JOHOR BAHRU, 27 SEPTEMBER 2024 – Malaysia’s Government-Linked Investment Companies (GLICs) reiterated their joint commitment to support the Ekonomi MADANI framework through targeted capital deployment in high-growth, high value sectors at the Invest Malaysia 2024 Conference, themed “Where Policy Meets Progress” that was launched by YAB Dato’ Seri Anwar Bin Ibrahim in Johor, yesterday.
In a panel session at the conference, GLIC heads highlighted their specific focus areas within the Ministry of Finance (MOF)-led GEAR-uP initiative which aims to deploy a collective amount of RM120 billion over the next 5 years to catalyse economic growth. The heads of KWAP, EPF, Khazanah and LTAT spoke about the focused sectors identified for targeted investment, which cover agriculture, the semiconductor industry, the venture capital ecosystem, infrastructure and transport, renewable energy, data centres, as well as healthcare and biopharmaceutical sectors.
The Malaysian economy has shown significant performance in the first half of 2024, growing by 5.1% year-to-date (YTD). This positive trajectory is further reflected in the strengthening of the Ringgit which has appreciated by 5.1% against the USD YTD. Additionally, the Malaysia equity market has outperformed the region with the KLCI climbing 13.5% YTD and reaching a multi-year high of 1,678.8 in August. This steady economic performance is a testament to the effective implementation of the Ekonomi MADANI Framework, particularly its focus on economic restructuring and fiscal reforms.
Building on this success, the GEAR-uP initiative aims to further strengthen Malaysia’s economic foundations with the GLICs spearheading efforts to contribute to “Raising the Ceiling” of Malaysia’s economic stature, and “Raising the Floor” of the rakyat’s quality of life. By getting the GLICs to heighten their focus on domestic investments, this deployed capital can benefit Malaysians equitably and birth new economic ecosystems.
Datuk Hajah Nik Amlizan Mohamed, Chief Executive Officer of KWAP, said, “KWAP is implementing a new Strategic Asset Allocation (SAA) to further optimise our portfolio’s risk-return profile, aiming to diversify further with private market investments. This aligns with our mandate to operate within our risk appetite while maximising returns and supports the national agenda of developing a thriving domestic private market, in line with the Madani Economy framework. We have identified, amongst others, three key strategic focus areas: agriculture and food security, the semiconductor industry, and the venture capital ecosystem. In agriculture, our goal is to enhance national food security by supporting innovative agribusinesses. Our investments in the semiconductor sector are aimed at elevating Malaysia’s global standing, advancing from basic manufacturing to higher-value processes such as chip design and complex packaging. Through our venture capital initiatives, we are cultivating a vibrant ecosystem that encourages entrepreneurship, innovation, and risk-taking.
“These strategic investments are designed to generate substantial long-term value while contributing to Malaysia’s economic development. By focusing on these critical sectors, KWAP is positioned to drive innovation, create high-skilled employment opportunities, and support sustainable economic growth for the benefit of our key stakeholders, in line with our tagline ‘Your Retirement Companion’. Our approach demonstrates a commitment to both the Malaysian pensioners and the broader national interest, reinforcing KWAP’s role as a key institutional investor in Malaysia’s economic landscape,” she added.
As part of the GEAR-uP initiative spearheaded by the Ministry of Finance, KWAP has pledged to allocate RM40 billion in Malaysia’s private sector. This commitment is part of the said RM120 billion pledges made collectively by six major government-linked investment companies (GLICs).
“EPF’s reallocation into domestic direct investments reflects our strategy to not only support local projects and companies but to also align with the broader national agenda for sustainable growth. A significant portion will be directed towards infrastructure projects, including renewable energy, data centres, and essential transport hubs like airports and toll roads—sectors critical to Malaysia’s long-term development. Healthcare is a strategic focus, as we anticipate the growing needs of an ageing population. This aligns with our mission to provide a secure and dignified retirement for Malaysians, while also ensuring our investments deliver long-term value,” said Ahmad Zulqarnain Onn, Chief Executive Officer of Employees Provident Fund (EPF).
