Towards high income nation

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Malaysia rises to 25th place in World Competitiveness Yearbook 2021
Bernama June 30, 2021 16:23 pm +08

KUALA LUMPUR (June 30): The World Competitiveness Yearbook 2021 has ranked Malaysia’s global competitiveness at the 25th place from out of 64 economies, an improvement from the 27th position in 2020.

International Trade and Industry Minister Datuk Seri Mohamed Azmin Ali said in the World Bank’s Ease of Doing Business 2020 ranking, Malaysia held the second position among 190 economies in dealing with construction permits.

“Nevertheless, while this shows that reform initiatives are working, there is still more to be done to ensure that our regulations are agile enough to respond to changes,” he said in his speech during the virtual official launch of “Productivity Report 2021 — Boosting Productivity: Reset, Reform, Rebound”.

Meanwhile, Malaysia Productivity Corporation (MPC) director-general Datuk Abdul Latif Abu Seman said the Productivity Report 2021 takes a different approach this year, focusing directly on the issues and challenges which impede productivity growth against the worst health and economic crisis and spotlighting the recommended solutions to manage these barriers.

“In addressing the pronounced challenges to productivity and in the effort to boost its growth, this year’s theme for the report summarises the journey — reset and reform — which eventually leads to a productivity rebound.

“The recommendations presented in the report align with the government agenda through its various economic stimulus packages and recovery plans. Aptly implemented, the solutions are expected to escalate productivity growth, and subsequently enhance business revival and recovery,” he said in his welcoming speech.

Within the business environment, Abdul Latif said, regulations play an important role to enhance the ease of doing business.

“Managing the regulatory concerns from the industry, especially from businesses affected by the pandemic, is more urgent now to facilitate their recovery.

“Regulatory reform is a must to reduce the unnecessary regulatory burdens on businesses and formulate policies which are more conducive to business efficiency. PEMUDAH or the Special Taskforce to Facilitate Business, working with MPC as the secretariat, has been steadfast in regulatory reforms,” he said.

Meanwhile, in his message in the report, Mohamed Azmin said the outlook is positive for Malaysia, underpinned by the National Covid-19 Immunisation Programme, which is progressing well to reach as many citizens as possible and as quickly as possible.

“The government has also launched and implemented several stimulus packages to ease the burden of the business community and the rakyat in general. Incentives and programmes are implemented to address issues of employment, loss of revenue and the business environment.

“Great attention will continue to be given to digitalisation and technology adoption as tools to accelerate the economic recovery. With these synergistic efforts in place, there is certainly an air of optimism for 2021 to be an inflection point for both holistic health and economic recovery,” he said.

The minister said that the Covid-19 pandemic had caused an unprecedented health and economic crisis, affecting the lives and livelihoods of the people, resulting in a huge decline in productivity growth by 5.5% last year due to the jarring disruptions.

“We have striven to overcome the various obstacles by setting in motion opportunities that have changed the trajectory of our lives for the better,” he said.

According to Mohamed Azmin, Bank Negara Malaysia (BNM), in its first-quarter performance report published in May 2021, forecast that Malaysia’s economy remains on track to achieve the projected growth of 6%-7.5% in 2021.

This, he said, denotes a rebound in labour and capital productivity, underpinned by a broad-based economic recovery across most sectors.

“While 2020 saw the execution of brave but necessary measures to flatten the curve of infections, the government, armed with valuable virological data, implemented more prudent measures in 2021 to curb the virus from spreading exponentially, pivoted on the overarching objective to protect the lives of the rakyat and simultaneously ensure the revival of the country’s economic growth,” he added.

https://www.theedgemarkets.com/artic...-yearbook-2021

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Malaysia's total trade 13% higher y-o-y at RM180.96b in July — MITI
Bernama August 27, 2021 14:35 pm +08

KUALA LUMPUR (Aug 27): Malaysia’s trade performance continued its growth momentum in July 2021, with total trade increasing by 13% year-on-year (y-o-y) to RM180.96 billion, marking the sixth consecutive month of double-digit growth since February 2021.

According to the Ministry of International Trade and Industry (MITI), exports grew by 5% to RM97.32 billion, the 11th consecutive month of y-o-y expansion since September 2020, while imports rose by 24% y-o-y to RM83.64 billion.

