Sarawak has attracted RM116 billion in approved investments across all sectors from 2020 to September 2024, solidifying its position as a major investment hub in Malaysia, said Deputy Premier Datuk Amar Awang Tengah Ali Hasan.

Speaking at a press conference today, the State Minister of Natural Resources and Urban Development and Minister of International Trade, Industry and Investment, attributed this success to Sarawak’s stable political climate and pro-business policies.

“Now, from the year 2020 to September 2024, total approved investment to Sarawak across all sectors thas been recorded, amounting to RM116 billion,” he said.

He was speaking at a press conference in conjunction with the 16th Parti Pesaka Bumiputera Bersatu (PBB) Convention, scheduled to take place from Feb 14 to 16 at the Borneo Convention Centre Kuching (BCCK).

He emphasised that Sarawak continues to be a prime investment location while simultaneously developing its conventional economic activities and exploring new industries based on sustainable development.

“Besides enhancing our conventional economic activities, our Premier wants to explore new areas based on sustainable development because, in the pillars of our Post-Covid-19 Development Strategy (PCDS) 2030, one of the key focuses is environmental sustainability,” he said.

Sarawak is also making significant strides in renewable energy, he said, aiming to generate at least 15,000 megawatts of electricity by 2035, not only for domestic consumption but also for export.

“We are going to be the hub. We have already started exporting power to Kalimantan, Indonesia, and now Sabah also wants to buy power from us. Even Singapore, and possibly Peninsular Malaysia, could be supplied by Sarawak,” he elaborated.

Beyond renewable energy, Awang Tengah said Sarawak is also strengthening its presence in the oil and gas sector through Petroleum Sarawak Berhad (Petros).

“We have already signed the Commercial Settlement Agreement with Petronas and the federal government, which provides a framework for us to work together. Petros is now the sole aggregator of gas in Sarawak, giving us a stronger position in the industry,” he said.

He also emphasised the state’s commitment to infrastructure development, including new ports and airports, to facilitate economic growth.

“Our Premier has announced that we will have a new port and a new airport. Yesterday, we took over MASwings and launched AirBorneo.

“This is crucial to unlocking Sarawak’s economic potential,” he said.

To ensure Sarawakians benefit from this economic growth, Awang Tengah said the state government is also investing in education and skills development.

“By 2026, we aim to provide free tertiary education for Sarawakian students. The students won’t have to pay – the government will cover their education costs,” he said.

He also highlighted Sarawak’s recent recognition by the World Bank as a high-income region in 2023 and 2024, attributing this achievement to the Premier’s leadership.

With a clear economic direction and strong leadership, Awang Tengah expressed confidence that Sarawak will continue to grow and attract more investments in the years to come.

Source: The Borneo Post

Awg Tengah: Sarawak records RM116 bln in approved investments since 2020, solidifying its economic hub status

Malaysia’s economic indicators have shown huge improvement, says Datuk Seri Anwar Ibrahim, dismissing claims by Opposition MPs that investors’ confidence has eroded due to policy uncertainties and flip-flops.

The Prime Minister said Bursa Malaysia reported minimal fund outflow from the country compared to its regional peers, such as Thailand and Indonesia, following the Donald Trump-led US administration.

“The Gross Domestic Product (GDP) for the first nine months of (2024) has been encouraging, investments rose 10.7% in the first nine months of 2024 compared to the corresponding period in 2023. This is a significant increase,” he said, adding that there were investment commitments from multinational companies such as Amazon, Microsoft, and Infineon Technologies, among others.

“This reflects investors’ confidence,” he said during the Prime Minister’s Question Time in the Dewan Rakyat on Thursday (Feb 13).

He said rating agencies such as Nomura, JP Morgan and HSBC have increased ratings for Malaysian public listed companies.

Anwar said the stock market did decline in February much like other regional bourses.

“However, companies and financial institutions continued to report big profits,” he said while reading out the profits registered by major banks.

“What sort of a dream is the perception that investors’ confidence has eroded because of the addendum (issue)?” he asked.

He was responding to a question from Wan Ahmad Fayhsal Wan Ahmad Kamal (PN-Machang) on the reasons why many foreign investors have been selling their shares in the country recently.

“Where are the numbers from?” asked Anwar.

When it came to the supplementary question, Wan Ahmad Fayshal then cited a Bursa Malaysia report and said that the foreign outflows from Bursa Malaysia has been high since Anwar became Prime Minister. He then asked whether the reason for the outflow is the perception of corruption and the addendum issue, among others.

Anwar then reiterated that all economic indicators have increased. The bond market has also reported a positive performance.

“He (Wan Ahmad Fayshal) did not listen to my explanation,” he said.

