Publication: Malaysia Economic Monitor, December 2018: Realizing Human Potential
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2018-12
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2018-12-13
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The Malaysia Economic Monitor consists of two parts. Part 1 presents a review of recent economic developments and a macroeconomic outlook. Part 2 focuses on a selected special topic that is key to Malaysia’s medium-term development prospects. In this edition, the focus of the special topic is on realizing human potential.
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“World Bank Group. 2018. Malaysia Economic Monitor, December 2018: Realizing Human Potential. © World Bank. http://hdl.handle.net/10986/30996 License: CC BY 3.0 IGO.”
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Publication Malaysia Economic Monitor, December 2017(World Bank, Washington, DC, 2017-12-13)The aim of the Malaysia Economic Monitor (MEM) is to foster better-informed policy analysis and debate regarding the key challenges that Malaysia faces in its endeavor to achieve rapid, inclusive and sustainable economic growth. The MEM consists of two parts: Part 1 presents a review of recent economic developments and a macroeconomic outlook. Part 2 focuses on a selected special topic that is key to Malaysia’s development prospects, particularly as the country moves towards becoming a high-income economy.Publication Malaysia Economic Monitor, December 2014 : Towards a Middle-Class Society(Washington, DC, 2014-12)Malaysia has in many ways become a success story in shared prosperity. Shared prosperity means that all households experience income growth, but growth is higher for those households at the bottom of the distribution, a pattern that leads to lower inequality. In the past 40 years, Malaysia drew on its natural resources to nearly eradicate absolute poverty, from 49 percent in 1970 to 1 percent in 2014. The number of Malaysians vulnerable to falling into absolute poverty has also declined in this period. To accelerate Malaysia s transformation into a middle-class society, Malaysia may consider prioritizing reforms that: (i) close the educational achievement gaps at the post-secondary levels by compensating for family background, including pursuing universal pre-primary enrolment and otherpolicies to boost the quality of the poorest performing schools; (ii) provide more demand-driven post-secondary skills training for those already in the labor markets; (iii) create an integrated social safety net including both social insurance mechanisms to protect households against shocks and old age (for example by introducing unemployment insurance and redirecting subsidy savings to matching contributions to retirement accounts), and higher levels of social transfers (by consolidating, improving targeting, and increasing benefits of existing programs); and (iv) this safety net may be financed through more progressive tax policy (for example by reviewing the top marginal personal income tax rate and expanding the number of taxpayers).Publication Indonesia Economic Quarterly, June 2018(World Bank, Washington, DC, 2018-06)This edition includes a focus topic that discusses how 15 years of education reforms have helped to improve education outcomes and human capital in Indonesia, and what challenges remain. The outcomes from 15 years of educational reform have been mixed, with a significant expansion inaccess, but a large deficit in quality. In 2002, Indonesia embarked on a series of policy reforms to strengthen access to and the quality of education, both key determinants of human capital development. After 15 years, however, the results of the reforms have been mixed. Enrolments have grown significantly, but student learning remains below the levels of other countries in the region. For example, 55 percent of 15-year olds are functionally illiterate, compared to lessthan 10 percent in Vietnam. Education reform covered the right areas, but implementation challenges led to uneven results. Most elements of the reforms were aligned with international best practices and had strong potential to improve Indonesian education outcomes. Educationreform included increasing financing for education, enhancing participation of local actors in sector governance, strengthening accountability, improving the quality of teachers, and ensuring students’ preparedness as they enter schooling. Significant implementation challenges prevented the policy reform from reaching its full potential. While steps have been taken to address some ofthese challenges, further actions are urgently needed. In particular, measures need to be taken tostop growing inequality in student results, and to take advantage of the opportunity generated by the large number of teachers retiring in the next decade. Key recommendations include: defining and enforcing qualification criteria to be met by every teacher who enters the classroom, complementing the existing financing mechanisms for education with a targeted, performance-based transfer for lagging schools and districts, and launching a national education quality campaign to generate public awareness and pressure for effective action to improve student learning.Publication Malaysia Economic Monitor, June 2018(World Bank, Washington, DC, 