BMI's Executive Summary

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Valued at US$4.2bn in 2006, the Malaysian construction industry seems set to witness a phase of high growth. The industry recently stabilised after a period of regional recession. This report forecasts the industry to grow at a high average of 6.58% during 2008-2012.

Under the Ninth Malaysia Plan (2006-2010), the state has set aside funds to the tune of MYR220bn (US$60bn) for the infrastructure sector. Major projects planned or currently under way include the US$14.5bn refinery projects at Yan and Bachok, the US$7bn Yan-Bachok oil pipeline, the US$5.74bn city centre in Penang, the US$4.2bn Rawang-Ipoh rail project and the US$2.4bn Kuala Lumpur- Singapore bullet train project.

The country's local contractors – besides competently handling nearly all kinds of domestic projects – have also ventured into other countries including India. Future growth of the infrastructure sector is expected to be driven by the rapidly-expanding tourism industry and increased demand for housing in the country. Increased private-sector participation in infrastructure development is expected to boost growth further.

However, the Malaysian construction industry has to deal with certain impediments such as frequent bureaucratic delays, fragmentation, low productivity levels and a lack of transparency in bidding. The government has also been known to be biased towards local players, granting most contracts to local construction and engineering firms. Foreign participation is encouraged only in areas that cannot be catered to efficiently by local investment and expertise. Furthermore, the lack of skilled domestic labour has prevented the country from taking up high-end construction assignments, and it still has to compete with low-wage giants including India and China. Despite all odds, the country has attracted significant foreign investment. The Malaysian construction industry is forecast to be valued at MYR26.25bn (US$7bn) in 2012, making up nearly 3.19% of national gross domestic product (GDP).

Contents

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Chapter 1 – Industry Trends And Developments

Market Overview

Malaysia's Economy In 2006

Malaysia's Construction Industry In 2005–2006

Some Recent Investment Initiatives

Chapter 2 – Key Projects

Transport

Utilities

Tourism

Residential And Commercial Construction

Table: Malaysia — Major Infrastructure Projects

Table: Malaysia — Major Infrastructure Projects (continued)

Chapter 3 – Business Environment Rankings

Introduction

Table: Asia Business Environment Rankings

Business Environment Rankings — Methodology

Long–Term Political Risk

Construction Growth

Competitive Environment

Anticipated Potential

Regional Overview

Malaysia: Business Environment Ranking

Economics — Long–Term Risk

Politics — Long–Term Risk

Construction Growth

Competitive Environment

Anticipated Potential

Chapter 4 – SWOT Analysis

Malaysia Infrastructure Industry SWOT

Malaysia Economic SWOT

Malaysia Political SWOT

Malaysia Business Environment SWOT

Chapter 5 – Industry Forecast Scenario

Table: Construction Industry — Historical Data And Forecasts

Risks

Chapter 6 – Macroeconomic Outlook

Exports Standing Up

Table: GDP, Output And Population

Chapter 7 – Competitive Landscape

Table: Malaysia — Key Players

Chapter 8 – Company Monitor

Gamuda

IJM Group

WCT Engineering

Sunway Construction

Bina Puri Holdings

Chapter 9 – BMI Forecast Modelling

How We Generate Our Industry Forecasts

Construction Industry

Sources

Competitive Landscape for Asia Infrastructure Reports: Sample of Companies Ranked

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Comparative company analyses and rankings by sales, % market share, employees, registration date and ownership structure. Company profiles include fully researched senior executives and contact details, business activity and leading products and services. SWOT (strengths, weaknesses, opportunities, threats) of the state’s business environment, infrastructure sector, politics and economics, which carefully evaluates the short- and medium-term issues facing the industry.

Network of Asian Infrastructure Sources

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BMI's Asian Infrastructure Reports are based on an extensive network of multilateral organisations, government departments, infrastructure industry associations, chambers of commerce and company reports. Information sources include: