Malaysia a rising global services hub

The Star

22-04-2025

MALAYSIA has emerged as one of Asia's most dynamic business hubs in just six decades since independence. The nation's meteoric rise comes from a powerful combination of strategic vision and consistent execution. Its transformation from a resource-based economy to a sought-after destination for global corporations, reveals a compelling story of economic reinvention.
Through careful economic planning and focus on innovation, Malaysia has built a robust ecosystem that continues to attract multinational corporations (MNCs) from around the world to expand into more high value strategic services by centralising key functions such as supply chain management, research and development and business planning in the country.
The presence of existing global multinationals speaks volumes about Malaysia's growing appeal as an attractive business destination, with an increasing number of MNCs that operate through an extensive network of subsidiaries regionally or globally, with the potential of integration to encourage these services activities.
These investments create value and virtuous cycles - attracting top global talent, generating high-paying jobs, and fostering innovation clusters that further enhance the country's appeal. The ripple effect extends beyond direct employment, creating entire ecosystems of supporting services and specialised expertise.
The Malaysian Investment Development Authority (MIDA) has been instrumental in positioning Malaysia as a premier global services hub. Besides creating job opportunities, these hubs cultivate innovation and learning as they build and grow value in people.
The Malaysian Government welcomes investments such as these, that help build and develop global talent aligned under the nation's 12th Malaysia Plan (12MP) and New Industrial Master Plan (NIMP) 2030 of making Malaysia as a Global Services Hub by 2025.
Malaysia's strong infrastructure, skilled talent pool and strategic location make it an attractive destination for MNCs looking to establish regional or global services hubs, said Sikh Shamsul.
'Malaysia's geographic advantage serves as a powerful magnet for global corporations. Our strategic position at the heart of Southeast Asia creates unparalleled access to Asean's dynamic markets,' explained MIDA chief executive officer, Datuk Sikh Shamsul Ibrahim Sikh Abdul Majid.
'By tapping into Malaysia's location situated in the pulse of the region and leveraging our infrastructure such as our ports and airports allow MNCs to better manage and serve their entire regional or global supply chain networks,' he added.
Malaysia's strategic advantages for MNCs
Malaysia's stable economic environment, well-developed infrastructure, and world-class connectivity – including modern airports, highways, seaports, and digital infrastructure – further enhance its appeal. The nation's 5G connectivity, cloud storage, and data centers provide a strong foundation for digital transformation, supporting seamless operations for companies.
Beyond infrastructure, Malaysia's workforce presents another key advantage.
'The country boasts a strong education system focused on science, technology, engineering and mathematics (STEM), ensuring we meet the evolving demands of the future workforce," said Sikh Shamsul.
Strategic partnerships form the cornerstone of Malaysia's talent development strategy. The landmark MIDA-MOHE (The Higher Education Ministry) collaboration represents a decisive step toward aligning academic output with industry needs.
This partnership ensures graduates enter the workforce with immediately applicable skills. Similarly, the MIDA-MTUN (Malaysian Technical Universities Network) alliance has revolutionised technical education in Malaysia.
Through this partnership, the Technical and Vocational Education and Training (TVET) programmes have been elevated to meet international standards, creating a robust pipeline of specialised talent.
Facilities and policies supporting businesses
Malaysia's commitment to attracting global business is reflected in its comprehensive incentive framework. At the forefront is the innovative Global Services Hub (GS-Hub) Scheme, which builds upon the success of the Principal Hub incentive.
Under this scheme, eligible MNCs benefit from tax exemptions on trading and service income, with a special tax rate for five to 10 years, along with special individual income tax rates for non-citizens holding C-suite positions for a period of three years.
Additionally, Malaysia has established key hubs such as the Forest City Special Financial Zone (FCSFZ) and the Johor-Singapore Special Economic Zone (JS-SEZ) to further enhance investment attractiveness. These zones provide unique benefits, including special tax rates ranging from 15 to 20 years and streamlined regulatory processes, making Malaysia an even more compelling destination for business expansion.
'The GS-Hub Scheme provides incentives for MNCs that use Malaysia as a base to conduct high-value services such as risk management and decision-making to support their network companies. The introduction of this new scheme is timely, as Malaysia continues to innovate its investment policies and strategies to position itself on par with other advanced countries in the region as the preferred location for regional hubs in the Asia-Pacific,' he said.
Sun remarked that Malaysia was a natural choice for Huawei's global services hub due to its prime location, strong governmental support for digital transformation and highly skilled workforce.
Championing Malaysia's digital transformation
Huawei has successfully established a global services hub in Malaysia, supporting the country's digital transformation agenda for the past 24 years and strengthening its leadership in technological advancements and regional connectivity.
