GEORGE TOWN – Penang may have outpaced the national gross domestic product (GDP) growth by expanding 13.1% last year compared to the country’s 8.7% figure, but Economy Minister Rafizi Ramli has advised caution due to the uncertain global economy.
Although Penang has the highest GDP growth of 13.1% last year, Rafizi said the state needs to adapt better in facing present challenges because its economy revolves mainly around exports.
“Penang must diversify from its reliance on the electrical & electronics (E&E) manufacturing segment by aggressively moving up the value chain,” he said at the 12th Malaysia Plan mid-term review and dialogue for Penang yesterday.
He noted that 74.6% of the state’s industries are in the E&E sector.
Rafizi also warned that chip manufacturing is now becoming “nationalistic”, with each country wanting to make their own in view of how crucial the key computer hardware has become to the global digital economy.
Penang caretaker chief minister Chow Kon Yeow was among those present at the dialogue.
Rafizi also spoke of national economic challenges that include the widening national debt of over RM1 trillion, upskilling, the fight against corruption, technology adoption and climate change.
He said Malaysia must address structural issues such as its reliance on foreign labour, uncompetitive wages, corruption and difficulties in moving up the industrial value chain.
To boost domestic consumption, he said a progressive wage scale is crucial and urged employers to reconfigure their business models to accommodate this.
The country must also register annual GDP growth of 4% to attain high-income nation status within the time frame of 2026 to 2028, he added.
Data shared by the ministry at the dialogue showed that 60% of the country’s workforce are now earning below RM3,000. – The Vibes, July 23, 2023
