According to Bernama, the Malaysian state-run news agency, Thailand last year attracted a lower level of FDI than Malaysia.

The agency quoted International Trade and Industry Parliamentary Secretary Tan Yee Kew as saying Malaysia was second in the Asean FDI ranking, after Singapore.

Last year, Singapore recorded 30.7 billion ringgit (Bt312 billion) in FDI, followed by Malaysia at 20.2 billion ringgit, Thailand at 11.4 billion ringgit and Indonesia at 4.7 billion ringgit.

Following US-based chip-maker Intel's decision to set up a plant in Vietnam despite Thailand being short-listed as a potential site, there have been reports that the Kingdom is losing out FDI to neighbouring countries.

It is evident that in light of unclear economic and political conditions, less FDI has been flowing into the Kingdom.

With a sharp drop in private investment, the Bank of Thailand so far this year has cut the policy interest rate by one percentage point while there are calls for the Finance Ministry to run a steeper budget deficit to spur domestic demand.

Tan said that last year, Malaysia ranked 23rd among 61 countries in "The World Competitiveness Book 2006", an improvement from its 28th placing in 2005.

"According to the World Bank Report 2007, of the 175 countries surveyed, Malaysia maintained its 25th position in terms of ease of doing business in 2006," Tan added.

"It is not fair to compare our country with countries like China, because that is a huge country. Malaysia's FDI ranking is acceptable." Tan said that the approved investment in the country last year was 46 billion ringgit for 1,077 manufacturing projects, compared with 31 billion ringgit in 2005.

"This exceeded the average annual investment target of 27.5 billion ringgit under the Third Industrial Master Plan [IMP3]," she told the agency.

"Investments this year are expected to increase by 7.7 per cent as targeted under IMP3. The ratio of foreign investment to domestic investment is 40:60."

Tan then listed the top 10 FDI source countries and their investment amounts in Malaysia in 2005 and 2006.

They are Japan (8.1 billion ringgit), the United States (7.6 billion ringgit), the Netherlands (5 billion ringgit), Singapore (4.9 billion ringgit), Australia (2.7 billion ringgit), South Korea (1.1 billion ringgit), the Cayman Islands (1 billion ringgit), Taiwan (800 million ringgit), the United Kingdom (700 million ringgit) and the British Virgin Islands (700 million).

She said the sectors targeted for these investments were electric and electronic products; chemicals and chemical products; basic metallic products; non-metallic mineral products; food; plastic products; measuring and scientific instruments; and machinery and equipment.