KUALA LUMPUR: Despite seeing the strongest growth in foreign direct investment (FDI) inflows among Asean countries last year, Malaysia continued to lag behind neighbouring countries in terms of total receipts.
Malaysia’s net FDI inflows grew by an impressive 22.2% to US$12.3bil (RM39.6bil) in 2013, compared with US$10.1bil in the preceding year, according to the World Investment Report (WIR) 2014 published by the United Nations Conference on Trade and Development (Unctad).
That put the country in the fourth spot among Asean FDI recipients, behind Singapore, Indonesia and Thailand. In Asia, as a whole, Malaysia ranked as the seventh top FDI recipient.
“In Malaysia, as in the rest of the world, our concern is that the level of investment in sectors relevant to the achievement of sustainable development goals remains insufficient,” Michelle Gyles-McDonnough, United Nations resident coordinator for Malaysia and UNDP resident representative for Malaysia, Singapore and Brunei, said in conjunction with the launch of the report here yesterday.
The WIR 2014 report, entitled “Investing in Sustainable Development Goals (SDGs): An Action Plan” was unveiled by Malaysian Investment Develop-ment Authority CEO Datuk Azman Mahmud.
Among the top three Asean FDI recipients last year, Singapore saw a 4.3% increase in net FDI inflows to US$63.8bil, while Indonesia saw a decline of 3.6% to US$18.4bil. As for Thailand, although it saw many FDI projects shelved because of political instability, the country still managed to attract higher investments, with net inflows rising 20.9% to US$12.9bil last year.
The increase of FDI in Malaysia compared favourably to the increase in global FDI of 9% and 6.7% into developing countries, as reported by Unctad.
When asked about his outlook for 2014, Azman said: “Leading indicators have shown that investments in Malaysia are on the uptrend.”
“If all our efforts are implemented according to plan, we will definitely have very strong growth in our investment numbers,” he told reporters on the sidelines.
According to Azman, Malaysia would continue to undertake and adopt the “ecosystem approach” in developing both the manufacturing and services sectors in its effort to align promotion of investment with sustainable growth. The “ecosystem approach” meant an integrated and holistic approach to promote the entire value chain of industry clusters.
The ecosystem approach, Azman said, would allow the Government to align with Unctad’s recommendation for it to be more selective and targeted in offering tax incentives to attract investors.
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