MIDA: Approved investments in manufacturing, services and primary sectors rose 1.7% in 2019

KUALA LUMPUR (April 21): The Malaysian Investment Development Authority (MIDA) said total approved investments for the manufacturing, services and primary sectors rose 1.7% year-on-year (y-o-y) in 2019 to RM207.9 billion.

Of that, RM125.5 billion or 60.4% of the total was contributed by domestic direct investment (DDI), while foreign direct investment (FDI) accounted for 39.6% of the total at RM82.4 billion, an increase of 2.9% from 2018.

The services sector, which saw an 11.3% increase in investments y-o-y, accounted for the biggest portion of investments.

The US (RM26.8 billion), China (RM15.7 billion) and Japan (RM12.1 billion) accounted for 66.3% of the total FDI approved in the three sectors.

Selangor recorded the highest investments approved in 2019 at RM47.8 billion, followed by Penang (RM33.7 billion), Johor (RM24.4 billion) and Kuala Lumpur (RM21.6 billion).

The four states contributed over 60% of the total approved investments for 2019.

The manufacturing sector saw approved investments amounting to RM82.7 billion for 2019, as the number of projects approved increased 37% from 721 projects in 2018 to 988 projects in 2019.

FDI accounted for 65.2% or RM53.9 billion of approved investments in the sector, while the balance was accounted for by DDI.

“MIDA has put in place a fast-track mechanism to expedite the approval of projects. It is noteworthy that 86.9% of the manufacturing projects approved last year were through this mechanism,” said senior minister and minister of international trade and industry Datuk Seri Mohamed Azmin Ali, in a statement.

A total of 108 projects were approved with investments of RM100 million and above, which is 33.3% higher y-o-y.

The approved projects will create about 78,000 new jobs, of which 35.4% are managerial, technical and supervisory (MTS) positions.

Among the notable projects were Intel’s RM10 billion investment which will see its advanced assembly and test technology brought to Malaysia, as well as UK-based Smith+Nephew’s orthopaedics manufacturing facility in Penang.

The services sector contributed to 56.8% or RM118.1 billion of total approved investments, with the top five contributors being the real estate (RM40.9 billion), utilities (RM32.6 billion), global establishments (RM11.8 billion), distributive trade (RM11.7 billion) and support services (RM5.7 billion), accounting for 87% of investments for the sector.

“Last year, notable services projects approved included two green technology projects by Telekosang Hydro in Sabah, a healthcare project by Daehan Rehabilitation Services in Putrajaya and a hospitality project by Interland Development in Sabah,” said Mohamed Azmin.

The primary sector saw RM7 billion in approved investments in 2019, down from RM10.9 billion a year earlier, led by the mining subsector, which accounted for 94.3% of investments.

The balance comprised the plantation and commodities (RM291.4 million) and agriculture (RM135.1 million) subsectors.

For 2020, a total of five manufacturing and services projects have been approved to date.

The minister said the priority currently is not about the number of investors or absolute value of investments but instead to bring in high value-added investments that can help to revive the economy.

“A business as usual approach will no longer work in this challenging environment, a fundamental solution for the country to revitalise the economy is through adopting bold initiatives to ensure impactful accomplishments.

“Closer partnerships between federal, states and local authorities will be of the essence in facilitating our investors and ensuring the implementation of approved projects. All stakeholders need to make the necessary changes and reengineer processes to deliver more efficient and effective services. Digitalisation and automation is indeed the way forward,” said Mohamed Azmin.

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