THE increase in foreign direct investment (FDI) proves that Malaysia is still an attractive investment destination despite global trade tensions, said Finance Minister Lim Guan Eng

He said this is evident in the 10.3% increase in FDI stock in the second quarter of 2019 to RM667.5 billion from RM605.1 billion a year ago.

“The steady rise in total FDI stock shows the continuing attractiveness of Malaysia as an international investment destination, amid rising trade tensions across the world,” he said, while referring to the Statistics Department’s International Investment Position document.

He attributed sustained economic growth as a reason behind the increased FDI stock.

Superseding market expectations, Malaysia recorded a gross domestic product (GDP) growth of 4.9% in the second quarter of 2019, amid the slowdown experienced by regional economies.

“The Malaysian GDP during the same quarter expanded 4.9% year-on-year, an acceleration from 4.5% growth in the first quarter of 2019.

“This comes at a time when various regional economies are experiencing synchronised growth slowdown. The 4.9% GDP quarterly growth is better than market expectations of 4.7% as compiled by Bloomberg.

“The stronger than expected second quarter performance has convinced Fitch to revise its 2019 GDP growth projection for Malaysia upward to 4.6% from a lowly 4.2%,” he said in a statement.

He added the government expects the full-year GDP to expand by 4.5%-5%.

The Malaysian Investment Development Authority (Mida) announced last week that approved FDI across all sectors rose by 97.2% to RM49.5 billion in the first half of 2019, from RM25.1 billion in the same period last year.

The approved FDI for the manufacturing sector jumped by 74.2% to RM33.1 billion in the first half of the year, from RM19 billion in the preceding corresponding period.

The US accounted for the bulk of the approved FDI in the manufacturing sector at RM11.7 billion, followed by China with RM4.8 billion, Singapore (RM3.1 billion) and Japan (RM2.1 billion).

“Mida states that the RM33.1 billion approved manufacturing FDI will create 30,449 jobs in the near future.

“The government will maintain its business-friendly approach to attract investment into the country and create quality jobs for all Malaysians.” – August 20, 2019.