Malaysia’s drop in the IMD’s World Competitiveness Rankings for 2024 to the 34th spot from 27th in 2023 is primarily attributed to the weakness of the ringgit last year, according to Minister of Investment, Trade and Industry Tengku Zafrul Abdul Aziz.
In a statement during the launch of the Centralised Sustainability Intelligence (CSI) Solution at Bursa Malaysia today, Tengku Zafrul explained that the rankings are based on 2023 data compared to 2022, creating a lag effect. He highlighted that the ringgit’s stability significantly impacted the country’s competitiveness, affecting investment valuation, productivity, and efficiency tied to currency value, thereby raising concerns about economic stability.
Tengku Zafrul indicated that the decline in Malaysia’s ranking was primarily attributed to the challenges encountered by the ringgit in 2023. He added that Malaysia have observed a strengthening trend recently. If this positive momentum continues, Tengku Zafrul said we can anticipate an improvement in future rankings.
He also pointed out that the reduced contribution from Malaysia’s electrical and electronic (E&E) export sector in 2023 had a notable impact on the rankings. The decline in high-end manufacturing exports, particularly E&E products, was influenced by global trade slowdowns.
“This was in tandem with the slowdown in trade worldwide, but this year we can see that the sector has improved.
“Now, the trade numbers have gone up quite considerably, by about more than 10 per cent in May 2024,” Tengku Zafrul said.
Malaysia now ranks 34th out of 67 countries in the IMD’s World Competitiveness Ranking 2024, down seven places from the previous year. Within the Asia-Pacific region, Malaysia has slipped to the 10th position out of 14 countries.
