South-east Asian countries are being wooed by major powers after clocking in strong growth and attracting rising investment inflows, Malaysia's Prime Minister Najib Razak said yesterday in an upbeat assessment of the region.
Datuk Seri Najib said Asean's economy grew at over 5 per cent a year from 2007 to last year, during a period of financial crisis worldwide. And in 2013, Asean overtook China in terms of foreign direct investment (FDI), with a chunk of the money from China itself.
He was speaking at the opening plenary of the World Economic Forum on Asean. The economy of Asean's 10 member nations grew by 4.6 per cent in the first quarter of this year, compared with the same period a year ago.
"Far further afield, people want to do business with Asean. We are being courted by the most advanced economies in the world," Mr Najib said in his speech.
Assuring foreign investors that the region, and Malaysia in particular, is where firms should park their funds, Mr Najib said the economies of Asean countries remain resilient and investors would be protected.
"The fact that FDI has been going up in Malaysia by 22 per cent per annum means that there is general confidence in Malaysia," he said during the joint panel discussion with other Asean leaders.
Malaysia's 22 per cent annual FDI growth was recorded in 2013, before the country's political and economic climate turned sour. The country's FDI last year fell by 44 per cent compared with the previous year.
Mr Najib also alluded to criticisms that have been voiced against him and his government. Critics have said Malaysia's economic slowdown and jittery investors are due to the financial scandals involving the premier himself and troubled state fund 1Malaysia Development Berhad. Mr Najib has denied wrongdoing.
He said yesterday that concerns arise because of a "problem of perception" due to the "noise from outside". "The noise level is rather high... but it belies the strong fundamentals and the commitment of the Malaysian government," he said.
Asean has a young population and, with 625 million people, it has the world's third-largest labour market after China and India.
The young and large population has also made the region a source of cheap labour for multinationals - an issue that speakers throughout the WEF forum addressed. They said Asean has to progress from low- and semi-skilled workers to high-skilled workers.
However, Indonesia's Vice-President Jusuf Kalla said that Asean countries need to cooperate and not compete with one another to ensure labour prices are not pushed down.