Kuala Lumpur, the capital city of Malaysia, is an attractive location for international investors looking to establish themselves in the Asia Pacific region. Volker Friedrich, Asian Insiders Partner in Malaysia explores the benefits:

Kuala Lumpur (KL) is a world class business hub strategically located near the centre in ASEAN, making it an ideal location for businesses looking to tap into the vast Asia Pacific market. The city is in the same time zone as major business cities such as Beijing, Shanghai, and Hong Kong and is also well-connected to other major cities in the region, including the new Indonesian capital of Nusantara, with excellent transportation links and state-of-the-art facilities.

Malaysia is an easy and cost-competitive market for doing business, with a ranking of 12th globally on the World Bank’s Ease of Doing Business Index. For several major international corporations, Kuala Lumpur has been the city of choice when investing in Malaysia, with a standard corporate tax rate of 24%. The country also offers attractive government incentives, developed infrastructure, and high cost-competitiveness. According to Ernst & Young, Kuala Lumpur’s “balanced growth attributes” include its green eco-system, world-class connectivity and attractive tax incentives for high-tech sector investments.

Malaysian politics is considered reasonably stable with civilian government and generally orderly elections, despite some recent turbulence. Importantly, there has been little evident engagement in past or present civil politics by the armed forces of Malaysia.

Kuala Lumpur is the largest city in Malaysia and contributes over 22% of the country’s GDP, with core industries covering ICT, manufacturing, media, and services. The metro area population for KL is approximately 8.6 million people with an average annual increase of 2.5%. Malaysia is well served with around 50 higher educational institutions ensuring a ready supply of well-skilled and multilingual professionals and workers. English is widely spoken in Malaysia and especially so in KL, ensuring ease of communication in business.

The Malaysian Ministry of Investment, Trade and Industry has established InvestKL as agency to attract and facilitate multinational corporations to the wider KL area, illustrating the extent to which the government wants to continue to attract enterprise and opportunity to the central region of the country. Other policy initiatives places focus on specific sectors, such as the Malaysian Digital Economy Blueprint, allowing financial assistance packages including subsidies, tax breaks and in some cases, preferential visa handling for incoming foreign executives and specialists.

Kuala Lumpur boasts excellent infrastructure, including state-of-the-art telecommunications, transportation, and logistics systems. The city’ offers well-planned road networks, modern office spaces, and an advanced telecommunications infrastructure. The presence of world-class business parks, commercial centers, and technologically advanced facilities further enhance the attractiveness of Kuala Lumpur as a business destination. KL International Airport is modern and conveniently located for hopping around the region.

Several larger international investors have selected Kuala Lumpur as their regional center, including IBM, Standard Chartered Bank, Intel, Shell, and DHL. Renewable energy is also an attractive investment opportunity in Kuala Lumpur, with several companies investing in solar and hydroelectric projects in the city, including Sunseap Group, Tenaga Nasional Berhad, Equis Energy, Green Energy Trading, and Solarvest Holdings Berhad.

IBM has invested heavily in Malaysia’s digital economy, and has partnered with the government to establish a centre of excellence for blockchain technology while launching a digital skills training program to boost skills needed for the digital economy. Similarly, US microchip company Intel, now based regionally in Kuala Lumpur, is partnering with the government to establish a research and development centre in the country, focusing on developing new technologies for the semiconductor industry. Standard Chartered Bank has its regional centre in Kuala Lumpur with a strong presence in Malaysia, operating 40 branches with more than 7,000 employees. DHL, also centred regionally in Kuala Lumpur has invested in developing the country’s logistics industry by partnering with the government to establish a ASEAN logistics hub in the country.

Asian Insiders has years of experience in Malaysia and offers insight, understanding and assured engagement in the market. For a no-obligation call, please contact Managing Partner, Jari Hietala: jari.hietala(at)asianinsiders.com or Volker Friedrich, Malaysia Partner: volker.friedrich(at)asianinsiders.com