Malaysia’s 1Q 2026 approved investments hit RM92.8b as domestic inflows strengthen, says Mida

Nevin Al Sukari - Sana'a - KUALA LUMPUR, June 8 — Malaysia has secured RM92.8 billion in approved investments for the first quarter of 2026 (1Q 2026), with Japan emerging as the largest foreign investor and domestic investment recording its strongest year-on-year growth in the reporting quarter.

In a statement today, the Malaysian Investment Development Authority (MIDA) said the investments comprise 1,249 projects across the services, manufacturing and primary sectors.

“While the total value recorded a marginal 0.2 per cent decline compared to RM93.0 billion in 1Q 2025, approved projects are expected to create 50,226 new jobs, representing a 46.7 per cent increase from the same period last year, underscoring stronger labour market impact from approved investments.

“Foreign investments accounted for 60.5 per cent or RM56.2 billion of total approved investments, while domestic investments grew 13.0 per cent year-on-year (y-o-y) to RM36.6 billion, representing 39.5 per cent of total approvals, reflecting growing confidence among Malaysian businesses,” it said.

MIDA said that among foreign investors, Japan emerged as the largest source of approved investments, with RM21.5 billion, a significant increase from RM1.6 billion recorded in 1Q 2025, followed by the People’s Republic of China (RM10.1 billion), the United States (RM10.1 billion), Singapore (RM6.7 billion) and Thailand (RM2.5 billion).

It said the strong Japanese investment performance reflected the deepening economic ties between Malaysia and Japan under the Malaysia-Japan Comprehensive Strategic Partnership established in December 2023.

“Notably, 93.6 per cent of Japanese approved investments in 1Q 2026 were channelled into digital transformation activities, reflecting Malaysia’s growing role in regional high-technology and digital supply chains,” it said.

Across the states and federal territories, MIDA said Selangor recorded the highest value of approved investments at RM33.5 billion, followed by Johor (RM16.9 billion), the Federal Territory of Kuala Lumpur (RM16.9 billion), Penang (RM6.2 billion) and Sarawak (RM4.0 billion).

“The top three states have solidified their standing as global data centre hubs, underpinned by a proven track record in attracting investments from tech giants.

“This success is driven by the integration of Cyberjaya’s mature infrastructure, Johor’s strategic positioning as a key alternative to Singapore, and Kuala Lumpur’s role as the nation’s primary network connectivity and financial heart,” it added.

MIDA chairman Tengku Datuk Seri Zafrul Abdul Aziz said the 1Q 2026 investment performance sends a clear signal that Malaysia’s economic fundamentals are strong, with both global and domestic investors continuing to place confidence in the nation.

“With gross domestic product (GDP) growing at 5.4 per cent and Moody’s projecting Malaysia as the fastest-growing A-rated economy over the next two years, we are proving that Malaysia is not just participating in regional value chains.

“We are emerging as a strategic hub for the industries that will define Asean and Asia’s next decade,” he said.

The investment authority said the services sector remained the largest contributor, accounting for RM60.8 billion or 65.5 per cent of total approved investments, involving 731 projects expected to create 19,758 new jobs.

“Growth was mainly driven by the information and communications subsector, which contributed RM38.9 billion, supported by growing global demand for artificial intelligence (AI) and digital transformation.

“Investments in data centres and cloud computing alone accounted for RM34.6 billion across 33 projects, representing 88.9 per cent of the subsector’s total approvals,” it said.

MIDA said the manufacturing sector attracted RM24.1 billion in approved investments across 501 projects and is expected to create 30,468 jobs, representing 60.7 per cent of total expected jobs, with the key industries including electrical and electronics (RM6.0 billion), chemicals (RM3.9 billion), machinery and equipment (RM3.5 billion), food manufacturing (RM3.3 billion) and transport equipment (RM2.2 billion).

As for the primary sector, it recorded RM7.9 billion in approved investments across 17 projects, up 418.2 per cent from a year ago, driven entirely by oil and gas projects involving offshore development and exploration activities, particularly in Sarawak.

MIDA said Malaysia’s investment outlook remains resilient, supported by a steady pipeline of quality investment proposals, whereby as at May 5, 2026, MIDA is facilitating a solid pipeline of 182 potential projects, collectively valued at RM38.3 billion.

“MIDA is also in active discussions for an additional RM91.0 billion worth of potential investments, signalling sustained investor interest and confidence in Malaysia’s long-term economic direction and pro-business policies,” it added.

Meanwhile, MIDA chief executive officer Datuk Sikh Shamsul Ibrahim Sikh Abdul Majid said Malaysia’s investment performance reflects the country’s strong facilitation and project execution capabilities.

“Despite continued global headwinds, Malaysia remains firmly on investors’ radar, supported by clear policies, strong economic fundamentals, and our ability to move projects from approval to operationalisation.

“The Asia Manufacturing Index 2026 ranks Malaysia second in Asia after China, our highest position in the index to date, and it is matched by results on the ground: of the manufacturing projects approved since 2021, over 85 per cent had reached various stages of implementation as of February 2026,” he added. — Bernama