MALAYSIA Investment Performance Report Strenghtening Momentum Growth The
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2016 2016 MALAYSIA Investment Performance Report Performance Investment MALAYSIA Strenghtening the Growth Momentum Strenghtening MALAYSIA Investment Performance Report 2016 Strengthening the Growth Momentum MIDA Sentral No.5, Jalan Stesen Sentral 5 Kuala Lumpur Sentral 50470 Kuala Lumpur Malaysia Tel: (603) 22673 3633 Fax: (603) 2274 7970 Email: [email protected] Website: www.mida.gov.my CONTENTS Strengthening the Growth Momentum A WORD FROM MIDA Overview on Global Economic and Investments Growth 9 Global Investments Scenario 10 Overview of Malaysia’s Private Investments Performance in 2016 11 INVESTMENTS IN THE MAIN SECTORS PERFORMANCE OF THE MANUFACTURING SECTOR ...........................15 Overview of Project Approved 15 Capital-intesive Projects 15 Projects Approved by Industry 15 Export-oriented Projects 16 Employment Opportunities 16 Approved Projects by Ownership 16 Approved Projects by Location 18 Implemented Manufacturing Projects 18 PERFORMANCE BY INDUSTRY .........................................20 Electrical and Electronic Products 20 Transport Equipment 22 Aerospace 23 Shipbuilding & Ship Repair 24 Rail Industry 25 Machinery and Equipment 26 Metal Fabrication & Engineering Support Industry 29 Basic Metal Products 32 Textiles and Textile Products 34 Non-Metallic Mineral Products 35 Medical Devices 36 Pharmaceutical 39 Biotechnology Industry (including Bionexus Projects) 41 Agriculture and Food Processing 42 Oil Palm Products 43 Palm Biomass 44 Petroleum Products (including Petrochemical Products) 44 Chemical & Chemical Products 46 Plastics Industry 47 2016 MALAYSIA: Investment Performance Report Oleochemicals 47 Rubber Products 48 Wood & Wood Products 48 Paper, Printing and Publishing Industry 49 PERFORMANCE OF THE SERVICES SECTORS ...............................50 Overview 50 Global Operating Footprint in Malaysia 50 Trends to Watch 50 Performance by Industry: Global Establishments Approved 51 Treasury Management Centre (TMC) 54 Support Services 54 Green Technology 56 Renewable Energy 56 Energy Efficiency/Energy Conservation 57 Business and Professional Services 58 Oil & Gas Upstream 60 Healthcare Services 61 Education Services 62 Tourism (including Hotels) 63 MSC Status Companies 63 Real Estate (Housing) 63 Transport 63 Telecommunications 64 Utilities 64 Financial Services 64 Distributive Trade 64 INVESTMENTS IN THE PRIMARY SECTOR ...............................65 Performance of the Primary Subsectors 65 Agriculture 65 Mining 65 Plantation & Commodities 65 COLLABORATION TOWARDS ATTRACTING QUALITY INVESTMENTS REGIONAL CORRIDORS .........................................67 East Coast Economic Region Development Council (ECERDC) 67 Northern Corridor Implementation Authority (NCIA) 69 Iskandar Regional Development Authority (IRDA) 71 Sarawak Corridor of Renewable Energy (SCORE) 73 Sabah Economic Development and Investment Authority (SEDIA) 75 OTHER INVESTMENT AGENCIES ....................................78 Malaysia Digital Economy Corporation (MDEC) 78 InvestKL 80 Halal Industry Development Corporation (HDC) 82 Bioeconomy Corporation 83 Talent Corporation Malaysia Berhad (TalentCorp) 84 CREST 87 FUTURE OF INVESTMENTS IN MALAYSIA SMART MANUFACTURING .........................................91 Facilitation and Opportunities 92 - FTAs/Grants/Incentives/Talent Automation/Transformation of Labour Intensive Industries 95 INVESTMENT OUTLOOK A RESILIENT MALAYSIA ECONOMY ....................................97 Global Investment Flows 97 Productivity and Competitiveness 98 SUCCESSFUL INVESTMENT STORIES ...................................101 APPENDICES ..................................................115 Strengthening the Growth Momentum A WORD 1 “ FROM MIDA” 8 A Word from MIDA MALAYSIA: INVESTMENT PERFORMANCE REPORT 2016 OVERVIEW ON GLOBAL continue to be the main drivers in infrastructure and stronger ECONOMIC AND of global growth, accounting for consumption. INVESTMENTS GROWTH 60 per cent of the world’s gross product growth in 2016-2018. However, headwinds arising Several serious economic East and South Asia will remain from the environment and challenges caused economic as the world’s most dynamic situational challenges as well growth to remain slow globally regions, benefitting from the as policy uncertainties may at a projected 3.1 per cent robust domestic demand and continue to constrain the in 2016 according to World supportive macroeconomic global economy. The issues that Economic Outlook Report by policies. arose in 2016 such as Brexit, the IMF released in October The emerging markets and the USA presidential elections, 2016. The prolonged low oil developing economies are prolonged low oil prices, low prices, uncertainties caused by