KUALA LUMPUR – Malaysia continues to be a competitive location for manufacturing projects as of 9 November. In the first nine months of 2020, a total of 740 projects worth RM65.3 billion were approved compared with RM56.0 billion in 669 projects in the corresponding period of 2019, representing an increase of 16.6 per cent in capital investments.
These newly approved investments are expected to create 51,172 jobs for the country. The jobs created include 1,040 electrical and electronic engineers, 963 mechanical engineers and 331 chemical engineers. In addition, the approved manufacturing projects will also require about 5,499 skilled craftsmen such as plant maintenance supervisors, tools and die makers, machinists, IT personnel, quality controllers, electricians and welders.
The total investments approved in the manufacturing sector were mainly in the petroleum products including petrochemicals (RM15.0 billion), basic metal products (RM14.5 billion), electrical and electronics (RM7.7 billion), machinery and equipment (RM5.8 billion), chemicals and chemical products (RM4.5 billion), food manufacturing (RM3.0 billion), transport equipment (RM3.0 billion) as well as scientific and measuring equipment (RM2.1 billion).
These industries make up 85 per cent of total approved investments for the sector. Compared to the corresponding period last year, domestic direct investment (DDI) in the manufacturing sector saw a leap of 45.5 per cent to RM25.9 billion during this period while the value of approved foreign direct investments (FDI) increased by 3.2 per cent to RM39.4 billion.
The states that recorded the highest total approved investments in the manufacturing sector for the period are Sarawak, Sabah, Pulau Pinang, Selangor and Johor. These states have collectively contributed RM51.3 billion.
A recent joint study by KPMG and The Manufacturing Institute in the USA entitled “Cost of Manufacturing Operations around the Globe” ranked Malaysia fourth among seventeen economies in an assessment comparing the economy’s competitiveness as a manufacturing hub.
Evaluating a total of 23 cost factors that impact the cost of doing business (CoDB), the study validates Malaysia’s aspirations to become a global supply chain hub in the region.
In efforts to increase the ease of doing business for investors in Malaysia, the Government, through the Malaysian Investment Development Authority (MIDA) has been intensifying its efforts to re-engineer its business processes to raise the efficiency of the organisation’s various functions.
Among the initiatives that have been implemented include the [email protected] or the Project Acceleration and Coordination Unit to provide end-to-end facilitation for all projects approved to enable the timely implementation of investments in the country; as well as online modules namely e-Manufacturing Licence (e-ML), e-Incentive and JPC Online Application to accelerate the necessary approvals for manufacturing licences, incentives and exemption of customs duties to expedite the execution of projects.
As the principal investment promotion and development agency of the country, MIDA prioritises the push for strategic collaborations between foreign and local companies to propel mutually beneficial outcomes such as the transfer of knowledge and expertise across industries as well as the development of resilient supply chains and support network. These are stepping stones to nurture Malaysian companies to become truly global champions.