He said the incentives were designed as the new encouragement from the federal government to assist states that received lower investment compared with more developed states that obtained huge investments.
"The incentives are still being studied by the Malaysian Investment Development Authority (MIDA) and the Ministry of International Trade and Industry (MITI) together with the Finance Ministry, and are expected to be announced soon," he told reporters after a dialogue session with entrepreneurs in Perlis and Kedah here.
Earlier, Mustapa was given a briefing on the direction and economic plans of the state by Azlan during his visit to the office of the Menteri Besar here.
According to Mustapa, the Perlis government's plan to build Lembah Chuping into a green biotechnology centre was a good development that would be able to attract foreign investors.
He said investments in Perlis last year increased nine fold compared with 2011 and the federal government would continue to assist in identifying suitable investment sectors to bring to the state.
Up to Dec 31, 2013, a total of 48 projects involving RM1 billion investment were implemented, with local investment making up 70 per cent or RM674.3 billion, and foreign investment accounting for 30 per cent or RM368.9 million.
On Asean Economic Cmmunity (AEC) which will be declared at end-2015, Mustapa said Malaysia would also hold the chairmanship the same year.
"The AEC issue is huge as the business community including state governments and government officers do not understand and have a wrong perception on the AEC.
"In fact, tariffs for most products coming into Malaysia or go out have been included and the bulk of them have been abolished, no more tax when the AEC is implemented later.
"Many quarters anticipate there will be dumping of products in Malaysia that would hinder the local industry. This is not correct," he explained.
He said the officers and state governments at the borders including the business community would be given a full briefing on the AEC and the implications of its establishment in the near future.
Meanwhile, Azlan said the Perlis government had offered an area in Padang Besar to be developed into an air strip sufficient to accommodate landing of small planes such Malindo Air, Firefly, cargo and for leisure activities.
"There's request for the air strip and we need to look forward. The air strip is capable of driving development in northern Perlis, this is the rationale. Hence, we will offer a bid for this in the 11th Malaysia Plan.
"I will make a proposal to the Minister in the Prime Minister's Department, Datuk Seri Abdul Wahid Omar who is visiting Perlis on July 3," said Azlan.