PENANG Chief Minister Chow Kon Yeow has defended the federal development allocations to the state despite neighbouring Kedah Mentri Besar Datuk Seri Muhammed Sanusi Md Nor's claims that Penang is a relatively small state.
The development allocations provided to Penang by the Madani Federal Government should not be questioned, as the state has made significant contributions to the nation’s economy, said Chow.
In the first quarter of this year, Penang secured RM4.9 billion in approved manufacturing investments, with 70% (RM3.4 billion) coming from foreign direct investment (FDI).
The state continues to be a global powerhouse, leading the country in exports and acting as the world's second-largest digital FDI destination, contributing an annual average of RM10.7 billion in federal tax revenue recently, according to figures released by Prime Minister Datuk Seri Anwar Ibrahim.
Despite this strong contribution to federal coffers, the state received an average of only RM7.9 billion in return, making it one of the few net-contributing states.
Chow said there was no need to repeat statistics published by the Department of Statistics Malaysia (DOSM), as Penang’s economic performance speaks for itself.
“We have attracted billions of ringgit in FDI. Penang is the country’s leading exporting state, contributing about 40% of Malaysia’s total exports, placing us at the top nationally. We are also the leading state for medical tourism, among many other sectors that contribute substantially to the country’s tax revenue."
Under the previous Federal administration, Penang did not receive the attention it deserved, while other states were allocated far more despite contributing less,” he told journalists after launching the updated version of the Penang Ferry Museum here.
Sanusi, during his campaigning at the Johor state election, claimed that the Federal Government had been unfair in distributing development allocations following its approval of approximately RM16 billion for the Mutiara Light Rail Transit (LRT) project in Penang.
To this, Chow replied that Penang is grateful that the Federal side has approved several major infrastructure projects over the past two to three years.
“For a very long time, Penang was not considered for the implementation of major infrastructure projects, such as the Penang LRT Mutiara Line, the Penang International Airport expansion, and the Juru – Sungai Dua Elevated Highway. We are thankful that these projects have finally been approved."
The state does not have the financial capacity to undertake multi-billion-ringgit projects of this scale on its own, said Chow.
“These projects are essential to enable Penang to address its existing challenges and further strengthen the state’s position so that we can continue playing a vital role in Malaysia’s economic development,” he said. - July 11, 2026.
.jpeg)
