MIDA e-News
Higher FDIs in manufacturing in 2011, Japan tops the list
Foreign investors particularly from Asian countries have continued to pump in more investments into Malaysia’s manufacturing sector.
In 2011, approved foreign direct investments (FDIs) increased 17.5% to RM34.2 billion from RM29.1 billion in 2010, Minister of International Trade and Industry, Dato’ Sri Mustapa Mohamed, said in announcing the 2011 full-year data at the Malaysian Investment Development Authority (MIDA) Annual Media Conference on Malaysia’s Investment Performance in 2011 in Kuala Lumpur yesterday.
He said FDIs from Asian countries accounted for some 72% of total FDI inflows into the manufacturing sector in 2011.
Approved FDIs accounted for 61% of total investments of RM56.1 billion last year, of which new investments amounted to RM20.2 billion or 59% of total FDIs while the balance RM14 billion were for expansion and diversification.
Foreign investors had shown keen interests to invest in quality projects in new growth areas and emerging technologies, which are technology and knowledge-intensive, capital-intensive and high-value added.
The increase in FDIs in 2011 was mainly in the electronics and electrical (E&E) industry, which attracted some RM10.1 billion in new investments and RM8.6 billion for expansion/diversification.
Foreign investments accounted for 93.5% of total investments in E&E last year.
Other major areas of interests to foreign investors include the chemical and chemical products with RM3.24 billion, basic metal products with RM2.6 billion; food manufacturing with RM2.6 billion and non-metallic mineral products, RM1.2 billion.
Japan emerged as the largest source of FDIs in the manufacturing sector in 2011 with RM10.1billion, of which RM9.1 billion were for 31 projects in E&E.
Other industries with Japanese interests were transport equipment, RM325.8 million, petroleum products including petrochemicals RM168.7 million, basic metal products with RM158.6 million and non-metallic mineral products, RM138.9 million.
Republic of Korea came in second with RM5.2 billion, of which the bulk of the investments were for two major projects- RM2.2 billion for a new project to make lithium ion batteries and another new project with investment of RM1.1 billion to produce photovoltaic functional glass.
The USA was the third largest source of FDIs with RM2.5 billion, which were mainly investments by existing American companies expanding/diversifying their operations in Malaysia amounting to RM2.4 billion.
The US investments were mainly in the E&E industry.
Singapore, remained an important source of FDIs, with RM2.5 billion in 2011, which were mainly in food manufacturing, RM1.1 billion, and E&E with RM476.3 million.
Saudi Arabia was the fifth largest foreign investor with RM2.2 billion which was for a new project to produce polycrystalline silicon, sodium hydroxide, chlorine, hydrogen, hydrochloric acid, silicon tri-chloride, silicon tetra-chloride, mixed chlorosilane, oxygen and nitrogen.
The five top sources of FDIs accounted for some 66% of the total FDIs approved last year.
Other major foreign investors were from Germany, Taiwan, China and the Netherlands.
Adapted from MIDA’s Report on Malaysia’s Investment Performance in 2011, MIDA Media Statement, New Straits Times and StarBiz, 22 Feb 2012
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