“It is alright if that is his view. This is why Machang is not developed,” the premier said.

Wan Ahmad Fayshal then responded by saying that he was a first- time MP, to which Anwar retorted that he would consider increasing allocations for the development of Machang.

Anwar then said what was important was strong economic fundamentals such as economic growth, increase in investments and the strength of the ringgit.

Meanwhile, to another supplementary question by Datuk Seri Hamzah Zainudin (PN-Larut) on the need for reforms on Bursa Malaysia to provide foreign investors the “flavour” to invest in the local capital markets, Anwar said he agreed with the proposal.

“There have been changes to the leadership of Bursa Malaysia which indicate reforms. There are early proposals,” he said while adding that the market capitalisation remains positive at RM2 trillion.

Source: Bernama

Malaysia’s investment climate remains strong, says Anwar

The government will introduce the New Investment Incentive Framework (NIIF), which will be implemented from the third quarter of 2025, said Deputy Minister of Investment, Trade and Industry Liew Chin Tong.

He said the NIIF is an improvement by focusing on high-value activities and economic spillover effects for investment proposals submitted, compared to existing practices or mechanisms that offer investment incentives based on specific products or activities.

“In an effort to increase the influx of foreign investments, the Madani Government is focusing on creating a paradigm shift that is no longer focused on the concept of ‘made in Malaysia’, but is more concerned with the new paradigm of ‘made by Malaysia’.

“From Miti’s perspective, this effort is also focused on the aspiration to develop a ‘local champion’, he said during a question and answer session at the Dewan Rakyat on Thursday, in reply to a question by Datuk Dr Zulkafperi Hanapi (Tanjong Karang), who asked about the additional measures that will be taken to ensure that foreign investments continue to increase in 2025.

According to Liew, the government will also take advantage of Malaysia’s role as Asean chair in 2025, to strengthen regional economic cooperation by ensuring Asean continues to be a high-impact platform.

The Ministry of Investment, Trade and Industry (Miti) will also promote Malaysia’s investment ecosystem as a selected investment destination in the region, which at the same time encourages foreign investments, including strengthening the supply chain ecosystem from Asean member countries, he added.

Source: Bernama

Liew: Govt to introduce new investment incentive framework in 3Q2025

Penang can overcome challenges from tariff changes announced by United States President Donald Trump’s administration, according to Chief Minister Chow Kon Yeow.

He emphasised that Penang, which exports about 5.0 per cent of the world’s semiconductors, is closely monitoring developments from the US.

“Any new tariff policy will impact the multinational corporations (MNCs) operating in the state and therefore directly affect the state in terms of employment opportunities and investment potential for the future.

“However, I believe we are in a strong position to withstand any change in tariff and other trade policies because we have been deeply rooted for the past five decades to face such challenges,” Chow told a joint press conference with the Ambassador to the European Union (EU) to Malaysia, Rafael Daerr, here today.

The chief minister also said the state government’s commitment to positioning Penang as a hub for high-value manufacturing and technological innovation remains unwavering.

Chow highlighted that Penang is keen to forge stronger partnerships with the EU and address the challenges in the ever-shifting global semiconductor landscape.

“The state government through InvestPenang stands ready to provide a conducive environment for EU businesses to thrive, innovate, and contribute to Malaysia’s economic success,” he said.

Meanwhile, Daerr said the EU business community in Malaysia has a long-standing presence and Penang is strategically placed in the centre of the key focus area.

He said Penang is a prime location for high-tech and high-skill industries in Malaysia and has the strongest orientation towards international trade.

“This, in turn, has attracted numerous EU companies and investors, including in future-oriented sectors such as the electrical & electronics industry, medical products, precision engineering and equipment, and aviation.

“From 2019 to 2023, Penang secured nearly RM100 billion in approved manufacturing investments from the EU, accounting for 51 per cent of the state’s total approved manufacturing investments.

“During the same period, Penang exported RM140 billion worth of goods into the EU,” said Daerr.

The delegation of the EU to Malaysia, in partnership with the Penang state government, Eurocham Malaysia and InvestPenang hosted the “EU-Malaysia Business Day 2025: Penang in Focus” panel session today.

The one-day event is aimed at strengthening economic ties and fostering collaboration between European and Malaysian businesses.

Source: Bernama

Penang confident of withstanding impact of US tariff changes – Chow

The government continues to identify new strategies to make Malaysia an attractive and competitive investment destination, said Prime Minister Datuk Seri Anwar Ibrahim.

He said among the initiatives that have attracted investors is the Johor-Singapore Special Economic Zone (JS-SEZ), which has received very positive feedback not only from Singapore but also from other countries.

