KUALA LUMPUR (Aug 8): Malaysia’s six main government-linked investment companies (GLICs) have together pledged RM120 billion in direct domestic investmensts over the next five years under a programme led by the Finance Ministry.

The proposed investments are targeted at “high growth, high value” industries such as energy transition and advanced manufacturing, especially in the semiconductor sector, the Finance Ministry said in a statement. That is on top of their investments in the public capital market worth RM440 billion, it noted.

The investments will cover business in all stages, such as startups, venture capital and mid-tier companies, as well as support the eventual listing of the companies, the ministry said.

The six GLICs involved in the programme known as GEAR-uP are Khazanah Nasional Bhd, Employees Provident Fund, Retirement Fund Inc, Permodalan Nasional Bhd, Lembaga Tabung Haji dan the Armed Forces Fund Board.

“There is a need to mobilise all parties in the countries, including the corporates,” Prime Minister Datuk Seri Anwar Ibrahim said in a statement. “GLICs will increase their focus on domestic investments and the funds could benefit all people and create new economic ecosystems.”

The GLICs — which collectively manage assets worth over RM1.8 trillion, about the size of the country’s nominal gross domestic product — have the financial strength to propel the country in the economic value chain and improve the quality of life for the people, he added.

Each GLIC will have its own focus areas under GEAR-uP, the ministry noted.

Khazanah will develop investments based on a strategy dubbed “A Nation That Creates” to raise the country’s productivity and competitiveness. The focus will be on transforming firms for energy transition and digitalisation, among others, as well as leading efforts to improve Malaysia's connectivity through its aviation portfolio.

For Retirement Fund Inc, also known as KWAP, the fund will strengthen the private market in Malaysia across private equity, infrastructure and real estate, with a focus on providing catalyst funding for venture capital as well as growth stage firms through Dana Perintis dan Dana Pemacu. KWAP has also identified eight sectors, including food security and digital economy.

Permodalan Nasional will modernise industries and the corporate sector in Malaysia by sharpening focus on high value-added and sustainable activities, concentrating on new industrial parks, supporting automation and smart agriculture in palm oil as well as green assets and energy transition.

For the country’s pension fund, or the EPF, its focus will be on investing in sustainable healthcare that is commercially viable through collaboration with the government, including construction of a private wing in public hospitals.

Tabung Haji will expand the role of Islamic banks as well as strengthen the Islamic financial system through strategic cooperation with other institutions as well as major Islamic financial industry players.

The Armed Forces Fund Board, meanwhile, will look to increase the value creation of the Malaysian pharmaceutical industry by expanding its capacity in the production of local biopharmaceutical products.