ETP driving strong inflow of investments
KUALA LUMPUR, 9 July 2012 - The outlook for investments into Malaysia remains bright as companies including those from debt-ridden Europe prepare for recovery of their businesses.
If traditionally businesses from the UK, Germany and Netherlands use to top the list of investments, there has been a growing interest from Spain, France, Italy and Scandinavian countries.
Malaysian Investment Development Authority (Mida) chief executive officer Datuk Noharuddin Nordin said stainless steel giant Acerinox Group's US$400 million (RM1.27 billion) investment in Johor marked the company's fourth largest global investments.
Likewise, the French aerospace industry is exploring Malaysia for opportunities in manufacturing parts and MRO (maintenance, repair and overhaul).
"This does not mean they will automatically come to Malaysia. We need to compete for these investments (with the neighbours)," he said in an interview with Business Times.
However, Noharuddin is pleased with the investment scenario after the first quarter's rosy numbers.
Investments in the manufacturing sector jumped 12 per cent to RM15.1 billion, of which domestic investments formed the bulk with RM9.2 billion.
The second quarter outlook also looks good, he said, without elaborating.
According to the UN Conference on Trade and Development (UNCTAD), Malaysia enjoyed inflows of US$11.97 billion (RM37.97 billion) last year, an increase of 31.5 per cent from 2010.
While Malaysia has its string of fundamentals which lured investors in the past, including strategic location, infrastructure, sophisticated financial system, political stability and multicultural mix, the Economic Transformation Programme has been the latest draw.
"Any process of change will create opportunities for the right investments and it is the right time for companies with the technology and high knowledge content to come to Malaysia.
"It's a great selling point and new story to promote investments to Malaysia and it excites investors as it is clear which direction we are heading for."
If cheaper utility prices were the lure in the past, potential investors have now been warned that they are at parity with the market but that has not deterred interest, he added.
For Noharuddin, it can be a challenge to define success in terms of investment figures due to the current strategy of attracting selective investments.
Becoming more attractive to R&D, design and other activities may not yield the same kind of numbers which the manufacturing activities do.
Malaysia has also become more attractive with its Intellectual Property rights.
Some of the interesting events happening in Malaysia have also not gone unnoticed by foreign investors such as Crest Group, which offers service and application support and re-training programmes.
Talent is an ongoing issue with most investors, although many have already taken the lead to develop design teams and Mida wants to create excitement in the environment with the state-of-the-art technology.
Source: Business Times
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