Kuala Lumpur, 6 March 2026 – Malaysia recorded RM426.7 billion in approved investments in 2025, the highest level in the nation’s history, reflecting strong investor confidence despite global trade disruptions and geopolitical tensions, according to Malaysia’s Ministry of Investment, Trade and Industry.
The record figure represents an 11% increase over the previous year, covering 8,390 projects across the manufacturing, services and primary sectors. These investments are expected to generate 244,902 new jobs for Malaysians.
Announcing the figures at the Malaysian Investment Development Authority’s Annual Media Conference, Deputy Minister Sim Tze Tzin said the milestone reflects Malaysia’s ability to remain competitive in a rapidly changing global investment landscape.
Global Turbulence Redefines Investment Flows
The announcement comes at a time when the global investment environment is increasingly shaped by geopolitical tensions and protectionist trade policies.
According to the deputy minister, sweeping tariff actions by the United States in 2025 have added uncertainty to global trade flows, while geopolitical tensions in the Middle East continue to inject volatility into energy markets and investor sentiment.
These developments have reshaped supply chains and forced multinational companies to reconsider manufacturing footprints and investment destinations. Yet ASEAN continues to stand out as a preferred destination for capital, supported by its policy consistency, strategic geography and growing consumer markets.
Within this context, Malaysia has emerged as one of the region’s key investment beneficiaries.
Domestic and Foreign Investors Both Driving Growth
A notable feature of Malaysia’s investment performance is the balance between domestic and foreign capital.
Domestic investments accounted for RM219.6 billion, representing 51.5% of total approvals, signalling strong confidence among Malaysian companies in the country’s economic direction.
Meanwhile, foreign investments surged 20.9% to RM207.1 billion, highlighting Malaysia’s continued appeal to global investors.
The top five sources of foreign investment in 2025 were:
- Singapore – RM58.3 billion
- China – RM58.0 billion
- United States – RM15.1 billion
- Japan
- Hong Kong
The near parity between Singapore and China reflects Malaysia’s strategic positioning as a neutral and reliable investment partner bridging Eastern and Western economies.
Johor Leads State Investment Rankings
Geographically, Johor emerged as Malaysia’s top investment destination, attracting RM110 billion in approved projects.
The state’s strong performance has been partly driven by the growing momentum of the Johor–Singapore Special Economic Zone (JS-SEZ), which aims to strengthen cross-border industrial integration and supply chains between Malaysia and Singapore.
Other leading states include:
- Selangor – RM83.9 billion
- Kuala Lumpur – RM63.3 billion
- Penang – RM32.9 billion
- Kedah – RM27.8 billion
At the same time, less-developed states collectively attracted RM66 billion in investments across 941 projects, demonstrating efforts to spread industrial growth beyond traditional economic centres.
Services Sector Leads Investment Growth
The services sector emerged as the largest contributor to investment approvals in 2025.
The sector secured RM281.3 billion in investments across more than 7,000 projects, generating over 130,000 new jobs.
At the forefront of this expansion is the information and communications subsector, which recorded RM152.9 billion in investments, driven largely by the rapid expansion of digital infrastructure.
Major investments in artificial intelligence, cloud computing, big data and data centre infrastructure are supporting Malaysia’s ambition to become an “AI nation” by 2030.
One notable project includes the Racks Central Group data centre campus in Pasir Gudang, Johor, with an estimated investment of up to RM26.6 billion and planned computing capacity of up to 510 megawatts.
Manufacturing Sector Moves Up the Value Chain
Malaysia’s manufacturing sector secured RM131.3 billion in approved investments across more than 1,300 projects, generating nearly 110,000 new jobs.
Importantly, 82.3% of these positions will be filled by Malaysians, with 46.3% classified as high-value managerial, technical and supervisory roles.
The electrical and electronics sector remained the cornerstone of Malaysia’s manufacturing ecosystem, attracting RM28.5 billion in investments.
Other key industries include:
- Chemicals and chemical products
- Transport equipment
- Basic metal products
- Machinery and equipment
These sectors reflect Malaysia’s ongoing transition toward higher-value industrial activities and more technologically advanced production.
Landmark Projects Driving Industrial Transformation
Several major investments illustrate Malaysia’s strategic industrial ambitions.
In Penang, TF AMD Microelectronics has invested nearly RM5 billion in advanced wafer bumping and semiconductor packaging technologies supporting AI and high-performance computing applications.
Meanwhile, Pengerang Biorefinery, a joint venture involving PETRONAS, Italy’s Enilive and Japan’s Euglena, will produce sustainable aviation fuel and next-generation green fuels, marking a major step in Malaysia’s energy transition.
In the automotive sector, PROTON’s RM1.29 billion investment in Tanjong Malim is establishing Malaysia’s first dedicated electric vehicle production facility, supporting the Proton e.MAS EV lineup.
Together, these projects demonstrate Malaysia’s push to develop a more complex, sustainable and inclusive industrial economy.
Implementation Rate Remains Strong
Malaysia has also demonstrated strong execution in turning approved investments into operational projects.
Between 2021 and 2025, 84.9% of manufacturing projects approved by the National Committee on Investment have reached various implementation stages, including construction, machinery installation and production.
More than 90% of projects approved between 2021 and 2024 have already been implemented, reflecting efficient coordination between federal and state agencies.
New Policy Frameworks for the Next Phase
Looking ahead, Malaysia is preparing a new generation of investment policies to sustain growth.
These include:
- A New Incentive Framework effective March 2026
- The Industrial Development Act 2026, replacing the Industrial Coordination Act 1975
- A forthcoming Climate Change Bill to support Malaysia’s low-carbon transition
- The 13th Malaysia Plan, allocating RM611 billion for national development from 2026 to 2030.
These reforms aim to shift Malaysia’s investment strategy from simply attracting capital to ensuring that investments deliver meaningful economic value.
Malaysia’s Investment Narrative in a Fragmented World
While global growth is expected to moderate in 2026 and trade uncertainty persists, ASEAN’s structural advantages continue to attract investors seeking resilience and supply chain diversification.
Malaysia’s strong investment performance suggests that policy clarity, institutional stability and targeted industrial strategies can provide a competitive edge in a fragmented global economy.
As the deputy minister concluded in his speech, the country’s ambition is not merely to attract large volumes of capital, but to build a high-value economy powered by technology, skilled talent and globally integrated supply chains.
