A tax incentive proposal for Forest City Special Financial Zone (SFZ) to attract global investors will be finalised by the end of the month.

Menteri Besar Datuk Onn Hafiz Ghazi said the Ministry of Finance said this during a Special Meeting on Johor Development, chaired by Prime Minister Datuk Seri Anwar Ibrahim, on April 18.

“When examining several other leading financial special zones worldwide, various incentives are provided to attract the interest of global investors.

“The fiscal incentives discussed for SFZ Forest City include corporate tax exemptions and special income tax rates for skilled workers, as well as exemptions and special rates for stamp duty on property, and share transfer-related instruments.”

The tax incentive package to attract global investors to invest in SFZ Forest City, meanwhile, will be announced in a few months, he added.

He said this when answering oral questions at the Fifteenth State Legislative Assembly of Johor, in the Sultan Ismail Building, here, today.

Earlier, Chen Kah Eng (DAP-Stulang) wanted to know the status of the development of SFZ Forest City.

Meanwhile, Onn Hafiz, who is also Machap assemblyman, said the state government would conduct benchmark studies on several other leading international financial special zones to attract investments in SFZ Forest City.

He said SFZ was established to put Johor and Malaysia on the international finance and banking map.

“SFZ Forest City is not aimed at competing with any other financial special zone in the world, but rather, to act as a catalyst for increasing government revenue, besides providing thousands of job opportunities for the people of this state.

“The benefits SFZ Forest City will bring to the people are not only through the creation of thousands of new jobs, but also by enhancing economic growth and stimulating the state and national business sectors, as well as through the improvement of infrastructure, including roads and public transportation, which will bring about many advantages to the people,” he said.

Source: NST

Tax incentive plan to attract investors to Forest City SFZ ready by month-end

Malaysia and Qatar have agreed to enhance investment cooperation between the two countries in the coming years, said Prime Minister Datuk Seri Anwar Ibrahim.

He said the understanding was reached when he met the Emir of Qatar Sheikh Tamim bin Hamad Al Thani, and was later mentioned in depth during a meeting with his counterpart, Sheikh Mohammed bin Abdulrahman Al Thani.

Also discussed was bilateral cooperation and facilitating investment and higher education which was then further discussed in a meeting with Sheikh Mohammed, who is also Qatar’s Foreign Minister, said Anwar.

“We both agree that investment cooperation between the two countries needs to be further enhanced in the coming years,” he said in a message on X today.

Anwar, who is also the Finance Minister, added that his official visit, which was at the invitation of Sheikh Tamim, was also aimed at continuing efforts and strengthening diplomatic ties and links that have already reached 50 years.

“The Malaysian delegation was then treated to a national banquet hosted by Sheikh Mohammed.

“Hopefully the bond of friendship between Malaysia and Qatar will continue to grow for mutual benefit,“ he said.

Earlier, Anwar was felicitated in an official reception and lunch at the Amiri Diwan, which is Qatar’s government hall, in conjunction with his maiden visit to the country.

The Prime Minister spent about 30 minutes with Sheikh Tamim, which was followed by a meeting with Sheikh Mohammed.

Last year, total bilateral trade between Malaysia and Qatar reached RM4.2 billion.

Source: Bernama

Malaysia, Qatar to enhance investment cooperation in the coming years – PM Anwar

Estithmar Holding and Baladna are among Qatar’s largest companies by market capitalisation that attended a roundtable meeting hosted by Malaysia’s Ministry of Investment, Trade and Industry (MITI).

Established in 2014, Baladna, which is a public shareholding company, is Qatar’s largest dairy and beverage producer, supplying over 95 per cent of the country’s fresh milk.

Meanwhile, Estithmar Holding is a Qatari public listed company with a diverse portfolio of 51 companies operating in four strategic sectors namely healthcare, services, contracting and industries, as well as ventures.

The roundtable meeting with these captains of industry is part of Malaysia’s aggressive efforts to attract more high quality investments into the country.

More than 30 top executives and business leaders took the opportunity to meet with Prime Minister Datuk Seri Anwar Ibrahim, as he briefed them on the latest investment climate in Malaysia, while convincing them that the country could be their preferred investment destination and competitive trade partner.

Anwar, who is also the Finance Minister, is currently on a three-day official visit to the capital as part of his mission to increase Malaysia’s visibility as a potential investment destination to the Qataris.

