A review of foreign construction firm presence in the Malaysian construction industry

While globalization has provided many prospects for the construction sector to expand, with firms now able to venture into other countries to initiate building projects, the challenge this represents in terms of regulations and performance is considerable. The scarcity of research exploring this important issue means that there is a pressing need for thorough investigative research which offers empirically-based intuitions on the assimilation of local and foreign construction firms, particularly in the context of developing countries. This study reviewed the presence of foreign construction firms in the Malaysian construction industry (MCI) by exploring regulations and performance-related issues. A systematic literature review was conducted by employing the summative content analysis methodology. The key concerns observed were the Malaysian liberalization policy, the governing rules and the actual performance of foreign construction firms. The formation of backward linkages was found to be one of the most substantial ways by which Malaysia could benefit from the participation of foreign construction firms. Therefore, this article suggests that the government has a vital role to play in promoting the formation of backward linkages between foreign construction firms and local business entities. This study marks a significant contribution to current knowledge of the critical elements involved in the relationship between MCI and foreign construction firms in Malaysia.