2009年-世界发展银行全球_Malaysia_-_Productivity_and_Investment_Climate_Assessment_Update_275页_6mb

Summary of Malaysia Productivity and Investment Climate Assessment Update (Report No. 49137-MY)

Core Content

This report presents an updated analysis of Malaysia's investment climate and firm performance, based on the second Malaysia Productivity and Investment Climate Survey (PICS-II) conducted in 2007. It builds on the findings of the first survey (PICS-I) from 2002 and assesses changes in the business environment, productivity, and technological capabilities across manufacturing and services sectors, as well as regional differences.

Main Findings

Investment Climate

• Overall Performance: Malaysia's investment climate remains relatively favorable compared to countries with similar per capita income levels, as indicated by firm perceptions and international rankings.
• Rankings: According to the World Bank's "Ease of Doing Business" report, Malaysia ranked 20th out of 178 economies in 2009, up from 25th in 2008. It also ranked 21st out of 134 economies in the Global Competitiveness Index (GCR) in 2008-09.
• Constraints: Despite improvements in some areas, firms still perceive significant challenges. The top constraints include:
  • Skills Shortage: Identified as the most pressing issue by about 40% of firms.
  • Macroeconomic Instability and Policy Uncertainty: Perceived as severe by 20-25% of firms.
  • Crime and Theft: Doubled in perceived severity from less than 10% in 2002 to about 20% in 2007.
• Improvements: Some indicators have improved, such as access to finance and customs clearance efficiency. The percentage of manufacturing firms with generators increased, and the time spent by senior managers dealing with regulatory agencies decreased.
• Deteriorations: Crime and theft, and anti-competitive practices in services, have become more significant challenges. Innovation and technological capabilities have also shown signs of deterioration.

Firm Performance

• Manufacturing Sector:
  • Productivity Growth: Labor productivity in manufacturing declined from 5.5% annually during PICS-I to 2.2% during PICS-II.
  • TFP: Total Factor Productivity (TFP) growth has also slowed.
  • Performance Drivers: Large, foreign-owned, and exporting firms with high use of computer-controlled machines and R&D activities tend to have higher productivity. Conversely, firms facing skilled labor shortages, regulatory burdens, inadequate infrastructure, and crime suffer from lower productivity.
• Services Sector:
  • Performance: The services sector has stagnated since the early 1990s.
  • TFP: No significant improvement in TFP has been observed.
  • Foreign Presence: The presence of foreign firms, especially those not restricted by the 30% ownership cap, has a positive impact on domestic firms.
  • Skills Mismatch: Over 40% of firms report skill shortages, with the average time to fill vacancies being around four weeks. Many workers lack the appropriate education or skills for their roles.

Regional Perspectives

• Development Corridors: The report highlights regional development corridors such as the East Coast Development Corridors (ECER) and Northern Corridor Economic Region (NCER).
• Regional Differences:
  • Manufacturing Firms: Perceptions of constraints and the severity of obstacles vary across regions.
  • Services Firms: Similar variations are observed, with some regions showing better business environments.
• Infrastructure and Services: Manufacturing firms generally report better access to infrastructure and business support services than services firms.
• Regulatory Framework: While some improvements have been noted, the regulatory environment still poses challenges for firms.

Skills Gap

• Education and Employment: There is a significant mismatch between the education level of workers and the skills required by firms. Over 25% of high school diploma holders believe they need a university education for their jobs.
• Tertiary Education: The gross enrollment rate in tertiary education has increased, but the graduation ratio remains low compared to other countries.
• Wage Premium: The wage premium for college graduates has declined, even though skills shortages are reported by firms. This suggests a misalignment between education and job requirements.

Technological Capabilities

• Technology Indicators: Malaysia's technological performance is measured using indicators such as R&D expenditures, patents, and the Technology Capability Index (TCI).
• R&D Expenditures: R&D spending increased slightly from 0.5% to 0.6% of GDP from 2000 to 2004.
• Researchers and Technicians: The number of researchers and technicians increased significantly, but still lags behind what is needed for Malaysia's income level.
• Innovation: Malaysian firms are more "adaptors" than "creators" of new technologies. There is a weak link between firms and universities, limiting the commercialization of new technologies.

Key Policy Issues

• Why has labor productivity not grown faster? Despite a favorable investment climate, productivity growth in manufacturing and services has slowed, suggesting deeper structural issues.
• Why has crime and theft increased? Manufacturing firms report nearly double the losses from theft, robbery, or vandalism compared to PICS-I.
• Why is the skills premium declining? Despite reported skill shortages, the wage premium for college graduates has dropped, indicating a possible misalignment between education and job market needs.
• Why is technological capability stagnating? Although R&D spending and the number of researchers have increased, the overall technological capability has not improved significantly, suggesting inefficiencies in the system.

Conclusion

The report highlights the need for targeted policy interventions to address the persistent skills gap, improve the regulatory environment, enhance technological capabilities, and reduce crime and theft. It also emphasizes the importance of aligning education with labor market demands and strengthening the link between academia and industry to foster innovation and productivity growth. The findings from PICS-II are a valuable starting point for further research and policy development aimed at improving Malaysia's investment climate and economic competitiveness.