Rising Electricity Costs: Can SMEs stay competitive?

Malaysia's headline inflation edged up to 2.0% in May, driven partly by higher electricity prices following a surcharge on generation costs. While the overall inflation rate remains moderate, businesses particularly SMEs continue to grapple with rising operating expenses, raising questions about productivity, competitiveness, financing and long-term sustainability. We discuss whether Malaysia is moving towards a high-value economy or facing the risk of becoming a high-cost one, and the structural reforms needed to keep businesses competitive.