Malaysia’s growth as a multi-sector economy over the past decade has been fuelled by the services sector. In 2015, the services sector accounted for more than half of the country’s gross domestic product (GDP). As trade expansion and inflows of foreign capital quicken the pace of Malaysia’s economic growth, the country’s logistics industry has established itself as a significant element in national competitiveness, bringing with it associated economic multipliers.
The momentum in the service sector was largely driven by the growth of wholesale and retail trade, which accounted for almost 18% of Malaysia’s GDP in 2014. The transport and storage sub-sector grew at about 10% in the same year, making up 3% of Malaysia’s economy.
The logistics industry performance has experienced favorable growth over the years, owing to the manufacturing, wholesale and retail, and business services spending. Malaysia’s strategic geographical position, excellent ports and connectivity, vast service capability provided by logistics providers, supportive legislative framework, and highly educated labor force are also growth factors driving the logistics industry here.
These strengths favor Malaysia as a key logistics link to Asia. The country is strategically located in the center of economic activity, surrounded by the growing ASEAN community and several emerging Asian economies. Despite Malaysia’s strengths, however, several core issues need to be addressed to support the continued growth of its logistics industry.
This research provides insights into the developments of Malaysia’s logistics industry. Following are the key questions it answers:
- What are the prevailing trends in Malaysia’s logistics industry, and what will the industry look like in the years to come?
- What is Malaysia’s logistics industry performance in terms of freight volume?
- What are the key freight activities?
- What are the key growth drivers?
- What are the issues and challenges faced by market participants?
- What areas need improvement, and what can be done?
- How will the Eleventh Malaysia Plan 2016–2020 affect the logistics industry?
- What is the impact of the ASEAN Economic Community (AEC) on the logistics industry in Malaysia?
- What growth opportunities are expected to arise in the near future that will enable market participants to gain market share?