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From Site Selection magazine, September 2014

Where Credit Is Due

Selangor, Malaysia’s most populous and developed state, has much to contribute to the national business climate.

M InvestmentGraph

alaysia has the 6th most business-friendly regulatory environment in the world, up from 8th place a year ago, according to The World Bank's and IFC's Doing Business 2014: Understanding Regulations for Small and Medium-Size Enterprises, released in October 2013. That's 6th out of 189 economies analyzed in the report, which factors in regulations pertaining to start-up and operations, trading across borders, taxes and resolving insolvency.

"Selangor, being the most developed state in Malaysia, can claim a fair share of this achievement," says Mr. Hasan Azhari Hj. Idris, CEO of SSIC Berhad, the Selangor State Investment Centre. "Our infrastructure, with two major airports [including Kuala Lumpur International Airport, Malaysia's chief air transport hub], the 12th largest global container port, highways and industrial parks is very competitive. In addition," he adds, "Selangor is able to deliver in regard to human capital with more than 100 institutions of higher learning, 10,000 graduates annually and such important soft skills as a multi-lingual workforce."

Hasan says Selangor has attracted projects worth more than 150 billion ringgit (US$47 billion) in the past three decades, a figure that reflects "the confidence and trust domestic and foreign investors choose to express through their decision to locate in Selangor."

Can Selangor, which encompasses the Federal Territory of Kuala Lumpur and Malaysia's administrative capital, Putrajaya, maintain this rate of inward investment?

"In the coming decade, we expect investment inflows of 8 billion to 10 billion ringgit ($2.5 billion to $3.1 billion)," says Hasan. This should be distributed over various sectors, which include specialty chemicals, food, transport equipment (automotive, aviation and maritime), E&E, logistics and green technology. Our efforts will also focus on biotechnology, pharmaceuticals and medical devices. In general, we hope to see more value-added production and R&D located in Selangor," and not just for the benefit of Selangor or even of Malaysia. Hasan sees the state as a gateway of the ASEAN Economic Community (AEC).

"Our state is at the heart of the region with an outstanding connectivity and logistics infrastructure. Furthermore, Malaysia is considered a politically stable and safe economy with excellent talent. If you evaluate our neighbors, you will not find many of these features in other locations."

Suitable human capital is what investors value most today, and Hasan is confident capital investors will find it in Selangor. The state has recently embarked on a new Talent Initiative aimed at enhancing the talent pool by involving higher education institutions more directly in Selangor's economic ecosystem. And the Selangor Human Resource Development Centre provides customized training services to investors.

"We consider our current approach to be holistic and shifting attention to the investment environment as a whole," says Hasan. "It is difficult to find a versatile, industrious and multi-lingual workforce like in Selangor."

This report was prepared under the auspices of the Selangor State Investment Centre. For more information, visit

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