KUALA LUMPUR: Malaysia has targeted at least eight to 10 per cent increase in foreign and domestic direct investments this year after posting a "historic" figure in 2023.

The country's approved investments for the manufacturing, services and primary sectors surged 23 per cent to RM329.5 billion last year from RM267.7 billion in 2022.

Investment, Trade and Industry MinisterTengku Datuk Seri Zafrul Abdul Aziz said these investments are expected to create more than 52,700 job opportunities.

Tengku Zafrul emphasised the importance of aligning the investment target with the country's economic growth.

With the gross domestic product (GDP) target for 2024 projected at 4.0-5.0 per cent, he said the ministry aims to double this rate, setting a minimum target of 8.0-10 per cent for total approved investments.

"We are still finalising the target, but it has to be higher than this year," he said at the press conference of Malaysia's investment performance for 2023 here today.

The services sector, Tengku Zafrul said, has emerged as a silver lining for Malaysia amid the economic slowdown.

The sector attracted RM168.4 billion, or 51.1 per cent of the total approved investments last year.

On the manufacturing sector, Tengku  Zafrul said the sector attracted a total of RM152.0 billion in approved investments, accounting for 46.1 per cent of the total approved investments across all industries.

Foreign investments (FI) accounted for a substantial 57.2 per cent or RM188.4 billion of the total approved investments, while domestic investments (DI) contributed 42.8 per cent or RM141.1 billion.

The investment influx was predominantly led by five countries. Singapore led the way wirth RM43.7 billion, followed by the Netherlands (RM35.5 billion), the United States (RM21.5 billion), Cayman Islands (RM17.5 billion) and China (RM14.5 billion) together accounting for 70.4 per cent of total FI, or RM132.7 billion.

This diversification in foreign investment sources underscores Malaysia's global appeal and the confidence of international investors in its robust investment landscape, he said.

Tengku Zafrul said the overall performance shows that as a country with strong policies that support growth and investment prospects, Malaysia offers a huge potential for attractive returns alongside the nation's clear vision to become a developed and inclusive economy.

He said the government and an "important" Chinese institution are in an advanced stage of negotiations to set up a two-way FI promotion.

"We aim to cement a cooperative agreement focused on investment promotion enhancement to bolster investment flows, encouraging Chinese firms to explore opportunities in Malaysia while similarly facilitating Malaysian enterprises to expand into China.

"This potential partnership is targeted at fostering investments in high-value sectors, meticulously chosen to reflect the strategic priorities of both nations, thereby promising to fortify economic ties and promote mutual growth," he added.

https://www.nst.com.my/business/economy/2024/03/1019649/malaysia-eyes-10-pc-increase-investments