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Wednesday, October 19, 2005

Malaysia becoming increasingly uncompetitive

Parliament 18.10.05 (5)

Malaysia was in the global forefront when the government envisioned the Multimedia Super Corridor (MSC) in 1996, with the then Prime Minister Datuk Seri Dr. Mahathir Mohamad proclaiming it as “A Gift to the World”.

Almost a decade later, MSC is no more the symbol of the country’s ambition to be at the cutting edge of the information technology revolution and to become an IT superpower. It is now not very much more than a piece of real estate.

During the winding-up speech of the Minister for Energy, Water and Communications Lim Keng Yaik, I asked why Malaysia had fallen so far behind South Korea, when Malaysia was slightly ahead of South Korea in the start and push of both countries into the ICT era.

South Korea is now the world’s No. 1 broadband nation with the population broadband uptake in the region of 75 to 80%, while Malaysia lags miserably at the one per cent broadband penetration rate.

Keng Yaik was unable to explain why South Korea had completely left Malaysia behind in the ICT race when Malaysia was slightly ahead of South Korea during the early MSC days. Another country which had started almost at the same time to make the quantum leap into the ICT era was Ireland, which is now recognized as one of the ICT leaders of the world while Malaysia has been relegated to the backwaters among these early pioneers.

What is most shocking is Keng Yaik’s smug dismissal of the query, claiming that while Malaysia is indeed behind South Korea in the IT stakes, we can be proud that we are ahead of countries like Namibia.

I find such attitude most deplorable, reflective of a “Malaysia Tak Boleh” instead of “Malaysia Boleh”.

Malaysia is losing competitiveness to one nation after another. During the second day of the three-day Ministerial winding-up, I had the occasion to draw the attention of Parliament and the government to two other instances where Malaysia is losing the race for international competitiveness.

Both these instances were highlighted during the winding-up of the Deputy Minister for International Trade and Industry, Husni Mohd Hanadzlah.

In the first instance, I referred to the Proton national car and the automative industry in Malaysia. In the 21 years from its establishment in 1983 till 2004, Proton had exported 245,222 vehicles – which is not even equal to the car export for Thailand for one year.
Before Malaysia started on the Proton national car project, Malaysia’s automotive industry was ahead of Thailand, but today, Thailand is again way ahead, regarded as “Detroit of the East” with production in the million region or some three times the volume of Malaysia’s annual automobile production.

Secondly, the Transparency International (TI) Corruption Perception Index (CPI) 2005 released yesterday was another adverse reflection of the nation’s competitiveness, stuck in the 39th ranking while other countries in Asia and the OIC registered improvements – and is now at risk of being left behind by South Korea which made a 7-point leap from 47th to 40th ranking from last year.

Just to add, Thailand has overtaken Malaysia for the first time in the Swiss-based International Institute of Management Development (IMD) World Competitiveness Yearbook 2005, where Malaysia plunged 12 rankings from 16th to 28th placing.

Up to now, the attitude of Ministers and the government is to welcome good news but to ignore or deny bad news. Unless this unhealthy mentality is wiped out, Malaysia is likely to careen on, sliding from one competitiveness factor after another and losing to one nation after another.