Q: How would you characterise the current state of the Malaysian economy and what is your outlook for the coming year?

A: I would say that I am cautiously optimistic. The ongoing problems in the eurozone are clearly having ramifications on global markets and, like any other country around the world, we hope to see a resolution to the debt crisis as soon as possible.

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In spite of this gloomy global backdrop, the Malaysian economy is in good health. Last year we registered growth of 5.1% as a result of strong domestic demand and an expansion in private investment. In the first quarter of this year we maintained this momentum with growth of 4.7%. Alongside this strong and steady rate of growth, our debt levels remain at a manageable 53.6% of GDP, while unemployment stands at 3%.

In the past few months, the health of Malaysia's economy [was] reflected by the vibrancy of our capital markets. In June, [Malaysian firm] Felda Global Ventures Holdings recorded the world’s second biggest initial public offering [IPO], swiftly followed by [another Malaysian company] IHH Healthcare recording the world’s third largest IPO. Bursa Malaysia has reached a record high, while other stock markets have fallen. 

Q: Malaysia’s FDI performance been strong in recent years. What factors have influenced this performance?

A: In 2010, inflows were [worth] $29.3bn and these increased [by] 12.3% to reach $32.9bn last year. There are a number of reasons that have contributed to this success, the most notable of which is the Economic Transformation Programme. This programme aims to transform our country to developed status by 2020, creating economic opportunities worth RM1300bn [$420bn] in 12 priority sectors. I am proud of the results we have seen so far. [ore than] RM179bn has been invested, 310,000 jobs created and per capita gross national income has increased to $9700.

We have also diversified our economy, and we are now home to industries ranging from palm oil to microprocessors, Islamic finance [and] renewable energy. This economic diversification has contributed to our success and helped to encourage inward investment. Investors are not only attracted to Malaysia for economic reasons... Malaysia enjoys a stable government that has consistently been pro-business and investor-friendly.

Q: Which segments of the Malaysian economy are most in need of investment?

A: To become increasingly competitive in the global economy, Malaysia is, at present, shifting to a new economic model based on innovation, creativity and high-value-added activities. To this end, we have identified 12 key economic areas for investment, including oil, gas and energy, financial services and the healthcare sector. We are also intensifying our efforts to attract investments in new growth areas and emerging technologies. These growth areas include biotechnology [and] renewable energy.

Q: What are Malaysia’s unique selling points as an investment destination?

A: One of the unique points about Malaysia is that we have been incredibly successful in a short space of time. From having been an economy based on primary commodities such as tin, rubber and palm oil a little over 50 years ago, today we are a dynamic industrialising nation.

It goes without saying that our transformation would not have been possible without the inflows of FDI. This has included investment from multinational corporations in more than 40 countries, who have recognised that a multicultural and multilingual nation with the ability to converse in Chinese, Indian and Malay dialects is a strategic investment destination. We have a modern and developed infrastructure, business-friendly policies and a competent and skilled workforce. And, of course, a significant draw has been our track record as a profitable base for investors.