Trade openness and manufacturing growth in Malaysia

This study investigates the long-run relationship between trade openness and manufacturing growth and further assesses the causal relationship between these variables. Contrary to some scholars belief that at national level, openness does not contribute to growth in Malaysia, our sector specific analysis suggest otherwise. In this aspect, we believe that in any attempt to establish relationship between openness and growth, the analysis should be sector specific since it is more relevant as well as assures a meaningful insight for policy makers. The results suggest that in the long-run, trade openness is positively related to manufacturing growth in Malaysia. Furthermore, the results also suggest that openness should be viewed as the long term policy initiative for the sector to benefit. Therefore, the policy direction for Malaysian manufacturing sectors should focus on long term trade openness policies. Nevertheless, to ensure sustainability, emphasis should be placed on how (which manufacturing sub-sectors) or when openness is actually important. Importantly, policy makers and scholars should understand that leveraging the benefits of openness also depend on whether the liberalized sector has the comparative advantage.Trade openness Autoregressive distributed lag Manufacturing growth Granger causality

Malaysia’s Export Market: Trends, Prospects and Challenges

This study examines the trends, prospects and challenges of Malaysia’s export market growth between 1990-2001 using the dynamic shift-share method. Two prevalent regional issues in the recent years that have been the concern of the policy makers in Malaysia have been investigated. First, realizing that Malaysia is highly dependent on its export as the engine of growth, the study analyzed the growth of each export product and international market access of these products at 2-digit SITC level for four major categories of manufactured exports. The results indicated that overall, Malaysia has a strong net shift in the chemical (SITC 5) and machinery and transport equipments (SITC 7) especially in office machinery (SITC 75) and electrical (SITC 77) products in the major markets. Secondly, due to the growing competition in international trade, the study also assessed the degree of competition between Malaysia, China and ASEAN-4 countries exporting to the major markets. In general the results revealed that China and other ASEAN countries have an impact on the position of Malaysia as an exporter of manufactured products. It was concluded that China poses stiff challenges to Malaysia in the major markets such as EU, US and Japan. However, China also promises opportunities for Malaysia to export certain products to its own market.Trade, Competitiveness, Net Shift, and Export Structure

Specialized entrepreneurship education: Does it really matter? Fresh evidence from Pakistan

Purpose There is a long-standing debate on whether the entrepreneurship education program (EEP) of university graduates can promote entrepreneurship intention and behaviour. The purpose of this paper is to use the theory of planned behaviour as a conceptual framework and compare the differences in entrepreneurial attitude, subjective norms, perceived behavioural control and intentions among students who participated in entrepreneurship education with a control group of Master of Business Administration (MBA) students in Pakistan. The study further examines what drives intentions between the two groups. Design/methodology/approach Data were collected using a questionnaire survey from 348 entrepreneurship students and 329 MBAs in their final year (both groups did a total of four years’ tertiary study). One-way analysis of variance test and regression analysis were used to examine the differences and the antecedents of entrepreneurship intention between the two groups. Findings MBAs have higher entrepreneurial intentions (EIs) than EEP students and the EIs are statistically significant. Nevertheless, the authors did not find any differences in attitude, perceived control behaviour and subjective norms towards entrepreneurship in both the groups. The entrepreneurship intentions of the MBA students are more influenced by social pressure as opposed to EEP students who are influenced by perceived control behaviours. Research limitations/implications First, although the study introduced a control group, comparisons were based only on EIs and their antecedents in participants’ final year of study. This cross-sectional design provides no information about how much intentions and antecedents changed over time. A longitudinal study would provide information about such changes. Second, the groups in the study were matched in terms of gender, age distribution, family background, years of study and presumed disposition towards running their business. It would be useful if future comparative and longitudinal research measured these individual factors and their effects. Practical implications Educational activities render the starting of a business desirable and feasible by changing the attitudes and intentions. Nevertheless, various exposures to the challenges of being an entrepreneur via the education programmes may lower their intention to be entrepreneurs. As such, entrepreneurial programmes should be designed with care. Social implications The study provides some insights on improving EIs especially in understanding the antecedents that are important for nations, such as Pakistan which has high unemployment and widespread poverty. Originality/value This study provides fresh evidence on the role of entrepreneurship education by comparing EIs and the cognitive antecedents of intentions of the two groups – entrepreneurship as well as MBA students

Demographic differences in learner response to entrepreneurial education programmes in Pakistan

Recent research on the benefits of entrepreneurship education has tended to ignore or “control out” possible demographic differences in outcomes for entrepreneurship graduates. This paper examines demographic differences in the perceived benefits of different components of entrepreneurship education programmes (EEPs), entrepreneurial cognitions and entrepreneurial intentions of EEP graduates. Data were collected by questionnaire from 348 university EEP graduates in Pakistan. All graduates had strong positive attitudes to becoming entrepreneurs and no demographic differences in entrepreneurial intentions were observed. Nonetheless, females in particular, and graduates with no work experience to a lesser extent, exited the EEPs with lower perceived benefits, particularly in terms of inspiration, and slightly weaker perceived control for entrepreneurship, than males and graduates with some experience. No substantial differences were associated with age or entrepreneurial family background. The authors suggest ways in which EEPs can be more inclusive of female students

Regulatory incoherence in nutrition labelling of prepackaged food in ASEAN: What next?

