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As Malaysia strengthens its position as a regional industrial hub, foreign investment, particularly from China, is playing an increasingly pivotal role in driving economic growth.
Chinese investment in Malaysia surged to RM31 billion in 2024, marking the second-highest level on record and the most significant inflow since 2015.
This is reported as newly released data from Juwai IQI Co-Founder and Group CEO Kashif Ansari.
“The year 2024 was the second‑biggest ever for Chinese capital, with RM31 billion finding its way to Malaysia,” said Ansari.
He anticipates a similarly strong performance in 2025, projecting at least RM30 billion in Chinese investments with a growing focus on battery and solar component manufacturing.
It’s not just China that is pumping ringgit into Malaysia. Singapore outdoes China in having accumulated the largest total investment stock in Malaysia, although its 2024 flows to Malaysia were smaller. The United States is the other top three source of inbound investment.”
Kashif Ansari, Juwai IQI Co-Founder and Group CEO
Key Sectors Driving Investment
Chinese capital has been channeled into a range of sectors but some clearly stood out.
These investments reflect both Malaysia’s industrial priorities and China’s strategic interests in energy, infrastructure, and advanced manufacturing.
Breaking down the RM31 billion figure:
- Metals took the lead with RM8.1 billion, driven largely by Hebei Xinwu’an’s ambitious steel plant plans.
- Energy projects drew RM3.4 billion.
- Investments in finance and technology amounted to RM700 million and RM400 million, respectively.
Major Investment Projects of 2024
Behind the investment totals are several large-scale projects that signal deeper economic partnerships between the two countries.
These flagship developments not only bring in capital but also jobs, infrastructure, and technology.
Three standout projects underpinned this surge:
- Hebei Xinwu’an’s RM8.12 billion steel plant
- Tibet Yiwei/EVE Energy’s RM1.8 billion battery manufacturing facility
- A RM1 billion deal with Jingxing Paper
When you look at it by sector, the metals sector dominated investment activity, thanks to Hebei Xinwu’an. Energy was the next most important sector, with RM3.4 billion. Finance and technology followed, with RM700 million and more than RM400 million, respectively.”
Kashif Ansari, Juwai IQI Co-Founder and Group CEO
Impact on Real Estate and the Economy
The effects of foreign investment go far beyond factory walls.
In Malaysia, these developments are already influencing demand in related sectors particularly real estate and logistics, as large infrastructure projects reshape local economies.
- Construction accounted for 52% of the total investment.
- The remaining 48% was made up of direct foreign investment (FDI).
This significant capital flow is driving demand for industrial and logistics spaces, especially around key project zones like the steel plant and battery manufacturing sites.
Geographic Highlights: Johor, Kuala Lumpur, and Selangor
Investment patterns also vary by region. Several Malaysian states are emerging as key hubs for different sectors, based on their infrastructure, policy incentives, and proximity to regional markets.
- Johor stood out as a hotspot for industrial development, particularly within the Johor–Singapore Special Economic Zone (SEZ). Investors are drawn by tax perks, efficient logistics, and strategic access to Singapore.
- Kuala Lumpur is attracting capital in urban transport and tech-related ventures.
- Selangor continues to gain attention in energy and infrastructure investments that support its established manufacturing ecosystem.
Broader Economic Significance
Beyond the numbers, these investments represent a larger shift in Malaysia’s economic landscape.
They point to a growing reliance on cross-border capital and deeper integration into global supply chains.
Ansari noted that Malaysia is “riding a wave of money from overseas,” with Mainland China and Hong Kong leading in new capital inflows.
Singapore, however, still holds the highest total investment stock in Malaysia, followed by the United States as another major contributor.
A key example is the East Coast Rail Link (ECRL) a large-scale infrastructure project managed by China Communications Construction.
It currently employs over 16,000 Malaysians and involves substantial participation from local contractors, including Bumiputera firms.
The ECRL is projected to boost Malaysia’s GDP by 3.8%, potentially creating over 90,000 jobs.
This aligns with data showing 127,000 new private sector jobs were added during Malaysia’s 5.1% GDP growth in 2024.
What Lies Ahead
Looking forward, Malaysia is building on this momentum with strategic policies and incentives to attract even more high-quality investments.
The country’s New Industrial Master Plan focuses on high-value and green industries. To support this, the government is offering:
- Deep tax incentives
- Fast-tracked licensing
- Clear sectoral roadmaps
These efforts aim to keep investor confidence high and ensure that the benefits of foreign investment ripple across industries and communities.
Juwai IQI was featured in Kopi and Property
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