Malaysia slid seven places in the Global Competitiveness Report (GCR) 2016-2017 to 25th out of 138 economies, down from 18th last year.
The country’s performance score drop from 5.23 to 5.16 out of a maximum of seven.
Despite the drop, the report released by the World Economic Forum said Malaysia remains ahead of economies such as South Korea, Iceland and China, but was overtaken by Belgium, Austria, Luxembourg, France, Australia, Ireland and Israel.
According to , Datuk Dr Nazri Khan Adam Khan, vice-president and retail research head of Affin Hwang Investment Bank, the new ranking is a ‘fair’ ranking considering the slowdown in global economy, sluggish commodity prices and ringgit depreciation.
“Asia, as a whole, has deteriorated. I think it’s a fair ranking given the 70% dropped in commodity prices and 40% ringgit depreciation.
“Our performance (competitiveness level) has increased in six consecutive years. Never mind that this time we see a slight drop due to external factors which we are not able to control,” Nazri said in a report by The Star.
Other countries and territories that also slipped in their rankings included Germany, Japan, Hong Kong, Finland, Canada, France, Thailand, Indonesia and the Philippines.
The Government will identify the reasons why Malaysia slipped in its ranking this year and find solutions to rectify the situation.
“Next Friday, we will hold an inter-departmental meeting to discuss the matter,” International Trade and Industry Minister II Datuk Seri Ong Ka Chuan told The Star in a separate report.
He is confident that the drop in ranking will not have a huge negative impact on the inflows of foreign investment into Malaysia.
“I believe that investors, when they study and analyse the GCR report, will find out that there are no drastic changes in the Malaysian investment environment,” he added.
He also said that the drop was not disastrous and Malaysia could rise back to its former glory of being in the top 20 again in the next few years.
