KUALA LUMPUR, Sept 4 – The World Economic Forum (WEF) has ranked Malaysia the 24th most competitive nation among 148 countries in its Global Competitiveness Report (GCR) 2013-14.
Last year Malaysia was ranked 25th out of 144 countries, the Ministry of International Trade and Industry said in a statement today.
Malaysia remains the second most competitive among member nations of ASEAN, improving to seventh position among 25 Asia-Pacific countries.
MITI said countries ranked as the 10 most competitive economies shared strengths in innovation and a strong institutional framework.
The GCR uses 70 per cent perception data obtained through the Executive Opinion Survey from high-level private-sector executives and 30 per cent statistical data. It comprises 114 criteria organised into 12 pillars of competitiveness.
The GCR categorises countries into three stages of development – factor-driven, efficiency-driven and innovation-driven based on gross domestic product (GDP) per capita.
Malaysia is categorised as a country in transition from the efficiency-driven to innovation-driven economy.
MITI said the WEF assessed that Malaysia’s most notable advantages were in its efficient and competitive market for goods and services (10th), its well-developed and sound financial market (6th) and its business-friendly institutional framework (29th).
Other indicators include number of procedures to start a business, where Malaysia was ranked 10th, and total tax rate, which improved by 30 places (20th).
Malaysia maintains its sixth position in financial market development. This has been one of Malaysia’s strongest areas, with consistent performance in the past few years. Among the criteria that contributed to this was the ease of access to loans (5th) and venture capital availability (7th).
Under the institutions pillar, indicators that contributed to the improved rankings are strength of audit and reporting standards (27th, improving three positions) and ethical behaviour of firms (28th, improving five positions).
However, the ministry said the WEF cautioned that Malaysia must confront and deal with some of the more critical challenges to Malaysia’s competitiveness. These included the government’s budget deficit, the consistently low rate of female participation in the workforce, and technological readiness. It said that while Malaysia moved up one notch in this year’s ranking, the government was aware that more needed to be done.
Measures such as the rationalisation of subsidies, proposal to introduce Goods and Services Tax, and improvement in the quality of education and training were important. The government would need to prioritise measures to increase female participation in the workforce.
While the government would step up efforts to implement the Economic Transformation Programmes, the private sector must also play its part, the ministry said. This was critical for Malaysia to continue to be a preferred investment destination and an attractive place to do business. – Bernama