“On that note, the trade surplus contracted 45.8% to RM13.68 billion,” it said in a statement today.

MITI said the export growth was backed by higher shipments of petroleum products, palm oil and palm oil-based agriculture products as well as chemicals and chemical products driven by robust external demand.

Exports to major markets, namely ASEAN, the European Union (EU) and Japan, recorded positive growth.

https://www.theedgemarkets.com/artic...-july-—-miti

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Originally Posted by nazrey

Malaysia rises to 25th place in World Competitiveness Yearbook 2021
Bernama June 30, 2021 16:23 pm +08
https://www.theedgemarkets.com/artic...-yearbook-2021

https://worldcompetitiveness.imd.org...le/overview/MY

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PM to table 12th Malaysia Plan in Parliament on Sept 27, says Mustapa
Bernama September 01, 2021 10:59 am +08

PUTRAJAYA (Sept 1): Prime Minister Datuk Seri Ismail Sabri Yaakob will be tabling the 12th Malaysia Plan (12MP) in Parliament on Sept 27.

Minister in the Prime Minister's Department (Economy) Datuk Seri Mustapa Mohamed said the 12MP is almost completed, adding that the Economic Planning Unit (EPU) will brief the prime minister accordingly.

He said this after clocking in to start his duties at the EPU here today.

Also present was his deputy Datuk Eddin Syazlee Shith.

Mustapa said the tabling of the 12MP and the 2022 Development Budget will be the EPU’s main focus for the next 100 days.

He highlighted that under the 12MP, key issues to be addressed in the next five years include bridging the development gap between the states and areas in the country.

“We have identified six states, which are a little behind [in terms of development], including Sabah and Sarawak.

"Additionally, we will also focus on addressing the income gap among the B40, M40 and T20 (bottom 40%, middle 40% and top 20%) groups, especially those affected by the Covid-19 pandemic," he said.

He said the 12MP will also ensure that basic needs such as water, electricity and Internet infrastructure can be fully enjoyed by the people.

Meanwhile, Mustapa said the EPU will be finalising the 2022 Development Budget together with the Ministry of Finance (MoF) as soon as possible.

https://www.theedgemarkets.com/artic...7-says-mustapa

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Inflows of FDI signal brighter economic recovery outlook — Tengku Zafrul
Bernama September 11, 2021 16:38 pm +08

KUALA LUMPUR (Sept 11): Malaysia registered foreign capital inflows of RM7.7 billion for the month of August 2021, marking the highest monthly net inflow since June 2020, and offsetting the declines in the two preceding months, said Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz.

Foreigners turned net buyers in the ringgit bond market with a total value of RM6.6 billion (July 2021: -RM3.6 billion), and Malaysian equities at RM1.1 billion (July 2021: -RM1.3 billion).

Malaysia has been registering net foreign capital inflows thanks to the positive progress of the National Recovery Plan (NRP), which has improved the overall public health situation, as well as enabling gradual reopening of economic sectors through the National Covid-19 Immunisation Programme (PICK). This sets the tone for Malaysia’s stronger economic recovery in the fourth quarter of 2021, the finance minister said.

Although Malaysia’s economic outlook has remained challenged by persistently elevated infection rates, positive progress on vaccination and on controlling critical Covid-19 cases are expected to spur growth.

Further, several states have shifted to Phases Two and Three of the NRP. This includes the Klang Valley and Putrajaya, which transitioned to Phase Two on Sept 10, 2021, predicating a wider reopening of economic sectors for the nation’s most populous states.

“These improved growth prospects have brought back investors’ confidence in Malaysia’s capital market,” Tengku Zafrul said.

August marked the first month of net foreign buying of Malaysian equities since June 2019, with foreign net selling showing clear signs of tapering. Malaysia’s local benchmark index, the FBM KLCI, which fell as much as 5.7% year-to-date, managed to recover 50% of its losses over the last fortnight.

This is a testament to investors and fund managers’ confidence in the nation’s economic growth prospects, as well as continuity of policies. Attractive valuations relative to other markets within the region have also been a major draw for foreign fund inflows, he said.

