We must start treating innovation as an industry that drives the economy — Ahmad Ibrahim

Résumé détaillé

Unlike Malaysia, China, by contrast, has made innovation an industry in its own right. Its policy directive on integrating science with industrial innovation ...

NOVEMBER 11 — Unlike Malaysia, China, by contrast, has made innovation an industry in its own right. Its policy directive on integrating science with industrial innovation is explicit: enterprises lead, research serves application, and the entire chain from idea to market is treated as a production system to be optimised. Malaysia wants the same. The question is whether it is willing to do the unglamorous industrial work that China did.

Malaysia’s innovation problem is not a shortage of ideas. The core challenge is the gap between R&D outputs and the ability of local technology to penetrate real markets. Malaysia spends only 1 per cent of GDP on R&D. But the private sector’s share of R&D spending is disproportionately low, meaning the engine of commercial innovation is running well below capacity.

Malaysia ranked 34th in the 2026 GII, a respectable position among developing economies. But look at the composition: Malaysia ranks first globally in high-tech exports and imports. It ranks eighth in science and engineering graduates. Yet its knowledge and technology outputs rank 32nd, and its creative goods exports are strong while its own intellectual property generation lags. Malaysia is exceptionally good at making things designed elsewhere. It is far less good at designing things the world wants to buy.

We need to treat innovation as an industry, with upstream, midstream, and downstream, each with dedicated capital, specialised labour, and performance metrics. Malaysia has pieces of this chain. What it lacks is the connective tissue that turns pieces into a system.

Malaysia has gestures in this direction. But intent is not an industry. The difference is that China’s policy assigns ownership of outcomes. Malaysia’s ecosystem still suffers from what one described as a “broken bridge” between knowledge producers and users, with both sides operating in silos.

The government’s rhetoric has shifted from “Made in Malaysia” to “Made by Malaysia,”.

If Malaysia were serious about…

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