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No Sabah takers for RM1b fund

Published on: Wednesday, February 19, 2014

Kota Kinabalu: There have been no takers for the RM1 billion Domestic Investment Strategic Fund (DISF) from Sabah as yet and lack of awareness has been blamed.

Malaysia Investment Development Fund (Mida) Executive Director Datuk Mathialakan Chelliah said a total of RM393 million had been dispersed to 71 companies since DISF was introduced in 2012 but none from Sabah.

"We feel there is no awareness among companies in Sabah over the availability of the facility," he said, after opening the seminar on Services Sector, here.

The Prime Minister introduced DISF on July 4 2012 to boost participation of Malaysian-owned firms in the global supply chain of high-value added, high technology, knowledge intensive and innovation-based industries.

Mida is going nationwide to promote DISF. The fund is granted on a negotiable basis, based on the request of the firms, merits and 60 per cent local ownership.

He said DISF can reimburse up to 50 per cent of expenses taken by firms to upgrade their present facilities or "take their business to a higher level".

"So if firms undertake such exercise, they need to show proof of their expenses and we will reimburse 50 per cent of the expenditures," he said.

Meanwhile, foreign firms, which provide technology that is not available in the country can also enjoy certain incentives from the Government, he said.

Among the incentives include 10 years tax-free incentives.

He said Mida does not differ any incentives to local, multi-national and foreign firms, saying all enjoy the same benefits.

Earlier, Mathialakan said the Federal Government expects the countries services sector will contribute 61 per cent of the country's gross domestic product (GDP).

Meanwhile, some 22 projects were approved in Sabah with investments of RM3.6 billion and are expected to create 1,665 jobs from January till September, last year.

These had been largely in the manufacturing, food manufacturing, chemical products and non-metallic mineral products.

The sector recorded a total of RM83.4 billion in investments into the country, with a total of 3,316 services projects approved, creating 68,436 job opportunities.

Domestic investments make up the bulk with RM71 billion or 85.1 per cent of approved investment, mainly in real estate (RM37.2 billion), followed by Global Operation Hubs (RM8.8 billion), transport (RM6.9 billion), utilities (RM6.2 billion) and hotel and tourism (RM6.0 billion).

"Services sector contributed RM600 million worth of investment under hotel and energy generation industry," said Mathialakan.