Huawei Technologies (Malaysia) Sdn Bhd (Huawei Malaysia) Malaysia chief executive officer Simon Sun said 'Malaysia was a natural choice for our global services hub due to its prime location, strong governmental support for digital transformation and highly skilled workforce.'
Sun highlighted Malaysia's strategic location in South-East Asia which ensures seamless access to regional markets, enabling Huawei to efficiently serve clients across the Asia-Pacific region.
He also noted the country's strong governmental support for digital transformation through initiatives such as the Malaysia Digital Economy Blueprint (MyDigital), the National 4IR Policy and foreign investment-friendly policies that foster a thriving ecosystem for technological innovation.
Additionally, he emphasised Malaysia's highly skilled and diverse workforce, with a strong talent pool in technology and engineering. Huawei Malaysia currently employs nearly 4,000 staff, with over 80% of them being Malaysian professionals. 'This multilingual, highly educated talent pool enables Huawei to develop localised solutions while maintaining world-class service quality,' Sun said.
'Malaysia's commitment to next-generation connectivity and proactive advancements in information and communications technology (ICT) make it a key innovation partner. The country's progressive telecommunications infrastructure supports the rollout of 5G, artificial intelligence and cloud computing solutions, reinforcing its position as a regional technology leader.'
These factors align perfectly with Huawei's global business strategy, which focuses on creating value for customers, ensuring secure and stable network operations, promoting industry development and enabling sustainable growth worldwide.
Huawei's regional headquarters is located at The Exchange TRX in Kuala Lumpur, overseeing operations in over 30 countries and regions. Its presence in Malaysia includes 11 Global Shared Service Centres, a Customer Solution Innovation Centre and the Malaysia Global Training Centre – the company's only such facility outside China. These facilities drive digital transformation and nurture local digital talent.
Huawei's commitment to talent development has also seen over 54,000 individuals trained in digital skills since 2021. Through the Huawei Asean Academy, the company has successfully established 44 Huawei ICT Academies in public and private universities across Malaysia.
The company has played a pivotal role in advancing Malaysia's ICT landscape, spearheading 5G and 5G-Advanced (5GA) networks, cloud solutions and AI-driven automation.
'As a trusted technology partner, we are dedicated to driving innovation, developing talent and fostering industry growth. Malaysia's success is a source of pride for Huawei and we are fully committed to ensuring the nation's leadership in the digital economy. We will continue to invest, innovate and collaborate to drive long-term success and digital excellence in the country,' Sun added.
With Malaysia as a key regional base, Huawei continues to contribute to the nation's digital economy, aligning with its mission to 'bring digital to every person, home and organisation for a fully connected, intelligent world.'
Enhancing operations with Malaysia's strength
For over five decades, Mamee-Double Decker Distribution (M) Sdn Bhd has been a beloved household name in Malaysia. Now, with a strategic focus on business expansion, the company continued its growth by establishing Malaysia as its global services hub.
Mamee's decision to establish its global services hub in Malaysia was driven by several key factors.
'Malaysia's central position in Asean provides excellent connectivity to key markets in Asia and beyond. This, combined with a business-friendly environment, attractive incentives and strong government support, made it the ideal location,' said its executive director Felix Pang Hee Zhong.
Additionally, Pang said that Malaysia boasts a highly skilled workforce with expertise in finance, information technology and supply chain management — essential components for a global hub. He shared that the country's robust infrastructure, cost competitiveness and strong manufacturing base further reinforce its attractiveness.
Mamee has been operating in Malaysia for 54 years, becoming a trusted household name.
The establishment of Mamee's global services hub in Malaysia has enhanced operational efficiency, streamlined regional supply chain management and strengthened digital transformation efforts.
'Our hub centralises key business functions, including finance, procurement, supply chain, human capital, business technology and marketing, ensuring operational efficiency and consistency across global markets,' Pang explained.
'We also leverage Malaysia's world-class logistics and transportation networks to optimise regional supply chain management and improve cost efficiency.'
Innovation remains at the heart of Mamee's strategy. The hub collaborates with global teams to drive product innovation, benefiting from Malaysia's strong food manufacturing ecosystem and research capabilities.
Mamee's Malaysian hub is at the forefront of digitalisation, supporting automation, data analytics and enterprise resource planning (ERP) integration to enhance decision-making and business intelligence.
Among other functions, the hub provides multilingual customer service, sales support and business analytics, ensuring a seamless experience for international clients and partners.
Mamee's growth and success in Malaysia has been strengthened by extensive government support.
'We have benefited from various forms of assistance from the Malaysian government, such as investment incentives, including tax exemptions and pioneer status, as well as research and development grants and Industry 4.0 and digitalisation initiatives,' Pang highlighted.
