Comment Competitiveness - from a champion

Comment Competitiveness - from a champion
Business & Markets 2013
Written by Dorothy Teoh of theedgemalaysia.com
Friday, 13 September 2013 15:55

THE World Economic Forum’s Global Competitiveness Report 2013-2014 released last Wednesday (Sept 4) had good news for Malaysia. At 24th out of 148 economies, Malaysia is the most competitive among Asia’s developing nations. Compared with last year, it moved up one position. Malaysia ranked no lower than 51st in any of the 12 pillars of the Global Competitiveness Index (GCI) and made it into the top 10 of two — its efficient and competitive market for goods and services (10th), and its well-developed and sound financial market (6th).

The report also gave a nod to the Economic Transformation Programme and Government Transformation Programme, saying that “in a region plagued by corruption and red tape, Malaysia stands out as one of the very few countries that has been relatively successful at tackling these two issues”.

The Global Competitiveness Report (GCR) also said that Malaysia’s 15th position for the quality of its transport infrastructure is “a remarkable feat in this part of the world, where insufficient infrastructure and poor connectivity are major obstacles to development for many countries”.

The country’s private sector also performed well, ranking 20th for business sophistication. On innovation, the 12th pillar of the Global Competitiveness Index, Malaysia came in a creditable 25th.

“All this bodes well for a country that aims to become a high-income, knowledge-based economy by the end of the decade,” said the report.

However, it noted three major competitive weaknesses: the government budget deficit, which represented 4.3 per cent of GDP in 2012 (103rd); the low level of female participation in the workforce (121st); and our comparatively low technological readiness (51st).

Overall, it’s a positive assessment with much to be pleased about, especially the fact that Malaysia ranks second in Asean behind Singapore, which the GCR calls a “competitiveness champion”. Until I read the part which said that “Singapore is in a league of its own”.

The republic is in the top 10 in nine out of the 12 pillars of the GCI. For seven of them, it ranks in the top 3, the only economy to achieve this. Singapore has since 2011 been ranked the world’s second most competitive economy behind Switzerland.

Malaysia has dropped four places since 2006, albeit from a high base, as the report notes. Still, Singapore has climbed from 8th position to 2nd in the same period, which meant its base was even higher.

The World Economic Forum says a more competitive economy is one that is likely to grow faster over time. Malaysia is ranked above South Korea (25th), Ireland (28th) and China (29th). But if we want to improve, we cannot afford to be complacent.

Of particular interest to me was how Singapore ranked in the GCI’s two pillars related to education. In the higher education and training pillar, Singapore ranked 2nd, ahead of Switzerland at 4th. Finland, where all teachers must have a Master’s degree, took the top spot.

Other rankings attest to Singapore’s competitiveness in this area. The National University of Singapore is ranked 29th in The Times Higher Education World University Rankings 2012-2013, making it the top-ranked university in Southeast Asia and the second in Asia after the University of Tokyo.

As the GCR noted, “Singapore’s competitiveness is further enhanced by its strong focus on education, which has translated into a steady improvement of its ranking in the higher education and training pillar.”

In the health and primary education pillar, Singapore also ranks second after Finland. By comparison, Malaysia ranked 33rd in this pillar, and 46th in the higher education and training pillar.

The GCR says education is gaining in importance as a factor in fostering countries’ competitiveness. “A perception is growing that educational systems in many countries could better respond to the needs of labour markets, help economies to avoid skills gaps, and ensure that adequately trained human capital is available to support business activity as well as to develop innovative capacity and entrepreneurship. It is therefore to be expected that, over the coming years, a series of major systemic reviews of educational frameworks at the national level will be necessary in many countries across all stages of development,” it noted.

Malaysia is one country that has conducted such a review, leading to the Malaysia Education Blueprint 2013-2025 which aims to transform the education system. The preliminary report was unveiled in September 2012, and the blueprint was launched last Friday by Deputy Prime Minister and Education Minister Tan Sri Muhyiddin Yassin.

Much work has gone into this blueprint, with the ministry conducting an unprecedented level of public engagement with some 50,000 stakeholders including educators, parents and students.

While it looks good on paper, the key to its success lies in implementation. That will make all the difference between a blueprint and not, in the word of a sceptic, a “blurprint”. Too much is at stake here — not just our competitiveness but our future.


Dorothy Teoh is CEO of The Edge Education Foundation



This article first appeared in The Edge Malaysia Weekly, on September 9, 2013.