KUALA LUMPUR: The Malaysian capital market increased 9% to RM3.1 trillion in the first six months of this year and is now ranked fifth in Asia, relative to the gross domestic product (GDP), Prime Minister Datuk Seri Najib Abdul Razak said. He said Malaysia is also home to the largest number of listed companies in Asean and at US$29 billion, Bursa Malaysia also recorded the highest in funds raised in the last five years among the 10-member regional body. “All this can point to only one conclusion, namely, our economy continues to prosper and we are stronger than ever as a result of the reforms and programmes the government has put in place,” he said in his keynote address at Invest Malaysia 2017 here today.
He said as the business community and companies like strength and stability, they want the certainty provided by a government that understands the prosperity of its people, is best served by being business-friendly and that sovereignty is not compromised by foreign direct investments. “The business community wants the certainty of knowing the government is committed to the necessary reforms and to fostering a culture of entrepreneurship, transparency, accountability, and good regulations,” he added. He said among the major investments pledged by foreign companies in Malaysia include China’s Huawei, which is making the country its global operations headquarters, data hosting and global training centre, at a project cost of RM2.2 billion, while employing more than 2,370 people. He also said another significant investment is Saudi Aramco which is investing US$7 billion – the company’s biggest downstream investment outside Saudi Arabia – for a 50% stake in the Petronas Refinery and Petrochemical Integrated Development in Johor. “That is the single largest investment in Malaysia, and shows the confidence Saudi Arabia has in our people, our technology, and ability to be a strong partner with their most important business,” he added. Apart from that, Najib said London-based HSBC is investing over RM1 billion to build its future regional headquarters at the Tun Razak Exchange, recognising Malaysia’s increasing status as an international financial and business centre.
Another company, Broadcom Ltd, one of the world’s largest semi-conductor entities with a market capitalisation of nearly half a trillion dollars, is transferring its global distribution hub that will manage the group’s global inventory of RM64 billion annually to Malaysia from Singapore this year. “Others who are already here are expanding their operations. Finisar Corporation, a global technology leader in optical communications, will invest a further RM610 million in its operations in Perak, bringing its total investment in Malaysia to RM1 billion,” he said.
Najib also criticised those opposing the Goods and Services Tax (GST) and said the government would always be straight with the people and do what is right for them. “We will always put their interests first, from economic welfare to security. Even if it is not the most popular thing to do, we will not hesitate, because it is the responsible thing to do for the country,” he added. He said this is a reason what he is not very popular with a certain person, under whose leadership, many corners were cut, and the people had to pay a very high price, so that a few of his friends benefited. “This was even when symbols of national pride had horrendous and catastrophic decisions hoisted on them.
“But, under this government, we are cracking down on crony capitalism. No more sweetheart deals. No more national follies to keep stroking the ego of one man. No more treating national companies as though they are personal property,” he said. He noted that Malaysia’s growth had been the envy of the advanced economies, even during years of turmoil for the global economy, while the World Bank had upped its own estimate for the country this year. “We are expected to record a rise in GDP of 4.9%, considerably higher than the IMF’s earlier prediction of 4.3%,” he said. He said other rating agencies has also increased their predictions with Morgan Stanley now projecting 5% and Nomura forecasting the Malaysian economy to grow by 5.3% this year. “Growth is expected to be higher next year. So we are on the right trajectory,” Najib added. He said other sets of figures supporting confidence in Malaysia includes trade in the first quarter increasing by 24.3% to RM430.5 billion compared to the same period last year, with exports breaching the RM80 billion mark for the first time in March.
“At RM82.63 billion, it is the highest monthly figure for Malaysian exports ever recorded. Apart from that, the ringgit has also has been described by Bloomberg as ‘easily the strongest major Asian currency this quarter’, climbing twice as much as the next best, the Chinese yuan,” he added. Najib said the Organisation for Economic Co-operation and Development’s (OECD) most recent economic assessment of Malaysia described it as one of the most successful Southeast Asian economies, thanks to sound macroeconomic fundamentals and the country’s success in transforming the economy into a well-diversified and inclusive one. He said the IMF, on the other hand, reported that the resilience of the Malaysian economy was due to sound macroeconomic policy responses in the face of significant headwinds and risks. “And these sound policies are the reason why they said that Malaysia is among the fastest growing economies among peers,” he added.
Meanwhile, Najib said the World Bank in its latest report, issued just last month, said the government’s macroeconomic management has been constantly proactive and effective in navigating near-term challenges in the economic environment. Co-organised by Bursa Malaysia and CIMB Investment Bank with the theme, “Malaysia at 60: Maximising Potential”, Invest Malaysia is the country’s premier annual event showcasing the diversity and strength of Malaysia’s capital market.