KUALA LUMPUR: Malaysia must undertake bold structural and sectoral reforms in its Foreign Direct Investment (FDI) policy in order to ride out the Covid-19 impact, says an academic.
Professor Sufian Jusoh of Universiti Kebangsaan Malaysia’s International Trade and Investment Institute for Malaysian and International Studies said Malaysia should conduct aggressive investment promotions in order to revitalise its economy.
“The investment priority sectors must include areas that could assist Malaysia to overcome any potential economic and health care problems and promote emergency preparedness and food security in the future,” Sufian said.
The Covid-19 pandemic represents an unprecedented disruption to the global economy and world trade, with production and consumption scaled back across the globe.
Similarly, most affected countries are under lockdown, with Malaysia also not spared. The government’s movement control order (MCO) has left manufacturers and factory owners with more questions than answers on how they are supposed to navigate this period, especially when it comes to completing the supply chain internationally.
Sufian said the Covid-19 pandemic will cut FDI around the world by about 40 per cent, and Malaysia, one of the countries in the region which relies on FDI, will be adversely affected.
Malaysia should undertake structural and sectoral reforms, adopt new frontier technologies, and promote access to finance, food security, international collaboration and signalling, he said.
“There has to be higher coordination between Mida and Federal agencies, as well as economic corridors and state investment agencies, to facilitate investment implementation,” he told Bernama TV Astro 502.
Sufian said digital technology could be the right enabler for achieving growth that is balanced, inclusive, sustainable, innovative and secure.
And with older persons more susceptible to Covid-19, Malaysia could encourage investments in digital technology dealing with assisting the ageing population, he added.
“During this trying time, we see regional peers announcing numerous measures to further attract foreign investors into their countries.
“Some could argue that these measures have been in the pipeline but making the necessary announcement during the crisis makes these countries stand out over other competing economies,” said Sufian.
He also said Malaysia should consider ratifying the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Malaysia’s commitment to the CPTPP as well as the Regional Comprehensive Economic Partnership (RCEP) will project a positive signal to international businesses of Malaysian investment sectors, he said.
As at April 5, the World Health Organisation reported 1.24 million confirmed Covid-19 cases with 68,667 confirmed deaths in 206 countries or territories around the world.
Malaysia reported its first Covid-19 case on Jan 25, and as at April 5, the number of confirmed cases stood at 3,662 with 61 confirmed deaths. – Bernama