With a robust economy, stable socio-political climate, skilled workforce, and developed infrastructure, Malaysia remains a preferred economic and trade investment destination for international investors.
Through the launch of several mega infrastructures or economic transformation projects such as HSR, eWTP initiated by Jack Ma, and Melaka Gateway among others, Malaysia is gaining exposure globally and is now being regarded as the gateway to other countries in the region.
Furthermore, the Malaysian government is already committed in the digital economy, by preparing a dedicated agenda and budget in parliament to cater for it. This is in preparation for the digital economy, as it plays a key role in building our nation’s GDP. Malaysia is on track in realizing its aspiration as a tech and digital hub in Southeast Asia.
According to the Minister of Industry and Trade (MITI), Datuk Darell Leiking, Malaysia’s economy is one of the most stable in the region. In the first quarter of 2019, Malaysia attained RM21.7 billion in foreign direct investment (FDI) in its 62-year history.
However, with the on-going US-China trade war, will Malaysia still be seen as an attractive investment foray for expats and investors?
Worrying times ahead?
Many nations worldwide have been affected due to the tariff wars between China and the United States. Governments across the globe, including Asia are strategizing on how to combat the possible economic slowdown.
That being said, some think that the trade wars can actually have a positive impact on smaller countries.
Malaysia’s Economic Affairs Minister Datuk Seri Mohamed Azmin Ali, echoed Minister Leiking’s highlighting that our nation is ready to accept new investment as we encourage more investors to take advantage of the country’s modern infrastructure, connectivity to the region and pool of skilled workers.
In spite of that, having two of the largest economic powerhouses at odds with each other can have a negative impact. China – the world’s second largest economy – saw an economic decline for the first time after three decades, and like many other countries in Asia, Malaysia is among China’s largest trading partners. As for the United States, Malaysia has always held on to its standing economic relationship with the US, going all the way back to the 1950’s.
Given the current scenario, there are various aspects of the economy that could possibly be affected, including trading – be traditional or online trading. Social Trading Company, eToro has weighed in on this topic.
“The overall economic growth of Southeast Asia is strongly influenced by US-China trade friction,” said Senior Analyst at eToro Asia, Toby Wu.
“The stock market will undoubtedly be affected by trade tensions, especially in export-related industries such as rubber and industrial supplies,” said Toby.
Bullish on foreign investment
Many believe that Malaysia is still a profitable country to invest in. According to Malaysia’s Investment Development Authority (MIDA), the country has achieved 47% of its fiscal projection of RM 113.5 billion. This encouraging news also serves as a strategic attempt to withstand the impact of the trade war that has widened beyond the US and China.
Chairman of MIDA, Datuk Abdul Majid Ahmad Khan, shared that Malaysia plans to work hand in hand with its counterparts, rather than pitching against each other. He believes that by doing so – with each countries individual niche and strengths, we will create a better ecosystem, resulting in a better economy for everyone.
In addition to that, another factor to consider is the fact that Malaysia is committing itself to Industry 4.0. According to Minister of Industry and Trade (MITI), a National Policy has already been tabled to help local industries increase productivity, efficiency, quality, and develop a highly-skilled talent, by using data, machine learning and AI.
This is further evidence that the times are changing, which includes trading industry as well. In fact, trading also is going through its own form of transformation, from traditional to Social Trading.
“Trading is no longer only for Wall Street bankers or people with vast knowledge and capital to invest. People can start investing with as little as $200, and due to that fact, it gives more people access to global markets,” according to Paul Familiaran, Head of Southeast Asia Business at eToro Asia.
Albeit, one can understand the worry of investing in a country that has a lot at stake. However, it is always good to remember that although 62 years old, Malaysia is a country reborn. With the change of power and the new government at the helm, it is a country that is determined to strive to be a major player in the Asian region. With that, it would be a safe bet to invest in Malaysia.