KUALA LUMPUR: The International Trade and Industry Ministry has teamed up with Performance Management and Delivery Unit (PEMANDU) to bump up the services sector's contribution to gross domestic product to 60 per cent by 2020 from 55 per cent.
The Malaysian Servies Development Council (MSDC) will monitor the sector's progress and identify obstacles in a bid to maximise its potential.
"The services sector has done well, it has been growing relatively faster than many other sectors, which can be seen from the quarterly report by Bank Negara.
"But this is not enough. Malaysia needs to implement some radical measures to push up the contribution from this sector," International Trade and Industry Minister Datuk Seri Mustapa Mohamed said after chairing a closed-door meeting ith MSDC representatives, here, yesterday.
Mustapa said among the key areas that will be reviewed by MSDC, including the efficiency of the country's logistics industry and the progress of the 45 services sub-sectors to be opened up to foreign participation.
In 2009, a total of 27 services sub-sectors were opened to foreign participation, where foreigners can own up to 100 per cent equity in the company, as part o the governments initiatives to accelerate the growth of the services industry.
During the tabling of the 2012 Budget, Prime Minister Datuk Seri Najib Razak announced another 18 services sub-sectors to be autonomously liberalised in phases.
He said liberalisation initiatives at the ASEAN level offers opportunities for services providers to gain bigger market access in member countries.
Liberalisation of services sector has been carried out in several phases since the signing of the ASEAN Framework Agreement on Services in 1995, administered by the Coordination Committee on services.
"ASEAN has completed negotiations on the ninth package of ASEAN Framework Agreement on Services, which will be signed duing the 46th ASEAN Economic Ministerial Meeting in August. Under the package, Malaysia hs offerd 102 sub-sectors for liberaliation," Mustapa said.
Meanwhile, the meeting, which was attended by representatives from various agencies and services associations, also discussed the work by the Malaysia Productivity Corporation on reducing the regulatory cost of doing business, improving the business climate and supporting the economic growth.
Other items on the meeting's agenda inlude the details of the government's RM120 million integrated package to increase innovation and productivity for small and medium entreprises.
Last year, contribution from exports of services to Malaysia's total exports of goods and services was 15.4 per cent, or RM125.47 billion, compared with 14.3 per cent, or RM117.01 billion in the previous year.