Penang’s Manufacturing Sector Endures Headwinds


The manufacturing sector continues to be a key contributor to Penang’s economic activity, supported by global recognition for Penang’s excellence in the electronics and electrical (E&E) industry.

Figure 1 shows that Penang remains an attractive state for capital investments. In 2016 Penang ranked fourth out of all states, capturing 7% (RM4.3bil) of total capital investments in Malaysia. Out of the RM4.3bil, it should be noted that 70% of the sum came from foreign investments. In 2016 40% of capital investments were contributed by the E&E industry (Table 1) – roughly double the amount of the next most-invested industry. It is also in the E&E industry that Penang observes the most investments from foreign companies.

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