PETALING JAYA: Malaysia has been ranked as the third most complex country for multinationals to do business in Asia due to the difficulty of obtaining operating licences for foreign businesses, according to a global business complexity index report.
The report by multinational professional services firm TMF Group also placed Malaysia as the 9th most complex globally, coming behind Brazil, Argentina, Bolivia and Greece.
However, its managing director for Malaysia Sharon Yam also said the country’s complexity might reduce as a result of the government’s efforts to simplify the process.
“As part of a drive to make Malaysia a more attractive place to do business, the government has launched a digital submission platform for audits and financial statements.
“While its use is not compulsory, the government is encouraging the companies to use it by giving an annual rebate of RM5,000 per year,” she said in the report.
“This is part of the Malaysian government’s strategy of simplifying processes to attract foreign direct investment which has helped move the country forward.”
Yam said the country’s legal system based on UK law and its internationally aligned accounting practices such as adhering to the International Financial Reporting Standards would also help Malaysia’s global positioning.
However, she warned that investors in the country must be able to navigate ever-changing social, political and economic landscapes as the country’s legislations have a large impact on day-to-day business operations.
The global business complexity index ranked 77 jurisdictions based on over 250 criteria, including the time it takes for foreign businesses to incorporate, changes in tax legislation, policies on wages and benefits and challenges of opening a bank account.
In Asia, Hong Kong and Singapore were regarded as the continent’s simplest jurisdictions for businesses. Meanwhile, the 10 least complex countries included the US, Jamaica and Denmark, with Curacao coming in first.