Malaysia rose to 15th place in the 2026 IMD World Competitiveness Ranking released June 18, moving up eight spots from last year’s 23rd place among 70 economies [1, 2, 3]. This marks its second consecutive rise, following an 11-place jump in 2025 from 34th in 2024.
The ranking assesses four pillars: economic performance, government efficiency, business efficiency, and infrastructure [1, 2, 3]. Malaysia ranked 4th globally in economic performance, 14th in government efficiency (up 11 places), 16th in business efficiency (up 16 places), and 33rd in infrastructure (up two places) [1, 2, 3]. Its domestic economy rose four spots to 11th, international trade climbed to 5th, and international investment increased seven places to 19th [1, 2, 3].
Prime Minister Datuk Seri Anwar Ibrahim said the country is entering a new economic phase focused on high technology, semiconductors, innovation, and artificial intelligence (AI). He added, "However, no matter how great or sophisticated the pace of technology, our focus remains on humans to produce a generation that not only has skills and expertise, but also values, kindness and responsibility" [4, 5, 6]. He also highlighted the climb in competitiveness as proof of government efficiency efforts, saying, "Alhamdulillah, this means we have moved up eight places from the previous year" [5].
In June, Malaysia and Bangladesh agreed to expand cooperation in AI, energy, and semiconductors during Bangladesh PM Tarique Rahman’s visit [4]. The government is actively upskilling and reskilling workers in AI-related fields. Human Resources Minister Datuk Seri R Ramanan reported 42,807 job losses from January to mid-June 2026, mostly due to business closures and downsizing rather than AI. He said, "AI is not a threat to employment at present and instead, the workforce needs to be equipped with AI-related skills" [7, 8].
Online fraud continues to surge, with losses rising from RM1.57 billion in 2024 to RM2.97 billion in 2025, and RM830 million lost in the first five months of 2026 alone, according to the Home Ministry [9]. The government is drafting legislation to hold e-commerce platforms accountable to protect local small and medium enterprises and combat counterfeit goods [10].
Malaysia maintains strong foreign investment due to AI-driven growth and supply chain shifts but notes infrastructure and skills development remains critical to boosting productivity [11]. Authorities say the country has the strategic capacity to manage data and safeguard sovereignty as part of its AI ambitions [12].
