Potential Incorporation of German Businesses in Malaysia: Things to Know
The German Chamber ASEAN Business Council (GCABC) is the network of German Businesses among the ASEAN region. Aside from the ASEAN Region, Germans also have business networks around the world. Every two years, they conduct a study, which they publish on AHK World Business Outlook, to find out about what are the different opinions of German Businesspersons to different aspects of their business. The GCABC is the one releasing the result of the study to the ASEAN region.
One of the things included in the AHK World Business Outlook 2018 is the German Assessment of their own business situation. They’ve been asked what they think about their current business situation and how they see their company perform within the coming years. For the year 2018, 51% of German Businesspersons perceived that their businesses performed ”good” for the past 2 years and will further perform “good” for the next two years to come while 10% perceived it to be poor.
Many German Businesspersons are still optimistic about their businesses around the world. The MGCC Director and CEO, Daniel Burnbeck further commented that what the German Businesspersons are looking for is the economic initiative of the country host.
Malaysia Economic Initiative
Germans are looking for stability when they are making their business investments. Malaysia is aware of this and they have created their own Economic Plan for the country in response to all businesspersons around the world including Malaysia and Germany. The plan is good for 5 years and the recent one has a duration from 2016 to 2020.
The main target of Malaysia on its Economic plan is to make the country a high-income economy by the year 2020. In order to do this, Malaysia has identified some key points as its economic priorities. These things include the following1:
- Unlocking the potential of productivity.
- Uplifting the B40 households (bottom 40% household income group) towards a middle-class society.
- Enabling industry-led Technical and Vocational Education and Training (TVET)
- Embarking on green growth.
- Translating innovation to wealth.
- Investing in competitive cities.
Malaysia’s Economic Projection to Business Investors
It was on the political term of Prime Minister Najib Razak when he presented the Economic Plan of Malaysia for 2016-2020. He made some projections for the country so businesspersons know what to expect for their businesses. They’re the following:
- Economic Outlook – The Gross Development Product (GDP) is expected to increase annually within 2016-2020, with an average increase of 5-6%. It will bring an increase of 7.9% annually to the Gross National Income (GNI). By the year 2030, the GDP of Malaysia is expected to be 721.4 Billion USD.
- Inflation – The inflation is the country is expected to remain at 3% for 2016-2020.
- Investment – The investment in the country should grow at 9.4% for private and 2.7 for the public within 2016-2020. The expected amount of investment would be 291 Billion MYR and 131 Billion MYR respectively.
- Export – The gross export is expected to increase at 4.6% per annum for 2016-2020 while the trade balance is expected to remain positive with a surplus of 57.3 Billion MYR by the year 2020.
- Gross National Income per Capita – The Gross National Income per Capita is expected to have the amount of 15,690 MYR by 2020.
- Tax – The taxes in the country is expected to gain an amount of 31.4 Billion MYR for 2016-2020 on goods and services.
- Debt – The Malaysian Government expected their debt to lower at 45% by the year 2020.
- Oil – The country expected to lessen its revenue from oil-related activities to 15.5% by the year 2020.
- Workforce – The country expected the workforce to have a 40% increase in skilled workers.
The Decision of German Investors to Invest in Malaysia
German businesspersons manage their investments well. They’re all over the world in search of the right place, time, people, and country to invest their money. Will Malaysia be a country of investment for them? The answer is simply yes.
With the Economic Plan presented by our Economic Leaders, the country is indeed providing stability. This is a great factor to influence German Investors to invest in Malaysia. Malaysia always welcomes German Businesses to incorporate it in Malaysia.
If you want to find out more how to incorporate a business in Malaysia, we at the 3E Accounting services for Incorporation would like to help you with that. You can also contact us if you are looking for a Malaysia Incorporation Agency.