Malaysia to invest $478m in PE, VC matching scheme
The Malaysian government will allocate MYR2 billion ($478 million) to a co-investment scheme that will match investments made in the country by private equity and venture capital funds.
The program, confirmed in a budget address by Minister of Finance Lim Guan Eng, is positioned as part of a plan to embrace the digital economy and will include a separate MYR50 million co-investment fund to support new investment platforms such as equity crowdfunding and peer-to-peer financing vehicles.
The plan also proposes the creation of a MYR3 billion Industry Digitalization Transformation Fund. “The purpose of this fund is to accelerate industry adoption of Industry 4.0 related technologies including robotics and artificial intelligence,” Lim said in the text of his speech.
Government investment agencies including Malaysia Technology Development Corporation, Malaysia Debt Ventures, Malaysia Venture Capital Management (Mavcap), and Cradle Fund are expected to realize improved efficiencies as a result of the scheme. The idea is that matching the commitments of these firms will allow capital to be more optimally distributed to the most credible investments.
Malaysia’s private equity and venture capital industries are regarded as heavily dependent on government support. However, local investors have expressed confidence in the government’s policy reform and anti-corruption efforts as well as a range of economic drivers including an improving talent pool and regional logistical advantages.
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