Investors reflect confidence in manufacturing sector

20 Feb '08

2 min read

In the year 2007, Japanese investment in the Malaysian manufacturing sector amounted to RM6.5 billion compared to RM4.4 billion of 2006. This mounting trend reflects the increasing interests of foreign investors in the country.

Petrochemicals and petroleum products were among the most invested sectors of Malaysia.

Recently, a Malaysian Industrial Development Authority (MIDA) media conference on the performance of the manufacturing and services sectors in 2007 was held.

At the meeting, Datuk Seri Rafidah Aziz, International Trade and Industry Minister noted that, the existing Japanese companies in the country have also expressed their desire to invest RM5.4 billion showing their confidence in Malaysia as one of the most reliable overseas location for investment.

Economists said the 2007 figures indicated that Malaysia remained the most preferred investment destination despite stiff competition from China, Singapore, Vietnam and Thailand. But, it will be tough to maintain these levels given an anticipated retardation in global consumer demand.

The Malaysian Government has plans to intensify promotional trade activities, cut red tape, upgrade industrial infrastructure and further cut corporate tax from 26 percent this year to 25 percent in 2009 to remain competitive.

While Germany surfaced as the second largest source of foreign investments, the US marked an increase of 20 percent to reach RM 3 billion last year, compared to RM2.5 billion of 2006.

India also emerged as an important source of foreign direct investment as a result of two major accomplishments valued at RM2.9 billion. Textiles formed the core area for investment by Indian companies.

However, investments from Iran, Singapore, China, the Netherlands, Australia and South Korea also had its imprint on Malaysia's overall economic development.

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