Malaysia moved up two positions to 18th in the latest world competitiveness report by the World Economic Forum (WEF). It marks Malaysia’s highest ranking since 2005 in this highly-influential and closely monitored report, which includes 140 economies.
Ministry of International Trade and Industry (MITI) described the ranking as an endorsement of the economic progress through the Government Transformation Programme (GTP) and Economic Transformation Programme (ETP).
The cross-structural and fiscal reforms by MITI over the last five years have played an important role in creating financial and economic resilience. Backed by institutionalising measures and sound fundamentals, Malaysia is well on track to continue its progress towards high-income developed status in the next five years.
Malaysia tops the list among 20 economies under the transition stage from an efficiency-driven to innovation-driven economy.
The report indicates that Malaysia’s competitiveness lies on two main pillars – market efficiency (ranked in the top ten at 6th) and financial market development (ranked in the top ten at 9th).
Malaysia improves in most of the 12 pillars, with gains in macroeconomic stability (up nine places to 35th) as the budget deficit continues to be reduced to the lowest in six years (3.7% of GDP); higher education and training (up by 10 places to 36th) and technology readiness (up by 13 places to 47th).
The Malaysia Productivity Corporation (MPC) will march forward to enhance productivity for global competitiveness and innovation. Areas which posed challenges to Malaysia’s competitiveness performance include:
- redundancy costs
- women in labour force
- gross secondary education enrolment
Among the priorities that need to be focused include unlocking the potential of productivity, nurturing talent and entrepreneurship and forging ahead with innovation.
Among the measures highlighted by MPC to enhance competitiveness include:
- ensure buy-in across stakeholders
- prioritising productivity and innovation
- accelerate good regulatory practice (GRP)
- strong public-private sector collaboration
However, as a trade-dependent economy, Malaysia has to be extra vigilant given the volatile nature of global markets.