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Manufacturing Industry to Expand in the First Half of 2018

FMM in the News: New Straits Times, February 22, 2018

KUALA LUMPUR: The manufacturing industry is projected to record a positive growth in the first half of this year, according to a survey by the Federation of Malaysian Manufacturers (FMM).

A survey conducted together with the Malaysian Institute of Economic Research (MIER) involved 414 respondents who are FMM members nationwide.

FMM president Datuk Soh Thian Lai said the positive growth was based on the overall “impressive” growth last year.

Soh said FMM members believe the positive momentum in the past year will continue in the first half of this year, especially with the strengthening of the ringgit against the US dollar.

"FMM expects the ringgit to trade between RM3.50 and RM3.80 this year which will lower the cost of doing business including production cost for manufacturers.”

Currently, raw materials represent 70 per cent of FMM members’cost of production which are mostly imported. With the strengthening of the ringgit, it will reduce the cost of raw materials thus lowering production costs.

"When these costs are reduced, manufacturers can reduce the price of their products, thereby increasing the purchasing power of consumers.

"That is why in the first half of this year, a third of survey respondents expect domestic sales to be boosted by these factors,"he told a press conference at Wisma FMM, here, yesterday.

Soh added that FMM members were also concerned on the delay in repayment of Goods and Services Tax (GST) from the Customs Department.

Under Section 67 of the GST Act 2014, repayments will be received within 14 working days from the date of claim being made online and 28 working days for manual submissions.

However, the survey found that the average period for each company to receive the repayment was between one and three months.

"Thus, we have been meeting with the Customs Department and raised this to them. The department promised to make improvements in the future and speed up the repayment process," he said.

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