Govt Introduces DIAF, FIAF To Support Businesses And Attract FDI -- MITI

KUALA LUMPUR, Nov 6 (Bernama) -- The government, through the Ministry of Investment, Trade and Industry (MITI) and the Malaysian Investment Development Authority (MIDA), has introduced two new funds under the 12th Malaysia Plan (12MP), namely the Domestic Investment Accelerator Fund (DIAF) and the Foreign Investment Accelerator Fund (FIAF).

DIAF and FIAF build upon the Domestic Investment Strategic Fund (DISF) and the High Impact Fund (HIF), aligning with the government’s current policies under the MADANI Economy framework and the New Industrial Master Plan (NIMP) 2030, said MITI Deputy Minister Liew Chin Tong.

"DISF and HIF, which were allocated under the 10MP and 11MP, have been fully utilised, with approvals for 526 projects," he said during a question-and-answer session in the Dewan Rakyat today.

Liew explained that DIAF aims, among other objectives, to support small and medium enterprises (SMEs) and mid-tier companies in obtaining certification or verification for adopting environmental, social and governance elements. 

This will be done through matching grants, with a 50:50 or 70:30 ratio for eligible expenses, depending on project evaluation.

"DIAF will also offer a 3.0 per cent interest rate subsidy for hire-purchase or term loans, with a 12-month tenure, on eligible capital expenditure for automation and digitalisation projects," he added.

Liew further noted that FIAF was introduced to attract high-quality foreign direct investment, in line with targets under NIMP 2030.

"This fund is also a matching grant, with a 50:50 ratio for eligible expenses.

"FIAF covers two types of activities, namely research, development and Innovation carried out in Malaysia, and technical training for full-time local workers," he said.

He was responding to a question from Sim Tze Tzin (PH-Bayan Baru) regarding the government’s plans to reinstate DISF and HIF to help local companies enhance technology and reach international standards.

Liew assured that MITI and MIDA would continue to assess the effectiveness of existing incentives in line with current government policies and industry needs, while ensuring these incentives enhance the competitiveness of local companies.

"In addition, high-impact incentives will attract more quality foreign investment, generating positive spillover effects, including increased technology adoption among local companies," he added.

-- BERNAMA