Is 30% Realisation of Approved Investments Reasonable?

Malaysia’s progress in realising RM46.1 billion or nearly one-third of the total RM152 billion approved investments for the manufacturing sector in 2023 was deemed reasonable by some economists.

The Ministry of Investment, Trade and Industry (Miti) has also been improving its information tracking system over the years to ensure that agencies like the Malaysian Investment Development Authority (Mida) is capable of providing timely assistance to businesses in implementing their capital expenditure in the manufacturing sector. 

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Data from Mida in 2023 showed that for the period 2016-June 2023, a total of 6,103 manufacturing projects had been approved, of which 5,202 projects or 85.2% had been implemented.

Miti told Dewan Negara recently that the RM46.1 billion of realised investment involved 445 projects and created 29,693 jobs. The ministry said this is encouraging, considering that the projects had been implemented in less than the usual 18-to-24-month period. Miti also said approved investment refers to investment planning for the capital expenditure of a project in the long term, including the cost of purchasing land, factories, machines, machinery and others.

The PM’s administration has been touting that approved investment rose 23% to a record high of RM329.5 billion in 2023, of which 57.2% was from foreign capital while 42.8% was from domestic sources. The services sector constituted the largest portion of total approved investment in 2023, amounting to RM168.4 billion or 51.1%, followed by the manufacturing sector’s RM152 billion or 46.1% and the primary sector's RM9.1 billion or 2.8%.

As the first quarter of 2024 came to a close, economic trackers are keen to watch if the country could beat its record in 2023, amid a mixed of external geopolitical uncertainties, weakening ringgit, expectations towards government’s austerity measures and the several boycott initiatives against certain businesses over the past few months.

Reference:

Economists deem 30% realisation of approved investments in manufacturing sector in 2023 reasonable? Chester Tay, theedgemalaysia.com, 2 April 2024