Prime Minister Datuk Seri Najib Tun Razak speaking at Invest Malaysia 2018.
Bismillahhirahmannirrahim
Assalammualaikum Warahmatullahi Wabarakatuh
A very good morning and Salam 1 Malaysia.
Ladies and gentlemen,
1. It is nearly eight years since I first stood before you at Invest Malaysia in March 2010, and introduced our New Economic Model – a transformative plan, with the aim of creating a high-income nation that is inclusive, equitable and sustainable; a country in which no one would be left behind, opportunity would be made available for all, and whose citizens could look confidently to the future, secure in the knowledge that their Government was putting in place the right fundamentals for a secure, stable and successful Malaysia.
2. We had an economic plan, and that plan has delivered, as I am about to explain. But let me stress that from the start we were also willing to take tough decisions – decisions that not everyone would support, but which were the right ones for the Malaysian economy and the Malaysian people.
3. Before I announced the New Economic Model, for instance, in 2008 and 2009, the global financial crisis spread across to Asia. This was a grave threat to our economic growth and the livelihoods and welfare of Malaysians.
4. Indeed, by the fourth quarter of 2008, conditions and sentiment in Malaysia had turned so negative that the MIER Business Conditions Index virtually collapsed, while the Consumer Sentiments Index fell to its second lowest level on record.
5. A stimulus response had been announced in November 2008, but the RM7 billion proved to be insufficient. It did not do the job.
6. In March 2009, just before I became prime minister, I announced a second package amounting to RM60
billion. This was not an easy decision, and it was attacked as a failure by our opponents at the time. But if the second stimulus package had not been implemented, and implemented in a timely manner, Malaysia’s recession would have continued.
7. As it was, the result of the second package was that Malaysia’s GDP growth rebounded from the contraction of 1.7 percent we saw in 2009, to a very positive 7.2 percent in 2010.
8. This is the kind of bold leadership the Government has shown since taking office, and it has delivered, and continues to deliver, for the Malaysian people.
9. Let the facts speak for themselves.
• Since 2009 Gross National Income, or GNI, has increased by over 50 percent. Over the course of 2017 alone, it is estimated to have expanded by a very healthy 9.1 percent, to RM1.3 trillion.
• Mean monthly household income rose from RM 4,025 in 2009 to RM 6,958 in 2016, an annual growth rate of 8.1 percent. The rise in income for B40 households was even more significant at 10.2 percent per annum, from RM 1,440 per month in 2009 to RM 2,848 per month in 2016.
• Over the same period, the incidence of poverty fell from 3.9 percent to 0.4 percent, while our Gini coefficient improved from 0.441 to 0.399, a significant narrowing of income inequality.
• Between 2009 and 2016, 2.26 million jobs have been created, of which more than one million are high income jobs. This marks 69 percent of the 3.3 million we want to reach by 2020, which shows that excellent progress has been made.
• Unemployment and inflation have been kept low, while the Government’s long-term commitment to fiscal consolidation and prudence means that the deficit is set to reduce further to 2.8 percent in 2018. That’s down from 3 percent in 2017, and from 6.7 percent in 2009.
• We have enjoyed years of strong growth – with figures that most developed economies could only dream of – even during times of global economic turmoil and uncertainty. In fact, last year Malaysia exceeded all expectations, with the World Bank having to revise its estimate for our growth upwards not once, not twice, but three times – to 5.8 per cent.
10. Other figures reflect why investors and global institutions are right to have confidence in Malaysia. Our total trade grew strongly by 20.8 percent over the period from January to November 2017 – while in that month alone, gross exports reached double-digit growth of 14.4 percent, with the highest receipts ever recorded, at RM83.5 billion.
11. Our capital market, a key facilitator for financing business growth, has continued to grow from strength to strength.
13. In 2017, foreign net fund inflow recorded a positive RM10.8 billion, the highest since 2012.
14. Corporate bond and sukuk new issuance amounted to RM111.2 billion for the first eleven months of the year, close to 30 percent higher than the whole of 2016, while Malaysia’s bond and sukuk market as a whole grew further to RM1.28 trillion.
15. The Malaysian Islamic Capital Market as a whole – of which our sukuk market is the largest globally – grew 11.9 percent to reach a size of RM1.9 trillion compared to RM1.7 trillion in the previous year.
16. The ringgit appreciated by 10.4 percent against the US dollar in 2017, and on 5 January 2018, it closed at a 17-month high, breaking the four dollar psychological barrier.
17. This rise may have been partially underpinned by the recovery in crude oil prices, but it also indicates positive sentiment among investors and a recognition of Malaysia’s excellent economic and financial fundamentals.
Ladies and gentlemen,
18. This progress has real and tangible benefits for both national and international investors. Total private investment approved by the Malaysian Industrial Development Authority during the first nine months of 2017, for instance, stood
at RM113.5 billion. This involves 3,886 projects and will create around 91,500 employment opportunities.
19. This represents a contribution to the growth of the national economy; to the improvement of our living standards; to the upscaling of our skills and knowledge transfers among our youthful and increasingly highly educated population; and to the increase in our productivity.
