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Malaysia’s Ranking in Productivity Growth (2003–2016)
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Malaysia’s Ranking in Productivity Growth (2003–2016)
Malaysia’s Ranking
TC shows a positive trend, indicating adoption of new technologies.
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It performed better than countries like Indonesia and the Philippines, but lagged behind leaders like Singapore and Thailand.
SC improvements are moderate, suggesting that Malaysia has yet to fully optimize production scale like top performers.
TEC fluctuates, reflecting inconsistent utilization of resources.
Strengths of Malaysia
Malaysia made moderate progress in adopting technology, especially in sectors like manufacturing, palm oil, and electronics.
Skilled labor is concentrated in urban and industrial zones, supporting competitive productivity in key industries.
Malaysia’s strengths lie in electronics, palm oil production, oil & gas processing, and automobile components, contributing to sectoral TFP growth. :
Challenges
Economic Constraints
Limited government investment in R&D and infrastructure hampers long-term innovation and productivity.
Labor Market Issues
Economic Constraints: Limited government investment in R&D and infrastructure hampers long-term innovation and productivity.
Technological Gaps
Low adoption of advanced technologies by SMEs and in agriculture leads to inefficiencies, especially affecting TEC.
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Policy Implications & Recommendations
While productivity improved between 2003 and 2016, the pace is slowing. Without proactive measures, Malaysia risks falling further behind its ASEAN peers.
Strengthen TVET, digital literacy programs, and lifelong learning initiatives.
Increasing government support for research, development and encourage smart agriculture and digital manufacturing.
Develop a National Productivity Blueprint with regular TFP assessments to ensure consistent policy direction.
Reduce reliance on commodity-based sectors and develop high-value industries such as green tech, healthcare, and tourism. :