WHY INVEST IN MALAYSIA
The Malaysian economy has made a gargantuan leap since 1957. The transformation
of the country's economy from one based on primary commodities like tin, rubber and
palm oil to a dynamic and vibrant industrialising nation is attributed to a variety of pull
factors. Malaysia's political and economic stability, prudent and pragmatic investor
friendly business policies, cost-productive workforce, a developed infrastructure
comparable to that of any western country and a host of other amenities makes this
country an enticing place for investors. Malaysia is strategically located at the South
Multinational corporations from more than 40 countries have invested in over 5,000
companies in Malaysia’s manufacturing and related services sectors, encouraged by
the country's pro-business environment. Malaysia today is one of the world's top
locations for offshore manufacturing and service-based operations. Many of the existing
foreign companies have also continued to show their confidence in the country's
potentials as an investment location through their numerous expansions and
diversifications over the years, particularly in high technology projects.
Making Transformation Happen
Malaysia has progressed from an economy dependent on agriculture and primary commodities to a
manufacturing-based, export-driven economy spurred on by high technology, knowledge-based and
capital-intensive industries. To move the country forward, the Government has crafted a framework
comprising four pillars to drive the change.
The New Economic Model (NEM) to be achieved through an Economic Transformation Programme
(ETP) constitutes a key pillar which will propel Malaysia to being an advanced nation with inclusiveness
and sustainability in line with goals set forth in Vision 2020. The ETP will be driven by eight Strategic
Reforms Initiatives (SRIs) which will form the basis of the relevant policy measures.
Three other pillars have been launched over the past year. They are the 1Malaysia, the Government
Transformation Programme (GTP) to strengthen public services in the National Key Results Areas
(NKRAs) and the 10th Malaysia Plan 2011-2015, the economic blueprint that will set the tone of the
whole country development over the next five years. It contains the new policy directions, strategies and
programmes all targeted enabling Malaysia to emerge as a developed high-income nation.
Continuous Economic Success
The Government’s initiatives have produced positive results and are reflected in our economic growth
figures. In 2012, the Malaysian economy grew 5.6%, compared to a slight contraction of 5.1% in 2011.
Based on current estimates, Bank Negara Malaysia has projected a growth of 5-5.5% in 2013.
The rollout of projects under the Government’s Economic Transformation Programme (ETP) will continue
to drive our economic growth in 2013. These initiatives auger well for the Government’s stated objective
of turning Malaysia into a high income nation by the year 2020, with a per capita income of USD15,000
from the present USD10,760.
High Level of Global Integration
Total trade for 2012 surpassed the one trillion ringgit mark with a value of RM1.31 trillion compared with
RM1.27 trillion recorded in 2011. Exports grew by 0.6% to RM702.19 billion while imports expanded by
5.9% to RM607.36 billion, resulting in a trade surplus of RM94.82 billion, 15th consecutive year of
Top 10 Most Competitive Countries in the World
Despite the adversity in economic circumstances, Malaysia for the first time has earned a position among
the 10 most competitive countries in the world, according to the 2010 World Competitiveness
Yearbook (WCY), published by the Swiss-based Institute for Management Development (IMD).
The country has taken the 10th spot on the Switzerland-based IMD's World Competitive Yearbook for
2010, up from 18th placing last year. The list measures Malaysia against 58 countries this year, from 57
nations last year.
With an index score of 87,228, Malaysia has joined the ranks of the most competitive countries in the
world, sharing the Top 10 ranking with Singapore, Hong Kong, the US, Switzerland, Australia, Sweden,
Canada, Taiwan and Norway.
27th Most Networked Economy
Malaysia also is the world’s 27th most networked economy and the highest-ranked nation not to belong
to the group of high-income countries. In the Global Information Technology Report 2009-2010, released
by the World Economic Forum (WEF), Malaysia is ranked sixth in Asia behind Singapore, Hong Kong,
Taiwan, South Korea and Japan.
The report praised Malaysia as it seemed to be clearly leading the way, with outstanding marks for its
readiness (11th) and usage (12th).
Supportive Government Policies
Government policies that maintain a business environment with opportunities for growth and profits have
made Malaysia an attractive manufacturing and export base in the region. The private sector in Malaysia
has become partners with the public sector in achieving the nation's development objectives.
A major factor that has attracted investors to Malaysia is the government's commitment to maintain a
business environment that provides companies with the opportunities for growth and profits. This
commitment is seen in the government's constant efforts to obtain feedback from the business community
through channels of consultation such as regular government-private sector dialogues. These allow the
various business communities to air their views and to contribute towards the formulation of government
policies which concern them.
