Step up domestic investments, PM tells firms

Malaysia's domestic investments so far are way off the RM94 billion full-year target, says Prime Minister Datuk Seri Najib Razak

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Kuala Lumpur: Malaysia's domestic investments so far are way off the RM94 billion full-year target, which will dampen the country's ambition to be a high-income and developed status by 2020. Prime Minister Datuk Seri Najib Razak urged "more local investors to stand out and to channel their funds in the country". Najib said the country needs domestic investments of about RM940 billion over 10 years, or roughly RM94 billion per year, in order to attain high-income and developed country status by 2020. Direct domestic investment (DDI) in manufacturing from January to July amounted to RM15.9 billion. Another RM11 billion was poured into the services sector in the first quarter of the year, for a combined DDI of RM26.9 billion. "We have quite some way more to go to reach our DDI target of RM94 billion for the whole year," Najib said, adding that the government always believes there is potential to further boost domestic investment. "I would like to call upon domestic investors to put up your capital in Malaysia, we have provided the platform for you to explore the opportunities and you may create your own wealth in your beloved country," he added. Speaking at the Domestic Investment Summit yesterday, Najib said that the Economic Transformation Programme (ETP) aimed at reversing the foreign direct investment (FDI) to DDI ratio, which stood at 60:40 in the past five years. The government hopes that the ETP can reverse the ratio to 73 per cent in favour of DDI. Up to July this year, manufacturing investments were split evenly between foreign and domestic sources. "With your interest in investing your money in Malaysia, it will support the plan laid out in the ETP and be more sustainable country in the long term," Najib said. At a press conference, International Trade and Industry Minister Datuk Seri Mustapa Mohamed said the RM94 billion DDI target is achievable. "Despite the very challenging economic and financial environment, Malaysia is on track to attract DDI and FDI," added Mustapa. He also noted that the prime minister has assured the private sector that the government has no plans to withdraw the re-investment allowance. Najib has guaranteed that both local and foreign investors will enjoy the same incentives and there will be no unfair treatment. The government, he said, has provided a wide and diverse range of fiscal and non-fiscal incentives to attract quality DDIs to capital intensive, high technology as well as creative and knowledge-based industries. "We are also making major investments in education and training to increase our pool of knowledge workers and improve the quality of our graduates," he added. The government has identified specific sectors which will be given support and high-impact funding. This includes halal, green energy, biotechnology, aerospace, advanced electronics, pharmaceutical and medical devices and maintenance-repair-overhaul engineering industries. "We have worked to reduce the cost of doing business by removing regulatory obstacles, simplifying rules and procedures, and promoting transparency and accountability in the government's delivery system," he added.