MIDA: Capital intensive projects dominate manufacturing landscape in 2020
02 Mar 2021
KUALA LUMPUR: Capital intensive projects involving advanced technology and skilled workforce dominated the manufacturing landscape last year, said the Malaysian Investment Development Authority (MIDA).
The agency said this was reflected in the increase of capital investment per employee (CIPE) to RM1.138 million in 2020 from RM1.052 million in 2019.
“(This is) in line with Malaysia’s move towards sophisticated technology industries,” it said in a statement today.
Furthermore, a total of 101 manufacturing projects were approved with investments of RM100 million and above, MIDA said.
In terms of top-performing industries in 2020, MIDA said nearly 90 per cent of the total approved investments in the manufacturing sector last year were contributed by electrical and electronics (RM15.6 billion), petroleum products including petrochemicals (RM15.5 billion), basic metal products (RM14.4 billion), paper, printing and publishing (RM7.8 billion), machinery and equipment (RM7.1 billion), chemicals and chemical products (RM6.3 billion), rubber products (RM4.3 billion), as well as transport technology (RM3.9 billion).
Overall, the manufacturing sector recorded approved investments of RM91.3 billion for 2020, an increase of 10.3 per cent from 2019, while the number of manufacturing projects approved rising 6.2 per cent to 1,049 projects.
Senior Minister Datuk Seri Mohamed Azmin Ali, who is also the International Trade and Industry Minister, said investments in three catalytic manufacturing sub-sectors, namely, electrical and electronics, machinery and equipment, and chemical, as well as two high growth areas – aerospace and medical devices – had been outlined within the 11th Malaysia Plan (11MP).
These constitute more than one-third (38.6 per cent) of the total approved investments in the manufacturing sector, with investments valued at RM35.2 billion in 2020, he said.
“As 2020 marked the end of the 11MP, the government is currently finalising the 12th Malaysia Plan (12MP), and this post-2020 blueprint will pave the way for Malaysia’s development agenda over the next decade,” he said.
Mohamed Azmin said the government was optimistic that 12MP would chart the way to further enhance Malaysia’s industrial competitiveness strategies in essential and key industries for sustainable economic transformation.
“This will elevate our manufacturing and the services sectors to the next level of sophistication and complexity in the new normal post-COVID-19 and beyond,” he said.
In terms of the services sector, Mohamed Azmin said in 2020, Malaysia’s proposition as a hub for business and investment for the services sector attracted a total of RM66.7 billion in approved investments through 3,527 approved projects, accounting for 40.7 per cent of the total approved investments in the economy.
“These approved services projects are expected to create 33,652 jobs to the economy,” he said.
According to MIDA, domestic direct investments dominated the total approved investments in the services sector, contributing RM60.2 billion (90.3 per cent), whereas foreign direct investments made up the remaining RM6.5 billion.
The agency said the majority of the main services sub-sectors showed a significant decline in approved investments, except for the Multimedia Super Corridor (MSC)-status projects and other services such as BioNexus status and software developments.
“The top five five contributors of approved investments in the services sector were real estate (RM31.2 billion), utilities (RM10.8 billion), support services (RM5.2 billion), telecommunications (RM5.2 billion) and MSC-status projects (RM3.9 billion),” it said.
Meanwhile, MIDA said the primary sector registered approved investments of RM6 billion last year versus RM7.0 billion in 2019, with the mining sub-sector leading the bulk of investments in the primary sector, contributing 99.5 per cent of total investments approved in the sector.
“The rest of the primary sector investments comprise the plantation and commodities subsector and the agriculture sub-sector, which registered investments of RM27 million and RM2.4 million, respectively,” it added.