Liberal Equity Policy
Since June 2003, foreign investors could hold 100% of the equity in all investments in new projects, as
well as investments in expansion/diversification projects by existing companies irrespective of the level of
exports and without excluding any product or activity.
Employment of Expatriates
Foreign companies in the manufacturing sector are allowed to employ expatriates where certain skills not
available in Malaysia. A company with foreign paid-up capital of US$2 million and above will be allowed
up to 10 expatriate posts, including five key posts, that is, posts that are permanently filled by foreigners.
Attractive Tax Incentives
Effective from the year of assessment 2009, the corporate tax rate is reduced to 25% and
the maximum individual tax rate is reduced to 26% (for year of assessment 2010). Malaysia also offers a
wide range of tax incentives for manufacturing projects under the Promotion of Investments Act 1986 and
the Income Tax Act 1967. The main incentives are the Pioneer Status, Investment Tax Allowance,
Reinvestment Allowance, Incentives for High Technology Industries and Incentives for Strategic Projects
and Incentives for the Setting-up of International/ Regional Service-based Operations.
An Educated Workforce
Malaysia offers investors a young, educated and productive workforce at costs competitive with other
countries in Asia. Backed by the government's continued support of human resource development in all
sectors, the quality of Malaysia's workforce is one of the best in the region. Literacy levels are high and
school leavers entering the job market have at least 11 years of basic education.
The greatest advantage to manufacturers in Malaysia has been the nation's persistent drive to develop
and upgrade its infrastructure. Over the years, these investments have paid off and serious bottlenecks
have been avoided. Today, Malaysia can boast of having one of the most well-developed infrastructure
among the newly industrialising countries of Asia.
Latest, the development of Kuala Lumpur Sentral, a futuristic self-contained city, providing the perfect
live, work and play environment. A modern transportation hub integrating all major rail transport
networks, including the Express Rail Link to the KLIA and Putrajaya, the government's new administrative
centre.The transport facilities offered are on par with the best the world over.
Vibrant Business Environment
A market-oriented economy and government policies that provide businesses with the opportunity for
growth and profits have made Malaysia a highly competitive manufacturing and export base. Malaysia's
rapid move towards the k-economy allows companies to do business in an environment that is geared
towards information technology.
One of Malaysia's major pull factors is its large pool of young, educated and trainable workforce. Many of
Malaysia's university graduates are trained overseas in fields such as engineering, and accountancy,
allowing them to adapt easily to an international corporate environment. English is widely used in
Malaysia, especially in business thus facilitating the investor's communication with local personnel and
The country's legal and accounting practices derived from the British system are familiar to most
international companies.In addition, Malaysia retained its position as the third best destination in the world
for outsourcing activities, after India and China, according to A.T. Kearney's 2009 Global Services
Location Index (GLSI).
Quality of Life
Malaysia is among the most friendly and hospitable places in the world to work and live in. In addition, the
country's tropical climate with its uniform temperatures allows light, comfortable clothing throughout the
Expatriates and their families will enjoy a safe and comfortable living environment with 21st century
amenities, good healthcare and medical facilities, excellent educational institutions, and world-class
recreational and sports facilities - at costs much lower than in their own countries.
One of the country's most distinctive features is its rich diversity of cultures, a heritage derived from its
racial mix of some of the world's oldest civilisations - Malay, Chinese and Indian. This potpourri of race
and culture has enabled Malaysians to speak at least two, and even three, languages - Malay (the
national language), English, and their own mother tongue. Living in such a cosmopolitan environment,
Malaysians are warm, friendly people who easily accept foreigners into their circle of friends.
For further enquiry and assistance on Business Opportunities in Malaysia, please contact Malaysian
Investment Development Authority.
Malaysian Investment Development Authority (MIDA)
The Malaysian Investment Development Authority (MIDA) is the government's principal agency for the
promotion of the manufacturing and services sectors in Malaysia. MIDA assists companies which intend
to invest in the manufacturing and services sectors, as well as facilitates the implementation of their
projects. The wide range of services provided by MIDA include providing information on the opportunities
for investments, as well as facilitating companies which are looking for joint venture partners. MIDA also
assists companies interested in venturing abroad for business opportunities. To further enhance MIDA's
role in assisting investors, senior representatives from key government agencies are stationed at MIDA's
headquarters in Kuala Lumpur to advise investors on government policies and procedures.
Malaysian Investment Development Authority, Dubai (MIDA Dubai)
Sukri Abu Bakar
Malaysian Investment Development Authority, (MIDA)
(The Consulate General of Malaysia – Investment Section)
No. 2205, 22Floor,
Tower A, Business Central Tower, Dubai Media City
P.O. Box 502876, Dubai, United Arab Emirates
Tel. : +971-4-434 3696
Fax : +971-4-434 3698
Email : email@example.com