Credit Management January February 2024

COUNTRY FOCUS
IT, healthcare, telecommunication and infrastructure, fastmoving
consumer goods, housing, finance companies and
machinery accessories.
Further, while the sector predominantly comprises Islamic
banking, finance, telecommunications and tourism, there are
firms engaged in warehousing and transportation services,
information services, securities as well as other investment
and professional services. FMT believed that “the healthcare
sector is going to be a major sector that will stimulate
economic growth and contribute to employment.”
Manufacturing
The HSBC document points out that multinational
corporations from more than 40 countries have invested
in over 5000 companies in manufacturing and services in
Malaysia.
International consultant, the SNECI Group, detailed in
February 2023 the key growth sectors for the manufacturing
sector. Aeronautics is one that is identified as is important
since the Government wants it to put the country in pole
position. The Malaysia Aerospace Industry Blueprint 2030
seeks revenue of $12bn a year and the creation of 32,000 high
value-added jobs by 2030.
world. The value of Malaysia’s agricultural exports increased
by more than 30 percent in 2021, with palm oil and palmbased
products as its major export commodities.
Food crops, including rice, fruits, and vegetables were
the second most important commodities. However, the
country’s production of food crops was not enough to meet
local demands. Malaysia’s imports of rice reached more than
1m metric tons in 2021, making up about 30 percent of the
country’s demand for the staple food commodity.
Livestock is key to Malaysia. Poultry’s contribution to GDP
reached around RM10bn in 2021; chicken is the most popular
type of meat among the Malaysian population of which
63.5 percent are Muslims. Overall, the value of the sector to
Malaysia is RM 98.9bn and some 1.86m are employed in it.
Summary
Malaysia may well be split across a sea but with its overall
geographic location and resources the country is well worth a
look. But as noted earlier, visitors need to be alive the cultural
sensitivities that a diverse population brings.
Author: Adam Bernstein is a freelance
finance writer for CM magazine.
In terms of oil and gas, Malaysia ranks 28th in the world for
oil reserves and 24th for gas (Statistical Review of World
Energy - British Petroleum, June 2023). It’s the second largest
producer of crude oil in ASEAN and the 5th largest exporter
of liquefied natural gas in the world (Statista 2022).
And then there’s electronics which SNECI says has
contributed approximately 22 percent of GDP in the last
five years through 49,000 manufacturing companies, most
of which are SMEs. Firms are involved in aeronautics,
automobile and general electronics. The Government’s desire
is to increase the number of highly skilled employees, and the
share of the manufacturing sector in the Malaysian economy,
to become one of the 30 most innovative economies in the
world. The 2023 Global Innovation Index currently ranks it
36th.
Pharmaceuticals in Malaysia is predicted, between 2017-2027,
to grow around 9 percent a year. SNECI says that the network
of para-pharmacies and independent pharmacies, medical
biotechnology and pharmaceuticals are all growth sectors.
Beyond that, firms typically produce antibiotics, generic
injectables, analgesics and dietary supplements. The market
is mainly based on imported drugs as there is a strong
demand for branded products. Foreign laboratories represent
62 percent of the pharmaceutical market, notably from the
United States, Germany and France.
Agriculture
With regard to this sector, Statista has commented that the
agriculture industry in Malaysia relies heavily on farming and
its cash crops, palm oil and rubber. These crops are grown
mainly for their commercial value to be exported around the
Brave | Curious | Resilient / www.cicm.com / January & February 2024 / PAGE 38