By Business Desk
Approved investments climbed for the fourth consecutive year in 2014, rising to a new high of 235.9 billion ringgit (US$65.45 billion) compared with 219.4 billion ringgit recorded in 2013, said international trade and industry minister Mustapa Mohamed.
Domestic investments accounted for 72.6 per cent of the total while new investments in the manufacturing sector rose 38 per cent to 71.9 billion ringgit
The approved projects last year would create 178,360 new jobs, Mustapa said.
He said the government was setting a modest target of 56 billion ringgit for approved projects in the manufacturing sector amid a more challenging global economic outlook.
“We are planning to introduce tax and location incentives for principal hub companies,” Mustapa said at an economic event organised by the Performance Management and Delivery Unit (Pemandu) yesterday. The government, he said, would include customised incentives to attract more foreign investors.
The economy expanded 6 per cent in 2014, boosted by steady growth in the construction and services sector.
Exports, a key engine in the country’s economic growth, rose 5.1 per cent to 741.3 million ringgit
The government revised its budget for 2015 after taking into account the lower oil prices.
“Continued surplus in the current account provides for economic strength that buffer against external shocks,’’ minister in the prime minister department in charge of the Economic Planning Unit (EPU) Abdul Wahid Omar said at the same event.
But sustaining growth in 2015 would be a challenging one, as plunging prices of crude oil reduced the country’s income and affected the key oil and gas industry.
“We are seeing a significant shift from dependence on oil revenue with the reduction from 35.4 per cent of total government revenue in 2010 to 29.7 per cent as estimated by EPU in 2014,’’ minister in the prime minister's department and CEO of Pemandu Idris Jala said.
He also said that the country’s current fiscal issues, like persistent budget deficit and revenue worries, were relatively “easy” to fix.
He noted the plunge in crude oil prices oil had allowed the government the opportunity to rationalise its hugely expensive fuel subsidy programme, while the introduction of the goods and services tax in April would immediately broaden the country’s tax base.