Regulatory heterogeneity (Pettman, 2013; USAID, 2013; Noraini, 2014) is identified as a challenge for increasing trade, harmonizing standards, and ultimately creating a single integrated Association of Southeast Asian Nations (ASEAN) market, which was a major objective in the formation of the ASEAN Economic Community (AEC) in 2015. One diverse technical regulation that governs the prepackaged food and beverage (PPF) industry is nutrition labelling. The labelling regulations across the AMS rest on the different International Guidelines followed by Member countries when preparing national regulations. Kasapila and Sharifudin (2011) point out that for nutrition labelling, Singapore, Malaysia, Brunei, Laos, Vietnam and Cambodia have followed the Codex1 guidelines in preparing their regulations. Conversely, Thailand and the Philippines, to some extent have adapted the United States (US) nutrition labelling guidelines. Even within those Member countries that adopt Codex, there are differences in the regulatory regime. Malaysia made nutrition labelling mandatory for energy, protein, carbohydrate, fat and total sugars for foods that are commonly consumed, and for various types of beverages in 2005 (AFBA, 2014; Kasapila and Sharifudin, 2011; see also Pettman, 2013). Nutrition labelling is also mandatory in the Philippines and Thailand, for certain food items. For other ASEAN countries that follow the Codex guidelines, nutrition labelling is voluntary; if nutrition and/or health claims are made on food packaging or if the food is for a special purpose (diabetic and fortified foods), nutrition labelling would then be mandatory

Patenting activities by developing countries: The case of Malaysia

This study examines the patenting activities in Malaysia with regards to applied for and granted patents in the Malaysian and US patent systems. The evidence shows that the patenting trend is increasing, particularly due to foreign firms' participation in the Malaysian economy. As such, any shock to the economic activities of foreign firms will deter patenting trends. This also indicates that the current local indigenous innovative capabilities are still weak and require better policy intervention to accelerate the inventive capabilities of Malaysia.Patent trends Foreign direct investments Innovative capability Technology distribution Developing countries Malaysia US patents

Electricity consumption-growth nexus: The case of Malaysia

The goal of this paper is to model the relationship between electricity consumption and real gross domestic product (GDP) for Malaysia in a bivariate and multivariate framework. We use time series data for the period 1971-2003 and apply the bounds testing approach to search for a long-run relationship. Our results reveal that electricity consumption, real GDP and price share a long-run relationship. The results of the autoregressive distributed lag (ARDL) estimates of long-run elasticity of electricity consumption on GDP are found to be around 0.7 and statistically significant. Finally, in the short-run, the results of the causality test show that there is a unidirectional causal flow from electricity consumption to economic growth in Malaysia. From these findings we conclude that Malaysia is an energy-dependent country, leading us to draw some policy implications. This paper adds support and validity, thus reducing the policy makers concern on the ambiguity of the electricity and growth nexus in Malaysia.Electricity consumption Economic growth Cointegration

Defining potentials and barriers to trade in the Malaysia–Chile partnership

Purpose: The purpose of this paper is to investigate the potentials and barriers to trade in the Malaysia–Chile partnership. Design/methodology/approach: This paper estimates two-way export potentials from an augmented three-dimensional panel gravity model of bilateral trade between Malaysia and the Latin America and the Caribbean (LAC) region, spanning the 1990–2014 period. Utilizing interviews with government officials and industry experts in Malaysia and Chile, this paper also provides insights into market access issues. Findings: The empirical findings of this study suggest that Malaysia has trade potential in Chile, but Chile is “overtrading” with Malaysia. By major products traded, both countries are found to be “overtrading,” as the export basket remains concentrated in this partnership. Through the interviews, fewer restrictions are reported by the various stakeholders, as the extent of trade engagement remains somewhat low. The main challenge identified within specific sectors in both the countries relates mainly to procedures established to secure compliance with labeling regulations for food products. Research limitations/implications: The sectoral findings reveal that there is indeed scope for expanding exports beyond the current major products traded, particularly in base metal and scientific and measuring equipment from the Malaysia and Chile perspectives, respectively. Thus, product diversification matters to intensify trade cooperation between the two countries. Non-tariff measures need to be streamlined by both parties to ensure further product diversification to food trade, particularly for Chile. Originality/value: The limited literature on cross-regional trade within the broader framework of Southeast Asia and LAC only support the fact that potentials do exist but do not appear to provide much research evidence. Empirically, this paper will add to the existing literature on the potentials that hold in the Malaysia–Chile partnership. Further, a lack of adequate information remains on market access and other barriers in both the nations to facilitate decisions on trade opportunities. The findings of the study fill that vacuum of information pertaining to market access and trade facilitation through interviews with various stakeholders in Malaysia and Chile

Harmonization of food trade standards and regulations in ASEAN: the case of Malaysia's food imports

Regulatory heterogeneity continues to be identified as a challenge for food trade in the Association of Southeast Asian Nations (ASEAN) as the progress of harmonization of food standards among member states remains slow. Using a new and comprehensive database on nontariff measures (NTMs), this article examines the coverage, frequency, and diversity of NTMs for the food sector in Malaysia, and then estimates their impact on food imports from ASEAN. The food sector in Malaysia is found to be highly regulated, dominated by technical measures, namely, labeling for sanitary and phytosanitary and technical barriers to trade reasons, product quality, and restricted substances. The empirical results subsequently verify that, overall, technical measures are import restrictive. This article therefore contends that harmonization of food standards and regulations at the regional level is important for enhancing trade. However, building common ground for food safety regulations should be NTM- and sector-specific, to realize progress in terms of regulatory convergence. This is particularly true for the food sector, since complete harmonization is not practical and not politically feasible