News

by AZALEA AZUAR 

MALAYSIA’S healthcare system remains under pressure despite bigger budgets, as the country struggles to keep pace with mounting health challenges and rising medical costs. 

During the recent Health Asia Summit 2026 (HSA2026), industry players warned that the country is facing growing strain from an ageing population, rising non-communicable diseases (NCDs) and worsening healthcare worker shortages despite ongoing reforms and increased spending. 

At the same time, they pushed for stronger preventive healthcare measures, digital transformation, and workforce sustainability to prepare the country for future healthcare demands. 

The three-day summit, held from May 20 to 22 at the Kuala Lumpur Convention Centre, gathered 10,000 delegates, more than 100 exhibitors and over 40 global speakers, while generating up to RM1.5 billion in commercial opportunities as Malaysia accelerated healthcare transformation through artificial intelligence (AI), MedTech, digital health and medical tourism. 

Prevention is Better Than Cure 

Malaysia’s healthcare budget rose steadily from RM32.4 billion in Budget 2022 to RM36.3 billion in Budget 2023, RM41.22 billion in Budget 2024, RM45.3 billion in Budget 2025 and RM46.5 billion in Budget 2026. 

Despite these increases, experts warned that healthcare spending remained relatively low compared to peer economies. 

According to the Institute of Democracy and Economic Affairs (Ideas) in January, Malaysia increased per capita health spending by about 40% between 2015 and 2022. 

However, other upper-middle-income economies expanded spending at a faster pace, while rising healthcare costs outpaced GDP growth and eroded the real value of expenditure. 

(From left) Tunku Kamarul Zaman, chief scientific officer of Cancer Research Malaysia Prof Dr Cheong Sok Ching and AGTC Genomics Sdn Bhd CEO Prof Dr Leong Chee Onn during the event

Malaysia also faces mounting pressure from an ageing population and rising NCDs, with the projected annual economic burden of RM64.2 billion already exceeding the Health Ministry’s (MOH) RM46.52 billion allocation for 2026. 

Health experts have reportedly warned that Malaysians are living longer but not necessarily healthier, as NCDs increasingly affected younger adults and further strained the healthcare system. 

Health Minister Datuk Seri Dr Dzulkefly Ahmad has been quoted as saying that Malaysia must shift from a treatment-based “sick care” model to prevention-focused strategies. 

Reforms were needed to improve public health literacy, empower citizens to make better health decisions and strengthen workforce productivity. 

NexGen MedSolutions Sdn Bhd business development manager Jessica Yeoh said preventive healthcare would become increasingly important as health systems moved away from relying solely on treatment-based care. 

“I believe preventive healthcare is going to be huge, especially from Malaysia and our partners,” she told The Malaysian Reserve (TMR). 

Yeoh says preventive healthcare would become increasingly important as health systems moved away from relying solely on treatment-based care

Malaysia’s stable environment, affordable cost of living, multilingual workforce and growing innovation capabilities make the country attractive as a regional medical technology hub. 

Yeoh stressed the importance of the use of robotic technology in surgeries, but noted that Malaysia still lacked surgeons trained in robotic procedures. 

Additionally, she called for more funding and opportunities for entrepreneurs and young scientists to develop medical technologies and healthcare products. 

More foreign companies were also choosing Malaysia as a base to expand into the Asia-Pacific market due to the country’s stability, manageable cost of living and educated workforce. 

Neighbouring countries including Indonesia and Thailand are among ASEAN markets that are growing the fastest. 

Meanwhile, PT Solas Langgeng Sejahtera (Solas) manufacturing GM Puti Krishnamurti Indira Marzoeki said preventive healthcare is attracting the most investor interest as consumers increasingly turned to supplements to prevent degenerative diseases such as kidney and heart conditions. 

“Chemically synthesised products usually have higher side effects. As a result, people tend to prefer traditional medicine and preventive healthcare,” she told TMR. 

The Indonesian-based company produces ethical pharmaceutical products, over-the-counter (OTC) medicines, nutraceuticals and traditional products, and is seeking partnerships with Malaysian distributors to expand into the local market. 

Puti Krishnamurti said Malaysia is emerging as a strategic ASEAN healthcare hub due to similarities with Indonesia in demographics, disease patterns and medicine demand. 

“Maybe for alternative second opinions, or they feel that doctors in Malaysia are easier to communicate with. 

“Or perhaps they feel they receive better treatment in Malaysia. That is why many patients go to Malaysia,” she said. 

Several Malaysian companies had expressed interest in original equipment manufacturer (OEM) partnerships to jointly develop and distribute products in both countries. 

MunchBOT portable composter represents automated food waste munching process

Healthcare Worker Shortage, Burnouts

In 2025, the World Health Organization (WHO) estimated that there would be a global shortage of at least 10 million healthcare workers by 2030. 

About 4.5 billion people are already lacking access to essential health services due to ageing populations, limited training capacity, economic constraints and worker burnout. 

Global healthcare expert Prof Mark Britnell said the healthcare crisis was not just about worker shortages, but also poor productivity. 

Speaking during the “Human: Solving the Global Workforce Crisis in Healthcare” session, he said many countries still relied on outdated workforce planning despite rapid changes driven by AI, demographics and labour trends. 

Healthcare is only half as productive as the private sector globally, even though digitalisation and AI could deliver productivity gains of 10% to 12%. 

“Healthcare needs human beings, kind hearts and warm hands, but certainly it can be more productive. Therefore, we have to rearrange the way we think about healthcare,” Britnell said. 

Healthcare workers were increasingly overwhelmed by administrative work, with 76% of doctors and 79% of nurses globally performing tasks they were overqualified for. 

The global healthcare system faced a 20% workforce gap, but part of the issue could be eased by redesigning care pathways, expanding the roles of nurses and pharmacists, and using AI and technology-enabled workers to handle routine tasks. 

Malaysia is not spared from the healthcare worker shortage. 

Malaysia is facing a 21% physician shortage and could see its nursing shortage exceed 30% by 2030, although he praised the country’s progress in primary healthcare, prevention and digital health initiatives. 

Richer countries were “stealing” healthcare workers from poorer nations as the world headed towards a shortage of 12 million healthcare workers by 2030. 

“I made some remarks and observations on what we can do globally, or rather what we should not do globally, which is continuing to steal workers from the poorer South into the richer North and from the East into the West. 

“Now, this is a developing and developed world problem.” 

In the “Sustainability-driven Healthcare: Maximising Outcomes through Human Capital Policy” panel discussion, Britnell proposed a micro-credential healthcare workforce model to speed up training and address shortages of doctors and nurses. 

Shorter, skills-based training programmes tied to care pathways such as diabetes, cancer and maternal care could help expand treatment capacity while allowing healthcare workers to earn more. 

Britnell urged Malaysia to become a regional leader in telemedicine and digital healthcare, while leveraging its strengths in medical tourism, wellness and ecotourism. 

Meanwhile, MOH deputy DG (Research and Technical Support) Datuk Dr Nor Fariza Ngah admitted that the government must do more to address talent outflows. 

She suggested that wealthier countries facing similar shortages should invest in training and education systems in source countries, while support such as open universities and training centres could help Malaysia produce more qualified healthcare workers. 

Malaysia’s urban areas have about one doctor for every 200 people, but the ratio worsened to about one for every 700 people in suburban and Borneo regions. 

The issue was not just about manpower shortages, but also structural and geographical challenges affecting healthcare access. 

Healthcare careers should be promoted earlier to students, as social media increasingly highlights burnout and stress while ignoring the meaningful and diverse opportunities available in the profession. 

“We see social media posts highlighting the negative aspects of the profession such as stress and burnout, so we need to bring the focus back to how good and rewarding healthcare can be,” Nor Fariza said. 

Exhibitors and visitors at the Health Summit Asia 2026 at Kuala Lumpur

Malaysia Unprepared For AI-driven Healthcare

Experts said Malaysia is still far from ready to fully adopt AI-driven healthcare due to weak digital infrastructure and poor electronic medical record (EMR) adoption. 

KPJ Healthcare University vice chancellor Prof Dr Tunku Kamarul Zaman Tunku Zainol Abidin said modern treatments are increasingly relying on genomics, analytics and digital tools to tailor care to individual patients, especially in cancer treatment. 

However, only 14.7% of hospitals currently use electronic medical records, limiting the country’s ability to collect and process the massive amount of healthcare data needed for AI and personalised medicine. 

“So now we have to think about how we are going to collect a huge amount of data without missing anything. 

“Digital tools will allow clinical records to combine not just genomic data, but also complete medical data, records, family history, pre-scanning data, response records and radiology clinical records,” he said during the “Cancer Care in The Digital Age: What Patients and Practitioners Need to Know” panel session. 

Tunku Kamarul Zaman noted that poor data collection and fragmented systems remain major barriers to AI-driven healthcare. 

Despite the challenges, he stressed that digital transformation was crucial to speed up treatment, improve patient outcomes and reduce delays in accessing specialist care. 

Nevertheless, he warned that AI tools such as ChatGPT could spread misinformation and generate false references despite sounding convincing. 

The technology “hallucinates” because it learns from large amounts of online data, including inaccurate information, making it increasingly difficult for the public to distinguish genuine expertise from misinformation. 

