KUALA LUMPUR, March 10 — The weakening ringgit has not affected the confidence of foreign investors to continue investing in the country, the Dewan Rakyat was told Thursday.
Deputy International Trade and Industry Minister Datuk Ahmad Maslan said the balance of payments statistics released by the Statistics Department recorded foreign direct investment (FDI) net inflows of RM39.5 billion last year.
He said of the FDI inflows, the manufacturing sector drew RM17.7 billion followed by services (RM7.8 billion), mining (RM12.9 billion), construction (RM1.1 billion), and agriculture, forestry and fisheries (RM16 million).
“The confidence of foreign investors was evident as they increased their holdings in the country’s financial market in spite of the ringgit being under pressure while worries plaguing the global economy due to rising U.S. interest rates and slowing China’s economy,” he said when responding to a question from Datuk Shamsul Anuar Nasarah (BN-Lenggong).
Ahmad said at the end of 2015, foreign holdings of debt securities and sukuk were valued at RM214.8 billion, up almost RM17 billion from RM197.8 billion at end of August 2015.
“The data clearly show that despite the challenging economic environment, Malaysia continues to remain strong as a choice investment destination for foreign investors,” he said.
Ahmad said various measures taken were taken by the government to maintain investment competitiveness, including exploiting the weak ringgit, which was actually below its true value, by adopting an ecosystem approach to attract FDI to Malaysia.
“Manufacturers are encouraged to use local products as input to enable them to get higher returns with the cost of production in ringgit and benefit from export of finished products at more competitive prices.
“Foreign investors are also encouraged to increase their investments in quality investment projects such as high-tech, high value-added, knowledge-intensive, skilled-intensive, export-oriented, capital-intensive, design and R & D, and high-impact products that have strong ties with local industries,” he said.
In addition, the ministry is also organising investment missions abroad, mainly through agencies under the Malaysia Investment Development Authority to promote and attract new investments.