KUALA LUMPUR (July 24): Malaysia's foreign direct investment (FDI) flows fell by 12.8% to RM41 billion last year, from RM47 billion in 2016.

In a statement today, Department of Statistics Malaysia chief statistician Datuk Seri Dr Mohd Uzir Mahidin said FDI flows in 2017 was mainly channelled into the services sector, particularly in real estate, financial and insurance or takaful, and information and communication activities.

"Mining and quarrying was the second contributor, followed by the manufacturing sector," Mohd Uzir added.

The top regions were from Asia with a share of 63.5%, followed by Europe and Africa.

Within Asia, Hong Kong remained as the prominent investor country, while China overtook Singapore as the second largest contributor.

As at end-2017, the expansion of the FDI position stood at RM570.3 billion, from RM547.4 billion a year ago, impelled by continuous inflows of FDI, Mohd Uzir said.

Malaysia also registered lower net direct investments abroad (DIA) flows of RM24.9 billion, down 25% from RM33.2 billion in 2016.

The investment abroad in 2017 was channelled mainly into the services, mining and quarrying, and manufacturing sectors, he noted.

"Investment in the services sector was primarily in financial and insurance, or takaful and real estate activities.

"In terms of region, Asia was the top destination for Malaysia's DIA flows, contributing half of the investment with RM13.7 billion, followed by Americas and Europe. For Asia, net DIA flows were mainly to Singapore and Indonesia, while Turkmenistan replaced India as the third largest destination," Mohd Uzir added.

Since 2016, the DIA position has been on the downward trend due to lower DIA flows and stood at RM525.2 billion in 2017, he said.