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Why Considering Malaysia for Live & Work ?

Economic Strength

Malaysia is a country on the move. Often dubbed the "lucky country" because of its wealth of mineral resources and fertile soils, Malaysia did not rest on its laurels but took decisive steps to progress from an economy dependent on agriculture and primary commodities in the sixties to a manufacturing-based, export-driven economy spurred on by high technology, knowledge-based and capital-intensive industries. The structural transformation of Malaysia's economy over the last 40 years has been spectacular.

Continuous Economic Growth

Malaysia's pragmatic and flexible management approach has enabled the economy to raise its competitiveness and enhance its resilience in facing challenging circumstances. Deliberate measure has been taken to make the economy more diversified and broad-based to ensure sustainable growth. Continuous efforts have been pursued to enhance the services sector, accelerate value-added of the manufacturing sector as well as boost the agriculture and agro-based sector as the third engine of growth. New sources of growth continue to be promoted and developed such as biotechnology, information and communications technology, halal products and Islamic finance. Indeed Malaysia is developing as a knowledge-based economy, driven by human capital, innovation and ideas.

The global environment remains challenging in 2007, as a result of a persistently high crude oil price, inflationary pressures and monetary tightening, this resulted in higher interest rates, as well as the prospects of slower growth in the second half of the year. However, Malaysia remains confident in facing these challenges to achieve a healthy growth rate for 2007, given the nation’s diverse economic structure and strengthened domestic fundamentals. Malaysia continues to enjoy healthy surplus in the external trade, low unemployment as well as strong international reserves and high national savings.

Supportive Government Policies

Government policies that maintain a business environment with opportunities for growth and profits have made Malaysia an attractive manufacturing and export base in the region. The private sector in Malaysia has become partners with the public sector in achieving the nation's development objectives.

A major factor that has attracted investors to Malaysia is the government's commitment to maintain a business environment that provides companies with the opportunities for growth and profits. This commitment is seen in the government's constant efforts to obtain feedback from the business community through channels of consultation such as regular government-private sector dialogues. These allow the various business communities to air their views and to contribute towards the formulation of government policies which concern them.

Liberal Equity Policy

Generally, foreign investors in Malaysia's manufacturing sector can hold 100% equity in projects which export at least 80% of their production. However, effective from 17 June 2003, 100% foreign equity holding is allowed for all investments in new projects, as well as investments in expansion/diversification projects by existing companies irrespective of their level of exports.

Employment of Expatriates

Foreign companies in the manufacturing sector are allowed to employ expatriates where certain skills are not available in Malaysia. A company with foreign paid-up capital of US$2 million and above will be allowed up to 10 expatriate posts, including five key posts, that is, posts that are permanently filled by foreigners.

Attractive Tax Incentives

Malaysia's company tax rate is attractive at 27% and is applicable to both resident and non-resident companies. Malaysia also offers a wide range of tax incentives for manufacturing projects under the Promotion of Investments Act 1986 and the Income Tax Act 1967. The main incentives are the Pioneer Status, Investment Tax Allowance, Reinvestment Allowance, Incentives for High Technology Industries and Incentives for Strategic Projects and Incentives for the Setting-up of International/ Regional Service-based Operations.

Educated Work Force

Malaysia offers investors a young, educated and productive workforce at costs competitive with other countries in Asia. Backed by the government's continued support of human resource development in all sectors, the quality of Malaysia's workforce is one of the best in the region. Literacy levels are high at more than 94% and school leavers entering the job market have at least 11 years of basic education. In addition, labour productivity has grown steadily at more than 3.3% per annum over the last few years surpassing that of many developed countries.

Developed Infrastructure

Malaysia's persistent drive to develop and upgrade its infrastructure has resulted in one of the most well-developed infrastructure among the newly industrializing countries of Asia.

The greatest advantage to manufacturers in Malaysia has been the nation's persistent drive to develop and upgrade its infrastructure. Over the years, these investments have paid off and serious bottlenecks have been avoided. Today, Malaysia can boast of having one of the most well-developed infrastructure among the newly industrializing countries of Asia.

A landmark event was the completion of Malaysia's newest and biggest airport, the Kuala Lumpur International Airport (KLIA), which opened for business in 1998. The following year, Cyberjaya, Malaysia's first intelligent city and the nucleus of the country's Multimedia Super Corridor (MSC), became a reality, complete with a multimedia university to provide a pool of knowledge workers for industries.
Recently launched is Kuala Lumpur Central, a transportation hub integrating all major rail transport networks, including the Express Rail Link to the KLIA and Putrajaya, the government's new administrative centre.

Network of Highways
Peninsular Malaysia's network of well-maintained highways is a boon to industries. These highways link major growth centres to seaports and airports throughout the peninsula and provide an efficient means of transportation for goods. To complement these highways, a Kuala Lumpur-Bangkok-Kuala Lumpur containerised service known as the Asean Rail Express (ARX) has been initiated with the aim of expanding it to become the Trans-Asia Rail Link that will include Singapore, Vietnam, Cambodia, Laos and Myanmar before ending up in Kunming, China.

