Malaysia Industry Policy

2026-01-21
Category: Government
Frequency: Daily

Explore key sectors, investment incentives, and regulatory frameworks shaping Malaysia's industrial landscape

Explore key sectors, investment incentives, and regulatory frameworks shaping Malaysia's industrial landscape.

Date Category Details
1 Jan, 2026 Iron and Steel Since July 1, 2025, sales and services tax (SST) of 5% to 10% has been applied to primary steelmaking raw materials, including steel scrap, iron ore, coking coal, and coke, with a compliance grace period ending 2025. This policy directly raises production costs for local steelmakers, reducing the competitiveness of domestic steel versus duty-free imports, potentially discouraging investment in value-added manufacturing, affecting employment, and increasing reliance on imported finished steel.
26 Dec, 2025 Data Centre Selangor now requires all new data centres to use at least 30% local content. The policy aims to boost domestic participation, support local suppliers, and create more benefits for the Malaysian economy. It covers areas like circuit design, cooling systems, and engineering services.
19 Dec, 2025 Renewable Energy The Solar Accelerated Transition Action Programme (Solar ATAP), which replaces the net energy metering (NEM) scheme, will open for applications on January 1, 2026, with guidelines available on the Energy Commission website on December 31, 2025. The programme has no specific quota but the government may impose limits if uncontrolled solar installation affects the national grid. Non-domestic users will be billed at the system marginal price, while households will be charged at the prevailing energy rate, with any excess energy sold back to the grid. Single-phase homes can install up to 5 kW of solar capacity, and three-phase homes up to 15 kW, up from the previous 12.5 kW limit under NEM, which allowed one-to-one bill offsets; the current self-consumption (SelCo) scheme only allows offsets if surplus energy is stored and discharged on demand.
8 Dec, 2025 Rare Earth Companies involved in midstream and downstream rare earth element (REE) production are eligible for incentives under the Promotion of Investments Act 1986, including Pioneer Status and Investment Tax Allowance, with additional special incentives available for high-technology activities and small and medium enterprises. These incentives are intended to promote higher value-added REE processing and strengthen Malaysia’s position as a global and regional REE processing hub.
3 Dec, 2025 Renewable Energy The government will require the next large-scale solar (LSS) projects to include Battery Energy Storage Systems (BESS) to keep the electricity supply stable. BESS stores extra electricity and releases it when needed. Tenaga Nasional is building a pilot BESS project, expected to start by the end of 2026. The Energy Commission has also run a tender for 400MW/1,600MWh of BESS, with results waiting for Finance Ministry approval. To protect the environment, companies must plan how to dismantle, dispose, and recycle batteries properly. BESS systems must meet safety standards to prevent fire or explosions.
26 Nov, 2025 Data Centre Johor will no longer approve Tier 1 and Tier 2 data centres, which can consume up to 50 million litres of water daily, focusing instead on Tier 3 and Tier 4 facilities that use around 200,000 litres per day and have lower environmental impact. The state has introduced the most stringent data-centre development rules in Malaysia, coordinated by the Johor Data Centre Development Coordinating Committee, which reviews water and electricity usage, environmental impact, cooling technologies, fibre infrastructure, sustainability initiatives, and compliance with the Green Building Index. New applications undergo a five-level vetting process under PlanMalaysia, ensuring approvals benefit the state’s economy without straining resources. Johor has approved 51 data-centre projects to date—17 operational, 11 under construction, and 23 pending—with total investments of RM182.96 billion and creation of 7,561 skilled jobs. Future facilities must be located in designated industrial zones, avoid commercial or residential areas, and use reclaimed water for cooling, with some campuses already adopting reverse-osmosis systems modeled on Singapore’s NEWater.
24 Nov, 2025 Financial SC proposes Bursa Malaysia listing rule revamp Main Market: Minimum annual PAT raised RM6M → RM15M; three-year PAT RM20M → RM30M. Profit track record shortened to 3 years; uninterrupted profits not required. Positive cash flow requirement may be relaxed for high-growth and tech firms. Other routes like market cap test (≥RM500M) remain. ACE Market: Strengthen sponsor oversight; companies may be required to transfer to Main Market once criteria met. Minimum 2-year listing and 3-year sponsorship requirement.
19 Nov, 2025 Financial Bank Negara Malaysia plans to introduce an open finance framework from 1 January 2027 that allows consumers to control how their financial data, including deposit accounts and credit and charge cards, is shared and used. Banks and selected financial institutions will share the last 12 months of transaction data and current account balances only with customers who opt in, starting with large banks and gradually expanding to smaller banks, development finance institutions and major e-money providers. Data sharing will begin with individual customers in 2027, extend to SMEs in 2028, and fully include development finance institutions and e-money issuers for both individuals and SMEs by 2029. The framework requires explicit and revocable consent, customer dashboards to manage data access, and strong safeguards on data security and usage, with feedback on the proposal open until 1 March 2026.
13 Nov, 2025 Food Malaysia and China have signed a new protocol on the export of Edible Bird’s Nest (EBN), replacing the 2012 and 2016 agreements and reinforcing China’s confidence in Malaysia’s food safety and regulatory systems. Malaysia remains the first ASEAN country allowed to export raw, clean, and unclean bird’s nests to China. Exports, temporarily suspended at the end of 2024 over avian disease concerns, resumed in January 2025. The protocol secures long-term market access for Malaysia’s EBN industry, valued at RM2–2.2 billion annually, with RM1.5 billion in exports to China. Compliance is monitored via the MyWalet system, covering over 15,000 swiftlet houses, and discussions are ongoing to expand exports to aquatic, poultry, and animal feed products.
3 Nov, 2025 Healthcare The Health Ministry plans to launch its Rakan KKM programme by the end of 2025 at Cyberjaya Hospital, after missing earlier mid-year and third-quarter targets. The initiative, announced under Budget 2025, provides non-emergency patients with “premium economy” services, including personalised care, choice of specialists, and enhanced ward privacy, with out-of-pocket payments. It aims to generate revenue for public hospitals and allow healthcare workers to earn additional income. Initial services will cover orthopaedics and internal medicine. The programme, managed by Rakan KKM Sdn Bhd fully owned by Minister of Finance Incorporated, will remain under government control, with any future equity participation limited to GLICs. It will also be regulated under the Private Healthcare Facilities and Services Act 2006 to ensure compliance and maintain a level playing field with private providers, amid criticism that it could create a two-tier public healthcare system.