Norges Bank Investment Management, which manages the huge Norwegian Wealth Fund, has bought a 5 percent share in the local Malaysian company, Cahya Mata Sarawak Berhad.
Cahya Mata is a leading corporation focused on the growth in Sarawak, the largest Malaysian state. The company is a holding company for 35 companies involved in areas such as green technology, construction and property development.
For the Norwegian Wealth Fund the investment in the Malaysian company is not a particularly large investment.
“Their fund is US$1.42 trillion. US$12 million is a marginal investment for them. ” Malaysia University of Science and Technology Economist Dr. Geoffrey Williams explains.
What’s the real intention?
Bank Muamalat Malaysia Bhd Chief Economist and Head of Social Finance, Mohd Afzanizam Abdul Rashid believes the acquisition proves Malaysia attractive for foreign investors:
“Certainly, it means Malaysia can offer good values for long-term investments, one that can provide sustainable long-term investment returns which suits the risks appetite of the global institutional investors.”
But Malaysia University of Science and Technology economist Dr Geoffrey Williams suspects that the Norwegian move was made to also promote Norges Bank’s involvement in ESG (environmental, social and governance) in Sarawak.
“It may also be related to the new Sarawak Sovereign Wealth Fund which is built around the Norwegian model. On that basis, it signals very little in terms of investment considerations but more in terms of ESG considerations and attention on sustainability in Sarawak,” Williams elaborates.