Malaysia has dropped from 21st to 25th slot out of 144 countries in global competitiveness, according to the Global Competitiveness Report 2012 - 2013.

The annual report , released by the World Economic Forum (WEF) today, also shows that Malaysia’s ‘technological readiness’ is ranked 51st, maintaining a five-year downtrend.

This was despite the overall score remaining relatively steady at 5.06 points out of a maximum of seven points, compared to 5.08 previously.

“Malaysia and other countries are putting in a lot of initiatives.

NONE “There are four countries which are faster growing in terms of their competitiveness here, and they are South Korea (ranked 19th), Luxemburg (22nd), New Zealand (23rd) and the United Arab Emirates (24th),” said Malaysia Productivity Corporation (MPC) senior director Lee Saw Hoon in explaining the drop in ranking.

Lee (right) was speaking at a press conference at MPC’s headquarters in Petaling Jaya today in conjunction with the release of the report.

She also said that the report also “upgrades” Malaysia’s status from an efficiency-driven economy to a country that is “in transition” to an innovation-driven economy.

In the report, the criteria for the latter classification is to have a gross domestic product (GDP) per capita between USD9,000 to USD17,000 and the change entails a shift in the weightage of various performance indicators towards those that promote innovation.

The report also places Malaysia’s competitiveness second to Singapore in the Asean region, and eighth in the Asia-Pacific region.

Low level of technological readiness

azlan Regarding Malaysia’s technological readiness, the report notes three areas that require improvement, namely: international internet bandwidth in kilobits per second per user (ranked 83rd), broadband internet subscriptions per 100 population (68th) and mobile broadband subscriptions per 100 population (64th).

“Its (Malaysia’s) low level of technological readiness (51st) is surprising, especially given its achievements in other areas of innovation and business sophistication and the country’s focus on promoting the use of ICT.

“Lack of progress in this area will significantly undermine Malaysia’s efforts to become a knowledge-based economy by the end of the decade,” the report wrote.

In a press statement today, International Trade and Industry Minister Mustapa Mohamed said there is a discrepancy between perception and what the data shows, and does not reflect Malaysia’s actual condition.

“Towards this end, the government will ensure that consolidated and comprehensive data and information is provided to international data sources such as the International Communications Union and the World Intellectual Property Organisation,” he said.

NONE Mustapa ( right ) added that the upcoming launch of the 1Malaysia Affordable Broadband Package could be expected to improve the situation.

Meanwhile the report also praised Malaysia’s markets for being “efficient and competitive” and supported by both a well-developed financial sector (ranked 6th) and business-friendly institutional frameworks (28th).

The report further praised the government’s efforts to combat excessive bureaucracy and lack of transparency, saying, “in a region where many economies suffer from lack of transparency and the presence of red tape, Malaysia stands out as particularly successful at tackling those tow issues.”

Regardless, in an opinion poll of 79 business executives in Malaysia conducted as part of the report, respondents still reported inefficient government bureaucracy as the biggest problem for doing business in Malaysia, followed by corruption and an inadequately educated workforce.