Kuala Lumpur, 6 March 2026 โ Malaysia recorded a historic RM426.7 billion in approved investments in 2025, marking the highest investment level ever achieved by the country and reinforcing its position as one of Southeast Asiaโs most resilient investment destinations.
The figure represents an 11% increase from RM384.4 billion in 2024, with 8,390 approved projects expected to create 244,902 new jobs nationwide, according to data released at the Malaysian Investment Development Authorityโs (MIDA) Annual Media Conference 2026.
The strong performance comes at a time when global investment activity remains cautious amid geopolitical tensions, shifting trade policies and tighter financial conditions. Yet Malaysia has managed to sustain investor confidence through a mix of policy clarity, industrial reforms and strategic positioning within the ASEAN economic bloc.
Balanced Investment Between Domestic and Foreign Capital
A key highlight of Malaysiaโs investment performance is the balanced composition of domestic and foreign capital.
Domestic investments accounted for RM219.6 billion, representing 51.5% of total approvals, while foreign investments rose 20.9% year-on-year to RM207.1 billion, accounting for the remaining 48.5%.
This balance reflects both strong local corporate confidence and sustained international investor interest in Malaysiaโs long-term economic prospects.
The top five sources of foreign investment were:
- Singapore: RM58.3 billion
- China: RM58.0 billion
- United States: RM15.1 billion
- Japan: RM7.6 billion
- Hong Kong SAR: RM7.1 billion
Together, these five economies contributed 70.6% of total foreign investments, highlighting Malaysiaโs strategic positioning between Eastern and Western investment flows.
Services Sector Drives Investment Growth
Malaysiaโs services sector emerged as the dominant investment catalyst, securing RM281.3 billion, or 65.9% of total approved investments, across more than 7,000 projects.
These projects are expected to generate 134,926 new jobs, the largest share of employment creation among all sectors.
Within the services sector, the information and communications subsector led investment activity, attracting RM152.9 billion driven by digital infrastructure development, artificial intelligence applications, cloud computing and large-scale data centre projects.
The rapid expansion of digital infrastructure is also accelerating Malaysiaโs energy transition, as data centres drive demand for renewable energy and large-scale solar projects in line with the countryโs goal of achieving 70% renewable energy by 2050.
Other key contributors within the services sector include:
- Real estate: RM78.2 billion
- Utilities: RM13.7 billion
- Support services: RM12.6 billion
- Distributive trade: RM10.8 billion ย
Manufacturing Sector Moves Up the Value Chain
Malaysiaโs manufacturing sector secured RM131.3 billion in approved investments, representing 30.8% of total investment approvals across 1,354 projects.
Foreign investments dominated this sector with RM100.6 billion, highlighting Malaysiaโs role as a major destination for high-technology and advanced manufacturing.
The sector is expected to create 109,948 new jobs, with 82.3% reserved for Malaysians, nearly half of which fall under managerial, technical and supervisory roles.
The electrical and electronics (E&E) industry remained Malaysiaโs manufacturing backbone, attracting RM28.5 billion in investments, followed by:
- Chemicals and chemical products โ RM24.9 billion
- Transport equipment โ RM14.9 billion
- Basic metal products โ RM11.1 billion
- Machinery and equipment โ RM11.0 billion ย
These investments reflect Malaysiaโs ongoing transition toward higher-value industrial activities, particularly in sectors linked to artificial intelligence, semiconductor supply chains and advanced manufacturing technologies.
Johor Leads State-Level Investment
At the state level, Johor emerged as Malaysiaโs top investment destination, attracting RM110 billion in approved investments.
The stateโs strong performance is partly linked to the rapid development of the JohorโSingapore Special Economic Zone (JS-SEZ), which is expected to strengthen cross-border supply chains and industrial collaboration between Malaysia and Singapore.
Other leading states include:
- Selangor โ RM83.9 billion
- Kuala Lumpur โ RM63.3 billion
- Penang โ RM32.9 billion
- Kedah โ RM27.8 billion ย
Collectively, these five states accounted for 74.5% of total approved investments in 2025.
Meanwhile, Malaysiaโs less developed states secured RM66 billion in investments across 941 projects, supporting broader national goals of inclusive economic growth.
Strong Project Implementation and Investment Pipeline
Malaysiaโs investment success is not only measured by approvals but also by project implementation.
Between 2021 and 2025, 84.9% of manufacturing projects approved by the National Committee on Investment have reached implementation stages, including factory construction, machinery installation and production operations.
As of early 2026, MIDA is also monitoring a pipeline of 172 potential projects worth RM29.1 billion, while RM65.5 billion in additional investment leads are currently under negotiation.
Policy Reforms to Support the Next Growth Phase
Malaysia is also rolling out major policy reforms aimed at sustaining investment momentum.
Among the key initiatives are:
- New Incentive Framework (NIF) โ effective March 2026, shifting Malaysiaโs investment policy toward an outcome-based model prioritising high-impact investments.
- Industrial Development Act 2026 โ replacing the Industrial Coordination Act 1975 to modernise industrial regulations.
- Climate Change Bill โ expected to establish the legal framework for Malaysiaโs transition toward a low-carbon economy. ย
These reforms are designed to ensure that Malaysiaโs investment growth translates into stronger industrial capabilities, sustainable development and high-value job creation.
Malaysiaโs Investment Outlook
Despite global economic uncertainty, Malaysiaโs investment performance suggests that the country continues to benefit from supply chain diversification trends and ASEANโs growing role in global trade and manufacturing.
With strong domestic participation, rising foreign investor confidence and a growing digital and advanced manufacturing ecosystem, Malaysia is positioning itself as a long-term hub for high-impact investments in Asia.
