 65.7 per cent of total approved investments in the quarter,” Mustapa said.
He said taking into account the two lumpy projects approved in the first quarter of 2015 – China’s in Johor and LNG9’s project in Sarawak – the first quarter of this year showed a decrease from 69.8 billion ringgit. The two projects amounted to 35.3 billion ringgit.
“I would like to highlight that without the two big projects, Q1 2016 actually shows an overall increase of 8.1 per cent from 34.5 billion ringgit last year,” he added.
Mustapa said the services sector attracted 27.6 billion ringgit of approved investments in the first quarter. A total of 1,088 services projects were approved, creating 20,200 employment opportunities, the largest potential employer in the economy.
“Foreign investment in the services sector surged by 112.1 per cent from 3.3 billion ringgit in Q1 2015 to 7 billion ringgit in the same period this year. We are seeing more foreign participation in distributive trade, education services, global establishments, financial services and real estate sub-sectors,” he said.
Distributive trade saw an increase of 992 per cent of foreign participation from 101.5 million ringgit in first quarter of 2015 to 1,108.7 million ringgit in the first three months of 2016.
The increased investments from regional and international retailers have boosted Malaysia’s ranking to third position in the 2016 Global Retail Development Index (GRDI) by AT Kearney.
For the education sub-sector, the increase of 672.7 per cent of foreign investments from 19.3 million ringgit in first quarter 2015 to 149.2 million ringgit in the same period this year reflects Malaysia’s success in accelerating the process in making the country a regional education hub of excellence, the government says.
The private education sector will complement the government’s efforts in providing access to quality education to the people.
