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RM12b

Amid US-China trade war, Putrajaya says RM12b FDI trickled out last year
acknowledged that FDI to Malaysia has reduced in the past year, stating that as much as RM16.4 million in investment value has stopped between May to June this year. ― Picture by Choo Choy May KUALA LUMPUR, August 6 — Putrajaya revealed that some RM11.8 billion in equity outflow left Malaysia last year, as the country sees a decline in foreign direct investment (FDI) in recent times amid the trade war between the US and China.Deputy International Trade and Industry Minister Ong Kian Ming said the equity outflow was based on the market capitalisation of the Kuala Lumpur Stock Exchange (KLSE) measured from May to July 14 this year.“This is out of the RM1.8 trillion value of KLSE’s cap. However the value of foreign investment shares remains stable,” he said in Parliament here.Ong was responding to Larut MP Datuk Seri Hamzah Zainudin’s question on how much the capital outflow from both FDI as well as the stock market has been, in light of the looming trade war between the United States and China.He acknowledged that FDI to Malaysia has reduced in the past year, stating that as much as RM16.4 million in investment value has stopped between May to June this year.“I feel several factors has led to the FDI withdrawal, including investor uncertainty on the market both domestically and abroad, as well as the move to digital and Industry 4.0 which means investors focusing on labour-intensive industries are unable to continue,“Other factors include the increase of labour costs in Malaysia especially for foreign labour in labour-intensive fields, as well as Malaysia’s preference to focus on high-tech and high quality investment,” Ong said.In light of the trade war, he added that Malaysia is also hoping to become a middle country which could attract high-quality labour from both the US and China, in turn increasing investment whose goods and services can be exported to both countries.“Regarding the labour-intensive industries, I feel it is possible more Chinese companies will ask to come here [and set up businesses] due to the trade war, Ong said.Despite the global uncertainty he said the government will endeavour to focus on developing FDI so that it will eventually rely on high-quality labour and no longer be dependent on foreign labour. [...]
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