Foreign investment benefits local economy and people

 |Jan 17, 2017

Malaysia is expected to accelerate to 4.3% in 2017 as adjustment to lower energy prices eases and as commodity prices stabilise

Foreign direct investments (FDIs) into the country, including Johor, will not only have ripple effects in terms of a spill over of economic activities but also assist in the socio-economic development of the people in the long-run.

While there are many “wild allegations” saying that bringing in FDIs could jeopardise national sovereignty and deny the locals the chance to reap benefits is merely baseless accusations.

Johor Bahru Chinese Chamber of Commerce and Industry President Loh Liam Hiang said local companies have been benefiting from the spillover effect with most of them securing businesses.

Moreover, the chances of getting recognised by these foreign companies are better and paved the way for more opportunities to arise as they learn to appreciate local talents here.

“There’s a lot of opportunities and I heard a lot of negative (remarks) especially from opposition parties talking about investors from China coming here and that it will not benefit Malaysia.

“I think it is totally wrong,” he said in an interview here today.

Loh said opportunities existed in many different sectors especially with Chinese investors investing in the Iskandar Malaysia region which is in the midst of rapid development.

Meanwhile, the Director for the Institute for Social Transformation and Regional Development, Universiti Tun Hussein Onn Malaysia (UTHM), was in total agreement with Loh.

The FDIs in mega projects in Johor have, among others, contributed significantly to the state’s development including the Forest City project, said Rosman, who is also the Dean, Centre for General Studies and Co-Curricular.

“There are three aspects to the 2017 Johor Budget namely community prosperity, empowerment of human capital and material prosperity.

“The development aspect in Johor for example via the Forest City project has had an overall impact and is in tandem with the state government’s inclusive development philosophy.

“This means the people will not be sidelined and development will be distributed evenly throughout the state,” he said.

Rosman said it was time the state was placed on par with neighbouring Singapore and simultaneously provide job opportunities which would benefit the people.

Associate Professor L. Nanthakumar from the Department of Business Administration, Universiti Teknologi Malaysia, said Johor was one of the earliest state to encourage greenfield investments which saw the launch of new development areas.

“In the 80s until 90s, we saw FDIs flowing in the form of joint ventures but now we see a change in the investment trend, it’s leaning more to greenfield and brownfield development,” said Nanthakumar.

A greenfield investment can be classified as a completely new area of investment where land and infrastructure development is undertaken by the investor while brownfield investment is focused on areas where infrastructure already exist.

Besides, the perception that China topped the list in terms of top investor in the country was wrong as the United States, Japan and Singapore were still occupying the top spots.

However, China still remained Malaysia’s largest trading partner, he said, adding that collaboration with other countries were still there but that with China was very noticeable because of the Asean Free Trade Area (AFTA).

“We were among the earliest to open our doors to China via the AFTA and there is a possibility that other ASEAN countries may emulate Malaysia.

“Malaysia opened the doors to China and invited investors from there to come to our shores, hence deriving benefits. We are certainly not selling out the country,” he added.

Today, the Sultan of Johor Sultan Ibrahim Almarhum Sultan Iskandar, said he was deeply offended and hurt by the political spin used by certain politicians against mainland Chinese investments in the state, saying if this is left unchecked, it would drive away investors.

The Sultan singled out former premier Mahathir Mohamad for “putting political interests above Malaysian interests, particularly Johor”.

 

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