The companies that attended the roundtable are mostly from the services, manufacturing as well as investment sectors.

Other companies that attended include Taleb Group, Morex Group, Tamam Capital and Al Mana Group.

Anwar spent about one hour in an interactive session to engage and update Qatari businessmen on the Malaysian economy, business ecosystem as well as the New Industrial Master Plan 2030.

The session was moderated by MITI Minister Tengku Datuk Seri Zafrul Abdul Aziz.

Apart from attracting potential investments through this meeting, Malaysia is also keen to woo more interest and increase awareness from the Qatari business community to source more products as well as services from Malaysia.

This is seen as vital as the two countries embark on a new phase of cooperation as they celebrate the 50th anniversary of bilateral trade this year.

Last year, Malaysia’s total bilateral trade with Qatar amounted to RM4.2 billion, as the Gulf state became Malaysia’s fifth-largest trading partner, sixth-largest export destination and sixth-largest import source from the West Asia region.

From January to March 2024, Malaysia’s total trade with Qatar increased by 178.4 per cent to US$303.9 million (RM1.43 billion) compared with US$116.7 million (RM514.9 million) for the corresponding period in 2023.

According to the International Monetary Fund, Qatar is among the richest countries in the world, with a per capita income of nearly US$96,610 in 2020.

It was reported that petroleum and natural gas are the cornerstones of its economy, with Qatar home to one of the largest reserves of natural gas in the world.

Source: Bernama

Qatar ‘big guns’ of industries attend roundtable meeting with PM Anwar

The Johor-Singapore Special Economic Zone (SEZ) could be a formidable competitive advantage in attracting fresh foreign direct investment (FDI) from multinational companies (MNCs).

This can be achieved by integrating Singapore’s global financial, logistics and advanced manufacturing capabilities with Johor’s access to competitive labour, abundant land and cheaper energy resources.

Maybank Investment Bank (Maybank IB) said Singapore enjoys wide and deep connectivity to global capital sources, while also serving as a gateway to the Asian markets, given unrivalled transport and trade links.

“MNCs are currently diversifying their supply chains away from China, and looking for alternative production bases as global competition for investments has intensified with rising impetus for countries to re-shore and friend-shore production.

“Against this backdrop, governments are looking to strengthen their competitive strengths to capitalise on this shift in supply chains and attract more foreign investments,” it said in a note today.

Maybank IB opined that there is scope for Singapore’s South-east Asia Manufacturing Alliance (SMA) to be expanded to other industrial parks within the SEZ.

“Incentive schemes covering other sectors could also be considered. This will provide additional impetus for complementary investments in Singapore and Johor, building on incentives offered by Malaysian authorities,” it said.

According to Maybank IB, rising business costs in Singapore have increased the need for a hinterland, which Johor is well positioned to provide.

It said Johor is cost-competitive and is a major consideration for Singapore-based small and medium enterprises.

Salary levels in Johor are more than 80 per cent lower for manufacturing; and 40 per cent lower for hospitality, while businesses hiring Malaysian workers are not subject to the foreign worker levies and quotas that they would face in Singapore.

Average electricity tariffs in Johor are around 60 per cent lower for businesses than Singapore, and 80 per cent lower for households.

“Business costs in the island state have climbed markedly in the post-pandemic period, driven by rising global inflation, a tight labour market, rents and tax adjustments, and administrative wage policies.

“Rents in Iskandar (Johor) are 75 per cent lower than Singapore for offices, 65 per cent lower for factories and 85 per cent lower for housing. Office rents are roughly RM9 per sq ft in Iskandar, compared to S$11-S$12 (RM38-RM42) in Singapore,” it said.

On the other hand, it said residential rents in Johor are around a seventh of Singapore’s public housing (HDB apartment) rents, while ready-built factory rents in Johor are roughly a third of Singapore.

“To minimise red tape and provide more clarity on investment policies, Malaysian authorities are working on the Invest Malaysia Johor Facilitation Centre (IMFC-J), which is to be located in Forest City, and scheduled to be operational in the third quarter of 2024.

“The JB-Singapore Rapid Transit System Link is about 70 per cent completed and on track to meet the operational start date at end-2026. Travel time between Singapore and Johor Bahru will take just six minutes,” it said.

