Malaysia eyes 8-10pc increase in foreign, domestic direct investments in 2024

KUALA LUMPUR: Malaysia has targeted at least an 8.0 to 10 per cent increase in foreign and domestic direct investments this year after posting a "historic" figure last year.

The country's approved investments for the manufacturing, services and primary sectors surged 23 per cent to RM329.5 billion last year from RM267.7 billion in 2022.

Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said these investments were expected to create more than 52,700 job opportunities.

He emphasised the importance of aligning the investment target with the country's economic growth.

With the gross domestic product (GDP) growth for 2024 projected at 4.0-5.0 per cent, he said the ministry aimed to double this rate, setting a target of 8.0 to 10 per cent for total approved investments.

"We are still finalising the target, but it has to be higher than last year," he said at the press conference on Malaysia's investment performance for 2023 yesterday.

Tengku Zafrul said the services sector emerged as a silver lining amid the economic slowdown.

The sector attracted RM168.4 billion, or 51.1 per cent, of the total approved investments last year.

On the manufacturing sector, Tengku  Zafrul said the sector attracted a total of RM152 billion in approved investments, accounting for 46.1 per cent of the total approved investments across all industries. 

Foreign investments accounted for a substantial 57.2 per cent, or RM188.4 billion, of the total approved investments, while domestic investments contributed 42.8 per cent, or RM141.1 billion.

The investment influx was predominantly led by five countries. Singapore invested RM43.7 billion, followed by the Netherlands (RM35.5 billion), the United States (RM21.5 billion), Cayman Islands (RM17.5 billion) and China (RM14.5 billion), altogether accounting for 70.4 per cent, or RM132.7 billion, of total foreign investments.

This diversification in foreign investment sources underscored Malaysia's global appeal and the confidence of international investors in its robust investment landscape, he said. 

Tengku Zafrul said the overall performance showed that as a country with strong policies that supported growth and investment prospects, Malaysia offered a huge potential for attractive returns alongside its clear vision to become a developed and inclusive economy.

He said the government and an "important" Chinese institution were in an advanced stage of negotiations to set up a two-way foreign investment promotion. 

"We aim to cement a cooperative agreement focused on investment promotion enhancement to bolster investment flows, encouraging Chinese firms to explore opportunities in Malaysia while similarly facilitating Malaysian enterprises to expand into China. 

"This potential partnership is targeted at fostering investments in high-value sectors, meticulously chosen to reflect the strategic priorities of both nations, thereby promising to fortify economic ties and promote mutual growth," he added.

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