QUESTION 1: Malaysia business overview Foreign Direct Investment FDI

FDI is defined as investment by a resident entity in one economy that reflects the objective of obtaining a lasting interest in an enterprise resident in another economy. The lasting interest implies the existence of a long-term relationship between the direct investor and the enterprise and a significant degree of influence by the direct investor on the management of the enterprise. The ownership of at least 10% of the voting power, representing the influence by the investor, is the basic criterion used. Foreign direct investment, net outflows (% of GDP) in Malaysia was 5.68 as of 2010. Its highest value over the past 11 years was 6.83 in 2008, while its lowest value was 0.29 in 2001. Inward stocks refer to all direct investments held by non-residents in the reporting economy; outward stocks are the investments of the reporting economy held abroad. Corresponding flows relate to investment during a period of time. Negative flows generally indicate disinvestments or the impact of substantial reimbursements of inter-company loans. The FDI index gauges the restrictiveness of a country's FDI rules through four types of restrictions: foreign equity limitations; screening or approval mechanisms; restriction on key foreign employment; operational restrictions.

Today, Malaysia has moved into the third stage of economic development, with growing emphasis on services. Malaysias Industry Sectors of the services in Malaysia have been growing in importance for the economy in the past few years. In 2010, Services was responsible for 49.3 percent of the GDP. The concerted development of the service industry is part of the national development strategy to venture into new growth areas and broaden the economic base for exports. It is also expected to provide the basis for sustained growth in the economy in order to achieve the vision of becoming a developed nation by 2020.

The oil, gas and energy sector has been the mainstay of Malaysias growth and contributes approximately 20% to the national GDP. To reach the ambitious real annualgrowth target and provide a sustainable energy platform, Malaysia is pursuing sector-wide opportunities. By 2020, Malaysia will have more diversified oil, gas and energy sector that remains vital to our development, and that builds on the nations competitive advantages. A key thrust would be to intensify exploration and enhance production from domestic reserves. Malaysia will also develop a strong regional oil field services and equipment hub and a stronger presence in the regional midstream logistics and downstream markets. Malaysia has the potential to grow alternative energy sources such as nuclear, solar and hydro to overcome the decline in domestic natural gas production. Malaysia is targeting to raise total GNI contribution to RM241 billion by 2020 from RM110 billion in 2009. Tourism services comprise hotels, resorts, lodgings, tour services, travel agencies, restaurant and catering services, and transport companies. Malaysia is one of the worlds top destinations, in the top 10 in arrivals and top 15 in global receipts. Tourism is our fifth largest industry, generating RM37 billion (USD10.5 billion) in GNI in 2009. The industry is expected to continue growing with arrivals rising from 24 million in 2009 to 36 million in 2020. Malaysia recorded a growth in State Gross Output (KDNK) of 4.6 for the first term percent in 2011, versus 10.1 percent are listed at the same rate last year, driven by solid demand of local and increased external demand. In 2010, the country recorded a growth of as much as 7.2 percent KDNK and modest growth of 4.8 percent the end of that tribe. Foreign nationals intending to work in Malaysia must generally obtain one of three work visas: employment pass, temporary employment visit pass, or professional visit pass. An employment pass applies to investors, skilled workers, professionals, and senior management in companies. The minimum employment period required is two years. A temporary employment visit pass is for unskilled and semi-skilled workers in the manufacturing, construction, and service fields. Foreign nationals under this category may typically work for up to three years, with extensions available on a year-to-year basis. A professional visit pass is generally appropriate for technical experts, including experts in machinery installation, and technical trainees. Professional visit passes are typically issued on a short-term basis.