Source: Bernama

Maybank IB: Johor-Singapore SEZ has competitive advantage in attracting fresh FDI

Prime Minister Datuk Seri Anwar Ibrahim’s official visit to the Qatari capital, commencing tomorrow, is expected to deepen bilateral relations between Malaysia and Qatar, as the two nations commemorate their 50th anniversary, while also exploring new investment opportunities.

The visit fulfills an invitation from the Emir of Qatar, Sheikh Tamim Hamad Al Thani, and encompasses participation in the Qatar Economic Forum 2024.

Malaysian Ambassador to Qatar, Zamshari Shaharan, hailed the Prime Minister’s inaugural visit as a promising start, aimed at strengthening relations forged over five decades and fostering new cooperation for the next 50 years.

“Qatar regards Malaysia highly as one of the progressive and modern Islamic countries that has achieved remarkable economic success over the years,“ he told reporters during a press conference at the Malaysian Embassy here on Saturday, coinciding with the Prime Minister’s official visit.

Shaharan noted that Anwar’s presence at the economic forum carries significance, especially as Malaysia is featured in a 30-minute ‘In Conversation with Prime Minister Anwar Ibrahim’ session, providing an opportunity for interaction with forum participants, including Qatari industry representatives and government delegations.

Furthermore, Anwar’s participation in a roundtable meeting with 30 representatives of Qatari companies will afford him the opportunity to elucidate Malaysia’s economic landscape and the incentives available for potential investors.

“Qatar is keen on attracting investments, including through joint ventures with Malaysian companies and establishing a presence in Qatar, aligning with the vision of the Qatari government,“ he said.

Renewable energy emerges as a potential sector in Qatar, added Shaharan.

Last year, bilateral trade between Malaysia and Qatar amounted to RM4.3 billion, a figure expected to rise further following this visit.

Malaysia’s major exports to Qatar last year comprised iron and steel products (37.2 per cent), machinery, equipment, and parts (16.5 per cent), and palm oil and palm oil-based agriculture (8.5 per ent), alongside processed foods, electrical and electronic products.

Conversely, imports from Qatar included petroleum products (47.4 per cent), crude petroleum (31.5 per cent), chemicals and chemical products (10.5 percent), manufactures of metal (9.3 per cent), and palm oil-based manufactured products (0.3 per cent).

Source: Bernama

Anwar’s visit strengthens Malaysia-Qatar ties, explores new investment horizons

Penang aims to attract 150,000 talents in the next five years, with a focus on the semiconductor and medical technology industries, which are crucial for the state’s economic growth.

Deputy Chief Minister, Jagdeep Singh Deo said Penang is commited to foster a conducive environment for technological innovation, partly undertaken through the development of tech talents.

“Penang’s strategic initiatives, such as collaborations between industry and academia, investments in education programmes and attracting foreign direct investment, aim to position the state as a global hub for technological advancement and to maintain its competitive edge in the global supply chain,“ he said in his opening speech at the Malaysia Board of Technologists (MBOT) Northern Symposium 2024 here today.

In a statement, MBOT said this symposium serves as a dynamic platform to encourage expertise sharing and facilitate knowledge transfer related to cutting-edge technologies.

It also connects professional members of MBOT under a strategic network, fostering knowledge sharing and collaboration with strategic partners in the Northern region of Malaysia.

The one-day event, organised by MBOT, brought together attendees from various industries, institutions and government agencies to foster meaningful discussions and collaborations that will shape the future of technology in Malaysia.

Source: Bernama

Penang aims to attract 150,000 talents in the next five years

Penang is witnessing robust growth in its technology, property and construction sectors amid an ongoing economic boom in the state.

Buoyed by continued investment inflows, particularly in the electrical and eletronics (E&E) industry, and supported by infrastructure upgrades, Penang has reported an increase in job creation and growth in household disposable income leading to surging demand for real estate.

RHB Research, in its thematic report on Penang yesterday, noted that government incentives and the forthcoming light rail transit (LRT) in the state would further stimulate investments and job creation, and drive growth in the technology, property, and construction sectors.

In the technology sector, the brokerage pointed out that Penang is a thriving E&E hub benefiting from the recovery of the semiconductor sector and the repercussions of the US-China trade tensions.

