Your Guide to Doing Business in Malaysia

Date of publishing: 07/07/2016 00:00

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Identified as one of the Top 20 in Ease of Doing Business by the World Bank Group, Malaysia’s business environment is conducive to starting and operation for local firms. A flourishing of successful young professionals in booming industries also adds to the supportive ecosystem of the country. According to the Malaysian Investment Development Authority (MIDA), in 2015, due to a focus on quality job creation and higher income generation, the country received RM150.6 billion in direct domestic investment and RM36.1 billion in foreign direct investment. The amount was primarily distributed between two main verticals: 57.9% went towards the country’s service sector, while the manufacturing industry attracted 40% of investments.



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Conducive and cooperative


The Malaysian Government’s effort to provide free education to its 30M population has been a decisive factor in their excellent English Proficiency. This accelerated the knowledge and absorptive capabilities of Malaysian workers. Malaysia was ranked 19th out of 144 countries on the World Economic Forum’s Global Competitiveness Report 2014-2015 for labour market efficiency. The country outperformed economies such as Australia (56th), Brazil (109th), China (37th), India (112th), Indonesia (110th) and Japan (22nd).


Furthermore, Malaysia enacted business reforms that makes paying taxes easier and less costly for companies. The efficient Companies Commission of Malaysia (SSM) requires only three procedures over 5.5 days and costs just 7.2% of income per capita in fees. Foreign companies are able to either register in Malaysia, or incorporate a local company.


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Malaysia’s political stability is driven by their democratically-elected coalition government. Dedicated to economic development, the government has enacted multiple policies to support and safeguard business investors. Licensing approvals, tax administration efficiency and ease of cross-border trading have all contributed to Malaysia’s favorable Ease of Doing Business ranking. It remains one of the world’s top destinations, favored by over 40 multinational corporations for offshore manufacturing and service based operations.


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A nation united in solidarity


With urban capitals like Kuala Lumpur, Johor, and Penang that are epicenters of finance, trade and commerce, and the massive population of diverse cultures and backgrounds spread across twelve states, Malaysia is a compelling destination to both live and work.


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To further improve liveability in Malaysia, the Government has made efforts to address the country’s crime rate such as the Government Transformation Programme’s Reducing Crime Ministerial Key Result Area. They have developed a reliable and convenient transportation system, the Mass Rapid Transit (MRT) Entry Point Project under the ETP’s Greater KL/Klang Valley National Key Economic Area.


Malaysia is blessed with a solid economy, grounded by a wealth of natural resources. This results in manageable living costs and a fertile environment for business investment. From the palm oil and rubber to oil and gas industries, the country offers opportunities for resource-rich downstream segments, while also possessing the capabilities to develop the more high-value upstream segments.


The country’s skilled labor force, motivated by a supportive ecosystem, together with its progressive developmental platforms and minimal capital investment contribute to cost-effective operations for business owners and investors. Malaysia’s market is ripe for production and one can be certain of its fruitful yield.


Sources: ia2009/leechewging.pdf

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