Malaysia: Jockeying for position

Text size +-
Recommend

A recent report on information and communications technology (ICT) has shown that regional rivals are advancing at a faster rate than Malaysia, and that more needs to be done to achieve public targets set by the government. However, officials remain confident that the lost ground will soon be made up.

In mid-April the World Economic Forum (WEF) released its latest “Global Information Technology Report”, a broad-ranging study assessing the conduciveness of national environments for ICT development and diffusion; the degree of preparation for and interest in using ICT by individuals, the business sector and the government; and its actual usage in daily life.

This year, Malaysia ranked 28th out of the 138 countries assessed by the WEF, one place down from its showing in 2010. The report highlighted the fact that Malaysia needs to do more to improve its ICT infrastructure – including in areas such as internet bandwidth and secure-access internet servers – with the country ranked 51st globally in this area. The number of broadband subscribers as a percentage of the population, in which it came 59th, was also a concern.

While Malaysia was not ranked as highly as last year in the WEF’s report, and indeed has slipped further back from its placing of 26th of 2007 and 2008, it remains something of an anomaly, being the only non-high-income nation among the top 30. It was also assessed as being one of the societies most prepared to embrace ICT.

Meanwhile, regional peer Singapore was ranked second globally, Taiwan came in sixth and South Korea rounding out the top 10. While Singapore held the same position on the WEF’s ladder as last year, both South Korea and Taiwan climbed five places, strengthening their ICT credentials at a time when competition for investment in the sector – and in regional economies overall – is increasing.

The country will also be keeping an eye on one of Asia’s emerging powerhouses. China climbed to an all-time high of 36th in the WEF rankings, making it one of the world’s fastest movers in the past few years, having been mid-table on the 59th rung as recently as 2007.

These changes in the rankings are an indication that other countries are only now rapidly improving their own ICT sectors, while Malaysia has already instigated many reforms – and made substantial investment – in the past.

Importantly though, the WEF found that the government’s prioritising of the use and development of ICT, the status given to ICT by the state in its vision for the future and its preparedness to acquire advanced technology were all extremely strong, with Malaysia rated 11th globally for government readiness.

The adoption and use of ICT has long been a priority for the government, which sees the sector as crucial to transforming Malaysia into a developed nation with a high-income economy by 2020. Under the 10th Malaysia Plan (10MP) the contribution of ICT to GDP is forecast to rise from 1.2% in 2009, the first year of the plan, to 10.2% in its last, 2015.

Despite the findings of the WEF study, Malaysia is confident that both the 2015 and 2020 targets will be achieved, with Badlisham Ghazali, the CEO of the Multimedia Development Corporation (MDeC), predicting that ICT will surge in the coming few years.

According to figures compiled by MDeC – a state-funded agency tasked with promoting and facilitating Malaysia’s goal of becoming an international centre for ICT firms and a leader in multimedia innovation, services and operations – some 160,000 jobs will be created in the sector over the next five years, and ICT will play a far greater role in society and the economy.

“We want ICT to be more pervasive, with a wider economic footprint. Our strategies in the three main clusters of creative multimedia, shared services outsourcing and infotech have been realigned to put stronger emphasis on wealth creation and high-value investments,” Badlisham told local media on April 20.

Malaysia will need to make these high-value investments if it is to attract more foreign and domestic interest to its ICT sector and provide the backbone required to meet the goals set out in the 10MP and Vision 2020. Given the intense competition in the region, the country cannot afford to ease up and sector development will need to remain front and centre going forward.

Read Next:

In Asia

Prime Minister Mahathir Mohamad, Malaysia

Which main structural challenges to the Malaysian economy are being addressed by the government’s Shared Prosperity Vision 2030?

In ICT

ICT expansion to position Oman as regional digital services leader

Oman is looking to strengthen its position as a digital services leader in the region, with a series of new developments designed to bolster the ICT sector.

Latest

Beligh Ben Soltane, Chairman, Tunisian Investment Authority (TIA)

What are the expected implications of Law No. 47 of 2019, which was adopted in April 2019 to improve the business and investment climate?