MALAYSIA may fall short of its target of having the service sector contribute 60% of its gross domestic product (GDP) by 2020, chief statistician Dr Mohd Uzir Mahidin said today.

The service sector’s GDP contribution stood at 57% in the year’s third quarter.

“We initially aspired to become a developed nation by 2020. However, we had to revise the target (as) there were a lot of external factors influencing the plans to achieve this,” he said.

He said the actual figures, however, had missed the mark by only a little.

“It will take a little more time to achieve,” he added.

He said this at the launch of the Statistics Department’s preliminary report on the wholesale and retail trade census for 2019.

Uzir projected that Malaysia could hit its target in three years.

Seven out of the 11 National Key Economic Areas (NKEAs) under the Economic Transformation Programme (ETP) fall under services.

The ETP also indicates that Malaysia’s focus will be on developing a large and thriving service sector, which is seen as the backbone of a developed nation.

Uzir said this at the launch of the Statistics Department’s preliminary report on the wholesale and retail trade census for 2019.

Today’s report noted that the number of establishments in the wholesale and retail trade sector stood at 468,930 in 2018 compared with 370,725 in 2013, translating into an annual growth rate of 4.8%

Revenue generated by the sector amounted to RM1.32 trillion in 2018 compared with RM893.2billion in 2013, representing an annual growth rate of 8.2%.

Meanwhile, the sector saw total expenses of RM1.14 trillion last year, which is 8.2% higher than the RM768.9billion in 2013.

The wholesale trade sub-sector was the highest contributor of total revenue in 2018 at RM672.4 billion (50.9%) followed by retail trade (RM494.9 billion or 37.4%) and motor vehicles (RM154.4 billion or 11.7%).

Uzir said the growth in the number of physical establishments is a good sign amid a backdrop of booming e-commerce and internet activities.

A total of 86.9% of the 420, 380 entities in the wholesale and retail trade sector used computers.

The wholesale and retail trade sector contributed 16.7% to the GDP.

Two million employees are involved in the sector as at last year with total salaries and wages paid amounting to RM62.8 billion.

Malaysia is also on track to achieve a developed-nation status, Uzir said.

This is supported by factors such as high household consumption levels heading towards 60% as well as the high internet penetration at 83%. – December 27, 2019.