“Its established E&E and manufacturing industries are positioned to capitalise on heightened investment in technology and medical technology supply chains, presenting vast business opportunities for local companies from design houses and outsourced manufacturing to engineering support and material supply and support services,” said RHB Research.

In construction sector, an increase in activities is providing vast opportunities to local contractors.

“The construction sector in Penang will continue to shine, in our view, buoyed by ongoing projects such as Seri Tanjung Pinang 2, escalating demand for E&E facilities, and property projects, alongside the impending Penang LRT Mutiara Line.

“This heightened infrastructure rollout is set to benefit contractors, with an estimated RM10bil to RM20bil worth of contracts anticipated in the coming years, driven by the Penang Transport Master Plan and development of Silicon Island,” it added.

RHB Research said the property sector is also benefiting from the burgeoning activity in the E&E space, major infrastructure upgrades, and rising income per capita.

For perspective, Penang’s E&E sector registered a five-year compounded annual growth rate of 12.1% from RM209mil in 2018 to RM341mil in 2022, while its gross domestic product per capita had risen to RM69,700 in 2022 from RM44,800 in 2015.

“The proliferation of new industrial parks like Batu Kawan Industrial Park 2, Penang Technology Park @Bertam, and AME Elite Consortium Bhd’s Northern Industrial Park are set to fuel job creation and population migration,” added the research house.

Source: The Star

Technology, property and construction sectors booming in Penang

Malaysia has become a magnet for skilled foreign professionals, with the number of expatriates entering the country surpassing pre-pandemic levels.

According to the Immigration Department’s data, a total of 154,155 expatriate passes were issued last year – the highest since 2018.

As of March, the department has issued a total of 38,197 passes – compared with the 32,947 passes given out during the same period last year.

Malaysian Employers Federation president Datuk Dr Syed Hussain Syed Husman said employers are often forced to hire foreign professionals due to the mismatch in locals’ skills and competencies with the requirements of certain jobs.

There is a need for specific expertise in sectors such as aerospace, manufacturing (food processing) and construction. These sectors require expertise in emerging technologies such as machine learning, automation and data analytics.

“The aerospace industry, for instance, demands highly specialised skills, expertise and experience in aerospace engineering, aircraft maintenance and related fields.

“However, Malaysia faces stiff competition for skilled and experienced workers from neighbouring countries.

“Employers in Malaysia struggle to recruit and retain talent in the aerospace industry, leading to gaps in the workforce and challenges in meeting industry demands,” he said when contacted.

An expatriate is a skilled professional, who is a non-citizen or a permanent resident who is allowed to work in Malaysia on a contract or temporary basis.

Due to skill gaps among the local workforce, Syed Hussain said employers are favouring expatriates over local talents.

“The upward trend in expatriate hires over the years can be attributed to various factors.

“One reason is the real lack of locals especially for new and emerging technologies.

“Higher learning institutes need to ensure that the programmes they offer are meeting the latest and emerging skills required by the labour market,” he said.

Malaysian Trades Union Congress president Mohd Effendy Abdul Ghani said companies will only employ overseas workers if they fail to find suitable candidates for highly skilled positions.

“In fact, companies often prioritise hiring locally to avoid issues related to work permits, cultural integration and potential language barriers,” he said.

The Statistics Department’s 2023 fourth quarter report revealed that Malaysian labour share in the skilled category only amounted to 25% of the total filled jobs.

The report showed that the majority of local talents were in the semi-skilled category with over 62.7% cumulatively.

Sunway University economics professor Dr Yeah Kim Leng said it is encouraging that the number of expatriates in the country is on the uptick after experiencing a decline over the last few decades.

“The decline has been reflective of falling foreign investment in the country as well as increased use of Malaysians in running the foreign-owned operations due to lower cost,” he said.

“The rise in the number of expatriates is a good indicator that affirms the surge in foreign investment over the past two years.”

It is also positive to the economy in terms of business confidence, domestic spending and investment, especially in the high-end property, automotive and durable goods markets in addition to domestic tourism, education and other household services.

He said expatriates are typically brought in to manage critical operations, train local employees and transfer their knowledge.

“With more high-value foreign investments, the expatriates play an important role in stemming the brain drain problem by training Malaysians and providing career enhancement opportunities,” he said.

He said they may also contribute to the economy by renting high-end properties.

