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| Top Page ＞ Bilateral Relations ＞ Press Briefing: Report on Economic Relation between Japan and Malaysia | ||||
Based on Trade Statistics of Japan which will be released on 30th January by Ministry of Finance of Japan, Mr. Masahiko HORIE, the Ambassador of Japan to Malaysia, held a press briefing on 31st January 2008 to report the economic relation between Japan and Malaysia.
1. Malaysian Economy and Japan’s Contribution Malaysia’s GDP growth rate reached 6.7% in the third quarter in 2007. This indicates strong fundamentals of Malaysia’s overall economy. There are more than 1,400 Japanese enterprises operating in Malaysia, and these Japanese companies have provided broad manufacturing base in Malaysia and significantly contributed to economic growth and further development of this country. 2. Investment to Malaysia In 2006 and 2007, Japan is the No 1 investor to Malaysia. Japanese enterprises have very much committed to upgrading or expanding manufacturing facilities in Malaysia. Since year 2000, Japan has always been among the top three investing countries with United States and Singapore (Figure 1). Figure1: Investment to Malaysia
2) Year 2007: approved investment in manufacturing sector (Source: MIDA) A major investment area is electronic products and transportation equipment. On top of such traditional investment in manufacturing sector, investment in various services has also been increasing; recent projects include retail sector and logistics, such as AEON, Jusco Supermarket which opened a new large Shopping mall in Pinang and plan to open others in various states. In 2007, as of October, Japan’s investment in manufacturing sector, approved by MIDA (Malaysian Industrial Development Authority) has reached 6.1 billion Malaysian Ringgit, or 1.75 billion in US dollar (Figure 2). The figure is 39% larger compared to the figure in 2006. Japanese investment projects, approved by MIDA, consists 24% or one-fourth of total manufacturing investment into Malaysia (Figure 3).
3. Bilateral trade between Malaysia and Japan Regarding bilateral trade between Malaysia and Japan, Japan is the third largest trading partner for Malaysia. Bilateral trade between the two countries consists 11% or more than one-tenth of total trade volume of Malaysia (Figure 4). Figure 4: Malaysia's Major Trading Partners
(Total of Export and Import, January-September 2007)
(Source: Department of Statistics, Malaysia) Throughout the last several years, Japan has been the third largest export market for Malaysia (Figure 5). Japan has also been the top import source for Malaysia (Figure 6). Figure 5: Malaysia's Top Export Destinations Figure 6: Malaysia's Top Import Sources On top of import of various Japanese products, such as consumer electronics goods, Japanese companies operating here in Malaysia import capital goods, parts and components, providing huge input to broad manufacturing base in Malaysia. According to the latest figure, which was just released yesterday by Ministry of Finance, Japan, bilateral trade (total of export and import) between Malaysia and Japan increased significantly, by 14.2%. Malaysia’s export to Japan increased by 13.4%, and imports from Japan also increased by 15.1% (Figure 7). Figure 7: Bilateral Trade between Malaysia and Japan The rate of increase of Malaysia’s export to Japan (13.4%) is the largest figure among larger ASEAN countries. Growth of other larger ASEAN countries’ export to Japan, such as Philippines (10.5%); Indonesia (10.1%); Thailand (9.5%); and Singapore (minus 4.6%), is far less than the growth in Malaysia’s export to Japan. Such significant increase in trade between the two countries and steady growth in investment from Japan into Malaysia clearly indicates further closer linkages between the two countries’ economies. Closer bilateral ties between Malaysia and Japan have been a very clear and visible fruit of the Malaysia-Japan Economic Partnership Agreement, which took into effect in July 2006. 4. Views of Japanese companies operating in Malaysia CEOs of Japanese companies operating in Penang and Sarawak, whom I met during my visit there, conveyed satisfaction with business environment there. The CEOs from Penang told me that they can secure reliable and highly skilled workers who are also multilingual. The CEOs from Sarawak pointed out that they can secure human resources from locals in Sarawak, without relying on foreign workers. The returnees from Japan who have studied there under Look East Policy are now at the managerial level. Human resources who are well versed in Japanese culture are now growing in Malaysia. Accustomed to multi cultural milieu, they are sent to neighboring countries and assume managerial posts. Press Coverage Bernama, 31st Jan Utusan Malaysia, 1st Feb New Straits Times, 1st Feb Oriental Daily （東方日報）, 1st Feb Nangyang Siang Pau（南洋商報）, 2 Feb |
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| (c) Embassy of
Japan in Malaysia No.11 Persiaran Stonor, Off Jalan Tun Razak, 50450 Kuala Lumpur, Malaysia |
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