Malaysia has no choice but to adopt digitisation to sustain growth, says McKinsey

Malaysia has no choice but to adopt digitisation to sustain growth, says McKinsey
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KUALA LUMPUR (Sept 19): Malaysia will have no choice but to adopt and embrace digitisation moving forward, in order to maintain its current gross domestic product (GDP) growth rate of 4% to 5%.

"Malaysia has no choice but to adopt digitisation and analytics moving forward, otherwise we will be left behind," said McKinsey & Company's Managing Partner of Malaysia Nimal Manuel when speaking to reporters after McKinsey Innovation Forum 'digitizing.Malaysia' here today.

He added that growth of the nation can be categorised as being driven by productivity as well as the demographic of the population, the former of which is essential for sustained economic growth.

"If Malaysia is to maintain its current growth levels of 4% to 5%, then we need to embrace digitisation, which will aid productivity," Manuel added.

"It is [no] longer whether Malaysian wants to but instead it needs to embrace digital and analytics in order to raise productivity which will in turn maintain our current growth rates," Manuel said.

He said that if Malaysia does not embrace digitisation, the productivity of the nation will be compromised, which can hamper overall GDP growth moving forward.

"Digitisation will look different with each sector, industrial sectors will benefit from Industrialization 4.0, while financial services will benefit from fintech, and so forth," Manuel added.

McKinsey also today announced its acquisition of talent and assets from VLT Labs, a Malaysian digital business, marking its first Southeast Asian acquisition in its digital capabilities space.

VLT Labs will join McKinsey Digital Labs, an existing team within McKinsey & Company.