KUALA LUMPUR: Malaysia recorded investment approvals of RM80.60bil in the first quarter ended March 31, 2021, which was a surge of 95.6% from the RM41.20bil a year ago.

The investments were for the manufacturing, services and primary sectors and involved 993 projects and they were expected to generate 32, 557 job opportunities, the Malaysian Investment Development Authority (MIDA) said on Wednesday.

“Total approved foreign direct investments (FDI) in the manufacturing, services and primary sectors increased by 383.4% to RM54.90bil in January to March 2021 from RM11.4bil in the same quarter last year, ” the statement added.

MIDA said Senior Minister and Minister of International Trade and Industry Datuk Seri Mohamed Azmin Ali had presented at the Cabinet on Wednesday the impressive investment approvals for 1Q despite the unprecedented economic challenges caused by the Covid-19 pandemic.

“The members of the Cabinet endorsed the 1Q, 2021 approved investment by responding optimistically that Malaysia will successfully weather the storm with every Malaysian’s steel effort in boosting the economy, ” MIDA said.

It also pointed out the continued aggressive strategies to attract high-level investments from both foreign and domestic investors is exhibiting promising results.

“Malaysia remains a competitive investment location for foreign investors despite the multiple headwinds on the global front, ” it said.

Total approved foreign direct investments (FDI) in the manufacturing, services and primary sectors increased by 383.4% to RM54.90bil in 1Q versus RM11.40bil a year ago.

The top five countries in accordance to reporting by immediate source of FDI was from Singapore (RM43.1bil), the Netherlands (RM5bil), South Korea (RM4.3bil), Taiwan (RM500mil) and Hong Kong (RM300mil).

MIDA said Investments from Singapore include one 100% Chinese owned mega project, where the source of funding is made through its affiliate located in the country.

Domestic direct investments (DDI) made up the rest of RM25.7bil, contributing 31.9% to the total approved investments in all the three sectors.

In the 1Q, Kedah, Selangor, Sarawak, Sabah and Kuala Lumpur accounted for RM68.4bil (84.9%) of the total approved investments.

The manufacturing sector recorded RM58.8bil in investments, followed by the services sector at RM15.6bil and the primary sector at RM6.2bil.

Malaysia’s manufacturing sector recorded approved investments of RM58.8bil from 246 manufacturing projects for 1Q compared to RM25.9bil from 226 manufacturing projects a year ago.

Amid the pandemic, FDI accounted for 88.9% or RM52.3bil of the total approved investments in the manufacturing sector while the remaining 11.1%, or RM6.5bil were from domestic sources.

The bulk of these investments were in the electrical and electronics (E&E) (RM47bil), fabricated metal products (RM4.9bil), rubber products (RM3.3bil), chemicals and chemical products (RM1.1bil), transport equipment (RM500mil), food manufacturing (RM400mil), machinery and equipment (RM400mil) as well as paper, printing and publishing (RM200mil).

These industries make up 98.3% of total approved investments for the sector.

“Malaysia has also consistently pursued more capital-intensive projects and those that support the sustainable development agenda of the nation.

“This is reflected by the increasing capital investment per employee (CIPE) ratio to RM2,201,838 in 1Q from RM1,625,162 a year ago.

“The approved manufacturing projects will create 26,689 job opportunities. The new workforce includes 943 managerial positions and 1,042 engineers in the electrical and electronics, mechanical and chemical disciplines, reflecting the higher value chain transition of the manufacturing sector.

“The approved manufacturing projects will also require 3,518 skilled craftsmen such as plant maintenance supervisors, tools and die makers, machinists, IT personnel, quality controllers, electricians and welders, ” MIDA elaborated.

Major industries which require the most skilled workforce are E&E, rubber products, fabricated metal products, transport equipment and machinery and equipment.

In terms of recipients of approved investments in the manufacturing sector, Kedah registered the highest level of investments with RM42.4bil, followed by Sabah (RM4.3bil), Selangor (RM4bil), Melaka (RM3.4bil), and Johor (RM1.7bil).

Collectively, these states contributed 95.1% or RM55.8bil to the total approved investments that will fund 165 projects.

These investments are set to create 19, 273 job opportunities, making up 72.2% of the total employment in the manufacturing sector.

The leading sources of foreign investments in the manufacturing sector were Singapore, South Korea, the Netherlands, Taiwan, China, the US, Switzerland, Denmark, Germany and Hong Kong.

These 10countries jointly accounted for 99.8% or RM52.1bil of total foreign investments approved in the manufacturing sector for this period.