How much more Foreign Direct Investment (FDI) would Malaysia have attracted without Najib and the scandal of 1MDB hanging over the heads of foreign investors?

Media Statement by Dr. Ong Kian Ming, Deputy Minister of International Trade and Industry (MITI) on the 10th of January, 2019

I feel sorry for former Prime Minister, Najib Tun Razak, who has taken on the new role of being Barisan Nasional’s (BN) no.1 internet troll in order to save his disgraced reputation. His latest pathetic attempt is to try to take credit for Malaysia’s investment and trade performance over the past 10 years. Many of the characteristics which makes Malaysia an attractive investment destination and an economy which is open to trade and business such the establishment of the rule of law to protect investors, infrastructure investments to improve our connectivity and trade liberalisation were already put in place by his predecessors including during Tun Dr. Mahathir’s first stint as Prime Minister.

If anyone should take credit, it should be the hard working civil servants at the Ministry of International Trade and Industry (MITI), the Malaysia Investment Development Authority (MIDA) and the Malaysian External Trade Development Corporation (MATRADE), in their consistent and concerted efforts to attract Foreign Direct Investment (FDI) and to promote external trade.

It is not as if external trade stopped growing after Najib was defeated in the 14th General Election in May 2018. Indeed, the growth in total trade AFTER GE14 from May to Nov 2018 compared to the same time period in 2017 was 7.0% which is HIGHER than the growth in total trade of 4.7% BEFORE GE14 from January to April 2018 compared to January to April 2017. (See Figure 1 below)

Similarly, it is not to say as if Foreign Direct Investment (FDI) applications in the manufacturing sector stopped once Najib was no longer Prime Minister. Indeed, from the months from May to September 2018, which is after GE14, the approved manufacturing investments increased to RM35 billion compared to RM7.3 billion during the same time period in 2017.  Indeed, the increase in approved FDI in the manufacturing sector gives a hint as to how much more FDI we would have been able to attract if Malaysia did not have the scandal of 1MDB hanging over the heads of the investors as they pondered whether or not this scandal would affect the investment climate in Malaysia.F

Indeed, instead of taking credit, Najib should thank the two previous and longest serving Ministers of International Trade and Industry (MITI) who emphasized a high level of professionalism and put in place investor friendly policies – Tan Sri Rafidah Aziz (MITI Minister from 1997 to 2008) and Datuk Mustapa Mohamed (MITI Minister from 2009 to 2018). He should also take note that Rafidah left UMNO before GE14 and actively campaigned against Najib personally during the recent general elections and Mustapa left UMNO after GE14 and has since joined BERSATU.

We can all sigh a huge sigh of relief now that we don’t have to be afraid of the 1MDB scandal and Najib chasing away foreign investors from Malaysia. Our challenge now is to show that Malaysia is and will be an even BETTER place to invest in for the long term as we put in place better governance structures and improve the ease of doing business in the country.