Overview
Since gaining independence in 1957, Malaysia has successfully diversified its economy from one that was initially agriculture and commodity-based, to one that now plays host to robust manufacturing and services sectors. This has propelled it to become a leading exporter of electrical appliances, electronic parts and components.
Malaysia is one of the most open economies in the world, with a trade to GDP ratio averaging over 140 percent since 2010. Openness to trade and investment have been instrumental in employment creation and income growth, with about 40 percent of jobs in Malaysia linked to export activities. After the Asian financial crisis of 1997-1998, Malaysia’s economy has been on an upward trajectory, averaging growth of 5.4 percent since 2010.
Malaysia is ranked 24 among world economies in 2018 World Bank’s Ease of Doing Business report. Malaysia was accorded with this ranking as it serves as an attractive destination for foreign investors.
Number 1 in Islamic Finance
Malaysia is also a world leader in Islamic finance, its long track record of building a successful domestic Islamic financial industry of over 30 years gives the country a solid foundation – financial bedrock of stability that adds to the richness, diversity and maturity of the financial system.
For instance, Islamic financing grew by 9.4% to RM605.5 billion (2016: 11.8%) during the year, amid a moderate growth of 1.3% in conventional loans (2016: 2.4%).
In terms of Islamic wealth management, Malaysia has the highest number of Islamic funds globally with 388 funds managing total Asset Under Management (AuM) of USD22.6 billion, representing 31.9% of Global Islamic Assets under Management (AuM).
In the banking sector, Malaysia’s total Islamic banking assets stood at USD204.4 billion as at end-2017, and ranked third globally after Iran and Saudi Arabia. The total Islamic Finance industry assets has grown 7% in 2016 to reach USD 2.2 trillion
Labuan
Our Fund is registered in Labuan, which is a federal territory established in 1990 as an international offshore financial center to provide for the development of offshore activities in the areas of offshore banking and insurance, trust and fund management, offshore investment holding and other offshore activities carried on by multinational companies.
In a rebranding exercise, the name was changed to Labuan International Business and Financial Centre (Labuan IBFC) in January 2008 to reflect the jurisdiction’s growing international status. In the same year, a new entity, the Labuan IBFC incorporated Sdn Bhd ( Labuan IBFC Inc.), wholly owned by the Labuan Financial Services Authority (formerly known as Labuan Offshore Financial Services Authority), was established as the official agency for the promotion and marketing of Labuan as the premier international business and financial center in Asia Pacific.
The Island has a population of approximately 100,000 inhabitants comprising mainly Malays and Chinese with a sizeable population of foreigners. Labuan jurisdiction follows a “mid-shore” jurisdiction that provides a half-way point between onshore and offshore. This promotes greater tax transparency, a strong legal system and a justified tax framework. Labuan has repositioned itself to reflect its enhanced supervisory framework and compliance with international offshore standards and best practices.