According to Minister Of Investment, Trade And Industry Tengku Datuk Seri Zafrul Abdul Aziz, MITI through MIDA has implemented a targeted approach to ensure that the promotion of foreign and domestic investment covers quality, value-added and high-tech projects to complete the ecosystem and supply chain of the industries targeted by the country.
For the year 2022, a total of RM267.8 billion investment from 4,517 approved projects from various economic sectors (main sectors, manufacturing and services) in Malaysia will generate 140,440 job opportunities.
Domestic investment contributed as much as RM104.4 billion (38.9%) to this amount, he said to address the first question posed by Tan Sri Dato’ Low Kian Chuan who inquired about the domestic direct investment (DDI) target for 2023 compared to foreign direct investment (FDI).
“I would like to share that for the first quarter of 2023, Malaysia has attracted investment commitments amounting to RM74.1 billion, which is an increase of 60% year-on-year. Most notably, the ratio of FDI to DDI is almost 50:50, which is 52.5% for FDI and 47.5% for DDI,” said Zafrul, adding that this is a clear reflection of the confidence from local companies and businesses in the current government policy.
As of 31 May 2023, there are 743 projects in the negotiation stage, or evaluation with a total proposed investment of RM50.6 billion. Of that amount, domestic direct investment (DDI) was as much as RM8 billion or 15.7% and foreign direct investment (FDI) was as much as RM42.7 billion or 84.3%.
The amount of this investment includes projects from the manufacturing sector with a proposed investment of RM37.5 billion involving 61 proposed projects.
“In this regard as well, as of June 2, 2023, MITI through MIDA has successfully obtained FDI investment commitments totaling RM23.07 billion through an investment mission to Japan, RM170 billion through an investment mission to the People’s Republic of China, RM24 billion through an investment mission to the Republic of Korea and RM13 billion through an investment mission to Singapore,” said Zafrul in response to the second question.
Low inquired about the measures taken by the government to stimulate the investment of micro, small and medium-sized enterprises. Zafrul added that these investment missions organized by MITI and MIDA are important achievements towards realizing Malaysia’s goal of becoming a high-tech global innovation hub, in line with the target sectors of the New Investment Policy (NIP) namely aerospace, electricity and electronics (including medical equipment), digital economy, pharmaceutical and chemical/petrochemical.
The NIP also aims for a resilient investment ecosystem that can generate various opportunities for small and medium enterprises (SMEs), as well as high-paying jobs for Malaysians.
In order to stimulate SME investment, MIDA, as the country’s main investment promotion agency, has provided several programs including incentives in the form of tax incentives and grants to domestic companies as follows:
1/ Providing tax incentives to domestic companies that implement projects promoted under the Investment Promotion Act (PIA) 1986.
2/ Increasing the capacity of local investors through the Industry4WRD Intervention Fund for SMEs.
3/ Encouraging the use of automation among companies in the manufacturing and service sectors through Automation Capital Allowance.
4/ Organizing the MIDA Invest Series Conference to identify the investment potential of each state.
