Productivity Up In Malaysia

KUALA LUMPUR, May 21 (Bernama) -- Malaysians are now more productive as evident in the 3.7 percent productivity growth to RM27,221 last year -- the highest in the last six years, Minister of International Trade and Industry Datuk Seri Rafidah Aziz said Monday.

"In 2005, the country registered a productivity growth of 2.98 percent to RM26,255," Rafidah said in her keynote address at the launch of National Productivity Corp's (NPC) Productivity Report 2006 here today.

She said last year's productivity growth surpassed that of some Organisation for Economic Cooperation Development countries such as Sweden (2.8 percent), Japan (2.5 percent), Germany (2.0 percent), Denmark (1.8 percent), the US (1.5 percent), UK (1.7 percent), France (1.4 percent), Australia (one percent), Canada (one percent) and Ireland (0.9 percent)

"Malaysia was also ahead of Thailand (3.5 percent), Taiwan (2.7 percent) and Singapore (1.2 percent)," she said.

Rafidah said during the year, manufacturing sector registered productivity growth of 4.4 percent, driven mainly by strong performance of export-oriented industries namely, petroleum and plastic products, basic industrial chemicals, wires and cables as well as semiconductors.

"The non-government services sector registered 2.6 percent productivity growth, with the utilities sector expanded by 4.5 percent, finance and transport sector grew by 4.1 percent while commerce and trade registered 2.2 percent growth," she said.

She said the total factor productivity (TFP) was an important contributor to the gross domestic product (GDP) and during the period 1997-2006, the economy has registered an average annual TFP growth of 1.6 percent.

"This trend will positively contribute towards realising the targeted 2.2 percent TFP growth by 2010," she said.

"Among the various components of TFP registered productivity growth last year were labour, which increased by 2.1 percent, capital (1.9 percent), education and training (35.6 percent), demand intensity (23.7 percent), capital structure (19.3 percent), economic restructuring (12.9 percent) and technical progress (8.9 percent)," she said.

Rafidah said the efforts by the government to improve the public services delivery system and to enhance the business environment could assist in increasing productivity levels of business entities.

However, she said, the private sector must undertake the necessary initiatives at both in-house and industry levels to invest in human capital in order to upgrade knowledge and skills, adopt best practices and apply relevent technology to achieve organisational excellence and higher added value.

"The government will continue to identify and remove administrative constraints, which add to the cost of doing business and institute the necessary measures and initiatives to help in cost reduction and enhancement of efficiency and competitiveness.

"The NPC, on its part, has initiated online programmes which can benefit companies. Among them are online best practices application and online registration of participants of productivity and quality training management information systems," she said.