“Furthermore, our plan with Thailand is to ensure that the northern states of Peninsular Malaysia, namely Perlis, Kedah, Kelantan, and Terengganu, alongside the four southern provinces of Thailand, are also being developed.

“We’ve had two meetings, and on Feb 18, I have another meeting to outline how this growth can be achieved,” he said during the Ministers’ Question Time in the Dewan Rakyat today.

Anwar was responding to a supplementary question from Syerleena Abdul Rashid (PH-Bukit Bendera), who asked about the government’s efforts and incentives in positioning Malaysia as an attractive and competitive investment destination.

Anwar said the incentive with Thailand is certainly different from JS-SEZ.

Apart from that, he said for Sarawak, the investment focus is on the energy hub for the Aseam region.

“As I mentioned in Parliament last week, one of Malaysia’s strategies is to integrate into the Asean framework by positioning Malaysia as one of the key hubs for the Asean Energy Grid, connecting Vietnam, Laos, Cambodia, Thailand, Malaysia, Singapore, all the way to Indonesia and the Philippines.

“And from Sarawak, it will be connected to Sabah, Kalimantan, and the Philippines,” he added.

He also said that Malaysia is taking steps to promote Forest City as a financial centre and to develop it as, for example, a single-family office scheme.

Source: Bernama

Govt identifies new strategies to maintain Malaysia’s investment competitiveness

Eight stock sectors are emerging as key beneficiaries of the Johor-Singapore Special Economic Zone (JS-SEZ), which launched in early January, aiming to strengthen economic cooperation and build synergy to attract global investments.

TA Research, which prepared a report following a visit to the state with institutional clients, said the initiatives would help lift Johor’s economy, especially in addressing the many issues that have plagued Iskandar Malaysia, including connectivity between the nine flagship zones identified under the JS-SEZ and connectivity between Johor and Singapore, among others.

The JS-SEZ largely corresponds to the area of Iskandar Malaysia, which was launched in November 2006.


The research house has identified banking, construction, consumer, oil and gas, property, power and utilities, technology and telecommunications as the key stock beneficiaries of the JS-SEZ.

“Johor will benefit from the spillover effects of Singapore’s economy and investments,” it said, noting that the bilateral trade flow between Malaysia and Singapore underscored both countries’ interdependence.

While the two countries have cooperated to develop an economic zone in Johor since the launch of Iskandar Malaysia, TA Research said the state needs aggressive incentives, promotion, a talent pool and sound infrastructure to attract investments and achieve the state government’s gross domestic product (GDP) target of RM260bil by 2030, up from RM148.2bil in 2023.

According to the Malaysian Investment Development Authority, between 2006 and December 2023, Iskandar Malaysia received a total cumulative investment of RM413.1bil, surpassing the RM383bil target set for the end of 2025.

Out of this, RM291.4bil, or 70%, has been realised. It is expected to attract RM636bil in committed investments by 2030.


“The JS-SEZ does not come with any financial targets but initiatives outlined under this economic zone are expected to complement the goals set for Iskandar Malaysia,” it said.

The JS-SEZ aims to increase economic complexity, promote digital vibrancy and technology adoption and achieve net-zero aspirations.

The value of investments stemming from these initiatives is expected to correspond with the enhanced requirements and help achieve the goals set.

Under the JS-SEZ’s identified economic sectors (manufacturing, logistics, food security, tourism, energy, digital economy, green economy, financial services, business services, education and health), aerospace, electrical and electronics, chemical, medical devices and pharmaceuticals were identified at the launch as top priority industries.

TA Research said Johor plays a crucial role in Malaysia’s economic landscape with its diverse economic base including manufacturing, agriculture, tourism and services.

“The inclusion of financial services as a key sector within the JS-SEZ is particularly important, as it will help elevate Johor’s role in Malaysia’s broader economic landscape.

“By creating a business environment conducive to the growth of finance technology, digital banking and other financial services, the zone could become a major regional financial centre, complementing Singapore’s dominance in this area,” it said.

It pointed out that the JS-SEZ may even rival the Klang Valley, given that Johor’s economic growth by GDP outpaced the national economy in 2023.

“We anticipate that this growth target will be revised upward in the 13th Malaysia Plan (due in July 2025), as Johor Mentri Besar Datuk Onn Hafiz Ghazi remains optimistic about the state’s development trajectory,” it added.

Source: The Star

JS-SEZ expected to spur growth in eight sectors

Malaysia and Turkiye have acknowledged the Malaysia-Turkiye Free Trade Agreement (MTFTA), which has been in force since 2015.

