PETALING JAYA: Malaysia continues to be a competitive manufacturing location for foreign investors despite the global economic uncertainty caused by the coronavirus (Covid-19) pandemic.
The Malaysian Investment Development Authority (Mida) said in the first nine months of 2020, a total of 740 projects worth RM65.3bil were approved, compared with RM56bil for 669 projects in the corresponding period of 2019, representing an increase of 16.6% in capital investments from both local and overseas companies.
The agency said the newly approved investments are expected to create 51,172 jobs for the country.
The total investments approved in the manufacturing sector were mainly in the petroleum products, including petrochemicals (RM15bil), basic metal products (RM14.5bil), electrical and electronics (RM7.7bil), machinery and equipment (RM5.8bil), chemicals and chemical products (RM4.5bil), food manufacturing (RM3bil), transport equipment (RM3bil) as well as scientific and measuring equipment (RM2.1bil).
Among the notable projects approved in the manufacturing sector for the first nine months of 2020 included LEM (Switzerland), Dexcom and Ultra Clean (USA) as well as Nippon Electric Glass (Malaysia) Sdn Bhd (NEGM).
“NEGM wants to increase its production capacity of glass tubing for pharmaceutical use by approximately 1,000 tonnes per month at its Shah Alam, Selangor facility, ” Mida said in a statement yesterday.
“To date, NEGM has invested more than RM6bil Malaysia on various products, ” it added.
Local companies continued to pour in more money into the country’s manufacturing sector. Mida said domestic direct investments (DDI) soared almost 46% to RM25.9bil from January to September period compared to the same period last year.
Meanwhile, foreign direct investments (FDI) jumped by 3.2% to RM39.4bil.
“The states that recorded the highest total approved investments in the manufacturing sector for the period are Sarawak, Sabah, Pulau Pinang, Selangor and Johor. These states have collectively contributed RM51.3bil, ” Mida said in a statement yesterday.
Meanwhile, the leading sources of FDI for the period of January to September 2020 were China, Singapore, Switzerland, the USA, Netherlands, Thailand, Japan and South Korea, accounting for 91.4% or RM36bil billion of the total FDI approved in the manufacturing sector.
Mida said it has been focusing on attracting “quality investments” in capital-intensive, high value-added and high technology projects.
“This is reflected in the increase of the capital investment per employee ratio to RM1.28mil in the first nine months of 2020 from RM1.04mil during the same period last year.
“Malaysia is committed to working hand in hand with investors, both local and foreign alike, to accelerate the transformation of Malaysia as an advanced nation with inclusive growth and development despite the economic climate.
“Through deliberate and targeted approaches, the government will ensure that the Malaysian economy remains steady on a recovery trajectory amidst this pandemic by providing a conducive and favourable environment to attract businesses, ” it said.
A recent joint study by KPMG and The Manufacturing Institute in the US entitled “Cost of Manufacturing Operations around the Globe” had ranked Malaysia fourth among seventeen economies in an assessment comparing the economy’s competitiveness as a manufacturing hub. “Evaluating a total of 23 cost factors that impact the cost of doing business, the study validates Malaysia’s aspirations to become a global supply chain hub in the region, ” Mida said.
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