Meanwhile, Dato’ Amirul Feisal Wan Zahir, Managing Director of Khazanah Nasional said, “Khazanah will continue to leverage on its strategic position to deploy its capital across the capital continuum – from venture investing with the National Fund-of-Funds initiative, to our upcoming programmes for Mid-Tier Companies, and our efforts in the semiconductor space. Furthermore, Khazanah’s “A Nation that Creates” framework will focus on increasing national productivity via investments in productivity, innovation and transforming firms. To that effect, we will be concentrating on the sectors of connectivity, energy transition, digitalization in order to raise the ceiling for all Malaysians. As for our efforts to raise the floor, we will emphasize on a sustainable economic development model with a focus on capacity building via talent upskilling and re-skilling that will be in tuned with the requirements of the global megatrends of today as well as the future.
Ashraf Radzi, Chief Executive of Lembaga Tabung Angkatan Tentera (LTAT), emphasised LTAT’s commitment to elevating Malaysia’s pharmaceutical value creation by strengthening its capacity to produce local biopharmaceutical products through its investee company, Pharmaniaga Berhad.
“This strategic focus aims to reduce import dependency and ensure a secure supply of critical pharmaceutical products while increasing public accessibility to essential healthcare supplies. The investment into developing the domestic pharmaceutical sector contributes to a self-sustaining healthcare supply chain, which benefits Malaysians and further adds value to the national economy,” he added.
For more information on the MOF-led programme GEAR-uP, please visit https://www.mof.gov.my/portal/en/news/press-release/ekonomi-madani-rm120-billion-domestic-direct-investment-boost-from-glics-under-mof-led-programme .
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About Kumpulan Wang Persaraan (Diperbadankan)
Kumpulan Wang Persaraan (Diperbadankan) [KWAP] or the Retirement Fund (Incorporated) was established on 1st March 2007 under the Retirement Fund Act 2007 (Act 662). KWAP manages contributions from the Federal Government and relevant agencies made into the Retirement Fund [Fund] to obtain optimum returns on its investments through sound management and investment of the Fund in equity, fixed income securities, money market instruments, and other forms of investments as permitted under the Retirement Fund Act 2007 (Act 662). The Fund shall be applied towards assisting the Federal Government in funding its pension duties. In 2015, KWAP was officially appointed as an agent of the Federal Government for the purpose of payment of pension, gratuity, and other benefits granted under any written law from the Consolidated Fund as agreed between the Federal Government and KWAP. Visit www.kwap.gov.my for more information.
About the Employees Provident Fund (EPF)
The Employees Provident Fund® (EPF®) is Malaysia’s premier retirement savings fund, helping its members achieve adequate savings for a comfortable retirement. This is in line with EPF’s vision to help members achieve a better future and its mission to safeguard members’ savings and deliver excellent services. The EPF has evolved significantly from a transaction-centric to a professional fund management organisation with a strong focus on retirement security. The EPF is guided by a robust and professional governance framework when making investment decisions. It continues to play a catalytic role in the nation’s economic growth and seeks to cultivate a savings and investment culture among its members to improve the country’s financial literacy level.
About Khazanah Nasional Berhad
Khazanah Nasional Berhad (“Khazanah”) is the sovereign wealth fund of Malaysia entrusted to deliver sustainable value for Malaysians. In line with its long-term strategy of Advancing Malaysia, Khazanah aims to deliver its purpose by investing in catalytic sectors, creating value through active stewardship, increasing its global presence, as well as building capacity and vibrant communities for the benefit of Malaysians. For more information on Khazanah, visit www.khazanah.com.my.
About the Lembaga Tabung Angkatan Tentera (“LTAT”)
Established in August 1972 under the Armed Forces Fund Act (also known as Act 101), the Lembaga Tabung Angkatan Tentera (“LTAT”) is a statutory body which manages the pension fund for officers and members of other ranks of the Malaysian Armed Forces (“MAF”) and the veterans.
The latest amendment to the Act was made on 1 November 2022. As of 31 December 2023, LTAT had assets under management of close to RM11.54 billion. LTAT declared a 5% dividend for members in 2022 after paying 4.1% in 2021, 3.5% in 2020, 2.5% in 2019, and 2% in 2018.
