Wan Junaidi speaks to delegates at the 2020 Asia Economic and Entrepreneurship Summit.

KUCHING: For Malaysia to maintain its prized standing as the most competitive economy in Asean after Singapore, it needs to unlock more business and investment opportunities in the country.

Entrepreneur Development and Cooperative Minister Datuk Seri Wan Junaidi Tuanku Jaafar said this can be done by growing the number of partnerships between the government, entrepreneurs and cooperatives.

“However, Malaysia must ensure that its increase in economic competitiveness must stem from inclusive, innovative and sustainable growth,” he said in his opening speech at the 2020 Asia Economic and Entrepreneurship Summit at The Ritz-Carlton in Kuala Lumpur on Sept 8.

He said the economy of the country has been rather steady since 2010 with an average annual growth of 5.33 percent. However, the country is still exploring the right formulae to sustain its economic competitiveness against emerging economies such as China, India and even Vietnam.

“This is evident as in 2019 the Malaysian economy only grew by 4.3 percent in contrast to our Asean neighbours who fared better as the economy of Indonesia and the Philippines grew by 5.02 percent and 5.9 percent respectively in 2019 while Vietnam’s economy grew by an impressive seven percent,” he said.

Citing the Statistic Department of Malaysia (DOSM), the country’s Gross Domestic Product (GDP) stands at RM1.4 trillion in 2019, with micro, small and medium enterprises (SMEs) that constitute 98.5 percent of the business establishments in the country has long been the backbone of the Malaysian economy.

“The SMEs has contributed RM552.3 billon or 38.9 percent to the country’s GDP in 2019, and SMEs collectively provide employments to 7.3 million people last year.

“It wasn’t until the start of the unavoidable movement control order (MCO) in March 2020 that the magnitude of the crisis really hit the Malaysian shore converting itself from a mere health crisis into a full-blown economic crisis without an expiry date,” he said.

He said pre-Covid-19, 55 percent of SMEs were anticipating an increase in sales, but by March 2020, 72 percent had to temporarily closed their business operations with 59 percent recording no sales at all, 79 percent have cash to only last them less than three months and 39 percent can only sustain their business for less than one month.

“The second-quarter GDP dipped 17.1 percent as the country went into a lockdown with strong enforcement to stem the spread of the disease. When the sustainability of many businesses is affected, the livelihood of people will also be affected. This calls for the public and private sector to move swiftly to buffer the impact,” he said.

As such, he said the government took the 3R approach to tackle the economic crisis depicting Relief, Recovery and Reform, and is gaining momentum.

“Going forward, we have to accept that life will never be the same after Covid-19. It pushed us to re-think, improvise and innovate. We should promote more local businesses to provide solutions to empower other businesses, including the micro enterprises to embrace technology adoption to adapt to the new normal.

“The momentum to introduce reform initiatives will be carried through as we embark on the 12th Malaysia Plan from 2021 to 2025,” he pointed out.

He added the Covid-19 pandemic has also shown how successful public-private partnership can be for the country in terms of maintaining public health.

“Unlocking business efficiency by growing the number of partnerships between the government, entrepreneurs and cooperatives to ensure inclusive, innovative and sustainable growth is insufficient in enhancing Malaysia’s economic competitiveness.

“Instead, Malaysia must also do more in building accountable and inclusive institutions, congruent with the concept of sustainable development,” said Wan Junaidi.