GOVT, THROUGH MPC, IMPLEMENTING INITIATIVES FOLLOWING DECLINE IN IMD COMPETITIVENESS RANKING - MITI

KUALA LUMPUR, June 25 (Bernama) -- The government is implementing several specific initiatives in response to Malaysia’s current position in the IMD World Competitiveness Ranking 2024, according to the Ministry of Investment, Trade, and Industry (MITI).

The latest IMD World Competitiveness Ranking saw Malaysia sliding by seven places to the 34th spot out of 67 economies.

MITI stated that the Malaysia Productivity Corporation (MPC), as the main implementing agency, will continuously undertake three long-term efforts to improve the country’s competitiveness.

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“The three initiatives include the ‘Reformasi Kerenah Birokrasi’ (RKB), an initiative based on directives from the Chief Secretary to the Government for the MPC to review 197 projects from 28 ministries and government agencies. 

“This aims to review and amend regulations affecting the public and businesses to make them more efficient, transparent, and effective,” MITI said in a response to Datuk Seri Hasni Mohammad (BN-Simpang Renggam) regarding steps to improve Malaysia’s ranking in Parliament today.

MITI also said that the Special Task Force to Facilitate Business (PEMUDAH) will implement the New Deal for Business (NDFB) initiative to address issues and challenges related to regulatory compliance faced by traders and industry players.

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According to MITI, the MPC received over 500 issues raised by the industry, encompassing structural and process efficiency-related matters.

“Engagement sessions with the industry agreed to prioritise 25 key issues that require immediate resolution to be implemented in the first phase of NDFB,” it said.

In line with MITI’s efforts to create an agile and conducive business environment, the government is also implementing the Express-10 (E10) Initiative, which aims to shorten the approval period for constructing new factories from 24 months to 10 months.

The E-10 model, first initiated by the Kulim Municipal Council, has now been expanded to several states including Johor.

According to MITI, Malaysia’s position in the IMD World Competitiveness Ranking 2024 reflects the need for the government to reassess its focus, conduct benchmarking, and renew its competitiveness strategies, including those related to currency strength.

“Based on MITI’s observations of Malaysia’s performance trends over the past few years, it can be said that Malaysia’s competitiveness performance in the World Competitiveness Ranking has been fluctuating, showing both upward and downward trends from year to year.

“A significant part of the decline in Malaysia’s competitiveness ranking is due to uncertainty in the stability of the exchange rate, where 63 out of 256 evaluation indicators, or 25 per cent, are directly influenced by the exchange rate,” it explained.

Despite this, MITI mentioned that several competitiveness performance indicators recorded strengthening.

IMD recognised the strong and effective national tax policies and implementation, with Malaysia ranking in the top 10 globally in this indicator.

This high position reflects that the country’s taxation framework is robust and efficient, supporting economic stability and encouraging business operations.

Malaysia also showed significant improvement in budget management indicators, with its ranking rising eight places to 46th position, due to effective fiscal policies and practices in managing public funds.

Additionally, Malaysia is noted for having the highest number of science graduates, with its competitiveness ranking in this area being first globally. 

-- BERNAMA