GEORGE TOWN, Jan 2 (Bernama) -- Despite the rosy performance in approved manufacturing investments in Penang last year, the inflow is expected to slow down in 2020, said Datuk Seri Lee Kah Choon, special investment advisor to the Penang Chief Minister.
Citing data from the Malaysia Investment Development Authority (MIDA), he said Penang received RM13.3 billion in total approved manufacturing investment between January and September 2019 .
The investments comprised RM12 billion in foreign direct investment (FDI) and RM1.3 billion in domestic direct investment (DDI).
Lee said electronic and electrical (E&E) products as well as scientific and measuring equipment were the major contributors to the total approved manufacturing investment, accounting for 68 per cent and 18 per cent respectively.
"While approved manufacturing investment was extraordinarily high in 2019, the investment amount is expected to be lower in 2020," he told a press conference here today.
Lee said that major challenges include the volatility of investment trends as well as the fierce competition in attracting high quality investments, as other ASEAN countries have introduced a variety of incentives to attract investors, especially those affected by the United States-China trade war.
He also said that Malaysia should pay more attention to the shortage of skilled manpower to remain relevant in the technology sector.
"The quality of the workforce can be worked on, but it is the quantity that is the issue. While Malaysia has about 30 million in skilled workforce, Vietnam has over three times the number," he said.
Lee highlighted that the federal government has introduced a series of initiatives to make Malaysia the preferred destination for investments, including customised packaged incentives worth up to RM1 billion to attract Fortune 500 companies and expediting incentive approval processes via the National Committee on Investment.
The list also includes promoting high value-added E&E industry by providing income tax exemption of up to 10 years for E&E firms investing in selected knowledge-based services.
"Meanwhile on the state level, we are also looking into collaborating with states such as Kedah and Perak to develop the northern region as an ecosystem hub for promoted industries," he said.
Lee added that the collaboration aimed to widen the supply chain of industries, specifically to manufacture E&E products and medical equipment.
TAGS: investment, outlook, Penang, Lee Kah Choon, InvestPenang