'Support from agencies like MIDA, Malaysia External Trade Development Corporation (Matrade), Department of Islamic Development Malaysia (Jakim) and the Halal Development Corporation (HDC) has facilitated global market expansion, innovation, product development, halal certification and market development programmes,'
Government-backed initiatives such as the Smart Automation Grant have enabled Mamee to accelerate its digital transformation, ensuring continued competitiveness in the food and beverage industry.
Mamee is at the forefront of digital transformation, leveraging artificial intelligence (AI) and big data to enhance decision-making.
'We have successfully deployed an AI-vision based app to our frontline merchandising workforce, significantly improving efficiency. Additionally, we will be investing in the next wave of AI tools to empower our employees.'
Factory automation and IoT integration have further streamlined production, improving product quality and reducing labour dependency.
Mamee's growth is backed by Malaysian government support, including tax breaks, R&D grants, and partnerships with MIDA and Matrade to boost innovation, exports, and halal certification.
The company adheres to strict quality and halal certification requirements, making its products suitable for both Muslim-majority markets and global consumers.
Looking ahead, Mamee remains committed to strengthening Malaysia as its global hub.
'We aim to expand into regional and international markets while further investing in digital transformation and sustainable business practices,' Pang shared.
The company is also prioritising talent development, collaborating with educational institutions to nurture skilled professionals in food innovation, research and development and supply chain management.
Sustainability initiatives, including eco-friendly packaging and carbon footprint reduction, are key areas of focus while continuing to engage in corporate social responsibility programmes to support local communities.
By harnessing Malaysia's strategic advantages and investing in innovation, Mamee-Double Decker is well-positioned to continue its legacy of excellence while contributing to Malaysia's status as a premier global services hub.
Sustainability and ESG initiatives
As global businesses increasingly prioritise Environmental, Social and Governance (ESG) factors, Malaysia has taken proactive steps to integrate sustainability into its economic framework.
MIDA encourages MNCs to adopt green technologies and sustainable business practices through initiatives such as the Green Investment Tax Allowance (GITA).
Initiatives like the Domestic Investment Accelerator Fund (DIAF) are instrumental in helping businesses, particularly SMEs, to embrace smarter and greener practices.
The government has also committed to achieving carbon neutrality by 2050, reinforcing Malaysia's position as a leader in sustainable investment.
As Malaysia prepares to assume the Asean Chairmanship this year under the theme 'Inclusivity and Sustainability', MIDA has been entrusted with an active role as the secretariat for programmes under the chairmanship.
'MIDA's vision extends beyond traditional investment metrics,' explained Sikh Shamsul Ibrahim.
'We're architecting an economy where sustainability and profitability go hand in hand. Our focus on green technology, renewable energy, and resource efficiency isn't just about environmental responsibility – it's about creating lasting economic value. The RM20.8bil in approved green investments we've secured in 2024 demonstrates that businesses see Malaysia as a prime destination for sustainable growth.'
Facilitating investments and economic growth
MIDA's one-stop centre, the Invest Malaysia Facilitation Centre (IMFC), streamlines the investment process by providing accelerated approvals, expert guidance and seamless regulatory facilitation, making it easier for businesses to establish and expand their operations in Malaysia.
'Since December 2023, IMFC has facilitated over 18,000 investment-related matters, achieving a 99.7% completion rate,' he shared.
With a strong commitment to investor support, MIDA assists both local and foreign investors by offering tailored investment facilitation, ensuring smooth project implementation and fostering strategic partnerships with key industry players.
Beyond attracting global businesses, MIDA strengthens domestic supply chains by supporting local vendors, promoting technology adoption and enhancing vendor capabilities to meet evolving industry demands.
Malaysia's economic outlook remains positive, with Bank Negara projecting a 4.7% GDP growth in 2025, driven by robust private investment, domestic demand and increasing exports.
This economic resilience is reflected in record-high approved investments of RM378.5bil in 2024, a record high and a 14.9% increase from 2023, spanning the services, manufacturing and primary sectors, reinforcing Malaysia's position as a premier investment destination.
A future built on vision and innovation
In today's volatile and uncertain world, success is defined by strategic agility. Malaysia's manufacturing and services sectors are at the forefront of this transformation, acting as key drivers of economic progress.
By accelerating digitalisation, strengthening key enablers, fostering innovation, and prioritising sustainability, Malaysia is future-proofing its economy and unlocking new opportunities.
As Sikh Shamsul Ibrahim puts it, 'Through proactive policies and facilitation measures, Malaysia continues to attract high-value investments, fostering innovation and driving long-term economic growth – reinforcing our position as a premier global services hub and a preferred destination for MNCs seeking long-term success in the region.'