Malaysia remains key Asian destination for high-value manufacturing, says global report

Knight Frank Malaysia expects the country to remain an attractive destination for high-value manufacturing and global services in Asia.

In a statement today, the independent global property consultancy said the country recorded a total of RM80.6 billion worth of approved investments in the manufacturing, services and primary sectors in the first quarter of 2021, a surge of 95.6% from the same period last year.

Its executive director of research and consultancy, Judy Ong, said the pandemic had accelerated the e-commerce boom and that it augurs well for the industrial property market.

“The Covid-19 crisis has a silver lining for the logistics industry as the pandemic has created a need for warehouse space to cater to the surge in last-mile delivery and collection.

“With lockdowns and restrictive movements, there is a structural shift towards omnichannel retailing,” she said.

Moving forward, Ong said there had been a sustained interest in the logistics industry supported by strong demand for warehouse and distribution facilities.

However, she expects the industrial growth momentum, which was initially expected to continue into the second half of 2021 and beyond, to be derailed as Malaysia grapples with the current spike of Covid-19 infections.

Meanwhile, executive director of capital markets, Allan Sim, said in the manufacturing space, the company expects more interest surfacing in the electrical and electronics (E&E) sector driven by the global shortage of semiconductors as well as the 5G network rollout.

“The E&E sector is among the top performers among key indices such as manufacturing output, export, as well as manufacturing sales.

“We anticipate significant interest and growth potential in the E&E space moving forward, bolstered by the current global demand for sensors, semiconductor, solar, internet of things products, as well as further investments into artificial intelligence and smart machines, among others, of the future,” he said.