Malaysia’s National Industry Investment Framework will base incentives on outcomes like job creation and tech transfer, not just investment size.
KUALA LUMPUR: Incentives under the National Industry Investment Framework (NIIF) will vary based on actual outcomes rather than the size of the investment.
Outgoing Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz said that, unlike previously when incentives were tied directly to investment amounts, the NIIF focuses on what the investment delivers.
“Some sectors may have different outcomes. It is not about how much you invest, but what the investment achieves.
“For example, in supply chains and workforce needs, are you working with universities, and how much are you spending on research and development? Only then will the level of incentives vary,” he told Bernama in an interview on Monday.
He said the NIIF also introduces stricter safeguards, particularly in relation to foreign labour and the reskilling of local talent.
These measures are necessary because companies often opt for cheaper labour and are less willing to commit to workforce training.
“So, this is why, under the budget, we are introducing the NIIF, which will set the criteria for incentives when companies invest in new technologies.
“We want to see how many local workers you take on, the extent of technology transfer, and what other spillover benefits accrue to the economy. That is important,” he added.
He said the NIIF will also support small and medium enterprises (SMEs) by strengthening their role and capabilities within supply chains.
“I have just returned from MBSB Bank, where we discussed smart technology. Acceptance will depend on financial support not only from the government but also from development and commercial banks,” he noted.
The NIIF will be fully implemented for the manufacturing sector in the first quarter of 2026, with the services sector following in the second quarter of 2026. – Bernama
