Boosting Productivity: Reset, Reform, Rebound

Senior Minister and Minister of International Trade & Industry YB Dato’ Seri Mohamed Azmin Ali officially launched the Productivity Report 2021 themed “Boosting Productivity: Reset, Reform, Rebound”, which echoes our recovery journey towards heightened productivity growth. 2020 was a year like no other as the COVID-19 pandemic has severely impacted our lives and livelihoods, causing major disruptions to industries and businesses, and adversely affecting productivity growth.

Under these circumstances, the need for supportive regulations and coherent operational frameworks is imperative in order to create business environments that are conducive for firms to operate productively and competitively. The reset button has pushed the regulatory reform agenda to a new level towards improved policymaking and regulatory delivery. 

“This ensures that our businesses can capitalise on the opportunities in the global marketplace in sync with the dynamism of current and emerging market trends,” said YB Senior Minister.

In pursuit of this objective, the MPC has continued to work closely with the Special Taskforce to Facilitate Business (PEMUDAH) to reduce the unnecessary regulatory burdens on existing and new businesses.

“In the World Bank’s Ease of Doing Business 2020 ranking, Malaysia recorded the second position among 190 economies in dealing with construction permits.” 

Staying on Course

It is noteworthy that the World Competitiveness Yearbook 2021 ranked Malaysia’s global competitiveness at 25th place from 64 economies, an improvement from the 27th position in 2020. In the World Bank’s Ease of Doing Business 2020 ranking, Malaysia recorded the second position among 190 economies in dealing with construction permits. Nevertheless, while this shows that reform initiatives are working, there is still more to be done to ensure that our regulations are agile enough to respond to changes.

Malaysia’s trade performance for April 2021 has demonstrated strong productive recovery indications with trade having grown by 43.2% to RM190.76 billion compared to April 2020. Exports have been in excess of RM100 billion for two consecutive months, reaching RM105.62 billion in April 2021, surging by 63% as against April 2020. This is a major achievement, being the fastest growth since February 1998 and the eighth consecutive month of year-on-year expansion since September 2020.

“To ensure that we continue on this trajectory of economic recovery and sustained growth, our regulations have to be more agile in responding to rapid changes,” stressed the YB Senior Minister. Regulatory frameworks must therefore be designed to enable technology innovation, ensure open and non-discriminatory business environments, protect consumers and workers, and tackle the unintended consequences of disruption.

Sustainable productivity growth depends on productive capital, people, and the workforce. Measures to reshape Malaysia’s workforce to be more dynamic, agile and resilient are vital to reboot productivity. Upskilling and reskilling programmes should be geared towards acquiring in-demand skills.

With the National Investment Aspirations being geared towards establishing Malaysia as a high-income nation and the primary destination for high tech and high impact industries, smart manufacturing and related services, and the provision for total solutions for advanced technologies, our digital transformation process must also move in tandem.

“We are already seeing the first fruits of the NIA with RM80.6 billion worth of approved investments in the manufacturing, services and primary sectors for the 1st Quarter of 2021. This translates into a surge of 95.6% in approved investments compared to the same period last year.”

Efforts are made to put Malaysia on a sustainable economic recovery path

Fighting the Good Fight

“We are still in the grip of the pandemic. That means we are still at war with an invisible foe. To win this war, we must act in unison and pool our resources together and remain resolute in our convictions. In this regard, the National Recovery Plan (NRP) has outlined the roadmap of the recovery journey,” said YB Senior Minister.

To put the country back on the recovery path under the NRP, the Prime Minister announced an RM150 billion package aimed at sustaining the earlier economic stimulus initiatives, supporting businesses and ramping up vaccination. In this regard, a total of RM600 million would be allocated to increase the country's vaccine supply and add 29 more vaccination centres (PPV).

Another RM150 million is allocated to facilitate the current MITI-led PIKAS vaccination program which is also a crucial aspect of the recovery plan, focusing on the manufacturing sub-sectors that are key components of the supply chain of essential products and services. Protecting workers remains imperative as they constitute a critical component of the economic sector, the backbone to ensuring economic recovery and resilience.

With these synergistic efforts in place, there is certainly an air of optimism for 2021 to be an inflection point for holistic health, greater productivity and sustained economic recovery.