In terms of the ringgit bond market, foreign inflows in August 2021 were mainly in Malaysian Government Securities (MGS) valued at RM3.1 billion (July 2021: -RM3.6 billion); and Malaysian Government Investment Issues (MGII) at RM3.2 billion (July 2021: RM425 million). The corporate bond market segment also saw higher net foreign inflows, valued at RM267 million (July 2021: +RM62 million).

As at end-August 2021, foreign holdings of Malaysian government bonds rose by RM23.9 billion to RM226.1 billion, comprising RM191.7 billion or 40.3% of total MGS; and RM34.4 billion or 8.6% of total MGII.

As at June 2021, more than 50% of the foreign holdings of Malaysian government bonds comprised long-term investors. This included other central banks and governments (32.4%); pension funds (18.4%); and insurance companies (2.2%).

The outlook for the fourth quarter of 2021 seems brighter as rapid vaccination rates enable the reopening of more economic sectors. This will boost the prospects for improved consumption from households and businesses’ pent-up demand, Tengku Zafrul said. But the outlook for the third quarter of 2021 may be challenging due to the prolonged Phase One for several states such as Selangor, which are significant contributors to the nation’s GDP.

Other factors underpinning Malaysia’s growth prospect include stronger external demand (for products such as electrical and electronics (E&E), and hydrocarbons), an increase in commodity prices, and continued investment in large-scale infrastructure projects with high multiplier impact.

https://www.theedgemarkets.com/artic...et-inflow-june

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Malaysia remains on the radar of potential foreign investors, says MITI minister
By Ayisy Yusof - September 14, 2021 @ 2:33pm

KUALA LUMPUR: Malaysia will continue to be an open economy, with pro-business and pragmatic policies that will help to improve the country's investment climate as it has been for decades.

International Trade and Industry Minister Datuk Seri Mohamed Azmin Ali said Malaysia's ongoing efforts have successfully kept the country on the map of prospective foreign investors.

"Investing in pandemic preparedness is crucial for resilient growth, and there can be no lasting end to the economic crisis without an end to the health crisis," he said in his keynote address at the recent virtual meeting between the ministry and the US-ASEAN Business Council (US-ABC).

Azmin said Malaysia had introduced the National Recovery Plan, which charts a four-phase strategy by balancing public health, economic sustainability, and people's livelihoods.

"Guided by this plan, we are gradually resuming business and social activities, which are imperative in achieving full recovery eventually," he said.

Azmin said the government has also introduced the National Investment Aspirations to navigate Malaysia towards a regional investment hub that increases economic complexity, creates high-value high-tech job opportunities, and extends domestic linkages.

This was part of Malaysia's long-term strategic plan, including the 12th Malaysia Plan (12MP) that would be the central guide for economic policymaking until 2025, Azmin said.

"Using the Fourth Industrial Revolution as the springboard, the plan also encompasses social re-engineering to close the gap between rural and urban areas by strengthening social security networks and improving the wellbeing of the people," he said.

Azmin emphasised that Malaysia places top priority on capitalising on the synergy between government and the private sector to expedite economic recovery and foster stronger collaboration in growth, wealth creation, and shared prosperity.

"We are on the same page concerning the imperative to advance capacity building and capabilities in digital technologies.

"Indeed, this is essential to win that decisive war against Covid-19 while ensuring that we move in tandem with the fast-paced technological changes of our time," he said.

In echoing this synergy, he was encouraged by the continued interest and participation of US-ABC in supporting ASEAN and Malaysia to foster its digital transformation agenda.

"Malaysia remains steadfast in undertaking continuous digital transformation – mainly through the MyDIGITAL agenda, a new dimension of our digitalisation policy," he said.

The agenda was poised to transform Malaysia into a digitally-driven nation, a springboard for the business community to access a regional market of more than 650 million people and potential online consumers of 400 million strength.

Meanwhile, he said Malaysia recorded an expansion of 16.1 per cent year-on-year (YoY) in the second quarter of 2021, mainly supported by improvement in domestic demand and robust export performance.

Malaysia's total trade rose 23.9 per cent to US$306.9 million in the first seven months of 2021. The US has been Malaysia's third-largest trading partner since 2015.

