Directorate for Science, Technology and Innovation

OECD Reviews of Innovation Policy: Malaysia 2016

In series:OECD Reviews of Innovation Policyview more titles

Published on November 11, 2016

The OECD Reviews of Innovation Policy offer a comprehensive assessment of the innovation system of individual OECD countries and partner economies, focusing on the role of government and concrete recommendations to boost innovation performance and R&D policies. While Malaysia successfully transformed its economy from agriculture and mining towards manufacturing and more recently services, it is currently facing an economic slowdown and new competition. Mobilising new sources of growth will allow Malaysia to respond to these challenges and re-energise its economy through innovation-driven productivity gains. 


Acronyms and abbreviations
Executive summary
Overall assessment and recommendations
Macroeconomic performance and framework conditions for innovation in Malaysia
Innovation performance in Malaysia
Innovation actors in Malaysia
Innovation policy and governance in Malaysia
List of people interviewed during fact-finding missions
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key findings

  • Malaysia is one of Southeast Asia’s most dynamic economies and one of Asia’s great success stories. Its economic and social development over the last half century has been impressive. High economic performance, based on a profound transformation into a diversified economy, coupled with a striking reduction in poverty levels, has brought Malaysia closer to reaching its goal of becoming a high-income country by 2020.

  • To achieve this goal, Malaysia faces a number of challenges. While the economy has maintained resilient growth, productivity growth has slowed in recent years, and Malaysian firms are facing new competition from their East Asian peers. 

  • Malaysia could seize immense opportunities by strengthening innovation and skills. This would allow firms to shift towards segments of the supply chain that support higher domestic value added and higher wages. Continued commitment to innovation policy is needed to support a broad-based upgrading towards more knowledge-intensive activities in services, manufacturing, and the primary and agro-food sectors. The Malaysian government is well aware of these opportunities and has already taken action in this area. The Review recommends further actions to help to build a well-performing innovation system which can effectively drive economic growth and social development.


further reading