SERVICES SECTORS NEEDS TO GROW 6-7 PCT IN 2010 TO ACHIEVE GDP TARGET

KUALA LUMPUR, Jan 12 (Bernama) -- The services sector must grow by at least
6-7 per cent if Malaysia wants to achieve a Gross Domestic Product (GDP) growth
of between 4-5 per cent in 2010, International Trade and Industry Minister,
Mustapa Mohamed said.

"The services sector has to grow a lot faster than the GDP," he said,
adding that the sector has increasingly been a significant contributor to the
economy.

In 2008, the sector contributed 55 per cent to GDP and despite the global
economic slowdown, it remained strong and resilient.

"The services sector is the main focus of our efforts going forward as it
offers high quality jobs and wages," said Mustapa.

Hence, the government may revise the roadmap for the services sector in the
Third Industrial Masterplan according to the needs of the New Economic Model, he
told reporters after opening the Malaysian International Chamber of Commerce
and Industry Services Summit here Tuesday.

For the first three quarters of 2009, services was the only economic sector
that registered growth and increased its contribution to the GDP.

The services sector, which grew by 3.2 per cent in the third quarter of
2009, was expected to perform well even in the fourth quarter of the year.

"We can also expect to see a third year of continous surplus in trade in
services in 2009," he said.

As an indication, Malaysia's services trade amounted to RM92 billion in the
first-half of 2009. Exports amounted to RM47.9 billion while imports were
valued at RM44.1 billion, registering a RM3.8 billion surplus for the period.
(US$1=RM3.38)

The services sector also attracted high levels of investments over
the years with approved investment of RM23 billion registered in the first six
months of 2009.

"It is significant that most of the investments in this sector originated
from domestic sources. In fact, domestic investment in the services sector
ranged from 85-90 per cent in the last five years," said Mustapa.

However, he said more foreign participation could bring about the transfer
of technologies and expertise, create new capabilities and help fill the vacuum
in services not available in the country.
-- BERNAMA


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