2018-06)The historic outcome of Malaysia's recent elections provides an unprecedented opportunity for change. The country's 14th General Elections which took place on May 9, 2018, in the context of widespread citizen concern regarding the degree to which the proceeds of economic growth have been shared across the Malaysian society and a call for increased government accountability, have resulted in the nation's first change in government since its independence in 1957. The new government's emerging economic policy framework is strongly guided by its election manifesto Buku Harapan, which responds to these popular sentiments. Heightened uncertainty amid the political transition exacerbated the ongoing turbulence in the financial markets arising from external factors. In the period between the elections and end-May, Malaysia's 5- and 10-year sovereign spreads against US Treasuries increased by 24 and 27 basis points respectively, while the stock market fell by three percent. Meanwhile, RM19 billion of foreign capital was withdrawn from the domestic financial markets in May as post-election market turbulence coincided with heightened investor uncertainty about the emerging markets asset class. However, since then volatility in the financial markets has been largely driven by external factors amid increased global trade tensions, as the uncertainty surrounding the political transition has gradually reduced.Publication Malaysia Economic Monitor, December 2016(World Bank, Kuala Lumpur, 2016-12)Malaysia’s economic growth has slowed down but remains resilient to external headwinds. The economic growth rate slowed from 5 percent in 2015 to 4.2 percent, year on year, in the first three quarters of 2016. Private consumption growth slowed down due to a softening labor market and households’ ongoing adjustment to a context of fiscal consolidation. Public investment in infrastructure is offsetting moderation in investment in the oil and gas sector. The gross domestic product (GDP) growth rate is projected to reach 4.2 percent in 2016, with slow improvement moving forward. The fiscal consolidation process remains on track despite lower oil-related revenues. External developments pose the greatest risk to Malaysia’s growth trajectory. Uncertainty regarding the impact of potential US fiscal stimulus policies on global trade, energy prices, financial flows and exchange rates is a major source of external risk, as evidenced with the recent financial outflows from emerging markets and its impact on the value of the ringgit. Bank Negara Malaysia (BNM) has introduced measures to curb ringgit trading in offshore markets while developing and deepening onshore foreign exchange future markets. Continuing good performance on fiscal outcomes, in large part thanks to the introduction of GST, is important in building confidence in the policy framework. This could be supported by further mobilizing and diversifying fiscal revenues, including by broadening the base for the personal income tax and removing some exemptions in the GST. Also, raising efficiency of operational expenditure (i.e. improving the targeting of social assistance) and development expenditures (i.e. greater inter-agency coordination) could provide some additional fiscal space.
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Against this backdrop, emerging market and developing economies are set to enter the second quarter of the twenty-first century with per capita incomes on a trajectory that implies substantially slower catch-up toward advanced-economy living standards than they previously experienced. Without course corrections, most low-income countries are unlikely to graduate to middle-income status by the middle of the century. Policy action at both global and national levels is needed to foster a more favorable external environment, enhance macroeconomic stability, reduce structural constraints, address the effects of climate change, and thus accelerate long-term growth and development.Publication The Container Port Performance Index 2020 to 2024: Trends and Lessons Learned(Washington, DC: World Bank, 2025-09-22)The Container Port Performance Index (CPPI) provides a global benchmark of how container ports perform in handling vessel calls. 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The report will bring global attention to high-performing countries that have valuable experience to share as well as to areas where efforts will need to be redoubled.Publication The Container Port Performance Index 2023(Washington, DC: World Bank, 2024-07-18)The Container Port Performance Index (CPPI) measures the time container ships spend in port, making it an important point of reference for stakeholders in the global economy. These stakeholders include port authorities and operators, national governments, supranational organizations, development agencies, and other public and private players in trade and logistics. The index highlights where vessel time in container ports could be improved. Streamlining these processes would benefit all parties involved, including shipping lines, national governments, and consumers. This fourth edition of the CPPI relies on data from 405 container ports with at least 24 container ship port calls in the calendar year 2023. 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