The decline was due to the lower quantum of approved investments recorded in the services sector
By MARK RAO / Graphic By TMR
Investments in Malaysia’s manufacturing, services and primary sectors fell 26.5% year-on-year (YoY) for the first nine months of 2017 (9M17) to RM113.5 billion compared to RM154.3 billion recorded in the same period last year.
According to Malaysian Investment Development Authority (Mida), the decline was due to the lower quantum of approved investments recorded in the services sector namely a drop of 37.6% and in manufacturing sector.
“This was in line with the subdued property market that is expected to persist until the end of the year,” Mida said in a statement last Friday.
The services sector brought in RM69.2 billion worth of investments over the nine months, 81.2% of which were from domestic sources while the remaining 18.8% were foreign sources.
Out of this figure, RM28.4 billion were from real estate investments, followed by information and communications technology (RM7.9 billion), distributive trade (RM7.2 billion), financial services (RM6.6 billion) and utilities (RM6.5 billion).
On the manufacturing front, investments declined by 15.5% YoY to RM35 billion with 464 projects approved for the nine months, with domestic contribution accounting for close to 60% of total investments secured for the sector.
“This was partly due to the higher base reported previously as a result of approvals associated with lumpy projects (Pengerang and Refinery And Petrochemical Integrated Development project in Johor) as well as the softening global foreign direct investment trend,” Mida said.
Close to 60% of manufacturing investments were domestic-based, with the bulk of the investments in petroleum products including petrochemicals (RM12.4 billion), electronics and electrical (RM8.8 billion), chemicals and chemical products (RM2.7 billion), non-metallic minerals (RM2.5 billion), and scientific and measuring equipment (RM2 billion).
Local players were the investment leaders across all three sectors of manufacturing, services and primary, accounting for over 73.5% of the approved investments secured for the nine month period under review.
“The higher component of approved domestic investments is in line with the government’s drive to ensure sustainable economic growth in the future,” Mida said.
“Under the Economic Transformation Programme, domestic investments are targeted to account for 73% of total investments by the year 2020.”