In a joint statement today, Prime Minister Datuk Seri Anwar Ibrahim and Turkish President Recep Tayyip Erdoğan expressed their satisfaction with the expansion of the MTFTA in 2024 to include trade in services, investment and e-commerce.

Both leaders reaffirmed their commitment to the full operationalisation of the Trade Preferential System among the Member States of the Organisation of Islamic Cooperation (TPS-OIC) and D-8 Preferential Trade Agreement (D-8 PTA) and agreed to cooperate for the enhancement of these agreements.

In recognising the critical role of the private sector in advancing economic ties, Anwar and Erdogan have expressed their full support for greater business-to-business collaboration to expand trade and investment opportunities.

They welcomed the mutual readiness to establish a Joint Business Council between the National Chamber of Commerce and Industry of Malaysia and the Foreign Economic Relations Board (Dış Ekonomik İlişkiler Kurulu) of Turkiye to enhance commercial exchanges and unlock new opportunities for sustainable economic cooperation.

The two leaders expressed their steadfast commitment to advancing partnerships and enhancing economic development cooperation under the Developing Eight Organisation for Economic Cooperation (D-8) and welcomed Azerbaijan’s accession to the D-8.

Erdoğan is on a two-day official visit to Malaysia beginning yesterday at Anwar’s invitation.

During the visit, he held extensive talks with Anwar on deepening bilateral relations, as well as exchanged views on current regional and international issues.

Source: Bernama

Malaysia, Turkiye acknowledge MTFTA, its 2024 expansion

The Malaysian government’s meeting with United Kingdom (UK)-based technology company Arm Ltd today proves that clear policies such as the National Semiconductor Strategy, along with the country’s other advantages, continue to make Malaysia a prime destination for foreign investment, said Prime Minister Datuk Seri Anwar Ibrahim.

In a Facebook post, he said that during his meeting with Arm executive vice president and chief commercial officer Will Abbey, accompanied by Economy Minister Datuk Seri Rafizi Ramli, they exchanged views on the direction of computing technology to help Malaysia strengthen its position as a hub especially in relation to the semiconductor and data centre ecosystem.

“Arm Ltd, a UK-based company, is a global leader in central processing unit (CPU) technology and focuses on building the future of global computing.

“The company also acts as an architect, developing and licensing high-performance, low-cost, and energy-efficient intellectual property solutions,” he added.

Source: NST

Malaysia continues to attract foreign investment due to clear policies – Anwar

Malaysia and Turkiye need to collaborate in various sectors, including semiconductors, agri-commodities, electrical and electronics (E&E) as well as food and beverages (F&B) to achieve the US$10 billion (RM44.68 billion) bilateral trade target, said Prime Minister Datuk Seri Anwar Ibrahim.

Yesterday, Turkish President Recep Tayyip Erdoğan, who is on a two-day official visit to Malaysia at Anwar’s invitation, said Turkiye aimed to double its trade with Malaysia to US$10 billion after surpassing the US$5 billion (RM22.34 billion) mark in 2024.

In response, Anwar acknowledged that while the target is ambitious, he believes Malaysia can facilitate Turkiye in achieving it.

“There is no reason why developing or emerging economies like Malaysia and Turkiye cannot increase their intra-trade.

“We therefore need to work in various fields, such as semiconductors, agri-commodities, E&E and F&B,” he said, also emphasising the importance of cooperation in the defence sector and technology exchange.

Anwar was speaking at a joint press conference with Erdoğan, which was broadcast live today.

He called for continued collaboration with Turkiye in sectors like energy, particularly with state-owned oil and gas company Petroliam Nasional Bhd (Petronas) and related firms, halal industries, healthcare, digital technology, and disaster management.

Anwar also praised Turkiye’s successful transformation of its airline and airport management, urging the sharing of its best practices.

Meanwhile, Erdoğan said his recent discussions with Anwar had examined opportunities for cooperation in various fields such as industry and technology, energy, tourism and commerce, as well as culture and education,

“And we have focused extensively on concrete steps to be taken forward,” he said.

Erdoğan added that Turkiye was determined to sustain its momentum in the defence industry through technology transfer and joint manufacturing, and its companies are ready to share their expertise and products with Malaysia for mutual benefit.

On the US$10 billion trade target with Malaysia — Turkiye’s largest trading partner in Asean — he hopes the upcoming Business Forum will serve as an opportunity to unveil new cooperation models and investment projects.

Source: Bernama

Malaysia, Turkiye should collaborate in key sectors to achieve US$10 bln trade target — PM

Malaysia’s proposed high-speed rail (HSR) project could play a crucial role in the success of the Johor-Singapore Special Economic Zone (JS-SEZ), according to a market insider.

