US FINANCIAL CRISIS HAS NOT AFFECTED FDI FLOWS TO MALAYSIA, SAYS MIDA By Manik Mehta

NEW YORK, Oct 6 (Bernama) -- Despite initial fears of the ongoing financial
crisis in the United States having an impact on foreign direct investments flow
to Malaysia, the crisis has not harmed US investments to the country.

"In my personal view, the US financial turmoil would hardly have any impact
on FDI flows to Malaysia because the FDI is intended for manufacturing
purpose.

"Since we deal mainly with the investment sector, we have not felt the
impact so much. In fact, history tells us that most manufacturing companies
decide to set up offshore manufacturing operations during challenging economic
times.

"If you study carefully, many companies have set up overseas operations
during challenging times and many of these companies, which received a good
bargain in Malaysia, are doing very well," said Wan Hashim Wan Jusoh, director
of the New York office of Malaysia Industrial Development Authority (MIDA) and
an expert on US investments to Malaysia.

Wan Hashim will soon be returning to MIDA headquarters in Kuala Lumpur
after a five-year stint in the United States, three of which were spent in
Boston and
the last two in New York.

Malaysia has been ideal for high technology, value-added and
capital-intensive industries," Wan Hashim told Bernama.

Taking stock of his five-year posting as MIDA representative in the
United States, Wan Hashim spoke of his "mentally satisfying achievements".

"I have made it a point to keep in touch with the executives of US
corporations having operations in Malaysia with whom I have been networking for
some time. Indeed, we like to find out if there are any additional areas of
interest in which they could invest and we could help," he said.

He has also been coordinating with a team of consultants and company
executives
to present what he calls their "wish list" to the Malaysian Government.

"I navigate my way through the maze of regulations and establish a link
between US companies and the Malaysian Government. If you determine what the
companies want, they feel grateful and help by spreading the good word about
Malaysia," he said.

Wan Hashim averred that the FDI flow from the United States was "quite
satisfactory" in the January-July period.

Malaysia approved a total of US$831.5 million worth of investment projects
during the period compared with US$878 million throughout last year.

American investments in Malaysia were in electrical and electronics
industry,
chemicals and chemical products, scientific and measuring equipment, petroleum
products, plastic products, fabricated metal products, transport equipment,
beverages and tobacco, food manufacturing, machinery manufacturing, non-metallic
mineral products, paper, printing and publishing, furniture, fixtures and
textiles.

Malaysia is poised in what local experts describe as a "take-off stage",
the
implied reference to the fact that as more and more Western companies realise
that it would not be prudent to put all their eggs in the China basket, they
look at places such as Malaysia, which although slightly more expensive, provide
better quality, value-added products and are much easier to deal with.

Responding to competition from countries such as China and India, Wan
Hashim said China's rise did take away some of the investments.


"China and India in the last few years did make an impact as alternative
locations to Malaysia and also impacted the FDI flow," he said.

All companies tend to first look at China for hard manufacturing and at
India for software development.

"But due to Malaysia's track political and economic record and also because
of the time and resources spent on infrastructure development and manpower,
Malaysia continues to be an attractive destination for investments in high
technology, capital-intensive and high-value product manufacturing.

"Of course, we need to be focused. The electronic and semi-conductor
industry is an example of our focus.

"Our strength lies in this sector, particularly in the development of the
new generation of chips used in solar energy industry in which Malaysia is
becoming a strong player," he said.

Indeed, solar energy is being projected as Malaysia's "sunrise industry",
particularly in view of the oil price spike that has created problems for many
countries and hastened the development of alternative energies.

There are already two major US companies engaged in solar production in
Malaysia -- First Solar Malaysia Sdn Bhd at Kulim Hi-Tech Park in Kedah and
Sunpower Malaysia Manufaturing Sdn Bhd in Melaka.

MIDA has named Arham Abd Rahman of MIDA head office in Kuala Lumpur as the
successor to Wan Hashim.