KUALA LUMPUR — Malaysia is rolling out a major initiative to leverage state-linked funds for RM120 billion (S$35.4 billion) in direct domestic investments over the next five years. The program, announced by the Ministry of Finance on August 8, aims to stimulate growth in critical economic sectors such as energy transition and advanced semiconductor manufacturing.
The initiative will harness the financial power of funds managing a combined RM1.8 trillion in assets. Key contributors to this program include prominent investment firms such as Khazanah Nasional, Permodalan Nasional, Kumpulan Wang Persaraan Diperbadankan, and the Employees Provident Fund.
Prime Minister Anwar Ibrahim highlighted the significant role these investment firms will play in advancing Malaysia’s position in the global economic value chain. He stated that these funds possess the necessary financial strength to drive national economic growth.
This new investment plan is in addition to the RM440 billion that state funds have already allocated to public markets. The Ministry of Finance also announced plans to enhance Kumpulan Wang Amanah Negara, Malaysia’s national trust fund, which is currently supported by Petronas. New funding sources will be introduced to ensure the preservation of wealth for future generations.
In 2024, Malaysian policymakers have urged state-linked firms and funds to repatriate overseas income to bolster the ringgit, which had fallen to a 26-year low in February. As of August 8, the local currency had appreciated by 0.8% against the US dollar, reaching its strongest level since April 2023.
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