KUALA LUMPUR: Recent revelations concerning Malaysia's Foreign Direct Investment (FDI) figures have stirred the nation's political and economic waters.
Earlier in the year, Prime Minister Anwar Ibrahim celebrated an impressive RM 170 billion in foreign investment from China, resulting from 19 Memorandums of Understanding (MoU) signed during a visit to Beijing.
The announcement was lauded by various sections of his administration as evidence of Malaysia's rising appeal to foreign investors under his stewardship.
However, the ebb and flow of politics means perceptions can change quickly. Numerous experts have begun scrutinising the declared amounts, sparking widespread debates about the authenticity of the announced figures.
The spotlight on these figures intensified when Budget 2024 was presented. Documents revealed that only RM 132.6 billion of investments were sanctioned in the first six months. From this, just RM 63.3 billion was attributed to FDI.
When juxtaposed against the RM 170 billion allegedly sourced from China, this disparity warrants further examination. There's a need for more specificity regarding the RM 170 billion figure. Was it a projection, a long-term goal, or an aggregate over multiple years?
The ambiguous nature of these statistics somewhat clouds the administration's stance on transparency. It's not just the amount; the source of the investment also matters. China's overseas investments have frequently been viewed with caution.
The term "debt-trap diplomacy", particularly in connection with China's Belt and Road Initiative (BRI), raises concerns about nations becoming ensnared in unmanageable debts, potentially leading to a compromise in their strategic assets. Sri Lanka's Hambantota Port saga is often cited as a cautionary tale in this narrative.
The Ringgit's fluctuating health is another factor weighing on economists' minds. It's a known axiom that currency strength is a reflection of international confidence. In light of these recent developments, the Ringgit's decline might be indicative of deeper economic concerns.
Budget 2024, meanwhile, has its share of critics. Economist, Professor Geoffrey Williams expressed reservations about the budget's lack of focus on certain areas, including TVET and gig-economy training allowances.
He was also sceptical about the RM44 billion earmarked for loans to micro-enterprises, suggesting that the real beneficiaries might be intermediaries rather than the enterprises themselves.
Trust is the bedrock of international finance. The current ambiguity surrounding Malaysia's FDI numbers, coupled with tepid responses to Budget 2024, might be undermining that essential trust.
The global investment community gauges various elements when determining investment strategies, and a nation's credibility is paramount. If there's a sense of opacity or inconsistency, potential investments could be rerouted.
The Ringgit's depreciation can be attributed to numerous factors, but it's impossible to overlook the developments in Malaysia recently. The nation is at an inflection point, with public confidence wavering.
The onus now rests on PM Anwar to offer clarity.
Can the government institute measures to restore faith in Malaysia's economic integrity and vision? Only time will tell, but the world, especially Malaysians, watch keenly.
* Ahmad Zaim Ahmad Tawfek was an assistant to Federal ministers in formulating economic, youth and foreign policies for Malaysia.
** The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect the position of Astro AWANI.
AWANI Columnist
Wed Nov 01 2023
The Ringgit's depreciation can be attributed to numerous factors, but it's impossible to overlook the developments in Malaysia recently.
ISIS Malaysia's perspective of Budget 2025
An excellent rakyat-centric budget under the overarching principle of a caring and humane economy.
Budget 2025: Record increase in STR, SARA aid initiatives
The government will provide a significant boost to the Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) initiatives next year.
Budget 2025: EPF contributions to be made mandatory for foreign workers – PM Anwar
The government plans to make it compulsory for all non-citizen workers to contribute to the Employees Provident Fund (EPF).
What policies to expect from Indonesia's new President Prabowo
Prabowo will be open to foreign investment, his aide has said, such as by offering investors management of airports and sea ports.
Budget 2025: Govt allocates RM470 mil to empower women's participation in PMKS
The Women's Leadership Apprenticeship Program will be intensified as an effort to produce more female corporate personalities.
Israel sends more troops into north Gaza, deepens raid
Residents of Jabalia in northern Gaza said Israeli tanks had reached the heart of the camp, using heavy air and ground fire.
Indonesia ramps up security ahead of Prabowo's inauguration
Prabowo Subianto will be sworn in as Indonesia's president on Sunday with Vice President-elect, Gibran Rakabuming Raka, also taking office.
Immediate allocation of RM150 mil for local authorities, DID to tackle flash floods
Datuk Seri Anwar Ibrahim said this allocation is intended to address the recent flash floods that hit the capital and several major towns.
Budget 2025: Sabah, Sarawak to continue receiving among highest allocations - PM
Sabah and Sarawak continues to be prioritised under Budget 2025, with allocations of RM6.7 billion and RM5.9 billion respectively.
NFOF will be operational in November 2024 with funding of RM1 bil
PM Anwar Ibrahim said NFOF will support venture capital fund managers to invest in startup companies with RM300 million set aside for 2025.
Minimum wage to increase to RM1,700 effective Feb 1, 2025
The Progressive Wage Policy would be fully enforced next year with an allocation of RM200 million, benefiting 50,000 workers.
Bursa Malaysia ends higher on Budget 2025 optimism
The benchmark index, which opened 1.85 points higher at 1,643.29, moved between 1,641.71 and 1,649.31 throughout the trading session.
Five important aspects relating to people’s lives in Budget 2025 - PM
The focus is on driving the MADANI Economy, speeding reforms, cutting red tape, raising wages, and tackling the cost of living.
Economic outlook: Govt plans to leverage, expand existing city transit system
The expansion aims to provide a more efficient and reliable public transportation network, reduce congestion, and improve accessibility.
Economic outlook: Budget 2025 to lay foundation for a digital-driven economy
The report said Budget 2025 will entail efforts to position Kuala Lumpur as a top 20 global startup hub by 2030 through the KL20 initiative.
Economic outlook: Corruption and lack of accountability hinder economic progress
Special Cabinet Committee on National governance is established to curb corruption, law reforms to modernise outdate regulations, MoF said.
National Wages Consultative Council will be strengthened
The govt will also incentivise hiring women returning from career breaks, offer job matching and improve care services facilities.
Economic outlook: Ensuring 11 years of compulsory education for all children
Budget 2025 will continue prioritising upskilling and retraining initiatives to equip workers with the latest skill sets necessary.
Consolidated public sector projected to record lower surplus of RM41.7 bil 2024
The MoF said the consolidated general government revenue is estimated to increase slightly to RM384.7 billion in 2024.
PM announces substantial Budget 2025 hastening Malaysia to become Asian economic powerhouse
Datuk Seri Anwar Ibrahim said it would create jobs and also tackle financial leakages to enhance public spending efficiency.