Bumi proviso removed to rope in more investments, says Najib - 23 April 2009 Print E-mail

Bumi proviso removed to rope in more investments, says Najib

From The Star, 23 April 2009 

PUTRAJAYA: The Government has removed the 30% bumiputra equity requirement for 27 services sub-sectors under a liberalisation of the services sector.

Prime Minister Datuk Seri Najib Tun Razak, who said this would take effect immediately, added that the sub-sectors — which included the health and social services, tourism, transport, business and computer and related services — would have no equity conditions imposed.

More liberalisation measures are in the offing, he added.

Najib said the move was aimed at creating a conducive business environment to attract more investments, bring in more professionals and technology, encourage competitiveness and create higher value employment opportunities.

“We will be progressively undertaking liberalisation of the other services sub-sectors,” he said at a press conference at his office, here, yesterday.

Noting that the services sector would become a new growth sector of the economy, Najib said it contributed 55% to the gross domestic product in 2008, and accounted for 57% of the country’s total employment.

The Government, he said, intended to tap the sectors’ full potential and raise its contribution to 60% of the GDP.

However, he gave an assurance that the liberalisation would not adversely affect the domestic services industry, which would continue to be supported, adding that a RM100mil services sector capacity development fund had been established under the first economic stimulus package.

To facilitate investments into the sector, a National Committee for Approval of Investments in the Services Sector had been established under the Malaysian Industrial Development Authority.

Najib also said the liberalisation was in line with Malaysia’s commitment with Asean, adding, however, that some of the measures were better than those undertaken by others in the region.

On the selection of the sub-sectors, he said: “Consultations were conducted through the International Trade and Industry Ministry and the decision was made based on the reception and acceptance by the sub-sectors.”

The Prime Minister said that in 2008, approved investments in the services sector totalled RM50.1bil, exceeding the target of RM45.8bil per annum under the Third Industrial Master Plan. The share of foreign investments was 11% of the total investments.

“With the liberalisation of the services sector, we expect greater inflow of investments,” he said.

Najib also said he would announce the liberalisation of the financial sector next week.

He declined to give hints on what to expect, saying: “I want it to be full of surprises” and “It is good for the market to digest (the announcement for the services sector) first.”