Industry

LATEST UPDATES (February 16, 2006):

The Malaysian Industrial Development Authority (MIDA) released the report on the performance of the manufacturing and related services sectors in 2005 on February 16, 2006. The summary of the report and the section related to the chemical industry is as follows:

General Overview

  • The manufacturing sector expanded by 4.1% for the first three quarters of 2005. It contribute 31.5% to the GDP and 28.4% of employment. This growth was attributed to the expansion in production of:

     - Transport (12.9%)
     - Food manufacturing (9.2%)
     - Industrial chemicals (6.3%)
     - Semiconductors and other electronic components (5.9%)
     - Rubber products (2.2%)

  • Exports of manufactured products increased by 9.6% to RM 413.1 billion in 2005 from RM 376.8 billion in 2004, accounting for 77.4% of Malaysia's total exports.

  • In 2005, Malaysia attracted investments amounting to RM 34.2 billion in the following sectors:

    - Manufacturing - RM 31 billion
    - ICT Services - RM 1.8 billion
    - Manufacturing related services - RM 1.2 billion
    - R&D - RM 241.1 million

  • Foreign investments approved in 2005, amounted to RM 17.9 billion in 562 projects, from RM 13.1 billion in 583 projects in 2004.

  • Foreign Investments approved in new projects in 2005 amounted to RM 4.7 billion, compared with RM 9.1 billion in 2004. FDI were mainly in the following sectors:

    - Electrical and electronics - RM 11.3 billion
    - Scientific and measuring equipment - RM 1.4 billion
    - Chemicals and chemical products - RM 869.1 million
    - Non-metallic mineral products - RM 596.1 million
    - Plastic products - RM 576.5 million

  • Major sources of FDI in year 2005 were:

     - USA - RM 5.2 billion
     - Japan - RM 3.7 billion
     - Singapore - RM 2.9 billion
     - Netherlands - RM 1.7 billion
     - Republic of Korea - RM 673.6 million

  •  Domestics investments approved in 2005 amounted to RM 13.1 billion from RM 15.6 billion in 2004.

  • Investments in new projects were RM 9.1 billion and RM 4 billion in expansion / diversification projects.

  • Domestic investments were mainly in:

     - Basic metal products - RM 2.8 billion
     - Electrical and electronics - RM 2.5 billion
     - Food manufacturing - RM 925.6 million
     - Transport equipment - RM 912.3 million
     - Chemicals and chemical products - RM 851.6 million
     - Paper, printing and publishing - RM 829.8 million


Chemical and Chemical Products

  • In the chemicals and chemical products industry, a total of 64 projects with investments totalling RM 1.7 billion were approved in 2005, compared with 68 projects with inestments amounting to RM 3 billion in 2004.

  • In the pharmaceutical sub-sector, 7 new projects with investments amounting to RM 204.3 million were approved, compared with 8 projects (RM 42.6 million) in 2004.

  • Domestic investments was RM 202.3 million. New projects were for the production of small volume injectables, pharmaceutical formulations, herbal extracts and aloe vera powder and formulations.

  • Increasing involvement by Malaysian companies in the pharmaceutical industry is encouraging. Given the limited size of th domestic market, Malaysian pharmaceutical manfacturers should continue to focus on increasing their exports and expand their production of generic drugs as more patents of branded drugs expire over the next few years.

  • Malaysia continued to be the leading producer and exporter of basic oleochemicals in the world. In the oleochemical industry, 11 projects were approved with investments of RM 968.4 million. OF these, five projects with investments of RM 544.8 million were for the production of fatty alcohols, fatty acids, glycerine, emulsifier blends, stabiliser blends, flavours and other oleochemical derivatives.

  • In the biodiesel industry, six projects with investments of RM 423.5 million were approved for the production of fatty acid methyl esters (biodiesel). Three of the biodiesel projects were Malaysian-owned, while the other three were foreign-owned. These projects proposed to export their production mainly to Europe. Demand for biodiesel is expected to grow as several countries are switching to biodiesel as an alternative fuel to reduce the dependence on crude oil and greenhouse gas emission.

For further information on the performance of other industries, please visit the MIDA website at http://www.mida.gov.my. The above summary was prepared by Mr Joseph Doraisamy, CICM Regulatory Affairs and Trade Advisor

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The performance of the various sectors of the chemical industry for the previous years are as follows:

 

 

 

 

 

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