Efficiency and Productivity Performance of Selected ASEAN Manufacturing Industries

Abstract

Manufacturing productivity in ASEAN has become increasingly important as the region joins global value chains and recovers from COVID-19 disruptions. However, it remains uncertain whether output growth results from true productivity improvements or from changes in factor utilization. This study analyses the efficiency and productivity trends in six ASEAN countries, namely Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam, from 2000 to 2022. It employs an input-oriented Data Envelopment Analysis (DEA) under both constant and variable returns to scale to assess technical, pure technical, and scale efficiency, while the Malmquist Productivity Index (MPI) decomposes total factor productivity into efficiency and technological change. Results show significant variation among countries and over time. Singapore and Malaysia consistently stay near the regional production frontier, whereas Indonesia, Thailand, and Vietnam lag in efficiency despite strong output and investment growth. Productivity shifts mainly stem from technological advances rather than efficiency gains, especially slowing during the pandemic. Scale inefficiency remains a key performance issue, particularly for Indonesia and Singapore, worsening after 2020. These insights indicate that ASEAN manufacturing competitiveness hinges not only on capital investment but also on converting inputs into productivity improvements. This study offers a comparative analysis of ASEAN manufacturing efficiency and productivity performance.