geneva, (reuters)
WORLD TRADE ORGANISATION (WTO) economists on Monday hailed Malaysia for its openness to trade and macroeconomic reforms they said had helped it boost national wealth and fully overcome last decade's Asian financial crisis.
Economists from the WTO Secretariat in Geneva studied the Asian nation's trade policies between 2001 and 2005 as part of a cycle of reviews of all the body's member countries.
"Malaysia has continued to liberalise its policies on international trade and foreign investment," during the review period of the review, their report said.
"As a consequence of its openness to trade together with prudent macroeconomic and structural reforms in key areas, it looks as if the Malaysian economy has now fully recovered from the Asian financial crises in 1997-98."
Growth in real gross domestic product (GDP) had risen from 0.3 percent in 2001 to 4.4 percent in 2002, 5.4 percent in 2003 and 7.1 percent in 2004, they said.
Slower world and trade growth, higher oil prices, and falling demand for semi-conductors and lower prices for palm oil both major exports -- are expected to trim GDP growth to 5 percent in 2005.
The WTO economists said Malaysia's over-reliance on export-led growth, particularly in electrical and electronic products, had contributed to the slowdown in 2001, leaving the country vulnerable to the business cycle in developed economies.
"To address this issue, measures have been taken to develop new sources of growth ... in order to improve the economy's competitiveness and resilience to shocks," the report said. These include agriculture, resource-based industries, high-technology manufacturing and services.
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