NEW YORK — October 2, 2015: Malaysia is facing a triple challenge in respect of the economy, including a dependence on commodity exports.
The first of the challenges is a reversal of fund inflow into the emerging economy with the uncertainty not being good for the market.
“We need clarity,” said Minister in the Prime Minister’s Department Datuk Seri Abdul Wahid Omar, who is here as part of Prime Minister Datuk Seri
Najib Tun Razak’s entourage.
Referring to the dependence on commodity exports, Wahid highlighted that efforts are being made to diversify the country’s export product line.
“The third is external and impacts the whole world. It is China’s economic slowdown. We have hedged against this by diversifying our trade and mitigating losses.
“Our major export markets are Singapore (13.8 per cent), followed by China (12.9), Japan (9.8) and the United States (9.3).”
But he told Bernama that despite the challenges, Malaysia’s economic fundamentals remain sound.
“I firmly believe in the new economic model that rests on the three pillars of high income, inclusiveness and sustainability. It is also designed to lead
us to developed nation status.”
Wahid pointed out that the high-income goal can be achieved with a six per cent growth rate to reach the target of US$15,000 per capita income by
2020, adding, Malaysia had already crossed the US$10,000 mark.
He also highlighted the importance of implementing the Economic Transformation Programme and said under the 10th Malaysia Plan, growth had been registered at 5.3 per cent from 2011 to 2015.
“A reason for our growth is that over the years, we have diversified the structure of the Malaysian economy and reduced the dependency on commodities.
“As a result, our commodity and mining sectors contribute just 18 per cent to our Gross Domestic Product. Our intention is to further reduce this share to 15 per cent by 2020.
” Our economy today is driven largely by the services and manufacturing sectors which together, comprise two-thirds of the GDP,” Wahid said.
The backbone of Malaysia’s manufacturing sector is the electrical and electronics industry while the services sector comprises among others, financial and business services, transportation and communication and gastronomy.
The latest World Bank data suggests that the GDP-based per capita income in Malaysia was US$10,830 in 2014, surpassing for the first time the US$10,804 world average.
Malaysia has also achieved an impressive measure of sustainability in terms of managing its natural resources, particularly oil and gas.
“Malaysia has been recognised by the World Bank as a success story in terms of harnessing natural resources for the environment. We are not fully utilising our capacity of natural resources and are, in fact, preserving a reasonable percentage for future generations,” Wahid said.