KUALA LUMPUR, Feb 18 — Putrajaya’s investment development agency InvestKL disputed today a Fitch Group unit’s report that local political controversies have eroded foreign firms’ confidence in Malaysia and its legal systems.

InvestKL president Datuk Seri Michael Yam said multinational corporations continued to make Kuala Lumpur a preferred choice for their regional headquarters due to confidence in Malaysia as a strategic base for the South-east Asian market as well as the country’s strong economic fundamentals.

“From InvestKL’s perspective, people are still investing, the MNCs are picking Malaysia as a place to set up their regional headquarters.

“Primarily and more importantly based on the fundamentals of the country: the GDP growth, the first world infrastructure, the language, the legal system, the legal framework and the effectiveness for them to do business,” Yam told reporters after presenting InvestKL’s 2015 investment report here.

Earlier in the media briefing, InvestKL chief executive officer Datuk Zainal Amanshah said the agency met its target of getting 10 MNCs to set up offices here.

Zainal said that from 2011 to 2015, InvestKL managed to secure investments from 51 MNCs totalling RM5.88 billion, with 31 per cent of it realised.

From the total 7,156 high skilled regional openings created from the investments 4,658 jobs or 65 per cent are already filled, he added.

“Politics is everywhere… even in the US. But investors look at our strong fundamentals,” Zainal said during his presentation while acknowledging the concerns over local political scandals.

To date, topping the list of MNCs making Malaysia its regional are European companies followed by those from the US and Asia Pacific countries.

The majority of the investments were in business services, global commodities trading, oil and gas, engineering services and industrial products.

InvestKL chief executive officer Datuk Zainal Amanshah speaks at a media briefing in Kuala Lumpur, February 18, 2016. — Picture by Saw Siow Feng

Zainal said InvestKL is targetting 13 MNCs for 2016, and believed the agency can meet its target.

Last week, a Fitch group unit said in its report that the scale of the controversy surrounding 1Malaysia Development Bhd (1MDB) and the RM2.6 billion donation to the prime minister will cause investors to be wary of dealing with state-owned firms here.

According to Business Monitor International (BMI), both scandals as well as the numerous investigations launched in foreign jurisdictions are set to damage Malaysia’s well-perceived legal environment.

BMI explained that the contrast in action taken within Malaysia, where the cases on both have been closed, versus emerging investigations elsewhere contributed to concerns over the levels of impunity and the erosion of the rule of law here.

Commenting on the report, Yam said the controversies were a matter of “perception” and that until the law finds anyone guilty, those implicated should not be incriminated.

“I can’t comment on some of the remarks made by the foreign press. I think we have our own legal system, our own governing standards that we abide and we follow the British rule of law which is one is innocent until proven guilty”.