“The weak ringgit enhances the purchasing power of expatriates who are paid in the currencies of their home countries,” he said.

Besides contributing in direct and indirect taxes, their daily consumption and spending power will boost local products.

Economist Dr Geoffrey William said there is no dearth of local talent in the high-skilled workforce.

“There is no lack of local talent in the local professional and high-skilled workforce; the problem is lack of jobs,” he said.

“Malaysia has an underemployment of around two million people with qualifications higher than the jobs they are doing.”

Source: The Star

Malaysia a magnet for expats

ALTHOUGH the 17 Sustainable Development Goals were adopted by the United Nations (UN) in 2015 companies were largely under the impression that such pursuits were mostly the responsibility of governments.

Ideas that the private sector are just as obligated to create a world with no poverty, has zero hunger, with access to health and education for everyone, were only subscribed to by a few corporations.

In fact, as the Ministry of Investment, Trade and Industry (Miti) senior director for Industry Development Division, Dr Meenachi Muniandy pointed out: “If you ask companies if they would say those are their priorities, definitely they will say ‘no’.”

Meenachi was presenting the ministry’s i-ESG Framework during Star Media Group’s ESG PIA Winners Showcase Agenda networking event, which was held on May 3.

Importance of ESG

However, she pointed out that today’s catch-all phrase for sustainability—ESG (environmental, social and governance)—has been in existence way longer.

The ideas were already present on Feb 1, 1999 when former UN secretary-general Kofi Annan called upon firms and their business associations to “embrace, support and enact a set of core values in the areas of human rights, labour standards, and environmental practices.”

She explained that the term “ESG” was then coined in a 2004 UN report called Who Cares Wins.

The report provided examples or components for “E”, “S” and “G” as well as on how companies can respond to climate change, treat their employees, build trust and innovation, and manage the supply chain.

She then addressed the reason why ESG is so important to the nation’s economy by saying that Malaysia is a small and highly open economy.

“Trade accounts make up more than 100% of the gross domestic profit, which means we are dependent on trade, with the European Union, for example, is a major trading partners.”

With more first-world countries pushing ESG and their sustainability agendas via regulations, exporting countries, such as Malaysia, have to meet these requirements.

In fact, Malaysia has pledged to observe the Paris Agreement 2015 and fulfil the objectives of the UN’s SDGs.

“We are committed to reducing our emission level intensity to 45% of GDP by 2030 as compared to the 2005 levels.

“We also aspire to become a net zero country as early as 2050,” she shared.

To align with these commitments, she explained that Bank Negara introduced the Climate Change and Principle-based Taxonomy, which mandates financial institutions on sustainability reporting.

“Financial institutions would have to disclose their Scope 3, which means they would eventually need to get disclosures from their clients,” she said.

She also indicated that companies that want to be listed will also have to meet Bursa Malaysia’s ESG requirements as well as the Securities Commission’s (SC) own requirements.

Approaching MSMEs“When we started our journey in 2022, our division was established on Nov 1, i-ESG division, with the ‘i’ standing for ‘industry’”, she mentioned.

“We were tasked to come up with the framework for the manufacturing sector in ESG.”

During the survey, she said Miti realised that ESG awareness was low among the micro, small and medium sized entrepreneurs (MSMEs).

These companies were also under the impression that ESG is difficult to implement and will incur more costs to them, for they lack the capacity, financial resources or technology.

“They think of it as a programme and not a journey, and that was actually the issue we identified in 2022,” she said.

Furthermore, the plethora of available standards in sustainability reporting and speed in which they evolve make it difficult for them to follow.

In September 2023, when Miti launched a new industrial master plan that included a mission to push for net zero within its four missions, the ministry recognised the need for a framework.

“In the subsequent month, we launched the i-ESG framework. This framework is guided by the 17 SDG goals, the 12th Malaysia Plan and two documents produced by Miti, which are the New Investment Policy and New Industrial Master Plan.”

Miti’s i-ESG Framework aims to foster economically beneficial environmentally sustainable and socially equitable manufacturing sectors.

Its main objective is to build and strengthen a system that encourages and enhances ESG practices among the manufacturers.

The framework will be in line with other plans and roadmaps that are supposed to come by the end of this year, such as the Nationally Determined Contribution Roadmap, the National Energy Transition Roadmap and the 13th Malaysia Plan.

