Welcome to Malaysia Dai Harries Leicester 5 September 2007.
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Transcript of Welcome to Malaysia Dai Harries Leicester 5 September 2007.
Welcome to Malaysia
Dai Harries
Leicester5 September 2007
Malaysia – Political, Economic and Social
Doing Business in Malaysia - why and how
UK Trade & Investment services in Kuala Lumpur
Malaysia: an introduction
Malaysia: a country at a crossroads
Malaysia: geographically diverse
Multi-ethnic, multi-cultural, multi-religious society
But stable
Bumiputra involvement important
Malaysia: ethnically diverse
Other1%
Indian8%
Chinese26%
Bumiputra65%
-5.2
-10.3
8.1
10.611.7
8.0 7.66.3
3.1
0.5 1.1
3.8
5.8 5.44.6 4.4
5.16.4
7.68.2
6.75.6 5.8
4.15.3
-10.9
-0.5 -1.2
-3.1
4.1
-1.3
-15
-10
-5
0
5
10
15
Q198
Q298
Q398
Q498
Q199
Q299
Q399
Q499
Q100
Q200
Q300
Q400
Q101
Q201
Q301
Q401
Q102
Q202
Q302
Q402
Q103
Q203
Q303
Q403
Q104
Q204
Q304
Q404
Q105
Q205
Q305
An
nua
l %
ch
an
ge
Malaysia: economic growth
• GDP growth: ups and downs, but impressive overall
• 7.1% for 2004, 5.2% for 2005, 5.9% for 2006 with c.6% forecast for 2007
•Ringgit peg to dollar scrapped smoothly in July 2006
Economy more and more developed. Service sector largest (nearly 60%)
But manufacturing (over 30% + of GDP and 80% of exports) important. So are mining and quarrying and agriculture/commodities (both nearly 10%)
Above all an open economy: 18th biggest trading nation in the world, with exports same size as GDP
E & E accounts for nearly 50% of manufacturing output and over 40% of exports: a strength and vulnerability
China factor – an opportunity and challenge
Skills - including English language
Malaysia: economy
UK-Malaysia: trade
Source: Department of Trade & Industry, London
£0.0
£500.0
£1,000.0
£1,500.0
£2,000.0
£2,500.0
£ m
illion
s
1997 1998 1999 2000 2001 2002 2003 2004Year
UK-Malaysia: Trade
Import Export
Investment also significant - and increasingly in both directions
Since 1990 cumulative UK investment well over £3 billion
Major current investors: Shell, BP, TESCO, Jardine Matheson, HSBC, Standard Chartered; but also various smaller companies
Significant Malaysian investment in UK: traditionally in hotels and leisure (eg Laura Ashley, Corus Hotels, Crabtree & Evelyn); recently in other sectors (Wessex Water, Petronas, Genting…)
UK-Malaysia: investment
Malaysia – Political, Economic and Social
Doing Business in Malaysia - why and how
UK Trade & Investment services in Kuala Lumpur
Malaysia
Why do business in Malaysia?
Close ties with the UK: similar governmental and legal systems; but above all education and the English language. And football!
Robust, generally open economy and buoyant domestic demand
Good infrastructure - IT, roads, airports
A good base for the region and Asia – with incentives on offer
How to do business in Malaysia?
Close to UK…but different, Asian customs, attitudes and rules of the game
Relationships central and key to success. Need to invest time and be patient
Bumiputra issue - especially with Government bodies (eg Petronas, TNB, Telekom Malaysia or TM)
A good local partner almost always essential
How to set up in Malaysia?
Various options to set up a legal presence in Malaysia: from light and easy to full-fledged local company
Other options – with incentives – for bigger companies operating regionally
We can provide more information
But strongly advise to seek advice from reputable business consultants, as well as MIDA if appropriate
Taxation in Malaysia
Tax regime reasonably benign, both corporate (28%) and personal (1% to 28%)
Also Sales (0-25%) and Service (5%) Taxes. Due to be consolidated into GST (= VAT) in 2007
Customs Duties generally low. But wise to check
Withholding Tax complicated, with potential liability of 8% for UK companies
Again, always best to check with business consultants
Useful Websites
UK Trade & Investment: www.uktradeinvest.gov.uk
British High Commission Kuala Lumpur:www.britain.org.my
Malaysian Industrial Development Authority (MIDA):www.mida.gov.my
Federation of Malaysian Manufacturers (FMM):www.fmm.org.my
Malaysia International Chamber of Commerce & Industry (MICCI): www.micci.com
British Malaysian Chamber of Commerce: www.bmcc.org.my