Efficient Seaports
International trade, especially seaborne trade, has traditionally been the lifeblood of Malaysia. Today, 95%of the country's trade is by sea via Malaysia's seven international ports - Penang Port, Port Klang, Johor Port, Port of Tanjung Pelepas, Kuantan Port and Kemaman Port in Peninsular Malaysia and Bintulu Port in Sarawak. Hong Kong-based Cargonews Asia placed Port Klang and Port of Tanjung Pelepas among Asia's top ten best seaports and top ten best container terminal operators.
Port Klang's central location and the government's emphasis on making the port a national and regional hub has resulted in an increasing volume of cargo.Port Klang recorded 4.5 million twenty-foot equivalent units (TEUs) for 2002, which ranks it the top 11th in the world. Port Klang's Westport has excellent deep water facilities which allow the world's largest ships to dock without any difficulty.
Malaysia's newest port, the Port of Tanjung Pelepas (PTP), at the southern tip of Peninsular Malaysia, commenced operations in late 1999. With the location of Maersk-Sealand's and Evergreen's transhipment facilities at PTP, the port is expected to achieve an annual cargo volume of 2.5 million TEUs in 2003. Another port, Kuantan Port on the east coast of Peninsular Malaysia, is also undergoing a 30-year expansion to meet increasing throughput from the massive petrochemical complex along the Kertih-Gebeng corridor.
Besides the physical infrastructure being in place, the electronic data interchange (EDI) in Port Klang, Penang Port and Johor Port has allowed speedy clearance of cargo with the electronic transfer of documentation.

International Airports

Malaysia's central location in the Asia Pacific region makes her an ideal gateway to Asia. Air cargo facilities are well-developed in the five international airports - the Kuala Lumpur International Airport (KLIA), Penang International Airport and Langkawi International Airport in Peninsular Malaysia, Kota Kinabalu International Airport in Sabah, and Kuching International Airport in Sarawak.

Malaysia's biggest airport, the KLIA, located 50 kilometres south of Malaysia's federal capital of Kuala Lumpur, has an initial capacity of 25 million passengers and 650,000 tonnes of cargo per year. Cargo import and export procedures are fully automated at the KLIA to cut down delivery time. Within a short span of two years since its opening, the KLIA was ranked number one for overall business passenger satisfaction in an International Air Transport Association (AITA) survey.

A Vibrant Business Environment
Malaysia's market-oriented economy, supportive government policies and a large local business community that is ready to do business with international corporations have made Malaysia a highly competitive manufacturing and export base.In addition, Malaysia's rapid move towards the k-economy allows companies to do business in an environment that is geared towards information technology.

One of Malaysia's major pull factors is its large pool of young, educated and trainable workforce. Many of Malaysia's university graduates are trained overseas in fields such as engineering, and accountancy, allowing them to adapt easily to an international corporate environment.

English is widely used in Malaysia, especially in business thus facilitating the investor's communication with local personnel and suppliers. The country's legal and accounting practices derived from the British system are familiar to most international companies.

 

Chambers of Commerce and Industry

Newcomers to Malaysia's business scene will feel at home with the presence of the various chambers of commerce and trade associations made up of corporations from different countries. These oganisations are invaluable sources for general business information, advice and assistance, and complement the role of government agencies such as MIDA. The major organisations, are the Malaysian International Chamber of Commerce and Industry (MICCI), Federation of Malaysian Manufacturers (FMM), the Japanese Chamber of Trade and Industry (JACTIM), and American-Malaysian Chamber of Commerce (AMCHAM), as well as several trade associations such as the Malaysian-American Electronics Industry (MAEI) Group.

Developed Financial Facilities

A well-developed financial and banking sector has enhanced Malaysia's position as a dynamic export base in Asia. Sophisticated financial facilities are available through domestic and foreign commercial banks and their nationwide network of branches. There are also representative offices of several foreign banks that wish to establish a presence in the region.

Besides the commercial banks, merchant banks, finance companies and industrial finance institutions are major sources of credit to the industrial sector in Malaysia. Exporters in Malaysia can also take advantage of the credit facilities offered by the Export-Import Bank of Malaysia Berhad (Exim Bank), while another institution, Malaysia Export Credit Insurance Berhad (MECIB), offers export insurance cover and guarantees.

To complement Malaysia's financial system, the government has established an international offshore financial centre (IOFC) on the island of Labuan located off the north-west coast of Borneo. Companies in Labuan enjoy minimal taxes as well as confidentiality. To-date, more than 2,700 offshore companies have started their operations in Labuan. These include offshore banks, trust companies, and insurance and insurance related companies. The Labuan Offshore Financial Services Authority (LOFSA) is the agency which promotes and develops Labuan as an IOFC.

Local Vendors

Over the last three decades, Malaysia has developed a large pool of ancillary and supporting industries that was initiated with the entry of MNCs into the country. These MNCs, especially those which pursued active vendor development programmes, have contributed greatly towards the development of local small-and-medium scale industries (SMIs) that are highly competent and competitive with some even penetrating export markets.

 

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