The insider said that improved connectivity between Kuala Lumpur and Johor would offer significant advantages, including enhanced labour mobility, which could drive social benefits through increased job opportunities for Malaysians.

Although the JS-SEZ is hailed as a “gamechanger,” he expressed concerns that without the HSR, the zone could disproportionately benefit Singapore, creating an unbalanced economic ecosystem.

“Without the HSR, the JS-SEZ risks shifting the regional economic focus towards Johor and Singapore, limiting Kuala Lumpur’s potential to emerge as a truly global city,” he told Business Times.

He cautioned that while Kuala Lumpur would remain a key domestic hub, its regional and international competitiveness could be compromised.

Covering 3,505 square kilometres in Johor, the JS-SEZ encompasses strategic areas such as the Iskandar Development Region, Forest City Special Financial Zone, and the Pengerang Integrated Petroleum Complex (PIPC). It features business-friendly initiatives, including simplified procedures for Singaporean firms to establish operations in Johor, passport-free checkpoint clearances, and digitised cargo management systems.

The JS-SEZ is expected to create over 20,000 skilled jobs and attract high-value investments in sectors like manufacturing, logistics, digital industries, healthcare, and education.

“This will lead to an increase in road users over time, eventually resulting in congestion. In the absence of the HSR, Malaysia will need to invest heavily in alternative infrastructure and strategic initiatives to strengthen Kuala Lumpur’s global standing and offset these challenges,” he added.

Wan Agyl Wan Hassan, founder and chief executive officer of MY Mobility Vision Sdn Bhd, said that reducing travel time between key economic hubs—Kuala Lumpur, Johor, and Singapore—would significantly boost productivity and stimulate the development of regional economic clusters.

Without the implementation of the HSR, travel times along the North South Expressway are expected to rise due to increased economic activity and population growth driven by the JS-SEZ.

To address this, alternative measures such as upgrading public transport, enhancing road infrastructure, and introducing traffic management strategies may be required. However, these solutions are unlikely to fully match the efficiency and benefits offered by a HSR system.

“We’re talking about the potential to attract FDIs, create dynamic business districts, and enhance our tourism appeal. However, the real challenge is ensuring that we adapt best practices. Just think of Japan’s Shinkansen or China’s HSR in our unique local context, not just replicating a foreign model,” he told Business Times.

Wan Agyl cautioned that failing to invest in HSR infrastructure could put Malaysia at a competitive disadvantage in the region.

“In my view, if we don’t invest in HSR, we risk falling behind our neighbours on several fronts. Modern HSR systems not only speed up travel but also create economic hotspots around station hubs, attracting investment and driving trade efficiencies.

“Without such infrastructure, Malaysia might be seen as less competitive, making it harder to attract both domestic and foreign investors. For tourism, reliable and fast connectivity is increasingly a deciding factor for travellers. The lack of HSR could therefore mean missing out on substantial economic spillover benefits and a diminished role in a rapidly modernising region,” he said.

HSR ‘revival’

Hailed as a “marquee project,” the Kuala Lumpur-Singapore HSR is envisioned as a strategic development aimed at reducing travel time between the two countries to just 90 minutes.

The HSR, which was initially proposed 23 years ago by YTL Group, is planned as a 350 km double-track route with eight stations. Johor will feature the longest stretch of the alignment, covering 182 km out of Malaysia’s total 328 km, with stations expected in Muar, Batu Pahat, Iskandar Puteri, and potentially Forest City.

Johor will also host two key maintenance facilities: a main depot north of the Iskandar Puteri station for general HSR train upkeep and a heavy maintenance base near Muar station responsible for maintaining the track, power supply, and signalling systems.

The project resulted in a legally binding agreement signed in December 2016, with the aim of having the line operational by 2026.

However, it was put on the back burner following several delays at Malaysia’s request and the eventual lapsing of an agreement in December 2020.

Malaysia paid more than S$102 million in compensation to Singapore for the project’s termination.

The Malaysian and Singaporean governments last year agreed to revive the mega rail project.

The project is nearing fruition, with three consortiums reportedly shortlisted: YTL Construction Sdn Bhd-SIPP Rail Sdn Bhd, Berjaya Rail Sdn Bhd-Keretapi Tanah Melayu Bhd-IJM Construction Sdn Bhd, and a Chinese consortium led by state-owned China Railway Construction.

Doris Liew, economist and assistant research manager at the Institute for Democracy and Economic Affairs (IDEAS), suggested that a well-structured public-private partnership (PPP) would be the best approach to ensure the project’s long-term viability and sustainability.

Relying solely on private initiatives for such a large-scale project is risky due to the significant investments involved.

A robust PPP model can balance financial sustainability with public value, Liew told Bernama.

