Malaysia approved RM264.6 billion in investments in 2022, the second-biggest yearly total on record. The catch is that it fell short of 2021, the year of the record.
International Trade and Industry Minister Tengku Zafrul Abdul Aziz explained the gap at a Malaysian Investment Development Authority media conference. “There were two large one-off investments that happened in 2021 from Intel and China’s Risen Energy Co Ltd,” he told reporters.
Where the money went
Services took the biggest slice: RM154 billion, or 58.2 percent. Manufacturing drew RM84.3 billion (31.9 percent) and the primary sector RM26.3 billion (9.9 percent).
Foreign direct investment made up 61.7 percent of the total, or RM163.3 billion. Domestic direct investment supplied the other 38.3 percent, RM101.3 billion.
China was the largest foreign source at RM55.4 billion. The United States followed with RM29.2 billion, then the Netherlands (RM20.4 billion), Singapore (RM13.5 billion) and Japan (RM11.4 billion).
By state, Johor led with RM70.6 billion, ahead of Selangor at RM60.1 billion. Sarawak drew RM28.2 billion, Kuala Lumpur RM25 billion and Penang RM16.3 billion.
The ministry expects the approved projects to create 140,370 jobs.
The minister’s pitch
Zafrul said the result “must be improved further in the near future,” pointing to an effective economic policy, a favourable investment environment, political stability and better coordination among federal and state promotion agencies. He tied the New Investment Policy reforms to the 12th Malaysia Plan, which aims to reset the economy, and said Malaysia is pushing to become Asean’s digital hub. A ministry initiative called Academy in Factory, under Budget 2023, is meant to supply skilled labour.
On 2023, he was cautious. Slower global growth may weigh on investment decisions, he said, citing IMF and World Bank forecasts. “Investment decisions are a little different from trade as it is based on long-term plans. The important thing is the country’s fundamentals,” he said.
He still expects the economy to hold up despite inflation, uncertainty and climate change. The World Bank forecasts growth of 4.0 percent for Malaysia and the IMF 4.4 percent, against the government’s own forecast of about 4.5 percent.
