• Malaysia registered the highest productivity growth compared to 15 selected Organisation for Economic Cooperation and Development (OECD) countries such as the  Republic of Korea (4.9%),Japan(4.1%),Sweden(4.4%),Germany(3.5%),USA(2.7%) and Finland(2.7%).
• In comparison with selected Asian countries, Singapore recorded productivity growth of 11.8%, China 10%, Taiwan 8.2%, India 6.7%, Hong Kong 6% and Thailand 5.9%.
• In terms of productivity level, Singapore productivity level of USD54,565 was 4.0 times higher,  USA (USD80,284) was 5.9times higher  and Korea(USD33,628) was 2.5 times higher than Malaysia productivity level of USD13,577.

Enhancing services sector contribution to growth is one of the strategies to achieve a high income economy? What contribute to the productivity performance of this sector?

Services Sector registered productivity growth of 4.7%. The outstanding services sub-sectors were communication (6.6%), real estate & business services (5.9%) transport and storage (5.7%) and utilities (5.6%)and Wholesale and Retail (5.2%). The contributing factors are:

• Demand factors – push for higher domestic consumption to cushion the effect of the global slowdown.
• Supply factors – widespread adoption of newer management systems and methods that emphasised quality, speed, reliability and customer satisfaction in terms of price and service quality.
• Regulatory factors – permitted expansion of large hypermarket chains after a five years freeze on foreign-related ones.
• The high productivity growth registered by communication, utilities, transportation and storage was partly due to capital and knowledge intensity. 

2006: 
Favourable consumer sentiment, strong business confidence and healthy labour market condition due to: 2007: 
Robust private consumption supported by rising disposable income, expanding retail activity and increased tourist arrivals in tandem with Visit Malaysia Year 2007:

• Establishment of new retail complexes and expansion activities of major hypermarkets, superstores and specialty stores such as foreign-owned hypermarkets which had gained popularity and expanded rapidly ( end of July 2006: Four foreign-owned hypermarkets operated 45 outlets in the country).
• The expansion also benefited from the rapidly growing tourism industry in particular, the high spending tourists from the Middle East countries.
  

2007: 
Robust private consumption supported by rising disposable income, expanding retail activity and increased tourist arrivals in tandem with Visit Malaysia Year 2007.

• Increased spending by rising number of foreign tourists and robust household spending – most benefited by the retail industry.

What are the strategies to enhance the country and industry productivity?

The Government has earmarked the private sector as the engine of growth in the NEM. The 12 NKEAs, under the ETP will contribute a quantifiable amount of economic growth and the initiatives under Performance Management and Delivery Unit (PEMANDU), Special Taskforce to Facilitate Businesses (PEMUDAH) will expedite  the journey towards  efficiency and competitiveness. The GTP will improve better public services productivity performance to the nation by focusing on six core NKRAs :

• MPC has transformed from its earlier functions of providing training and advisory services in the 1960s towards its new roles by focusing into areas of competitiveness and innovation. To increase the outreach to the masses, MPC will partner with both local and global players.
• MPC five-departmental model integrates innovation and productivity activities together with regulatory review. The core of this transformation is the establishment of new functions namely, the  Regulatory  Review and Enterprise Innovation  which  monitor, review and provide recommendations for smart regulations and  introduce innovative  programmes  at the enterprise level.
• To further strengthen  MPC’s  functions, the three  other functions namely,  Business Excellence,  Global Competitiveness  and  Knowledge Management were established to support the Regulatory Review and Enterprise Innovation
  

• High global oil price weighing on USA economic outlook will dampen prospect for Malaysian export growth because USA is one of Malaysia largest trading partners.
• Exchange rate factor; weakening of the US Dollars.
• Financial crisis experienced by some of the EU countries.
• Troubling social tension in the Middle East will affect our tourism revenue.
• Tsunami and earthquake in Japan which will affect our trade with Japan.

How can Malaysia sustain its productivity growth of 4.6% per annum to support the GDP growth of 6% from now till 2020?

Output Factors

The successful implementation of programs identified in the national plan; NEM, GTP, ETP and 10th MP will help to sustain the output growth momentum.  Introduction of new focus areas besides the existing 12 NKEAs under ETP will further boost the economy.

Input factors

• Government Initiatives such as the establishment of more high performance schools, vocational & technical school and great emphasis on vocational training besides “white collar” training will provide the pool of talented, skilled manpower with productive and innovative mind set.  Other factors include;
• Enhancing the use of ICT, innovation in business process  and restructure   business  process to be more efficient  and cost effective;
• Establish of  strong international network for market diversification;
• Continuously pursue breakthrough in innovation.