From Bernama
Malaysia’s global competitiveness ranking dropped three positions to 24, according to the World Economic Forum’s Global Competitiveness Report for 2009-2010 released Tuesday.
The drop essentially was the result of a much poorer assessment of its institutional framework, said the report, which was released ahead of WEF’s annual meeting of the New Champions 2009 in Dalian, China.
The report said every indicator in the area had been exhibiting a downward trend since 2007, causing Malaysia to tumble from 17th to 43rd position in this dimension in just two years.
Switzerland topped the overall ranking of 133 economies, with the US fell one place to second position, and Asia continued to feature prominently with Singapore at third and Japan at eighth, and Hong Kong, South Korea and Taiwan all in the top 20.
The report also said security was of particular concern in Malaysia with its ranking dropped 25 levels to 85th.
According to the business community, the potential of terrorism (ranked 97th) and crime (ranked 95th) both imposed significant business costs.
Also of concern was the budget deficit, which increased in 2008, amounting to almost five percent of Malaysia’s gross domestic product, it said.
However, Malaysia scored high in most other dimensions particularly in those factors at the top end of the value chain, namely business sophistication (ranked 24th) and innovation (also ranked 24th).
The report said expectations were high for Malaysia that averaged an impressive seven percent growth per year between 1990 and 2000 and a healthy five per cent since then.
Mirroring this economic success, Malaysia had featured prominently in the competitiveness rankings ever since its first inclusion in 1994, it said.
“Indeed, it remains the most competitive Stage 2 (efficiency-driven) Country,” it said.
It pointed that in order to maintain its competitive edge, Malaysia now needed to prepare its conversion into a knowledge-based, innovation-driven economy.
“Improving both the quantity and quality of higher education (ranked 41st) and boosting technological readiness (ranked 37th), particularly information and communication technology penetration, would serve this effort well,” it said.
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