KUALA LUMPUR: Japanese companies are looking at opportunities to invest in new sectors in Malaysia such as aerospace, automotive components, medical equipment and renewable energy.
Japan External Trade Organisation (JETRO) Managing Director Akira Kajita said the Japanese companies were keen to set up their manufacturing bases in Malaysia and expand their supply chain within the ASEAN region.
“If government policies continue to promote new industries such as aerospace, there would be a big opportunity for related Japanese companies to venture into the Malaysian market,” he added.
He said this in a media briefing following the presentation of a business survey on Japanese companies jointly conducted by Jetro and the Japanese Chamber of Trade and Industry, Malaysia (JACTIM) here, today.
Kajita said electrical and electronics sector was the biggest investment made by Japanese companies in Malaysia.
For the second half of this year, he envisaged a positive investment trend, boosted by Malaysia’s robust economic growth.
JACTIM President Hiroyuki Imizu said Japan remained the biggest foreign investor in Malaysia in the manufacturing sector.
“We are positive of the government’s Look East Policy,” Imizu said during the media briefing.
However, he said wage increase and quality of workers were the prime issues in the sector and emphasised that wage increase should commensurate with economic growth.
” To reduce the dependency on foreign workers, there is a need to transform to Industry 4.0, increase productivity and invest in research and development,” he explained.
Imizu also stressed on the shortage of skilled workers such as engineers to move towards Industry 4.0 and towards higher value industry.
Malaysia’s foreign exchange control with the central bank’s regulation on exporters to retain up to 25 per cent of export proceeds in foreign currency was also a major concern for Japanese companies, he added.
“From an investor point of view, this regulation means additional cost and burden in doing business...we hope that this regulation would be mitigated,” he said.
The regulation requires exporters to get approval from the central bank to hold more than 25 per cent export proceeds in foreign currency.
Imizu emphasised that government’s policy was important to enable foreign investors to decide which country to invest in .
Based on the Questionnaire survey for Japanese companies in Malaysia in 2018, Vietnam is valued as the most attractive destination, followed by Indonesia, Thailand, Myanmar, the Philippines, Malaysia, India, Cambodia and China.