Skyscraper City Forum banner
1 - 10 of 10 Posts

·
klite
Joined
·
2,589 Posts
Discussion Starter · #1 ·
Malaysia's Abdullah Says Government May Ease Investment Rules

By Angus Whitley

June 14 (Bloomberg) -- Malaysian Prime Minister Abdullah Ahmad Badawi said he may ease investment restrictions and roll back race-based policies should an experiment in the southern state of Johor be a success.

Asked at a dinner with business executives in Kuala Lumpur late today whether the redevelopment of Johor could be a model for the rest of the country, the prime minister said ``yes.''

Abdullah is seeking foreign investors to help fund a two- decade, 382 billion ringgit ($110 billion) redevelopment of Johor, bordering Singapore. Scrapping the nation's race-based program could lure investors and pave the way for the country to completely drop its 36-year-old policy in support of ethnic Malays, who comprise 60 percent of the population.

The racial program, introduced under the New Economic Policy in 1971 after clashes between ethnic Chinese and Malays, also known as Bumiputras, aimed to increase the wealth of the nation's poorest grouping through benefits ranging from cheaper housing to greater access to initial public offerings.

Concern about the policy's validity grew last year after a report by the Asian Strategy and Leadership Institute in Kuala Lumpur showed the original targets to address the wealth imbalance had been surpassed.

The government earlier this year removed a capital gains tax on property, allowed foreign investors to take out more than three mortgages from local lenders and offered tax incentives aimed at transforming Johor.

The Malaysian government expects the $147 billion economy to expand 6 percent this year after 5.9 percent growth in 2006.
 

·
North Borneo Is My Home
Joined
·
722 Posts
Source :http://www.theedgedaily.com

20-06-2007:
M'sia risks falling behind in FDI
By Harpreet Bhal



Malaysia may chart a favourable economic growth this year, but risks falling behind other emerging Asian economies in terms of attracting foreign direct investments (FDI) into the country, says a UK-based research and consultancy group.

The Oxford Business Group (OBG), in its publication The Report: Malaysia 2007, said Malaysia had somewhat lagged behind regional rivals such as China, Hong Kong and Singapore in attracting money from foreign investors.

The Malaysia government, it noted, had attributed this primarily to a loss of competitive edge caused by an overall shortage of human capital, wage pressure and increased competition from China.

OBG editor-in-chief Andrew Jeffreys said during the launch of the report here yesterday that Malaysia needed to move up the value chain, and place greater emphasis on the services sector, value-added services such as Islamic finance and tourism to outpace its competitors.

Furthermore, OBG believed that the country needed to reduce the remaining distortions in the domestic market, such as the preferential treatment given to government-linked companies and restrictions on some government contracts, to stay ahead of international competition.

"The free market does not operate perfectly in Malaysia, but it is being dealt with. The less the distortion is, the more the free market will flourish and the firms within it will flourish," Jeffreys said.

He added that the distortion in the domestic market was a major bone of contention among local investors, while foreign investors felt that Malaysia had a good brand perception overseas as an established manufacturing base.

"Given Malaysia's strengths, we do not expect these challenges to pose a threat to the continued growth of the country's economy in the short to medium term. Many (of the problems) are being tackled at the current time," he said, adding that Malaysia's competitive edge also lay in good infrastructure and an English-speaking workforce.

Malaysian Industrial Development Authority (MIDA) director-general, Datuk R Karunakaran, who launched the report, said Malaysia's struggle was one of achieving competitiveness in a global environment.

"We are no more competitive in many areas, particularly in the labour intensive industries, where (China and India) are natural destinations. Our challenge is to compete in technology intensive and higher value-added industries worldwide."
 

·
North Borneo Is My Home
Joined
·
722 Posts
Source : http://asia.news.yahoo.com/070621/kyodo/d8pt70d01.html

EU envoy hits out at Malaysia's pro-Malay policies

(Kyodo) _ The European Union's top envoy to Malaysia on Thursday issued a rare and strong criticism against Malaysia's policy of favoring ethnic Malays, calling it protectionist and unfair to foreign companies.
Thierry Rommel, the EU ambassador to Malaysia, said Malaysia uses the excuse of "infant industry argument" allowed under the World Trade Organization to bar foreigners access into markets like the automotive, steel and public procurement sectors.

"In reality, however, it is the Malay-centered bumiputera policy that drives the protectionist policies. In a dominant part of the domestic economy, there is no level-playing field for foreign companies even when in partnership with bumiputera," he said in a speech to local and foreign businessmen.

Bumiputera, literally meaning princes of the soil, refers to Malays who form 60 percent of the country's population of 26 million.

In 1971, the government launched the New Economic Policy with the aim of nurturing the politically dominant but economically lagging Malays in the hope they would catch up with the minority but economically strong Chinese.

The massive affirmative action program saw Malays being given privileges from admission in public universities to discounts in housing. Bumiputera companies are also given priority in government contracts.

Rommel said Malaysia should take a hard look at the policy following many complaints of abuses, such as that it has benefited primarily a handful of politically well-connected Malays while
 
1 - 10 of 10 Posts
Top