Overview of MalaysiaAfter analyzing its current economy, Malaysia is one of the top countries for expanding business in the early stage. Malaysia has a driving business environment with the politically stable economy, strategic location, educated and skilled labour, well-developed infrastructure, government incentives and supports, and infrastructure development.Firstly, Malaysia currently has a politically stable economy. Malaysia government formed by democratical elected and actively contributes to country socio-economic development. There will be a low investment risk when the country is stable.
Choosing to expand business in Malaysia, not only 32 million Malaysian but also 630 million populations become our potential consumer because Malaysia is one of the ASEAN members. Malaysia is an upper-middle income and the 3rd richest country in Southeast Asia. Malaysia GDP is 5.9% which approximately RM1,353,381 million in 2017. The economic growth of Malaysia will boost up the consumer’s spending power on product and services and business’ demand and supply. Malaysia currency is JB¥1=RM0.
03590 in Jan 2018 showed a decrease compare to JB¥1=RM0.03835 in Jan 2017. The lower exchange currency may become an advantage for the foreign company. Secondly, Malaysia is strategically located in the heart of Southeast Asia. Malaysia located in this good position able to avoid from the many natural disasters such as earthquakes and typhoons.
Malaysia is a high trading country because of Malacca is one of the world economic shipping lanes. Nowadays, 73% of GDP contribution from manufacturing and service sectors make Malaysia developed to an advance technology and competitive nation in 2017. Malaysia has signed bilateral Free Trade Agreements (FTAs) and Malaysia-Japan Economic Partnership Agreement (MJEPA) with Japan. Both countries can shared huge available resources and low or free tariffs on their trading products.
Thirdly, Malaysia previously focused on hired cheaper labour, now Malaysia emphasized on educated and skillful employees for the economy. There is currently 31.5% manpower in Malaysia. So, government has launched two programs named MyApprenticeship and Technical and Vocational Education and Training (TVET). MyApprenticeship provided chances for youths and women employees to work in public and private organization for helping them to gaining skill and working experiences. TVET trained on skilled manpower by increasing their expertise, advancing their careers and earning better income. Due to multiracial, people can speak multiple languages fluently such as English (International Language), Malay, Chinese and Tamil in Malaysia.
The foreign companies can hire more educated and skillful Malaysian employee to perform the tasks efficiency and effectiveness in the organization.Next, government also provides incentives and supports for the foreign companies to expand their business. Malaysia has launched MaGIC’s accelerator programme, and Cradle Fund and MDEC provided accessibility and financial supporting. So, there will be low operation cost and easily for foreign company to penetrate into the market. The pro-active of Malaysia government is supporting the foreign business so that they can attract more foreign investment (FDI) for the economy growth.
Malaysia has global business summit every yearly to provide international connection between different companies around the world. Malaysia ranked as 24th in World Bank’s Ease of Doing Business in 2018. Labuan is a lucrative platform for expanding business in Malaysia. Businessmen can enjoy 3% tax rate or RM20000 flat tax yearly when setting up Labuan International Company and tax free for Labuan Investment Holding Company. Lastly, Malaysia government also concerned the infrastructure development.
This is to provide a good environment for the local and foreign business. The building of the Malaysia infrastructure companies always can be completed within the time given. Infrastructure development such as network of well-maintained highways and railways, well-equipped seaports and airports, fully developed free industrial zones and Multimedia Super Corridor (MSC) make Malaysia an ideal springboard to the Asia-Pacific market. In short, Malaysia has the tremendous potential for foreign company to expand business now and in the future.
