KUALA LUMPUR, March 2 — Malaysia’s Foreign Direct Investment (FDI) fell 56 per cent to US$3.4 billion (RM13.9 billion) in 2020, a government report said on Tuesday, as the Covid-19 pandemic hit economic activity globally and in the trade-reliant Southeast Asian nation.
The country’s economy contracted 5.6 per cent last year, marking its worst performance since a 7.4 per cent fall in 1998 during the Asian Financial Crisis.
The net foreign investment totalled RM13.9 billion (US$3.43 billion) in 2020, down from RM31.7 billion the previous year, according to a report published by the Malaysian Investment Development Authority (MIDA).
“Malaysia’s lower net FDI inflows in 2020 is not necessarily an unfavourable sign when taking into consideration the global investment landscape and the uncertainties that prevailed during the year,” MIDA said in its report.
Foreign investment flows hit the negative territory in the third quarter when they fell 0.8 per cent, the first time since the fourth quarter of 2009 in the aftermath of the US subprime crisis, according to the report.
Malaysia, however, saw gross foreign investment inflows rise 0.8 per cent last year, MIDA said.
MIDA said the country brought in RM64.2 billion worth of approved foreign investments, primarily in the manufacturing sector, in 2020.
In January, the United Nations Conference on Trade and Development said in a report that foreign investment inflows in Malaysia fell 68 per cent last year, the worst rate in Southeast Asia.
— Reuters
