Services sector has played an important role in the growth and development process of the Malaysian economy. The greater presence of the services sector in the Malaysian economy is indeed in line with the growth transformation that has taken place in many of the developed economies such as the US in which the services sector forms a major structural component of the economy compared to that of the manufacturing or primary sector.
With the greater role of the services sector over the years, Malaysia has moved into the third stage of economic development. In the third stage, economic growth is no longer led by the manufacturing sector alone. Instead, economic growth is powered by both the manufacturing and services sectors.
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Thus, given the increasing role of the services sector in Malaysia, this article (Part 1) seeks to describe the role and contribution of the services sector to the economy.
By definition, the services sector encompasses two broad categories: intermediate services and final services. Intermediate services include several sub-sectors such as transport, storage and communication; and finance, insurance, real estate and business services. Final services include sub-sectors such as electricity, gas and water; wholesale and retail trade, hotels and restaurants; and other services. |
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