DAP’s chief economist, Tony Pua unleashed his opinion about Malaysia’s FDI 3 days ago in all online media; blaming Dato Sri Najib Tun Razak entirely on this issue. Maybe he should focus on the Pakatan states which are not doing so well as compared to other BN led state governments.
THE World Investment Report 2010 issued by the United Nations Conference on Trade and Development (Unctad) reported a significant plunge in Malaysia’s FDI (Foreign Direct Investment) in 2009.
The report has given Pakatan Rakyat leaders and supporters a much needed opportunity to deflect public attention away from the problems plaguing states under the Pakatan rule. DAP’s “economic adviser” Tony Pua has issued statements to buttress his charge that investors had totally lost confidence in Malaysia.
His statements betray a lack of understanding of the issue. I am not sure how Unctad arrived at the FDI figure of US$1.38 billion but Mida (Malaysian Industrial Development Authority) had months ago published in its website that Malaysia procured FDI worth US$6.48 billion last year. Sabah and Sarawak alone had attracted more than US$1.38 billion each last year.
Based on the figure of US$6.48 billion, Malaysia has done well compared to its regional peers. The numbers seem to indicate that foreign investors’ confidence in Malaysia had sky-rocketed. I had been travelling to Europe, Asia and the US in the last few months for business purposes and had the opportunity to speak to business leaders and investors. Almost everyone seemed to agree that Malaysia has made significant progress economically and politically. This is a sea change in perception compared to my trip in 2008 when the investors’ sentiments were mostly bearish.
The second point that Pua had pointed out was on the outflow of FDI. Malaysian firms have grown in recent years to be regional and even global players and champions. They have been investing and acquiring companies overseas. As such there is an outflow of FDI.
I agree with Pua that a drop in FDI shows a loss of confidence in the government. I am sure Pua would concur with me that the 80% drop in FDI for Penang is a testament that the investors have no confidence in the state’s leadership or its policies.