Rafizi: Malaysia needs to shift focus to higher growth, higher value industries to sustain growth
15 May 2023
Malaysia has to focus on its long-term economic restructuring plan that will shift its reliance from commodities and low-value manufacturing to higher growth and higher value industries, such as the digital economy and green economy that are less vulnerable to international headwinds, to sustain the country’s gross economic product (GDP) growth in the future, said Economy Minister Mohd Rafizi Ramli.
He said this as he noted that Malaysia posted a surprisingly solid GDP growth of 5.6% in the first quarter of 2023, mainly contributed by the oil and gas (O&G), commodity and semiconductor industries.
“The first-quarter GDP [growth], I think, surprised many because it was a lot better than what we expected. But we are still a manufacturing and exporting nation. Our income rests more or less in three broad categories of products — O&G, commodity and manufacturing,” Rafizi told a press conference after the launch of the Centre for the Fourth Industrial Revolution Malaysia (Malaysia Centre for 4IR).
These sectors, however, are vulnerable to global headwinds, which is why Malaysia needs to focus on its long-term restructuring plan, he said.
“We are still exposed to whatever monetary decisions that the US Federal Reserve will decide. That is why it is important that while we manage our day-to-day economic performance, we have to really stay focused on the long-term restructuring,” he said.
“Through the [transition to the] digital economy [and the] energy transition — the more progress we make in these new high growth and high value sectors, the less we are exposed to international headwinds, and the less dependent we become on commodities, natural resources and so on,” he noted.
“The reason why this (focusing on high-value new sectors) is done is because this is the prerequisite for becoming a high income nation, hopefully in two or three years’ time,” he said.
The Malaysia Centre for 4IR is part of the World Economic Forum’s Global Centre for 4IR Network, and the first such centre in the Asia-Pacific region.
Hosted by MyDigital Corp, the Malaysia Centre for 4IR aims to drive the advancement of the digital economy in Malaysia, with a focus on supporting the country’s digital transformation and advancements in fast-growing sectors, including green energy.
The centre also serves as a public-private platform, bringing together leaders from government, business, civil society, academia and other sectors to advance new partnerships and initiatives that can unlock the value of technology for Malaysia’s economy and society.
Source: The Edge Malaysia