By Datuk Ts Dr. Hj Ramli Amir, former President of the Chartered Institute of Logistics and Transport (CILT) Malaysia and Vice-President of CILT International for Southeast Asia
KOTA KINABALU: GapMalaysia’s leap in the IMD ( International Institute for Management Development) World Competitiveness Ranking – from 23rd to 15th in just one year, and from 34th two years ago – is more than just a “feel-good” headline.
It is a clear signal that the world now sees Malaysia as a serious, rising player in the global economy.
It tells investors, manufacturers and logistics planners that this is a country where the economy is resilient, policies are becoming more predictable, and businesses can operate with growing confidence.
Behind the ranking are four key pillars: economic performance, government efficiency, business efficiency and infrastructure.
Malaysia is now ranked among the world’s top performers for economic performance, reflecting stronger trade, investment and growth momentum.
Government and business efficiency have also improved significantly, suggesting that reforms, policy coordination and private-sector dynamism are starting to show real results.
In simple terms: the “software” of the economy – policies, institutions, management quality – is on an upward trend.But there is an important caveat that Malaysians should not ignore: infrastructure remains our weakest pillar.
While the country has climbed impressively in most areas, our infrastructure ranking still lags behind the others.
This covers not only roads, railways and ports, but also digital connectivity, energy reliability, education and health systems, and environmental sustainability.
For a trading nation that depends on moving goods, data and people efficiently, this gap is both a warning and an opportunity.Why does this matter for supply chains?
In today’s world, companies are reconfiguring their global production networks. Geopolitical tensions, trade disputes and pandemic shocks have pushed many multinationals to diversify away from over-dependence on any single country.
Southeast Asia has emerged as a key winner of this “China+1” or “China+N” strategy – and Malaysia’s improved ranking positions it as one of the preferred nodes in these new regional networks.
When boardrooms discuss where to locate a new plant, distribution centre, or regional hub, a country that is rising rapidly in competitiveness – not just stable, but improving – naturally moves up the shortlist.
For Malaysia, this opens doors in sectors where we already have strong foundations: electrical and electronics, semiconductors, advanced manufacturing, shared services and data centres.
A higher competitiveness ranking supports the narrative that Malaysia is not just a low-cost assembly base, but a place where more complex, higher-value activities can be anchored.
This means more opportunities for skilled jobs, technology transfer and deeper participation in global value chains.However, higher flows of trade and investment also mean greater pressure on our logistics and transport systems.
Ports will need to handle larger volumes more efficiently. Road and rail networks must be better integrated with industrial zones and hinterland areas.
Customs and border processes must be fast, predictable and digitally enabled. If we do not upgrade these “hard” and “soft” infrastructure elements in time, the very success reflected in the ranking could translate into congestion, delays and rising logistics costs – eroding the competitiveness gains we are now celebrating.
This is where regions like Sabah come into sharp focus. Nationally, Malaysia is now seen as a competitive economy with strong potential.
But the national infrastructure score implicitly averages very different realities across Peninsular Malaysia, Sabah and Sarawak.
States with less developed transport networks, ports and digital backbone risk being left on the sidelines of new supply chain flows, even as the country as a whole advances. When a multinational plans its regional distribution, it will naturally gravitate to corridors that offer deep ports, reliable hinterland connections and efficient logistics ecosystems.Instead of viewing this as a disadvantage, Sabah can position itself as part of the solution to Malaysia’s infrastructure gap.
Strategic investments in ports such as Sapangar Bay and POIC Lahad Datu, supported by well-planned road, rail and logistics corridors into the interior, can transform Sabah into a complementary gateway for East Asia–Borneo–ASEAN trade. With the right planning, Sabah’s ports and industrial zones can absorb some of the increased flows that Malaysia’s higher competitiveness ranking will attract, and provide redundancy and resilience to national supply chains.From a policy perspective, the message is simple but powerful: Malaysia has proven it can climb the global competitiveness ladder quickly when economic management, governance and business conditions improve.
The next stage of the journey will be won or lost on infrastructure. If we invest wisely in transport, logistics, ports and digital connectivity –including in East Malaysia – we can convert the “paper gains” of a ranking into real gains: more factories, better jobs, stronger regional linkages and more inclusive development.
For the public, this ranking should not be seen as a distant, technical index. It is about whether your state attracts new industries, whether your children can find quality jobs at home, and whether businesses in your town can reach markets faster and cheaper.
For businesses and policymakers, the signal is equally clear: global supply chains are rewiring, and Malaysia is back on the radar.
The question now is whether we are prepared to match this renewed confidence with the infrastructure and logistics capacity needed to truly become a top-tier, connected, and resilient trading nation.
