Tengku Zafrul: Malaysia’s E&E sector set to soar driven by demands in EVs, renewable energy, aerospace and digital economy
29 Feb 2024
Minister of Investment, Trade and Industry (Miti) Datuk Seri Tengku Zafrul Abdul Aziz today said that Malaysia’s electrical and electronics (E&E) sector is poised to emerge as a powerhouse.
He said the optimistic outlook is attributed to the rising local and regional demand, fueled by the expansion of sectors like electric vehicles (EVs), renewable energy (RE), aerospace, and the digital economy.
“All these will collectively improve Malaysia’s export competitiveness, while providing higher paying skilled jobs for our people,” he said during his speech during the Malaysian Investment Development Authority (Mida) annual media conference here.
He also said that the advent of Industry 4.0 and the ascent of the digital economy play pivotal roles in the increasing need for chips and semiconductors as industries are adopting technologies like artificial intelligence (AI), automation, robotics, and data analytics to streamline their operations, boost efficiency, and elevate productivity.
He further emphasised that sustainability serves as another significant catalyst for E&E products, particularly in transforming industries such as automotive.
“Sustainability is another major driver for E&E products as industries such as automotive continue to transform. The increased demand for the production of EVs, for example, has also increased the demand for electronics that support battery management systems (BMS),” he said.
He added that substantial investments were drawn to other industries, with machinery and equipment (M&E) securing RM22.6 billion, chemicals and chemical products receiving RM8.9 billion, non-metallic mineral products obtaining RM8.8 billion, and transport equipment attracting RM7.1 billion.
He highlighted the creation of over 30,000 jobs in the managerial, technical and supervisory category, with 91.7 per cent of these positions filled by Malaysians.
“In addition to providing employment opportunities for the people, these investments have spillover effects that can bolster and develop our domestic SME supply chain, advancing towards innovation, knowledge-intensive and higher-value-added activities and products,” he said.
Tengku Zafrul said, as of now, Malaysia has garnered interest from potential investors, primarily through our flagship initiatives, accumulating to RM88.82 billion with over 1,710 projects currently in the pipeline, with projected investments reaching RM87.8 billion.
He said there are ongoing substantial discussions between the ministry and Mida with a significant Chinese institution, aiming to solidify a mutual agreement to promote two-way foreign investments (FI).
“We are in the advanced negotiations stage, aiming to cement a cooperative agreement focused on FI promotion enhancement, to bolster investment flows, encouraging Chinese firms to explore opportunities in Malaysia while similarly facilitating Malaysian enterprises to expand into China,” he said.
Tengku Zafrul said that the prospective collaboration aims to encourage investments in high-value sectors, carefully selected to align with the strategic priorities of both nations.
This initiative, he said, holds the promise of strengthening economic ties and fostering mutual growth.
“We aim to conclude a comprehensive cooperative agreement focused on FI promotion enhancement, to bolster investment flows, encouraging Chinese firms to explore opportunities in Malaysia while similarly facilitating Malaysian enterprises to expand into China.
“We are targeting this potential partnership to foster investments in high-value sectors, meticulously chosen to reflect the strategic priorities of both nations, thereby promising to fortify economic ties and promote mutual growth.
He further added that Malaysia’s economy is currently at a crucial turning point, presenting an opportunity to capitalise on key factors such as the restructuring of supply chains for greater resilience and the implementation of the China Plus One strategy.
He said the goal is to effectively position the country as a contemporary regional industrial powerhouse and a gateway for those seeking access to the expanding Asean and Asian population.
Last week, Tengku Zafrul encouraged EV automakers with facilities here to consider making Malaysia their hub to supply and service the fast-growing EV market in Asean.
He said this is because the EV market in Asean is expected to grow at a compound annual growth rate of about 33 per cent from around US$500 million (RM2.4 billion) in 2021 to US$2.7 billion (RM11.77 billion) by 2027.
Source: Malay Mail
