ASEAN KEY DESTINATIONS
Manufacturing investments up in Malaysia
Total approved manufacturing investments expanded by almost 120 percent year-on-year to RM16.4bil in the second quarter this year, the fastest pace since the first quarter of 2008, bringing the total approvals to RM28.6bil in the first half this year, according to the Malaysian Industrial Development Authority (Mida).
CIMB Investment Bank Bhd economic research head Lee Heng Guie said the foreign direct investment (FDI) inflows were encouraging as they were in line with the Government's objective to spur private investments.
“Domestic direct investments will continue to drive growth, while attracting the interest of the foreign investors,” he said.
CIMB Research said in a report that the numbers reflected investors' confidence in the favourable prospects in Malaysia.
It revised this year's manufacturing investment approvals estimate to between RM50bil and RM55bil from between RM45bil and RM50bil previously, while sustained net FDI was projected to reach RM35bil to RM 40 billion in 2012.
Foreign investors led the way with approvals more than doubling to RM10.2bil in the second quarter, marking the fourth consecutive quarter of increases. Foreign share of total approved investments climbed to 62.3 percent from 37.9 percent in the first quarter. The major foreign investors in Malaysia are Japan, the United States, the Netherlands, China, Taiwan and Singapore.
Japan was the largest foreign investor in the second quarter with total approved investments of RM3.1bil or 30.3 percent of total approvals.
High capital intensive industries like electrical and electronics accounted for the bulk of total approved investments in the second quarter, followed by chemical and chemical products, petroleum refineries, transport equipment, basic metal products and plastic products.
FDI is expected to increase to between RM25bil and RM30bil this year, with the catalysts coming from improved global FDI prospects as well as the investment opportunities under the Economic Transformation Programme.
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