Malaysia ranked 19th in the world’s most investor-friendly

 
Malaysia ranked 19th in the world’s most investor-friendly

Jun 17, 2014

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Malaysia has moved up five spots in a survey from The Economist Intelligence Unit that identifies the most business-friendly cities and countries around the world.

Kuala Lumpur is now ranked 19th in the Business Environment Rankings report – up from 24th place in the previous report.

Singapore remained top for the second consecutive report, followed by Switzerland and Hong Kong in second and third place respectively. Thailand’s ranking also increased – from 38th to 34th place.

Asia is a diverse region, the report noted, and there are large differences between the overall scores and global rankings of its top four countries (Singapore, Hong Kong, Australia and New Zealand) and its poorest performers (Bangladesh and Pakistan, in 69th and 74th place respectively, out of the 82 countries ranked).

The gap reflects the widely varying levels of economic development and political stability between these countries, alongside sharp differences in the underlying structure shaping laws and regulations of foreign investment.

Asia’s best performers have several factors in common: a favourable policy environment – particularly for finance and foreign investment – with competition policies that encompass international best practice. Despite tensions in some countries over immigration from poorer neighbours, migration of skilled labour within Asia will remain relatively unimpeded and overall labour market conditions will continue to compare extremely favourably to other regions, with companies able to expand or reduce their workforce with ease, as well as benefitting from freedom to set wages and hire foreign nationals.

Infrastructure remains a relative weak point for Asia, with only Singapore ranking among the world’s top 10 in this category (compared with other areas of the business environment, faring relatively poorly, in 7th place). Australia, Japan and New Zealand trail in joint 14th place, with Hong Kong coming in at 18th.

While some of the region’s infrastructure is excellent, particularly in telecoms and air transport, other areas require investment to improve distribution networks and utilities provision, as well as lower office rents.

The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It is designed to reflect the main criteria used by companies to formulate their global business strategies, and is based not only on historical conditions but also on expectations about conditions prevailing over the next five years.

 

Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg

 

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