She noted that the success of the HSR project would also depend on the financial resilience of private sector partners involved.

Emphasis on balanced planning

The revived Kuala Lumpur-Singapore High-Speed Rail (HSR) project is projected to cost around RM70 billion, marking a significant reduction of 30 to 35 percent from the previously estimated RM110 billion, according to market insiders.

This revised figure factors in the updated railway alignment within Malaysia, along with adjustments in the number of stations and trains required for the project.

Wan Agyl noted that while project delays often lead to cost escalations due to inflation, rising land prices, and technological advancements, the notion of a “do now or never” approach oversimplifies the complexity involved.

“Rushing into a project without solid feasibility studies since we need a new study due to the many years of delay, clear political consensus, and secured financing can lead to even more serious cost overruns and execution failures. Instead, we need to fast-track essential preparatory work. In other words, we must strike a balance between urgency and due diligence so that when we move forward, we do so on rock-solid ground,” he said.

Despite both Malaysia and Singapore signalling readiness to move forward with the project this year, construction may not begin for at least another two years.

“The fact that we haven’t yet secured a formal commitment from Singapore and haven’t even kicked off discussions on our side should be seen as a sign of prudence rather than reluctance. Both nations need to ensure that all technical, financial, and political details are ironed out before making any binding commitments via bilateral agreement.

“For cross-border projects of this scale, aligning differing regulatory and operational standards is a lengthy process. This cautious approach allows us to conduct deeper feasibility studies and stakeholder consultations. It’s not a rejection of the project but a necessary phase to build a robust, mutually beneficial framework. We have done it before and I believe it’s not a big issue for us to go through the process again,” he said.

Wan Agyl explained that this projected timeline reflects deeper structural challenges beyond bureaucratic delays.

“Firstly, comprehensive feasibility studies are needed to tailor the project to our local realities, ensuring that environmental, economic, and social impacts are fully understood. Then there’s the issue of political and bureaucratic inertia. Malaysia has seen large projects stall due to shifting priorities and slow decision-making,” he said.

He further emphasised the complexity of cross-border collaboration with Singapore, highlighting the need to align technical standards, regulatory frameworks, and financial structures.

“These delays, while frustrating, are critical to laying a sustainable and accountable foundation,” he said.

Wan Agyl said that an operational HSR could be a catalyst for growth across multiple sectors.

Shorter travel times would streamline business interactions and foster the creation of new economic corridors, making Malaysia a magnet for both domestic and international investors, he said.

“For tourism, HSR would offer an attractive, efficient way for visitors to experience our rich culture and landscapes, spurring growth in hospitality, retail, and services. Moreover, HSR stations can serve as nuclei for urban renewal and transit oriented development, spurring smart city initiatives and sustainable development.

“In short, HSR isn’t just a transport project; it’s an economic corridor development and an integrated strategy for national economic development,” he said.

Source: NST

Kuala Lumpur-Singapore high-speed rail will complement JS-SEZ

Malaysia’s foreign direct investment (FDI) is expected to remain robust in the long term, but there could be repercussions in the short term as investors hold back on their investment decisions amid heightened global uncertainties.

These uncertainties triggered by geopolitical risks are further exacerbated by US president Donald Trump’s import tariffs and the looming trade war.

However, economists viewed this scenario as a temporary setback as the country’s economic fundamentals remain intact.

Furthermore, they said Trump’s delayed tariffs on Canada and Mexico for another month may reduce the chances of an outbreak of a broader trade war.

HSBC Asean economist Yun Liu told StarBiz despite recent tariff announcements from the United States on Mexico, Canada and China, there remains huge uncertainty on future tariff risks.

She said this would likely put investors on a cautious footing in the near term when looking not only at Malaysia, but also other Asean countries.

That said, she said there are still good reasons to believe in Malaysia’s growth prospects, as the determinants of FDI often focus on long-term fundamentals.

“If we measure FDI commitments as a percentage of gross domestic product (GDP), Malaysia has topped the region since late 2021.

“After all, a confluence of factors, including its significance in the global tech supply chain, friendly FDI policies, existing industry clusters, a skilled labour force and extensive free trade agreements or FTAs make Malaysia an outperformer in the region.

“One thing worth keeping an eye on is the New Investment Incentive Framework, expected to be unveiled in the first quarter of the year (1Q25) and implemented in 3Q25.

“Malaysia needs a set of new incentives to lure investments into high-tech sectors that produce high-value jobs,” Liu added.

RAM Rating Services Bhd economist Nadia Mazlan said in the short term, the perils of potential Trump tariffs may lead investors to hold back on their investment decisions, which could weaken FDI into Malaysia.

