KUALA LUMPUR: Hong Kong was Malaysia’s top source of foreign direct investment (FDI) in the final quarter of 2013, compared with ninth spot the year before.
In 2013, Hong Kong-Malaysian trade total trade rose 1.7% to US$14.65bil, of which, US$4.9bil accounted for FDI outflow from Malaysia into Hong Kong in the last quarter. This was conveyed at a press conference by the Hong Kong Trade Development Council deputy executive director Margaret Fong, who urged Malaysian small-medium enterprises to bring their businesses into Hong Kong.
Information on FDI inflow from Hong Kong into Malaysia was unavailable at the event.
Although Fong refrained from suggesting a target amount for Malaysia-HK FDI, she said that the perks of trading in and with Hong Kong included expertise in legal and branding services, as well as double tax deduction of 10% to 5%.
As a first step towards exploring the feasibility of entering into a bilateral free trade agreement, Hong Kong and Malaysia signed a Joint Declaration on Strengthening Economic Co-operation in December 2009. It exempts Hong Kong-incorporated Malaysian companies from being taxed in its home country.
“We have a governmental agency, InvestHongKong, to help with setting up,” Fong said, adding that Hong Kong served as a platform for companies to network with neighbouring China, Japan and Korea, which always tap into Hong Kong.
On intellectual property trade, Fong said Hong Kong had one of the most robust regimes in the world, providing protection, commercial expertise and funding, adding that Hong Kong was the largest source of overseas direct investment for China.
In 2013, China was the second largest export market of Malaysia, accounting for 14% of the country’s total exports with electrical and electronic products being the major items.