High-quality investments drive Selangor GDP to RM460.1b, says exco

SHAH ALAM, July 6 — The inflow of high-quality investments with strong value chains has been one of the key drivers of Selangor’s economic expansion, enabling the state to record a gross domestic product (GDP) of RM460.1 billion in 2025, up 6.3 per cent from the previous year.

Selangor State executive councillor for investment, trade and mobility, Ng Sze Han, said the state’s economic performance was underpinned by consistent policies to attract investment in technology-intensive sectors, bringing technology spillovers and better-paying jobs for Malaysians.

He noted that the sustained growth contributed 26.5 per cent to the national economy, further reinforcing Selangor’s role as a key engine of growth and a pillar of Malaysia’s economic stability.

Ng said that under the state’s strategy to achieve a RM500 billion economy by 2026, the Selangor government is focusing on high-technology sectors, including semiconductor chip design, electric vehicles (EVs), the digital economy and aerospace.

“Selangor now accounts for nearly 70 per cent of the country’s aerospace activities. Our investment missions to the Greater Bay Area, Hong Kong, Singapore and the United States are aimed at attracting high-quality investments that create value, rather than simply pursuing large investment figures.

“Through the Speed Selangor policy, we have reduced the approval period for factory construction to less than three months, compared with the national average of six months. As a result, Selangor recorded the highest approved investment value in Malaysia in the first quarter of 2026, at RM33.5 billion,” he told Bernama.

Ng said efforts to strengthen the investment ecosystem would continue under the draft Selangor Plan 2 (RS-2), including requiring foreign investors to incorporate local content requirements to ensure domestic suppliers benefit directly from incoming investments.

He said that the ultimate objective of every approved investment was to create high-skilled, high-paying jobs for the domestic workforce.

“The state government’s principle is to ensure that a strong economy translates into a better quality of life for the people. For us, that is the true measure of successful policymaking,” said Ng.

Earlier, Menteri Besar Datuk Seri Amirudin Shari said Selangor’s economy expanded strongly in 2025, with GDP reaching RM460.1 billion, an increase of RM28 billion from the previous year.

Meanwhile, UniKL Business School associate professor Dr Aimi Zulhazmi Abdul Rashid said Selangor’s economic performance demonstrated that the state had evolved beyond being Malaysia’s largest contributor to GDP and had become the country’s primary engine of economic growth.

He said Selangor’s 26.5 per cent contribution to national GDP, together with its shares of 35.9 per cent in construction, 32.8 per cent in manufacturing and 27.1 per cent in services, meant that the state’s economic performance had a direct impact on the national economy.

“Malaysia’s economic structure today largely reflects the model pioneered by Selangor, which achieved an advanced services- and manufacturing-based economy ahead of other states. The inflow of high-quality investments therefore provides an important foundation for preventing Malaysia from falling into the middle-income trap,” he said.

Aimi Zulhazmi said the success of an economy should not be measured solely by GDP figures, but by the extent to which growth raises incomes and strengthens the competitiveness of local companies.

He said that while Selangor’s success had become a catalyst for the national economy, the state continued to face domestic challenges, particularly the high cost of living in districts such as Petaling and Shah Alam.

“To ensure long-term sustainable economic development, challenges relating to wealth distribution, wage growth and the cost of living for local communities must be addressed comprehensively,” he said. — Bernama