However, she said as jitters wear off, tariffs that are currently being imposed on China may prompt even more manufacturing companies to adopt the China Plus One strategy.

This supply chain realignment could lead to a rise in investments into Asean, including Malaysia, as seen during the first United States-China trade war.

“As transpired back in 2018, when the first trade war was initiated, we saw Malaysia’s net FDI slip to RM30.7bil from RM40.4bil in 2017, before rising to RM32.4bil the following year.

“Thus, if history serves as any guidance, the unpredictability of Trump’s trade policies could hamper investor sentiment in the near term, leading to a more moderate net FDI inflow this year compared to last year.

“That said, foreign capital investments are typically made to further an entity’s long-term goals and objectives. Thus, the committed FDIs in Malaysia are unlikely to be swayed by short-term geopolitical fluctuations,” she noted.

Nadia said Malaysia’s FDI will likely remain relatively robust this year on the back of a still-favourable FDI outlook, albeit somewhat dampened by heightened global uncertainties.

She said the latest foreign investments approved data suggest a healthy FDI pipeline, registering RM106.7bil worth of foreign investments approved for the first three quarters of 2024, most of which were in manufacturing.

The full-year investment approval amount for 2024, she said, while likely to come in lower compared to RM188.4bil in 2023, is still markedly higher than the pre-pandemic average (2016-2019 average: RM69.1 bil).

“We expect some of these investments to materialise soon, which should continue to support Malaysia’s FDI inflow this year,” Nadia said.

OCBC Bank senior Asean economist Lavanya Venkateswaran expects FDI inflows to remain steady this year.

She said notwithstanding global volatilities, Malaysia’s economic fundamentals have become stronger in recent years.

“Malaysia remains an attractive destination for manufacturing and services FDI inflows based on relatively solid infrastructure, young workforce, strong positions in the electrical and electronics (E&E) and commodities supply chain.

“These factors will continue to hold water even in 2025. This is complemented by the government’s push to diversify growth across the country, for example, setting up of the Johor-Singapore Special Economic Zone (SEZ), facilitate and develop infrastructure and implement the various medium-term economic plans will keep FDI inflows into Malaysia well buoyed,” Venkateswaran said.

Malaysia recorded FDI inflows (on a balance of payments basis) of RM29.1bil for the first three quarters of 2024, about 39% higher than the period in 2023. The trend for FDI inflows is upward and this is also being reflected in broader investment approvals. For the first three quarters of 2024, Malaysian Investment Development Authority (Mida) approved RM254.7bil of domestic and foreign investments across various sectors.

Juwai IQI global chief economist Shan Saeed said Malaysia continues to draw investment from local and foreign investors due to its macroeconomic stability, increasing demographics and policy consistency.

“The outlook for investment in 2025 looks promising with FDI expected to increase by 10% to 15% in the current fiscal year. Malaysia has created its own niche as information and communications technology (ICT) and data centre reliable hub for the global market in the last three to four years.

“The main drivers that will attract FDI inflows into the country include accelerated economic growth trajectory, ⁠macroeconomic stability, foreign investors positive outlook on the country, tech savvy labor force, modern infrastructure, and its strategic geographical location in the region. These all bodes well for FDI inflows into Malaysia,” Shan said.

At the same time, he said Malaysia continues to compete in FDIs with neighboring Asean countries like Indonesia, Vietnam, Singapore and the Philippines. In terms of regional competitiveness, Malaysia is fairly competitive, thanks to its four key variables to attract FDIs – political stability, productive labor force, modern infrastructure, and consistent economic policies and development outlook.

MARC Ratings Bhd chief economist Ray Choy said the global trade environment is expected to become increasingly complex this year compared to 2024, potentially dampening business sentiment and transaction velocity.

“Despite this, FDI typically operates on multi-year planning horizons, indicating that Malaysia is likely to continue benefiting from a robust long-term economic strategy.

“This strategy includes actively pursuing a diversified portfolio of investors and trade partners, pertinent examples are the Johor-Singapore SEZ and renewable energy investments in collaboration with South Korean companies in Sarawak, which exemplifies Malaysia’s approach to diversifying business partners within Asia amidst global trade challenges,” he said.

Choy said in recent years, Malaysia has experienced a surge in FDI inflows beyond long-term average levels since 2021, driven by national economic blueprints focused on increasing GDP contributions from higher value-added sectors and ongoing economic transformation.

As a leader in semiconductor manufacturing, which is currently a high growth sector, Malaysia would continue to benefit from policies such as the National Semiconductor Strategy, he said. Other sectors would also contribute significantly, driven by the New Industrial Master Plan 2030, National Energy Transition Roadmap, and goals towards the upcoming 13th Malaysia Plan.

