KUALA LUMPUR: Malaysia’s approved foreign direct investment (FDI) hit an all-time-high in 2018 and broke the RM80bil mark, even as global FDI figures dipped to the lowest levels in a decade.
However, the country’s domestic direct investment (DDI) continued to fall for the fourth consecutive year in 2018, across the manufacturing, services and primary sectors.
Official data from the Malaysian Investment Development Authority (Mida) showed that the country’s approved FDI in 2018 surged 48% to RM80.5bil, up from RM54.4bil in 2017
The strong showing in approved FDI was largely led by the manufacturing sector, in which investment flows from abroad surged by over 169% in a year.
However, approved DDI, which represented 60.1% of Malaysia’s overall investments last year, fell 17.1% year-on-year (y-o-y) to RM121.2bil.
Speaking at Mida’s annual media conference yesterday, International Trade and Industry Minister Datuk Darell Leiking said that total approved investments last year for the manufacturing, services and primary sectors were valued at RM201.7bil from RM200.6bil in 2017.On a y-o-y basis, the growth in overall approved investments was flattish, up by only 0.55%.
However, it should be noted that the RM201.7bil amount of approved investments had exceeded the government’s earlier forecast of RM200bil.
“To break it down further, investments approved for the period of January to June 2018 were valued at RM86.1bil, while a total of RM115.6bil investments were approved for the period of July to December 2018,” said Leiking.
For context, Pakatan Harapan rose to power in May 2018 following the 14th general election. The ruling government has said that it has intensified its efforts to attract investments, particularly in the high-technology segment, amid the economic slowdown globally. According to the latest Global Investment Trends Monitor released by the United Nations Conference on Trade and Development on Jan 21, global FDI fell by nearly a fifth in 2018 to an estimated US$1.2 trillion from US$1.47 trillion in 2017.
In 2018, Malaysia’s manufacturing sector saw a 37.2% growth in approved investments totalling RM87.4bil, despite the global economic slowdown. Mida figures show that approved foreign investments for manufacturing projects last year more than doubled to RM58bil from 2017’s RM21.6bil.
Leiking said this reflects the country’s success in its targeted approach in attracting investments into high-technology segments.
China was the biggest contributor of approved foreign investments into the manufacturing sector last year, valued at almost RM20bil. Meanwhile, Indonesia was the second-largest contributor, with total investments of RM9bil into the Malaysian manufacturing sector.
Despite the strong performance of investments into the manufacturing industry, the approved investments into the services and primary sectors reported a contraction in 2018, valued at RM103.4bil and RM10.9bil, respectively.“The services sector continued to be the cornerstone of the nation’s economic growth, as it was once again the largest contributor of the total approved investments in 2018.
“For the primary sector, approved investments registered a decrease of 12.2% to RM10.9bil in 2018. This is largely due to lower investments in oil and gas exploration activities,” said Leiking.
For 2019, Mida targets to record total approved investments of over RM200bil.
“The International Trade and Industry Ministry and Mida trust that with the existing policies in place, Malaysia will continue to spark confidence in investors and business owners, and attract more quality investments this year.“As to date, Mida has 399 manufacturing and services projects with investments totalling RM23.7bil in the pipeline,” said Leiking.
We're sorry, this article is unavailable at the moment. If you wish to read this article, kindly contact our Customer Service team at 1-300-88-7827. Thank you for your patience - we're bringing you a new and improved experience soon!
What do you think of this article?