anticipated to partially offset commodity prices, currency Brexit, switch in economic and the slower growth of the pressures and geopolitical trade policies to be adopted developed economies. China’s tensions may continue in 2017. by the new president of the rebalancing efforts towards a Political uncertainty resulting USA, low commodity prices and more sustainable growth in the from the post-Brexit referendum recurring natural disasters were services sector and domestic and the Trump administration’s among the issues impacting on consumption are expected to policies remain unknown. global economic development. be the main economic drivers with an anticipated growth Quality investments in A modest global recovery of of 6.2 per cent. Meanwhile, Malaysia 3.4 per cent is projected for the India is expected to sustain The Malaysian economy is year 2017. As a cautionary note, its growth momentum of 7.6 expected to continue to grow the improvement in the global percent with the increase in 2017 despite the challenging economic scenario is more of private consumptions as external environment. As of an indication of economic well as stronger growth in an open economy, Malaysia stabilisation rather than revival. the services and agriculture is not immune to external sectors. In addition, most of the uncertainties, but its economic According to the UN World Association of Southeast Asian and financial reforms and Economic Situation and Nations (ASEAN) member states policies have somewhat Prospects (WESP) 2017, are expected to record higher buffered the challenging developing countries will growths due to investments external impact. A Word from MIDA A Word from MIDA 9 Strengthening the Growth Momentum The country’s fundamentals three catalytic subsectors of GLOBAL INVESTMENT remain strong with a stable E&E, Machinery and Equipment SCENARIO labour market, manageable and Chemicals as well as the inflation, healthy foreign two growth subsectors of The United Nations Conference reserves and sound financial Aerospace and Medical Devices. on Trade and Development systems to support a sustained These ‘3+2’ catalytic and growth (UNCTAD) projects global FDI momentum in economic subsectors have also been flows to accelerate in 2017, growth. identified to increase the export reaching 3.4 per cent compared activities of local manufacturing to the post-crisis low of 3.1 Malaysia continues to adopt companies. per cent in 2016. The rise is a more focused and targeted As for the services sector, focus estimated to be driven by rise in approach in attracting quality will be in the areas of principal growth in developed countries; investments in high technology, hubs, logistics, the ecosystem rebound of developing capital-intensive and surrounding e-commerce, green economies led by a sharp rise knowledge-intensive industries; technology and renewable in growth in natural resources high value added industries; energy as well as waste exporting countries; and greater R&D activities as well as in new management. Sustainable economic activity which will growth areas, in line with the investments depend extensively help to boost world trade Government’s efforts to become on a vibrant talent pool, a volumes, which are forecast to a high-income nation by 2020. knowledge-based economy, expand by 3.8 per cent in 2017. robust investor protection, In this regard, MIDA’s focus will healthy interconnected Global Investment Trends be leveraging on megatrends upstream and downstream Monitor Issue No. 25 by the development and smart industries, and other factors United Nations Conference manufacturing to target which are the precursors for on Trade and Development products with technological competitive advantages. (UNCTAD) announced that the advancements and new global foreign direct investment product applications as well With these unique strengths, (FDI) flows slip fell 13 per cent as focusing on high value R&D Malaysia is well on its way to to an estimated US$1.52 trillion activities and the Internet of creating such a conducive in 2016. Part of the decline in Things (IoT). This emphasis is business landscape. This FDI was due to weak global to nurture and encourage both conducive investment economic growth. This decline foreign and local investors and landscape is the principal was not equally shared across manufacturers to switch their impetus for investors to regions, reflecting the diverse mindsets on the Malaysian continue to invest in Malaysia. impact of the current economic manufacturing landscape environment on countries and move up the value chain worldwide. with quality investments that incorporated hi-tech innovations. Figure 1: FDI inows: global and by group of economies, 2005–2016 (Billions of US dollars) World total $52 Developed economies +38% With competition from Developing economies Transition