Malaysia had also recorded a promising growth of 8.2 per cent in total trade with the US, reaching US$42.6 billion despite global trade registering a deficit last year.

The US is Malaysia's second-largest foreign investor in terms of implemented manufacturing projects.

"Nevertheless, I strongly believe that there is still plenty of upside for the foreseeable future, particularly if we factor in the economies of scale that could be derived with extension to the Asean region," he added.

Malaysia also achieved robust and impressive performance for the first half (1H) of 2021, with foreign direct investments (FDI) soaring by 223.1 per cent compared to 1H of 2020.

This has signalled the confidence of foreign investors in the country's stable and conducive economic climate and business ecosystem.

The stellar performance also demonstrated Malaysia's strategy of positioning the country as an attractive investment destination of choice and a supply chain hub in ASEAN, particularly for manufacturing operations, is showing positive results.

https://www.nst.com.my/business/2021...-miti-minister

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CMP3: Malaysia to transition into high-income nation over next decade, needs to ensure that sustainable economic growth — Tengku Zafrul
Shazni Ong September 21, 2021 11:00 am +08

KUALA LUMPUR (Sept 21): Malaysia will transition into a high-income nation over the next decade, even as geopolitical factors and the global response to the pandemic create headwinds and disruption.

Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said while income is only one measure of a developed economy, Malaysia also needs to ensure that its economic growth is sustainable and shared equitably by all.

"The government announced our 6R National Economic Recovery Strategy in May 2020, as the world was being roiled by the pandemic, impacting supply chains and markets equally. To date, the actual and potential impacts are still being calibrated. Against this backdrop, the first five stages of the 6R strategy have provided much support to all Malaysians and stabilised the economy against the fallout from the pandemic.

"With the vaccine roll-out underway, we will soon enter the final stage of the 6R strategy, that is, Reform," he said in his foreword in conjunction with the Capital Market Masterplan 2021-2025 report unveiled by the Securities Commission Malaysia today.

Tengku Zafrul noted the 12th Malaysia Plan (12MP) — which will be launched later this year — will set the agenda for the longer-term reforms of the Malaysian economy that will underpin the next stage of our economic development.

The aim, he said, is to drive economic growth and at the same time, ensure that the nation's prosperity is inclusive, for all Malaysians today, and sustainable for future generations.

As for the priorities of the 12MP, it would include creating a conducive environment for domestic businesses, accelerating the shift towards a greener economy, developing industries with high added value to the economy, eradicating poverty and reducing socio-economic inequality.

"Within this context, the capital market plays an important role to support the structural upgrade of the economy and help inculcate a more inclusive society. The Capital Masterplan 3 (CMP3) paves the way for the wider population to participate in the sustainable and productive growth of the nation, and the broader accumulation of wealth for all in the process.

"As we transition towards becoming a more developed nation, Malaysia will need to cultivate more domestic firms in the frontier sectors of the rapidly changing contours of the global economy, in order to capture economic growth," he added.

Citing reference, Tengku Zafrul said the Dana Penjana Nasional Programme was set up for this purpose to spur innovation and provide risk capital for domestic entrepreneurs.

"Strategies outlined in the CMP3 will address this priority more comprehensively, enabling more funding avenues for entrepreneurs and small and medium business owners to grow their companies into competitive firms in the global economy," he said.

Looking ahead, Tengku Zafrul said the digital economy is another key area of growth for the country moving forward.

"This agenda will be further supported by the CMP3, which encourages greater digital adoption in the capital market. Digital adoption on a wider scale can enable businesses to raise capital at lower cost, and at the same time, empower all Malaysians to invest for their future," he said.

To recap, the Malaysia Digital Economy Blueprint (MyDIGITAL) was launched earlier in 2021 to catalyse the growth of the country's digital economy and enable greater digital inclusiveness across the nation.

In addition, Tengku Zafrul said the CMP3 also supports the country's commitment to the United Nation Sustainable Development Goals (UN SDGs) and the Paris Agreement.

