M'sia productivity grows by 2.5%

  • Business
  • Saturday, 07 Jun 2003


MALAYSIA'S productivity grew by 2.5% last year, attributed to higher capacity utilisation in industries from an improvement in both domestic and external demand, National Productivity Corp (NPC) said in its 2002 report. 

The productivity growth was supported by strong consumer spending, continued recovery in investment activities, expansion in public sector expenditure as well as favourable export performance. 

“In terms of contribution to gross domestic product (GDP) growth of 4.2%, productivity and employment contributed 58% and 40.9% respectively. The economic growth was broad-based, with all sectors recording productivity growth,” NPC said. 

Among the sectors that recorded higher productivity were manufacturing (3.3%), construction (2.5%), electricity, gas and water (2.9%), finance (2.8%) and government services (3.4%). 

The report said that productivity-driven growth strategies through higher total factor productivity (TFP) would enable Malaysia to remain competitive.  

For 1991-2002, TFP grew by 1.4%, resulting in GDP growth of 6.1%. The contribution of TFP to GDP growth was 23.7%, while capital and labour contributed 48.3% and 28.1%. 

From 1997-2002, productivity growth of 2.8% surpassed that of several countries of the Organisation for Economic Cooperation and Development (OECD) such as the US at 2.3%, Canada (1.5%), Britain (1.4%), France (1.2%), Germany (0.9%), Japan (0.8%) and Italy (0.4%). 

Compared with East Asian countries, Malaysia’s productivity growth was higher than Singapore(1.9%), Hong Kong (0.3%) and Thailand (-0.1%). However, South Korea and Taiwan recorded higher productivity growth of 3.6% and 3.2% respectively. 

Malaysia’s 2.5% growth last year exceeded that of Italy, which contracted by 1.4%, Japan (0.7%), Germany (0.9%), Britain (1%), France (1.1%) and Canada (1.4%). The US, however, recorded a higher growth of 2.8%.  

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