The i-ESG Framework

The framework has four components; standards, capacity building, financing and market mechanism.

It also lists 70 strategies, 50 deliverables and is supported by six enablers.

Miti’s portal that hosts the framework has detailed information on ESG as well as the reasons to push for the standards.

It holds a readiness assessment tool called i-ESGReady that companies can use to gauge themselves with.

They need to answer about 40 questions in terms of their ESG practices and at the end of the form, they will be shown either if they are at the basic, limited, evolving or advanced level.

“If you’re at the evolving or advanced levels that means you are actually on the right track.

“You may not need much help from Miti, but if you’re at the basic or limited levels, then you may look at Miti’s starter kit,” said Meenachi.

The starter kit is available at the conclusion of the readiness assessment, after pressing the “done” button.

As it is just a starter kit, Meenachi cautioned that it is not a guideline or a standard and it is not a framework.

It however helps companies understand how to do their ESG reporting, as it will link them to the frameworks or standards that they will need to use.

“So if you want to disclose total energy consumption, the starter will show the link to the Global Reporting Initiative, to the European Sustainability Reporting Standards, the SDGs, to Bursa and more—but those documents will not show you how to disclose.

“That is in your own capacity, either you want to engage a consultant to gather the information, or you do it internally,” she added. In order to assist MSMEs in navigating the starter kit, which has 200-over pages and can be overwhelming, Miti has “ESG Clinics” to guide them in the process.

“Companies can join in a group of about 50 for us to conduct hand-holding sessions to teach them how to use the starter kit.”

She also said that Miti does awareness programmes nationwide, such as “Kenal ESG”, where it meets industries and participates in various webinars, seminars and forums organised by third parties.

It also runs “ESG Mentor”, where multinationals and large companies can team up with Miti to brief their vendors on adopting ESU practices and reporting on their sustainability.

The i-ESG Framework on Miti’s official portal at https://www.miti.gov.my/index.php under the “Transformation Industry” tab and is freely available to all companies.

Source: The Star

Making ESG accessible to all companies

Malaysia and Saudi Arabia are in the midst of discussions about new investments into the country, said Prime Minister Datuk Seri Anwar Ibrahim.

Anwar said he and his delegation are expected to finalise the details of investments from Saudi Arabia into Malaysia on Monday evening. 

“We will be announcing some new investments with the Kingdom of Saudi Arabia,” said Anwar, who is also finance minister, here on Monday. 

He said this after witnessing the memorandum of understanding (MOU) signing ceremony between the Securities Commission Malaysia and the Islamic Development Bank (IsDB) Group.

Anwar, who has been in Saudi Arabia for a three-day working visit since Saturday (April 27), has had a series of bilateral meetings with his counterparts from Pakistan, Iraq and Bangladesh, among others, amid the World Economic Forum’s Special Meeting and the IsDB annual meeting.

“I am having a private meeting with Saudi Crown Prince Mohammed bin Salman today. They have been to Pengerang in a big way and through IsDB.

“There are also some new ventures with the Kingdom in terms of digital technology and also energy transition, which gel with Malaysia’s priorities,” said the prime minister. 

To recap, in March this year, the board of IsDB approved the US$100 million (RM477 million) Pengerang Energy Complex project for Malaysia under the bank’s public-private partnership programme.

The project aims to develop a sustainable, energy-efficient, state-of-the-art aromatics complex in Pengerang, thereby adding value to Malaysia’s downstream oil and gas chain and economic growth. 

“The Kingdom takes a more progressive and open position in terms of looking at globalisation, inclusivity, issues of equity and inequality, and our capacity to involve or venture into new aspects or instruments (like digital technology and artificial intelligence) would help immensely.

“At the same time, this is how countries can propel the economy through these sorts of networking between countries, and some fiscal and institutional reforms,” he added.

Malaysia joined the IsDB on Aug 12, 1974. It has a capital subscription of 1.55%, worth 868.18 million Islamic dinars, which is equivalent to one special drawing right of the International Monetary Fund.

The IsDB has funded 166 projects in Malaysia, worth US$963.2 million.

Of these, 160 projects (worth US$945.8 million) have been completed and the other six projects (worth US$17.4 million) are ongoing.

Source: Bernama

Anwar: Malaysia in talks for new investments into country by Saudi Arabia