"Over the next five years, it is envisaged that the ever increasing amount of capital will be mobilised to enable the transition towards a low-carbon economy, and to fund projects that create a positive impact on society and the climate," he said.

https://www.theedgemarkets.com/artic...re-sustainable

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UOB keeps its RM185 bil projection for Malaysia's approved investments in 2021
Justin Lim September 21, 2021 21:29 pm +08

KUALA LUMPUR (Sept 21): UOB Global Economics and Markets Research (UOB Research) is keeping its 2021 forecast for approved investments in Malaysia at RM185 billion, as it expects investor sentiment to pick up in the fourth quarter.

This optimism is underpinned by its anticipation of a further reopening of the economy, with the country expected to have its adult population fully vaccinated by year end and with the pandemic situation in the country entering the endemic phase by then, according to UOB Research's note on Tuesday.

It is also premised on more stable domestic politics with the memorandum of understanding (MOU) on bipartisan cooperation signed between the government and Pakatan Harapan (PH) opposition leaders, and continued expansion in the global economy.

In the first half of this year (1H21), Malaysia’s total approved investments increased by 69.8% to RM107.6 billion, from RM63.3 billion in 1H20. The strong year-on-year gain was partly due to a low base effect, as 1H20's performance was weighed down by the first Covid-19 outbreak across the world last year.

The rebound was helped by an improvement in the foreign direct investment (FDI) and domestic investment approvals, UOB Research noted. FDI shot up 214.9% y-o-y to RM62.5 billion in 1H21, making up about 58% of total approved investments, while the remaining came from domestic investments, which grew 3.6% y-o-y to RM45.1 billion.

However, total approved investments fell on a quarter-to-quarter basis, no thanks to the re-introduction of the nationwide lockdown in mid-May and the entire month of June. Consequently, Malaysia’s total approved investments contracted 66.5% q-o-q to RM27 billion in the second quarter (2Q21), compared with RM80.6 billion in 1Q21.

In 1H21, a large bulk of FDI approvals was channelled into the manufacturing sector, UOB Research noted, which accounted for RM58.2 billion or 93.1% of total FDI approvals. Top three leading sources of FDI in the manufacturing sector were Singapore, South Korea, and the Netherlands, accounting for a combined RM53 billion or 91.1% of total approved FDI in the sector during 1H21.

Some notable FDI projects approved in 1H21 included a South Korean renewable investment to produce copper foil for electric vehicles (battery manufacturing); a South Korean company’s solar grade polysilicon plant expansion in Samalaju, Sarawak; China’s solar energy project approved under the PENJANA scheme; and a RM8.5 billion investment from Austria headquartered company to produce high-end printed circuit boards and substrates for semiconductors in Kulim High-Tech Park that targets to begin construction of the plant in 2H21.

Apart from RM58.2 billion manufacturing investment from FDI, RM8.8 billion were sourced from domestic investment approvals.

With that, the electrical & electronics (E&E) industry gained the highest approved investment value within the manufacturing sector in 1H21, accounting for RM47.1 billion. This was followed by fabricated metal products (RM5.1 billion), chemicals & chemical products (RM3.8 billion), food manufacturing (RM3.7 bIllion), and rubber products (RM3.6 billion), noted UOB Research.

These five industries made up 94.6% of total committed investments in the manufacturing sector.

By state, the key recipients of approved manufacturing investments were Kedah, Selangor, Sabah, Perak, and Johor. These five states collectively contributed 88.7% or RM59.4 billion to overall manufacturing investment approvals.

https://www.theedgemarkets.com/artic...vestments-2021

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Malaysia's third capital market masterplan to chart growth in next five years
By Farah Adilla - September 21, 2021 @ 11:02am


https://www.nst.com.my/business/2021...ext-five-years
Capital market grew to RM3.4 tril from RM2 tril from 2011 to 2020, says SC
Shazni Ong September 21, 2021 11:00 am +08

KUALA LUMPUR (Sept 21): Malaysia’s domestic capital market expanded to RM3.4 trillion at the end of 2020 from RM2 trillion at the start of 2011, said the Securities Commission Malaysia (SC).

This was the result of various focused plans and strategies, the SC said in its Capital Market Masterplan 3 (CMP3) (2021-2025) report today.

“The introduction of various strategic initiatives helped to improve the depth, accessibility and efficiency of the capital market, which continued to improve since 2010,” said the regulator.

https://www.theedgemarkets.com/artic...0-says%C2%A0sc