Johari: Local firms must produce more components to cut imports

KUALA LUMPUR: Malaysian companies must produce more components for investors to reduce import dependence and widen the country's trade surplus.

Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani said exports grew 34 per cent in the first nine months of this year compared with the same period last year, while imports rose 25 per cent.

He said domestic firms, including small and medium enterprises (SMEs), could help meet investors' production needs by becoming part of their supply chains.

"When we bring in investors, they want to manufacture products. If we cannot supply the components they need, they have to import them.

"An investor may need 10 types of materials or components to manufacture a product. If three or four local companies can produce some of those components, we can reduce imports," he told reporters after the 2026 Industry Excellence Awards at the ministry's headquarters here today.

Also present were Prime Minister Datuk Seri Anwar Ibrahim and Deputy Investment, Trade and Industry Minister Sim Tze Tzin.

Johari said greater domestic production would help Malaysia expand its economy and exports while slowing import growth.

He said, for example, export growth of 34 per cent alongside import growth of 10 per cent could generate a larger trade surplus if more production inputs were sourced locally.

He urged local companies to identify the components investors needed and invest in research and development (R&D) to produce them.

Earlier in his speech, Johari said the New Industrial Master Plan 2030 aimed to advance manufacturing through innovation, technology, digitalisation and automation.

He said Malaysian companies should develop their own technology, strengthen R&D and build strong brands to become trusted suppliers to multinational companies and global industry leaders.

"This progress must translate into quality job opportunities, a highly skilled workforce, as well as higher incomes and living standards for the people," he said.

Johari said the biennial awards recognised companies' economic contributions and provided benchmarks for newer businesses to learn from successful firms in the manufacturing and services sectors.