Malaysia’s InvestKL is more than half way to completing its mission: attracting 100 multinational corporations (MNC), including top oil and gas firms, to base their regional headquarters in Greater Kuala Lumpur (KL) by 2020.
Luring oil and gas MNCs ranked among the Fortune 500 or Forbes 2000 group of firms looms large for InvestKL given Malaysia’s well established petroleum industry, anchored by national oil company (NOC) Petroliam Nasional Berhad (PETRONAS).
“It’s is not the main focus, but it’s certainly a key sector because oil and gas is one of the 12 national key economic areas. KL is also an oil and gas hub for Southeast Asia,” Daniel Teng, senior director of Marketing & Communications, Strategy, Advisory and Services at InvestKL.
Strong Government Backing for InvestKL
With strong government backing, InvestKL – which was established in July 2011 – can tap on an array of state resources to achieve its objectives.
“We work very closely with PETRONAS and Malaysia Petroleum Resource Corp. (MPRC), which is under the Prime Minister’s Department. We work with them as they are the subject experts that can guide us in attracting the oil and gas MNCs. We also use our channels to help the MNCs,” Teng said.
The synergies created through the location of oil and gas MNCs in Greater KL would benefit PETRONAS given that the NOC has extensive operations in the different segments of the petroleum industry.
“PETRONAS is very supportive because it is also their goal to bring more companies to KL so that they can be closer to the company,” Teng explained.
Building Capacity Through Relocation
With the petroleum sector negatively affected by several rounds of cost-cutting exercises in the current downturn, InvestKL acknowledged that cost is certainly a key driver encouraging MNCs to seek an alternative operating base to neighboring Singapore.
“Cost is an important consideration, but not the main factor. It’s about sustenance. MNCs look at strategic options to build a sustainable business. We position KL as a very good complementary alternative to Singapore for MNCs that wish to establish their regional headquarters,” Teng said.
“What this means is that MNCs need to understand whether their operational capacities are lost, maintained or expanded. The relocation to KL is about building capacity, in terms of building talent ability, developing available talents, bringing in expatriates to KL and of having a support ecosystem.”
He recounted that MPRC told participants at an AmCham Singapore’s industry talk Aug. 23 that the ecosystem in KL can be a good value-add to MNCs doing business there as sub-contractors are easily available.
“So it’s talent capacity and ecosystem capacity. But above all, we are making it very easy to do business. We help them, facilitate them with immigration, we connect them to the right parties,” the InvestKL executive said.
The attraction of working in close proximity to PETRONAS – Southeast Asia’s largest oil and gas firm and a Fortune 500 company – in KL could be a key consideration for MNCs thinking about relocating their regional operations to the Malaysian capital.