"I am concerned that the economic recovery will not be achieved as planned. The amount of FDI (foreign direct investment) coming in does not appear to be in line with the realised percentages.
"So there will be a lot of questions about where exactly the investment was generated, where it was invested and how much has it translated into highly skilled job opportunities, especially for locals.
"Is the country really recovering and getting the impact of the transfer of knowledge, skills and technology, especially to micro, small and medium enterprise operators?"
This was the concern expressed by former second finance minister Datuk Seri Johari Abdul Ghani, the Titiwangsa member of parliament, on the first day of the Dewan Rakyat sitting last month.
Johari also was concerned about how the government, through the International Trade and Industry Ministry (Miti), should report FDI outflows to determine net investment inflows.
Based on the ministry's statistics, approved FDI in the manufacturing and service sectors from 2018 to 2021 stood at RM392.9 billion.
In 2018, approved FDI was RM64,686.2 million. A total of RM37,270.7 million (57.6 per cent) was realised.
In 2019, approved FDI came to RM69,611.5 million; RM52,653.9 million (75.6 per cent) was realised.
In 2020, approved FDI stood at RM58,108.5 million; only RM36,126.2 million (62.2 per cent) was realised.
In 2021, approved FDI rose to RM200,481.3 million. A total of RM174,497.5 million (76.5 per cent) was realised.
Of course, any FDI will boost the economy. What is of concern, though, is the unrealised FDI of RM92,339 million (23.5 per cent) between 2018 and 2021.
If one looks at the FDI in the manufacturing sector for the same period, RM350,609.7 million was approved but only RM266,851.3 million (76.1 per cent) was realised.
So, what are the reasons behind the rejection of the remaining RM83,758.4 million?
There is an urgent need to establish a monitoring committee on investment commitments that Malaysia acquired but were not realised. This reflects Johari's concern, too.
What were the obstacles and constraints faced by foreign companies in investing here?
The time has come to restore Malaysia as an FDI paradise, to implement projects that can create new wealth and highly skilled jobs for Malaysians.
Miti and other ministries should intensify the FDI-realisation strategy so that the influx of foreign investment can be translated into economic activities.
This is in line with the goals of the new national investment policy to increase the sophistication of the economy, create high-value jobs, expand the domestic network, develop new and existing clusters as well as target high-quality capital and technology.
It is also hoped that the country's economic recovery continues after recording RM264.6 billion in approved investments through 4,454 projects in the manufacturing, service and primary sectors.
Analysts say the realised investments should be more than 90 per cent. This would create more than 140,000 jobs, convincing foreign investors that Malaysia is the right country to go to.
Most importantly, ensure every investment is approved and realised without leakage, deviation, mismanagement or corruption.
This will help foreign investors look at Malaysia as a top destination.
Source: https://www.nst.com.my/opinion/columnists/2023/04/898312/restoring-malaysia-fdi-paradise