KUALA LUMPUR (June 24): Malaysia needs to raise productivity in order for the economy to reach high-income status in the next decade, said Christine Lagarde, managing director of the International Monetary Fund.
Despite Malaysia’s economic success in the past 20 years, productivity has lagged and “in recent years it has stagnated,” she said in an embargoed text of a speech delivered to students in Kuala Lumpur on Monday.
She highlighted three ways in which the Southeast Asian nation can achieve this:
* Improve governance and tackle corruption: Malaysia’s anti-corruption plan launched earlier this year is “excellent progress,” but the key will be in making sure the changes are captured in law and implemented
* Investing in high-quality education: While Malaysia is investing more in education, the results have been lackluster. The country is still ranked below the OECD average in math, reading and science. Authorities should focus on skills retraining, a compulsory education requirement, and more online
courses and part-time training for university age students
* Boosting labor force participation for women: In Malaysia, women have fewer career opportunities compared to peers in the region and they earn on average about one-third less than men.
The recent budget includes measures to increase paid family leave and ensures government-linked companies have at least 30% female participation on their boards, although Lagarde says that should be 50%