Kuala Lumpur once again emerged as one of the top destinations for investors in 2021, attracting the third-highest investments approved in Malaysia after Pulau Pinang and Kedah.
The national capital recorded RM37.7 billion in investments last year, an increase from RM17.1 billion in 2020. More importantly, Kuala Lumpur is a major host of the country’s diversified services sector that continued to expand with intensified digitalisation last year, accounting for a substantial portion of the high-technology and high-value investments nationwide with a strong focus on innovation, said InvestKL Chief Executive Officer, Muhammad Azmi Zulkifli.
Malaysia’s services sector attracted RM94.1 billion in approved investments in 2021 through 3,803 projects, of which foreign investments made up 26.5% of the total spending with RM24.9 billion. The global establishments sub-sector was among the top five contributors in the services sector with RM19.7 billion in approved investments last year, higher than the RM595.2 million achieved in 2020.
“Malaysia is garnering traction as a regional hub for multinational corporations searching for the most ideal location to house their central operating hubs and Kuala Lumpur is playing a key role in attracting such high-quality projects to the country with its excellent connectivity and competitive ecosystem,” Azmi said.
A notable investment was from Huawei Technologies (Malaysia), which is gearing up for the next frontier in 5G innovation with its new Global Operational Headquarters in Kuala Lumpur as part of its advances in developing IR4.0 technologies to accelerate Malaysia’s digital transformation.
Other major contributors of approved investments in the services sectors include real estate (RM28.8 billion), financial services (RM12 billion), utilities (RM9.6 billion), and information communications (RM8.2 billion).
“Digitalisation is a major theme that continued to drive investments in the services sector as remote working and automation trends gathered pace throughout the pandemic. The Internet of Things, Artificial Intelligence and the cloud network have also spurred new services, elevating the importance of the services sector to the Malaysian economy as we focused on attracting targeted investments in these areas. This is also reflected in InvestKL’s two initiatives launched in 2021; Greater Kuala Lumpur (GKL) Live Lab, a driver for quality, innovation-led, and knowledge-intensive investments, and Fit4Work, a programme to nurture quality, innovative and knowledgeable workforce while creating highly skilled employment opportunities.,” he added.
The Government has sought to gradually shift towards a greener economy by making green growth a priority under various policies and mid-term plans such as the Twelfth Malaysia Plan and the Shared Prosperity Vision 2030, with a focus on sustainable investments championing the Environmental, Social and Governance principles.
“Given Kuala Lumpur’s infrastructure and pool of talents, InvestKL is well poised to help advance Malaysia’s sustainable agenda by targeting high-level and niche investments, specifically in the areas of digital technology, global services and innovative offerings,” Azmi said.