2 nd INTERNATIONAL CONFERENCE ON BUSINESS AND ECONOMIC RESEARCH (2 nd ICBER 2011) PROCEEDING 40 FACTORS AFFECTING THE PERFORMANCE OF FOOD MANUFACTURING INDUSTRIES IN MALAYSIA Elsadig Musa Ahmed Economics Unit, Faculty of Business and Law, Multimedia University 75450 Melaka, Malaysia (E-mails: elsadigmusa@yahoo.com , asadiq29@hotmail.com) ABSTRACT This study attempts to fill the gap of extensive growth theory model by providing statistical analysis in a parametric form that removed the doubts in the results generated. Using this model, the factors affecting the output growth in the food industries were identified in this study to be the individual contributions of capital, labour, material as well as the combined contributions of the quality of these inputs, which were expressed as the total factor productivity (TFP) growth. The results on the food-manufacturing industries showed a characteristically low productivity with an inefficiency problem. The contribution of the TFP growth of 13 out of 27 food industries was found to be negative during the entire period as well as the sub period of 1987-2000. 11 industries were found to have contributed negatively during the sub periods of 1971-1979 and 1980-1986. Finally, these findings were identified to be due to the problem of low quality of inputs of the food industries and the productivity growth of the Malaysian manufacturing industries, which were input-driven rather than TFP growth driven as similarly found by previous studies. Keywords: Malaysian food industry, productivity performance, total factor productivity JEL Classification Code: O120