Agriculture is no longer the most important sector of the Malaysian economy, contributing 12% of GDP in 2001 (down from 38% in 1960) and occupying about 16% of the employed work force in that year. Nevertheless, agriculture still accounted for 6.3% of export earnings in 1997. Diversification—including development of such newer crops as oil palm, cocoa, and pineapples—is promoted by the government. Much of Sabah and Sarawak is covered with dense jungle and is not conducive to farming. Peninsular Malaysia, however, is predominantly an agricultural region. Cultivation is carried out on the coastal plains, river valleys, and foothills.
Domestic rice furnishes Peninsular Malaysia with about 80% of its requirements; most of the rice supply for Sabah and Sarawak, however, must be imported. Milled rice production for 1999 totaled 1,934,000 tons, of which about 70% came from Peninsular Malaysia. Rubber production totaled 886,000 tons in 1999. The government, through the Rubber Research Institute of Malaysia, has concentrated on improving production, but many estates have switched to production of the more profitable oil palm. Although Malaysia produced 14% of the world's rubber in 1999, and typically accounts for over one-third of the world's rubber exports, rubber is no longer the country's primary source of export income. Competition from Thailand and Indonesia has recently diminished the Malaysian market share for rubber.
Production of palm oil and palm kernel oil totaled 10,553,000 and 3,026,000 tons respectively in 1999, more than any other country in the world. More than 90% of all rubber and palm oil is produced in Peninsular Malaysia. Black and white peppers are grown on Sarawak; pepper exports amounted to $49.3 million in 2001. Output of lesser agricultural products in 1999 included copra, 13,000 tons; coconuts, 711,000 tons; cocoa, 100,000 tons; and pineapple, 143,000 tons.