Malaysia Continues To Attract FDIs During Difficult Global Economic Scenario

GEORGE TOWN (Penang, Malaysia), Sept 21 (Bernama) -- Malaysia expects to attract the same amount of foreign direct investments (FDIs) as last year despite the challenging economic environment. Minister of International Trade and Industry, Datuk Seri Mustapa Mohamed, said last year, Malaysia recorded FDIs of US$9.42 billion (RM39 billion). He said Malaysia's highly-diversified economy, strong manufacturing foundation, developed infrastructure and connectivity, proactive government policies and multilingual workforce were among the reasons investors continued to view Malaysia as their profit centre. "I believe we can emulate what we had achieved last year in terms of FDIs and the majority of them will be coming from the services and manufacturing sectors," he told reporters after chairing the dialogue session with 14 Penang-based companies here Tuesday. Penang is Malaysia's northern state. He said Asia would become the new source of FDIs in future while the investors from Europe and US would continue to view Malaysia as their ideal destination. He said year-on-year, FDIs increased to US$3.09 billion (RM12.8 billion) in the first quarter of 2016 from US$2.41 billion (RM10 billion) in the corresponding period of 2015. However, Mustapa said, the closure of some manufacturing companies in Malaysia would not result in the higher number of restrenchment. He said for the last 18 months, 90,000 new jobs from the manufacturing sector were created compared to only 10,000 during the same period. "The disruptive and radical changes due to digital evolution have affected the way businesses are conducted. The closure of many other labour-intensive industries, be it in electrical and engineering (E&E) or in motor vehicle, is not unexpected. Such industries, in many ways, have lost its comparative and competitive advantages. "Retrenching workers is normal process, part of industrial restructuring as technology change and companies tend to adapt to the new environment. What's important is there are more jobs opportunity created," he said. He said Malaysia continued to be a preferred location for investments as reflected by the performance of our approved investments in the manufacturing, services and primary sectors in the first quarter of 2016 which recorded a total of 1,271 projects with investments of US$9.01 billion (RM37.3 billion). For Penang, Mustapa said, the state would continue to attract investments in various industries including design activities, research and development and light-emitting diode products. For the first quarter of this year, Penang attracted approved investments of US$323.82 million (RM1.34 billion) in 27 manufacturing projects. He said there were 34 projects more in the pipeline with investments of US$403.46 million (RM1.67 billion) from the E&E, medical devices, machinery & equipment, chemical & chemical products sectors. --BERNAMA