KUALA LUMPUR (June 22): The government is confident that Malaysia’s position in the International Institute for Management Development's (IMD) World Competitiveness Ranking 2025 will improve from this year, driven by an increase in high-technology product exports.

Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz said a reduction in the country’s high-technology exports influenced Malaysia’s lower positioning in the IMD list this year, and this is a short-term situation that is expected to improve in 2025.

The minister said this is following the many new investments from electrical and electronics companies in Malaysia, as well as those from multinational corporations.

“All of these [investments] will begin to have an effect in the next 12 to 18 months, and they will improve our position,” he said in a post on social media.

High-technology exports are products with extensive research and development components, such as those in the aerospace, computer, pharmaceutical, scientific instruments, chemical, and electrical machinery sectors.

Zafrul said Malaysia’s lower position in the IMD competitiveness ranking this year resulted from a fall in electronic communications exports due to lower global demand, and increased global competition for electronic communications products.

“For example, China’s high-technology exports in the first 10 months of 2023 fell 11.4% year-on-year to US$728.2 billion (RM3.43 trillion), while South Korea’s plummeted 28% to US$110 billion, and Japan was 10% lower at US$76.9 billion,” he said.

However, Zafrul said global sales of semiconductors are projected to increase 16% in 2024, and 12.5% in 2025, benefiting Malaysia as the world’s sixth largest semiconductor exporter.

“When demand for semiconductors increases, it is automatic for a country’s high-technology exports to increase too,” he explained.

Zafrul added that stable economic growth, low unemployment and an inflation rate that remains under control will improve Malaysia’s position in the near future. 

https://www.theedgemarkets.com/node/716400