Malaysia rising as a destination for business

As the world’s focus shifts towards Asia, post the economic downturn in 2008 and 2009, one country that has been making quiet, yet steady progress is Malaysia. Although the nation’s economy was hit by the global downturn, posting GDP rate of -1.7 per cent in 2009, its economy has since rebounded, with GDP figures of 10.1 per cent and 8.9 per cent, in the first and second quarters of 2010, respectively. Liberal trade and economic policies, have seen Malaysia transform, from a country dependent on agriculture and primary commodities in the 1960s, to an export-driven economy, with technology, knowledge-based and capital-intensive industries.

Last year, Malaysia’s international trade and industry minister, Datuk Mustapa Mohamed, announced a target, to put Malaysia among the top 10 economies in the world for ease of doing business, by 2012. The Doing Business 2010 report, by the World Bank and the International Finance Corporation, which aims to provide a quantitative measure of business regulations and protection of property rights, across 183 economies, lists the Malaysian economy at rank 23, ahead of Asia’s two big economies, China and India (ranked 89 and 133, respectively).

The country has also established five economic growth corridors, namely, Iskandar Malaysia in Southern Johor (IRDA), the Northern Corridor Economic Region (NCER) the East Coast Economic Region (ECER), the Sabah Development Corridor (SDC) and the Sarawak Corridor of Renewable Energy (SCORE), aimed at promoting free trade and business investment.

Cost-efficiency is another aspect, that Malaysia is hoping to cash-in on, to attract businesses. A report by DTZ Research, ‘Global Occupancy Costs – Offices, 2010’, shows that Kuala Lumpur’s total occupancy cost per work station, per annum, is around $3,780. This is significantly lower than other cities in Asia, like Hong Kong ($16,970), Dubai ($14,520), Singapore ($8,440) or Mumbai ($10,910).

Continuing with rankings, Malaysia also moved up two places in the Economist Intelligence Unit’s ‘Digital economy rankings 2010’, which benchmarks economies on their progress in leveraging information and communications technology (ICT), for the benefit of consumers, businesses and governments.

Other factors, such as consumer price inflation, which have remained in single digits (in the range of one to five per cent) and low unemployment rates (at around three to four per cent), have contributed towards a stable economic climate. Malaysia, it seems, on the path towards becoming a global competitor. The Swiss-based Institute for Management Development (IMD), according to its 2010 World Competitiveness Yearbook, places Malaysia as the tenth most competitive country in the world, ahead of several developed countries such as Denmark (13th) Netherlands (12th), Luxembourg (11th) and United Kingdom (22nd).