The the International Institute for Management Development, which released the ranking on Thursday, said improvements across all four competitiveness pillars contributed to Malaysia’s stronger standing.
The country ranked fourth globally in economic performance, while government efficiency rose 11 places to 14th, business efficiency advanced 16 places to 16th and infrastructure improved two places to 33rd.
Among the sub-factors, Malaysia’s domestic economy ranking climbed four places to 11th, while international trade moved up one place to fifth. International investment recorded a notable improvement, rising seven places to 19th.
People walk outside the Petronas Towers in Kuala Lumpur, Malaysia. Photo by Reuters |
The IMD ranking assesses 70 economies based on four key pillars: economic performance, government efficiency, business efficiency and infrastructure.
Malaysia has steadily improved its standing in recent years. It climbed 11 places to 23rd among 69 economies in last year’s ranking, up from 34th out of 67 economies in 2024.
Economists said the country’s higher ranking reflects a stronger economic foundation, underpinned by robust trade competitiveness, improved public and business sector performance, and expanding opportunities in the technology sector.
Stephen Innes, managing partner of SPI Asset Management, said Malaysia’s significant rise in competitiveness represents more than a short-term recovery.
He identified the rapid growth of artificial intelligence and the semiconductor industry as key drivers, noting that Malaysia is well positioned across the electrical and electronics supply chain and has attracted investment in advanced packaging and data centers, making it a natural beneficiary of global supply chain diversification.
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