🇲🇾 Doing business in Malaysia

What makes up the long-term score

Highlights: Semiconductor hub · Bumiputera policy applies · Strong infrastructure

Key industries

Semiconductors & Electronics ↑ Strong growth

Malaysia is the worlds 7th largest exporter of semiconductors. Penang is the Silicon Valley of the East hosting Intel, AMD and Infineon.

Main investors: US, Germany, Japan, Netherlands

Palm Oil & Commodities → Stable

Malaysia is worlds 2nd largest palm oil producer. Downstream oleochemical processing is a growing value add sector.

Main investors: China, India, EU, Japan

Financial Services & Islamic Finance ↑ Growing

Malaysia is the worlds largest Islamic finance market with $500B+ in assets. Bursa Malaysia is SEAs 3rd largest exchange.

Main investors: Saudi Arabia, Kuwait, UK, Singapore

Technology & Digital Economy ↑ Rapid growth

Malaysia Digital Economy Blueprint targeting $22B in digital investment by 2025. Data centre investment is surging.

Main investors: US, China, Singapore, Japan

Sector priorities

1. Semiconductors & Advanced Manufacturing: NIMP 2030 offering significant incentives for semiconductor and advanced manufacturing investment building on Penang cluster strength.
2. Data Centres & Digital Infrastructure: Hyperscaler investment in Malaysian data centres surging due to competitive power costs, political stability and connectivity.
3. Islamic Finance & Fintech: Malaysia is the global centre of Islamic finance creating unique opportunity for Shariah compliant financial products and services.

Talent & work permits

Malaysia has a multilingual professional workforce with strong English proficiency. Talent pool of 15M with good engineering and finance graduates.

• Foreign workers: Expatriates need an Employment Pass. Under MIDA guidelines (from 16 March 2026), the minimum monthly basic salary is RM20,000 for a key post and RM5,000 (selected services) or RM7,000 (manufacturing) for a term post.
• Localisation: Under the same guidelines, a 100% foreign-owned company needs RM500,000 paid-up capital to employ expatriates. Bumiputera equity requirements apply in certain sectors.
• Key consideration: Employer EPF is 13% (wages up to RM5,000) or 12% above that, plus SOCSO 1.75% and EIS 0.2% (capped at RM6,000) and a 1% HRD Corp levy for 10+ Malaysian staff.

Checked 11 November 2026. Sources: MIDA Employment Pass guidelines (16 Mar 2026) · Malaysia payroll and contributions 2026 (Second Talent, Aug 2026)

How to enter: first four steps

Malaysia has a straightforward market entry process. SSM registration is fast. Sector specific incentives require MIDA engagement.

1. Register with SSM: Companies Commission of Malaysia online registration takes 1 to 2 days
2. Engage MIDA: Malaysian Investment Development Authority for manufacturing and technology investment incentives
3. Register with LHDN and JKDM: Inland Revenue Board for corporate tax and Royal Customs for SST registration
4. Apply for expatriate posts: MIDA or relevant ministry approval required before applying for Employment Passes

Indicative cost: 10-person team

Professional-services team (1 senior manager, 5 professionals, 2 admin, 2 support), Grade A office, registration, legal, audit and tax compliance. Model estimate, not a quote.

First year by industry (10 people)

Regulatory watch

• Jan 2026 · New Industrial Master Plan: Malaysia launched NIMP 2030 with new incentives for high value manufacturing and digital economy.
• Feb 2026 · New Industrial Master Plan Incentives: MIDA announced enhanced incentives under NIMP 2030 for data centre and semiconductor investments including pioneer status and investment tax allowances.