On 1 September 2023, the Prime Minister of Malaysia, Dato’ Seri Anwar Ibrahim, launched Malaysia’s New Industrial Master Plan 20301
The NIMP 2030 provides national strategic direction to lead the industrial development policies in Malaysia. It is a collaborative effort between the public and private sectors and is the product of extensive industry consultations, including more than 70 focus sessions and engagements with 313 stakeholders including ministries, regulators, agencies, industry associations and industry players.
The NIMP 2030 adopts a whole-of-nation approach and is an overarching policy that takes into consideration the interconnectedness of all industrial-related policies and the various authorities involved.
In formulating the NIMP 2030, the Malaysian Government recognised twelve key challenges faced by the country, including marginal growth in economic complexity2
, stagnation of labour productivity, skills mismatch and talent shortage, rising disparity in manufacturing activities between States, loss of foreign direct investment (“FDI
”) to neighbouring countries and declining domestic direct investment (“DDI
”), insufficient financing for new ventures and the need to improve ease of doing business.3
The Government also noted the three recent key global trends, namely geopolitical movements, digitalisation and increasing environmental, social and governance (“ESG
”) compliance requirements, and the opportunities presented by these trends.
Highlights of the NIMP 2030
The NIMP sets six goals, namely:
The outcomes of each goal and the criteria by which they are measured are set out in the NIMP 2030. For example, 700,000 new jobs are to be created by 2030 and median wage for manufacturing is to increase by 128% from RM1,976 in 2021 to RM4,510 in 2030. Further, the NIMP 2030 seeks to increase total investments (FDI and DDI) as a share of State GDP from an average of 13% of State GDP in 2021 to 25% in 2030.
The NIMP 2030 adopts a Mission-based approach in industrial policy development setting ambitious goals and bold solutions from “moon-shot thinking
Four Missions have been formulated to meet the Goals and targets of the NIMP 2030, namely:
The four Missions are interlinked and are to be advanced simultaneously towards achieving the Goals and targets.
Four Enablers are introduced to address multiple systemic and institutional issues faced by Malaysian industries:
Highlighted below are several of the Strategies and Action Plans comprised in the Missions and Enablers:
A summary of the Strategies and Action Plans for each Mission and the Enablers is set out in pages 44-45 of the NIMP 2030. The summary also lists out nine Mission-Based Projects (MBP) for Missions 1 to 3. Further discussions of the Missions and the Enablers are set out in Chapters 4 to 8 of the NIMP 2030.
The NIMP covers 21 sectors, with aerospace, chemical, electrical and electronics (E&E), pharmaceutical and medical devices being recognised as priority sectors. In addition, the NIMP 2030 also identified four new growth areas, namely advanced materials, electric vehicles, renewable energy and CCUS.5
Sectors not covered in the NIMP 2030 include banking and insurance, construction services, utilities, tourism, private healthcare, private education, transport and logistics, food and beverage and other unregulated services.6
Some of these areas are covered by sectoral policies or blueprints.
Enablers 3 and 4 recognise the need for appropriate frameworks to be established to ensure the successful implementation of the NIMP 2030 and the Action Plans.
To this end, Enabler 3 recognises the challenge in Malaysia’s investment promotion landscape, which comprises over 30 Investment Promotion Agencies (“IPAs
”), each with its own direction and potential overlapping responsibilities. Amongst others, it is proposed that the roles and responsibilities of all IPAs be streamlined so that the Malaysia Investment Development Authority (“MIDA
”) will be mandated as the national body to centralise investment promotion and marketing, whilst the Project Implementation and Facilitation Office (TRACK), a unit under MIDA, will be empowered to accelerate investment implementation. The role of subnational IPAs will be streamlined to support the investment ecosystem.
The Government’s incentives mechanism will also be improved to ensure that the incentives offered remain attractive for investors and the intended outcomes are better aligned with national targets (NIAs). This would include establishing a tiered incentive system that prioritises national resources based on investor contribution to the national agenda. Each tier will have incremental access to more generous benefits e.g. exemptions on import duties and income taxes, talent visa, etc.
A One-Stop Portal (OSP) will be established for a seamless investor experience from the inception of the investment journey to post-investment care.
Enabler 4 will, amongst others, establish the NIMP 2030 Delivery Management Unit (“DMU
”) which will drive the implementation of the NIMP 2030 via the five Working Groups. Key responsibilities of DMU include: (a) tracking and monitoring the progress of Mission-based Strategies, Action Plans and Projects in delivering the NIMP 2030 Goals and targets; and (b) managing the NIMP 2030 funding related matters including tracking and reporting on the utilisation of the NIMP 2030 funds; and (c) managing the Working Groups to ensure implementation timeliness.
The Working Groups will be chaired by identified champions and be responsible for implementing the respective Strategies and Action Plans.
The NIMP 2030 will be implemented in two phases - Phase 1 (2023 to 2026) will be to strengthen the collaboration between the public and private sector and set the foundation for the implementation of the NIMP 2030 while Phase 2 (2027 to 2030) will focus on driving implementation at scale to diversify the economic base, create stronger local linkages and strengthen global cooperation for greater economic resilience that enables sustained growth under any economic conditions.
A mid-term review will be carried out by the end of 2026 to review the targets and implementation progress of the NIMP 2030. It will also provide the opportunity to assess any further global trends and recalibrate any gaps to achieve the NIMP 2030 Goals.
The NIMP 2030 is a holistic, multi-faceted and integrated industrial plan, with many Action Plans to be implemented within a relatively short 7 plus years timeframe. As acknowledged by the Minister of International Trade and Industry, Tengku Datuk Seri Zafrul Tengku Abdul Aziz, “The NIMP 2030 is an ambitious plan. However we are confident that its targets are achievable ...
Time will tell whether the Malaysian Government in formulating the NIMP 2030 has gone for the moonshot.
Article by Kok Chee Kheong (Partner) and Tham Zhi Jun (Associate) of the Corporate Practice of Skrine.