“We need to be careful. Unfortunately, some of this misinformation did not get filtered out, which is why when we use ChatGPT, it sometimes gives out false information.” 

Misinformation is becoming increasingly dangerous in the AI era, where louder voices and social media popularity could overshadow genuine experts. 

Tunku Kamarul Zaman stressed the need to rely on trusted institutions and credible experts, adding that people should be cautious about the software and information sources they use. 

Misinformation is becoming increasingly dangerous in the AI era, where louder voices and social media popularity could overshadow genuine experts, says Tunku Kamarul Zaman

How Covid-19 Transformed Healthcare Regulation

The Covid-19 pandemic fundamentally reshaped healthcare regulation, forcing agencies worldwide to make rapid decisions amid vaccine shortages, supply chain disruptions and public misinformation. 

The National Pharmaceutical Regulatory Agency (NPRA) has introduced conditional approvals, accelerated review pathways, rolling data submissions and remote inspections in response. 

Head of policy and strategic planning Maslinda Mahat said in Malaysia, NPRA has implemented multiple mechanisms to facilitate product registration and to have efficient regulatory review without compromising regulatory standards.

“The objective is not to shortcut scientific assessment, but rather to optimise regulatory resources by leveraging available evidence and trusted international assessment. 

“This is particularly important for innovative products, life-saving therapies and products addressing unmet medical needs,” she said during the “Regulatory Agility In A Disrupted Era: Accelerated Approvals, Reliance Pathways and Digital Transformation In ASEAN” session. 

Faster regulatory pathways were now crucial to ensure timely access to life-saving treatments without compromising safety standards. 

The NPRA is increasingly relying on assessments by trusted regulators such as the US Food and Drug Administration (US FDA) and the European Medicines Agency (EMA) to reduce duplication and speed up approvals while still conducting independent local evaluations. 

The pandemic also accelerated regional regulatory collaboration across ASEAN to improve efficiency, harmonisation and patient access to medicines. 

Maslinda said biologics and advanced therapies were creating new regulatory challenges due to their complexity and sensitivity to manufacturing changes, requiring stricter scientific oversight and enhanced safety monitoring. 

At the same time, traditional medicines and health supplements remain widely used across ASEAN, although regulators face growing challenges from diverse products, shifting consumer trends and aggressive online marketing. 

“Regulators must balance consumer access with safety assurance while addressing issues such as product adulteration, misleading claims and inconsistent quality of the products. 

“Therefore, regional collaboration with ASEAN member states is very important to improve harmonisation and strengthen regulatory oversight in this rapidly expanding sector,” she said. 

Sitting is the New Smoking 

Lifestyle Medicine Global Alliance advisory board chair Dr Sivaneswaran Poobalasingam warned that sedentary living was becoming a major public health concern in Malaysia. 

Sedentary lifestyles, stress, poor sleep, smoking, alcohol use and loneliness are rising health risks, with social media creating “fake connectivity” among younger people. 

“Thirty percent of Malaysians are physically inactive and sedentary behaviour is 50%. So sitting is the new smoking. 

“We have laws about smoking. Why don’t we institute laws about sitting?” he said during the “Transforming Workplace Wellness with Lifestyle Medicine” session. 

Workplaces should move beyond one-off health talks and adopt action-based well-being programmes such as exercise sessions, stress management, sleep health and smoking cessation initiatives. 

Lifestyle medicine could reduce absenteeism, burnout and healthcare costs while boosting productivity and staff retention. 

“Lifestyle medicine has the potential to transform workplace wellness. It is not a workplace luxury.” 

Despite record healthcare allocations, Malaysia’s healthcare system continues to face growing pressures from an ageing population, rising chronic diseases, workforce shortages and digitalisation challenges. 

Experts at HSA2026 stressed that sustainable solutions will require stronger preventive care, better workforce planning and faster adoption of healthcare technology. 

As demand for healthcare continues to grow, meaningful reforms and effective implementation will be key to ensuring the system remains resilient, accessible and future-ready. 

• This article first appeared in The Malaysian Reserve weekly print edition 

The post Malaysia’s healthcare system under pressure despite bigger budgets appeared first on The Malaysian Reserve.

Business conditions remain challenging, with 87% of respondents reporting operating conditions have worsened or remained unchanged since early May

THE prolonged conflict in West Asia is escalating from a cost burden into a significant commercial challenge for Malaysian manufacturers. Companies are reporting lost orders, discontinued product lines and customer attrition as the fallout from the conflict continues to intensify. 

The Federation of Malaysian Manufacturers (FMM) warned that the disruption is causing lasting damage to businesses, affecting not only profitability but also their ability to retain customers and sustain growth. 

