The constant talk about a coup is affecting Malaysia’s FDIs

The constant talk about a coup is affecting the confidence of foreign investors and is hurting FDIs

(FMT) – The inflow of foreign direct investments (FDI) into Malaysia dropped by 68% to US$2.5 billion in 2020, according to a United Nations Conference on Trade and Development (UNCTAD) report.

The UNCTAD said FDI in Southeast Asia decreased by 31% to US$107 billion, with Singapore’s FDI falling by 37% to US$58 billion, Indonesia by 24% to US$18 billion and Vietnam by 10% to US$14 billion.

Malaysia, however, saw a sharp 68% decline in FDI last year to a mere US$2.5 billion.

The report said FDI in most developing countries dropped by a mere 12%, compared to developed nations that saw a 69% decline. Global FDI decreased by 42%.

“In Thailand, FDI contracted 50% to US$1.5 billion, mainly due to a large divestment. Tesco UK sold its stores to a Thai investor group for US$9.9 billion. FDI flows in the Philippines, bucking the trend, rose by 29% to US$6.4 billion.

“Southeast Asia registered more than US$70 billion in new greenfield investment projects, the largest volume among developing regions. An uptick in the number of projects in Q3 in Singapore could signal an impending FDI recovery in the region,” said the report.