Malaysia’s global competitiveness ranking in line with economic slowdown

KUALA LUMPUR: Malaysia’s 25th spot in the Global Competitiveness Report (GCR) 2016-2017 is a ‘fair’ ranking given the slowdown in global economy, sluggish commodity prices and ringgit depreciation, said Affin Hwang Investment Bank vice-president and retail research head, Datuk Dr Nazri Khan Adam Khan.

“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,” he told reporters after the Islamic Capital Market Malaysia 2016 seminar here today.

Nazri Khan, who is also the president of Malaysian Association Technical Analysts, was one of the panellists at the third session titled “Benefits, Challenges and Malaysia Islamic Capital Market Prospects for Muslim Investors”.

Malaysia has been ranked 25th out of 138 economies, down from 18th last year, with its performance score down from 5.23 to 5.16 out of a maximum of seven.

Despite the drop in ranking which was in line with most of Asian economies, Nazri Khan said the Malaysian economy remained competitive, beating other big regional economies such as South Korea, China, Thailand and Indonesia.

In the report unveiled by the World Economic Forum Wednesday, Malaysia remains ahead of economies such as South Korea, Iceland and China, but was overtaken by Belgium, Austria, Luxembourg, France, Australia, Ireland and Israel.

Meanwhile, countries and territories that also slipped in their rankings included Germany, Japan, Hong Kong, Finland, Canada, France, Thailand, Indonesia and the Philippines.

Switzerland remained the most competitive economy in the world for the eighth consecutive year, ahead of Singapore and the United States, followed by the Netherlands and Germany.

The GCR is an annual report published by the WEF based on the Global Competitiveness Index that combines 114 indicators that integrate both macro and micro economic aspects of competitiveness.

These indicators are grouped into 12 pillars comprising Institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and innovation.

Nazri Khan said the Government Transformation Programme and Economic Transformation Programme had been successful and remained relevant in boosting Malaysia’s economy, which helped to contribute to the competitive ranking in the report. - Bernama