Findings from FMM’s third survey on the impact of the West Asia conflict on Malaysian manufacturing, trade and supply chains indicate that disruptions first emerged earlier this year have continued to deepen. 

Conducted between May 25 and June 10, 2026, the survey gathered responses from 196 companies across a wide range of industries. It represents FMM’s third consecutive monthly assessment since supply chain disruption began emerging in February. 

“The prolonged crisis has moved beyond a cost problem and is inflicting lasting commercial damage,” FMM president Jacob Lee said. 

The survey found that business conditions remained challenging, with 87% of respondents reporting that operating conditions had either worsened or shown no improvement since early May. Nearly two-thirds (65%) said they had yet to see any improvement across their operations. 

Cost pressures also remained significant. Some 74% of manufacturers reported production costs that were still between 10% and 50% above pre-conflict levels. 

Freight and logistics expenses continued to be the biggest source of pressure, affecting 86% of respondents. This was followed by raw material shortages (64%), higher energy and fuel costs (60%) and growing customer resistance to price adjustments (56%). 

As margins came under strain, only 6% of respondents said they were able to pass on higher costs to customers while maintaining profitability. 

Profitability remains under pressure, with 58% of respondents operating at or below break-even on product lines affected by the conflict. 

The survey also highlighted growing commercial repercussions. About 39% of respondents reported losing orders to competitors in markets less affected by the disruption, while 19% had withdrawn products that were no longer commercially viable. 

In addition, 9% said they had already lost at least one major customer or contract, and a further 19% expected customer losses should current conditions persist. 

FMM warned that the long-term consequences could extend beyond the immediate crisis. 

“Once buyers switch to alternative suppliers, those relationships rarely return. The resulting impact which may outlast the conflict itself and erode Malaysia’s export competitiveness long after the situation is resolved,” the federation said. 

Freight and logistics continue to weigh heavily on manufacturers. 

More than half of respondents, or 54%, reported further increases in freight cost since early May, while 86% said shipping expenses remained at or above peak levels recorded in the previous survey. 

Sea freight remained the only commercially viable transport option for 51% of manufacturers. Among companies that shifted to air or land transport, almost half incurred additional cost of between 50% and 100% compared to pre-conflict sea freight rates, while 12% faced increases exceeding 200%. 

The prolonged disruptions is also beginning to influence workforce and investment decisions. 

Some 42% of respondents reported making workforce adjustments since May, including hiring freezes (21%) and reductions in working hours (20%). In addition, 5% said they had implemented or announced retrenchment plans. 

The uncertainty is also weighing on longer-term business plans. Some 41% of respondents said they had postponed or cancelled investment, automation or expansion initiatives. 

For the first time, the survey assessed the viability of domestic sourcing as a mitigation strategy. 

While 46% of respondents had sourced or attempted to source materials from local suppliers, significant challenges remained. 

About 36% cited the lack of locally available specifications or grades, while 31% said domestic alternatives were not price-competitive with imported products. 

FMM welcomed several measures introduced by the government following the presentation of its second survey findings to the Majlis Tindakan Ekonomi Negara (MTEN) on May 19. These included support for alternative raw material sourcing, Bank Negara Malaysia’s (BNM) SME Stabilisation Relief Facility and the consideration of tax relief for returned export cargo. 

However, the survey suggested that uptake of existing assistance programmes remains limited among affected manufacturers. Only 11% of respondents said they had applied for the SME Special Relief Facility. 

The federation said one of the main barriers to accessing support was a eligibility. About 25% of respondents reported that they did not qualify for assistance because they fell outside the official definition of small and medium enterprises (SMEs). 

These mid-tier manufacturers, typically generating annual turnover of between RM50 million and RM500 million, continue to face significant working capital challenges driven by higher inventory requirements, elevated freight costs and ongoing supply chain disruptions. 

Based on the findings, FMM urged the government to consider six measures: Duty and tax relief for raw materials sourced from alternative origins; double tax deductions for freight and insurance expenses incurred as a result of the crisis; industrial fuel cost relief; a dedicated financing facility for mid-tier manufacturers; a deferment of remaining port tariff increases; and a government-facilitated supplier matching programme to strengthen domestic sourcing. 

“The findings of the third survey underscore the importance of timely and targeted intervention to prevent temporary disruptions from becoming longer-term structural disadvantages for Malaysian manufacturers,” Lee said. 

FMM said it would submit the latest survey findings to the relevant authorities and continue engaging stakeholders as the situation evolves. It cautioned that the window for action is narrowing, with a growing risk that current disruptions could to translate into lasting losses in competitiveness, market share and industrial capacity. — TMR

• This article first appeared in The Malaysian Reserve weekly print edition

The post West Asia conflict raises risks for manufacturers, FMM warns appeared first on The Malaysian Reserve.