20. But the business community knows well that this has always been a Government that is business-friendly, and that we welcome foreign direct investment – of which we had net approved FDI of RM36.4 billion during the first nine months of 2017.
21. When it comes to FDI, by the way, you may have heard some irresponsible politicians scare-mongering about FDI from China, saying that we are selling our sovereignty. I know that the well-informed and well-educated audience here today will recognise what baseless nonsense this is. My Government will never sacrifice an inch of our sovereignty.
22. Remember that Malaysian investment into China used to be bigger than Chinese investment in Malaysia, and that we have more Malaysian investments overseas than foreign direct investments in this country. So this is a two way street.
FDI levels vary over time, and such connections are part of, and key to, a healthy and diversified economy.
23. Perhaps I can also take the opportunity to remind that you that, while over time, we have had RM63 billion in FDI stock from China and Hong Kong, we have had more – RM70 billion in fact – from Japan: and you don’t hear anyone warning that we are selling our country to the Japanese!
24. Of course not. They are most welcome here. So are investors from Africa, the Americas, China, the EU, India, Saudi Arabia and around the world.Ladies and gentlemen,
25. We will continue to strive to make our country even more business and market -friendly, which means we are always working to improve transparency, accountability, and efficiency.
26. We need to ensure the Malaysian capital market remains regionally competitive, so that the market continues to evolve in order to sufficiently expand its depth and breadth to serve the needs of our growing economy.
27. Our Securities Commission and Bursa Malaysia, as well as our central bank and the Ministry of Finance, have continuously introduced and supported measures to further increase the dynamism of our capital market. Towards this
objective, I can assure you that we can expect the introduction of further measures in the near future.
28. I would also like to remind you that in the last Budget, I announced that in order to boost Malaysia’s attractiveness as a preferred investment destination, the Principal Hub tax incentive will be extended until 31 December 2020, and
the Government has allocated RM200 million to MIDA to attract high-impact investments to this country.
Ladies and gentlemen,
29. The international business community knows that this is a Government that provides stability, strength and the certainty that investors want and need. For example, HSBC is investing over RM1 billion to build its future regional headquarters at the Tun Razak Exchange.
30. Huawei, an ICT global solutions provider which serves more than a third of the world’s population, has made Malaysia its global operations headquarters, data hosting centre and global training centre – with a project cost of RM2.2 billion and employing more than 2,370 people.
31. And Saudi Aramco’s US $7 billion investment in Petronas’s Refinery and Petrochemical Integrated development in Johor. That’s Aramco’s biggest downstream investment outside the Kingdom, and this shows the confidence they have in us.
32. There is a long list of others. But today let me also mention some of our own blue chip companies. Sime Darby Plantation
is the world’s largest producer of Certified Sustainable Palm Oil. Top Glove is the world’s largest manufacturer of gloves. And AirAsia is the world’s best low cost airline.
33. There are so many successful Malaysian companies that make us proud, and whose names will be very familiar to you. For instance, PETRONAS, Khazanah, Maybank, CIMB Bank, Genting, SP Setia and IOI Group – regional and global players, who are capitalising on opportunities especially in the ASEAN region, but also all over the world.
34. Think of the redevelopment of one of London’s most iconic structures, the Battersea Power Station. That’s a massive project, being undertaken by a Malaysian consortium. Or consider IHH Healthcare, the second largest healthcare provider in the world. Or the largest and fastest growing mobile telecommunications network in Sri Lanka, owned by Axiata.
35. This Government will continue to encourage and champion Malaysian companies in their quest to become regional and global players, to establish global brands that can proudly fly our flag across the international markets.
Ladies and gentlemen,
36. Their achievements, and those of the foreign companies who invest in Malaysia, the efforts of the Malaysian people and this Government, have been commended by a wide range of international bodies. Let me give you a few examples:
37. The World Economic Forum’s Global Competitiveness index for 2017-2018 rates us very highly. Out of 137 countries, Malaysia is ranked 3rd for Strength of Investor Protection, 5th for Pay and Productivity, 5th for our low Burden of Government Regulation, and 14th for our Quality of Education System.
38. The International Monetary Fund has praised what they call our “sound macroeconomic policy responses in the face of significant headwinds and risks”. In their most recent report, published last month, they said, and I quote: “The Malaysian economy has shown resilience in recent years and continues to perform well.”
39. The World Bank recently confirmed they think we are on track, reporting that, “Malaysia is expected to achieve high-income country status in the next few years.” They have also stated that “The Malaysian economy is progressing from a position of strength.”
40. And a survey last year co-authored by the Wharton School at the University of Pennsylvania awarded Malaysia the laurels as the “Best Country to Invest in”. They said, and I quote: “Malaysia is the clear frontrunner in this ranking, scoring at least 30 points more than any other country on a 100 point scale.”
Ladies and gentlemen,
41. There are certain politicians that would like to make you think that Malaysia is in danger of going bankrupt. Does it sound like it to you? I think not, and neither do the World Bank, the IMF or any credible independent agencies and economists. Quite the opposite, in fact. It is those politicians are bankrupt of ideas. They are so desperate that they are willing to run down their own country for personal political gain.
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