PETALING JAYA: Malaysia registered a total of RM53.9 billion approved investments in the manufacturing, services and primary sectors for the first quarter of 2019 (Q1 2019), 3.1% higher than the RM52.3 billion recorded in the same period last year.
Malaysian Investment Development Authority (Mida) said in a statement that the growth was mainly driven by the robust performance of the manufacturing sector, which jumped 126.8% with an investment of RM25.4 billion in the sector compared with Q1 2018.
The government agency pointed out that there is a trend towards more capital-intensive, high value-added and high technology projects that are well reflected in the capital investment per employee (CIPE) ratio.
“The CIPE ratio of manufacturing projects approved in Q1 2019 was RM1.11 million compared with RM805,531 in Q1 2018. A total of six manufacturing projects with investments of at least RM1 billion, with total investments of RM16.5 billion, were approved in Q1 2019,” said Mida.
In addition, there were 20 approved projects with investments of at least RM100 million. Together, the 26 projects account for 87.8% of the total investment approved for the sector with a value of RM22.3 billion.
Foreign investments in approved manufacturing projects surged 127% to RM20.2 billion in Q1 2019 from RM8.9 billion in the corresponding period last year.
Mida explained that the increase reflects the country’s continuous competitiveness as a location of choice for investments.
“These approved projects are expected to generate strong multiplier effects, which include the growth of domestic companies or engineering supporting industries, cluster development, local sourcing, strengthening of R&D activities and human capital development.”
It disclosed that the US (RM11.5 billion), China (RM4.4 billion), Singapore (RM2.2 billion), Japan (RM600 million), and the British Virgin Islands (RM500 million) accounted for 95% of total approved foreign investments in the manufacturing sector.
However, the services sector accounted for the lion’s share of approved investments for the quarter with 1,445 approved projects worth RM26.1 billion.
“The bulk of the investments came from domestic sources, which contributed RM18.0 billion or 69% of the total approved investments while the foreign sources contributed RM8.1 billion or 31%,” said Mida.
The five main sub-sectors that led the services sector with the highest total investment were real estate (RM11 billion or 42.3%), followed by the distributive trade (RM8.2 billion or 31.6%), utility (RM4 billion or 15.4%), hotel and tourism (RM1.8 billion or 7.0%) and support services (RM550.9 million or 2.1%).
Meanwhile, the primary sector contributed RM2.4 billion or 4.5% to the total approved investments in the first quarter of this year, with a majority of investments were contributed by domestic sources (RM1.4 billion or 58.3%), while foreign investment amounted to RM1.0 billion or 41.7%.
Oil and gas exploration activities dominated the mining sub-sector with approved investments of RM2.2 billion or 91.7%, followed by plantation and commodities with RM140 million and agriculture sub-sector with RM43.5 million.
According to the investment authority, the manufacturing sector accounted for the largest share of total potential employment in the economy with 22,970 job opportunities or 55.7%, followed by the services sector with 18,000 job opportunities (43.7%) and primary sector with 240 employment opportunities (0.6%).