Anwar announces incentives for companies moving to Malaysia’s international financial hub TRX

MALAYSIAN Prime Minister Anwar Ibrahim on Friday (Feb 23) announced incentives for companies that want to move their bases to the country’s newly launched international financial centre – Tun Razak Exchange (TRX) – in Kuala Lumpur.

The incentives include an industrial building allowance, a tax exemption on 70 per cent of the statutory income for a period of five years for property developers, and stamp-duty exemption on loans and services for a TRX-status company.

TRX is a 28.3-hectare development that is aimed at becoming Malaysia’s international financial and business centre.

Speaking to reporters at the launch event, Anwar also commented on the weakening ringgit, describing the slide as “concerning”.

The currency plunged to a 26-year low earlier this week against the US dollar to RM4.78, a level not seen since the height of the Asian financial crisis. Against the Singapore dollar, the ringgit also fell to a historic low of RM3.57 on Tuesday.

“We have assigned the central bank to monitor, but it is affecting all countries,” said Anwar. “Ideally, the ringgit should be under control.” He pointed out that a “comprehensive view” of the situation must be taken into account.

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He said investments were high and both inflation and unemployment were down, and that Malaysia’s growth could be sustained compared to that of its neighbours. “Look at this comprehensive view and the capacity for the country to grow.”

He added that the government will continue to monitor the ringgit’s value but would leave it to the central bank to act.

Bank Negara on Tuesday said the ringgit’s recent performance was largely due to external factors and did not reflect the positive prospects of Malaysia’s economy.

The central bank’s governor Abdul Rasheed Ghaffour said that given improving exports, a recovery in tourism, an increase in investments, and the government’s commitment to structural reform, most analysts were forecasting the ringgit to appreciate this year. 

Economists have lowered their forecasts for 2024 gross domestic product growth to 4.3 per cent from 4.5 per cent, after last year’s expansion missed estimates. REUTERS, BLOOMBERG