KUALA LUMPUR (June 13): The approved foreign direct investment (FDI) for all sectors in the first quarter of 2019 (1Q19) jumped 73.4% year-on-year (y-o-y) to RM29.3 billion from RM16.9 billion.

In a statement today, Minister of Finance Lim Guan Eng said the first quarter increase shows that the trade and investment diversion Malaysia is enjoying is a persistent positive trend that was preceded by a rise in 2018 approved FDI by 48% to RM80.5 billion, from RM54.4 billion in 2017.

He explained that the 73.4% 1Q19 rise in overall approved FDI was driven by a 127% manufacturing investment surge to RM20.2 billion, compared to RM8.9 billion a year ago.

"Out of the RM20.2 billion in approved manufacturing FDI, RM11.5 billion came from the United States, RM4.4 billion from China and RM2.2 billion from Singapore.

"Of note are approvals for Micron Technology and Jabil Circuit, which are making high-quality investment to expand their respective operations in Penang.

"The RM29.3 billion worth of overall approved FDI is expected to create more than 41,200 jobs for Malaysians, of which 22,970 employment opportunities would be in manufacturing and 18,000 jobs in the services [sector]," he said.

Commenting on industrial production, Lim said the April 2019 industrial production growth accelerated to 4.0% year-on-year, compared to the 3.1% y-o-y growth in March.

He said the industrial growth was supported by robust manufacturing growth and mining output recovery.

"The 4.0% April industrial expansion is the strongest in six months and it is above market consensus, which was 2.5% according to Bloomberg," he said.

Meanwhile, Lim said the April industrial expansion occurred during a period of low and stable inflation of 0.2%.

"Prices of some basic consumer items have fallen due to multiple factors, including the shift in the taxation regime from the burdensome goods and services tax (GST) to sales and service tax (SST), and the imposition of price ceilings on RON95 and diesel.

"In February 2019, the price ceiling of RON95 was reduced from RM2.20/litre to RM2.08/litre," he said.