“our baseline scenario suggests Malaysia will continue to benefit from trade diversion, as US tariff policies remain primarily targeted at China, with potential for renegotiation if China adopts a less assertive geopolitical stance.

“While the United States has begun with a 10% tariff, this measured approach remains subject to review and depends on China’s diplomatic strategy,” Choy noted.

As to what Malaysia should do to further attract FDIs, he said the country has made considerable progress in enhancing tangible aspects that support (FDI), including improvements in transportation infrastructure, competitive rental rates, and well-connected utilities.

However, Choy said there is an urgent need to address several intangible factors that could further enhance FDI inflows. A critical area of focus is the development of skilled human capital, which is essential for attracting high-value investments, particularly in the technology sector. Additionally, he said there needs to be a greater emphasis on research and development (R&D) to foster innovation and drive economic growth.

“Nonetheless, it is important that basic sectors are not neglected in the pursuit of high-growth, high-value sectors, particularly for the purpose of agricultural security as Malaysia’s ecological abundance is a natural strength that should be capitalised upon.

“When assessing FDI, it is essential for a strategic focus on sectors that create spillover effects across the economy and generate employment opportunities. Consequently, attracting FDI must go beyond mere value creation.

“It should be targeted on a deal-by-deal basis to ensure that sustainable economic impacts are achieved. Given the commercial aspects of attracting FDI, dynamic regulatory and policy flexibilities should be tailored to each investment deal,” Choy said.

Juwai’s Shan said to further step up FDI, the government can navigate the new tariff regime from the Trump administration by exploring new markets in the Gulf Cooperation Council (GCC) countries, Africa and Asia, especially Asean to spearhead economic growth and achieve higher income.

“FDI, trade and commerce move in countries where economic growth momentum is strong, political stability is solid, has the ability to consume goods and services to bolster the GDP growth, and strategic geography.

“I foresee Malaysia’s GDP growth outlook to meander around 5 to 6% in 2025, and the country will continue to stay on global investors radar as it is the 26th largest economy of the world, 11th in Asia and third in ASEAN. Malaysia has also been running the trade surplus for the last 27 years,” Shan said.

RAM’s Nadia said Malaysia remains an attractive FDI destination given its unique strengths such as having a skilled workforce, robust infrastructure, and a business-friendly environment as showcased by our 12 th ranking in the World Bank’s ease of doing business index.

“Furthermore, Malaysia’s ability to attract FDI is clearly demonstrated in sectors where it holds a competitive advantage, such as E&E, as well as data centre developments, which have received significant government attention and support.

“However, increasing regional competition from peers could make it a challenge to sustain Malaysia’s investment competitiveness. In particular, Vietnam has been a top alternative to China for firms while Indonesia’s pull factor includes its large labour and market size,” she said.

Source: The Star

FDI forecast to remain robust

The Johor-Singapore Special Economic Zone (SEZ) will encourage the industry diversification needed for the state to shield itself from global trade uncertainties, said Chief Minister Datuk Onn Hafiz Ghazi.

In an interview with Channel News Asia, he said the SEZ, which was formalised in January, spans 3,571 sq km and covers 11 key sectors, including manufacturing, logistics, financial services, and the digital economy.

With rising geopolitical tensions such as those arising from Donald Trump returning as the US presidency as disruptions in the artificial intelligence space from the release of China’s DeepSeek model, doubt has befallen Johor’s data centre gold rush.

Global technology giants Nvidia, Microsoft, and GDS International have already established data centres in southern Johor, the release of the DeepSeek model has led the technology sector to rethink if the previous projections for data centre requirements remained accurate.

“At the moment, the demand (for) data centres in Johor is huge, there are requests from US, China, Australia and quite frankly, this demand is getting higher,” Onn Hafiz was quoted as saying.

“Right now, it’s not a major concern, but we will monitor as it goes.”

Onn Hafiz explained that the JS-SEZ would help mitigate this as the zone covers 11 disparate sectors that considered “global demand and Johor’s strength”.

The 11 are manufacturing, logistics, food security, tourism, energy, the digital economy, the green economy, financial services, business services, education, and health.

The state was also pushing for travel infrastructure development to complement the Johor Baru-Singapore RTS Link that is expected to come online next year, such as by expanding the MyBorderPass QR-code clearance system to improve cross-border connectivity.

Onn Hafiz said the state was also working to ensure the growth and development would be both sustainable and equitable, by ensuring that some of the revenue is channelled back to ensuring the quality of life for state residents.

These include prioritising affordable housing and food security to balance economic expansion with local quality of life improvements.

Source: Malay Mail

With Singapore SEZ, CM says Johor will be more than just data centres