MALAYSIA

COUNTRY OVERVIEW

LOCATION AND SIZE.

Malaysia is situated in Southeast Asia, bordered by Thailand in the north, Indonesia in the south, and the Philippines in the east. The country has an area of 329,758 square kilometers (127,320 square miles). Comparatively, the territory of Malaysia is slightly greater than that of the state of New Mexico, the fourth-largest state in the United States. The Federation of Malaysia consists of 13 states, and is divided into 2 parts: 11 states are located in Peninsular Malaysia (also called West Malaysia) and 2 comprise East Malaysia, which is situated on the island of Borneo (see map). Peninsular and East Malaysia are separated by 640 kilometers (400 miles) of the South China Sea. Malaysia's capital city, Kuala Lumpur, is located in southeast Peninsular Malaysia, just 300 kilometers (187 miles) from Singapore. However, a new capital, Putrajaya, is being developed outside the overcrowded metropolitan area as the new administrative center. The strategic importance of Malaysia is in its location along the Strait of Malacca, which is a major sea-route connecting the Far East to Asia, Europe, and the Middle East.

POPULATION.

The population of Malaysia was estimated at 21,793,000 in July 2000. It has almost doubled since the 1960s due to improved health, medical facilities, and longer life expectancy. In 2000, the birth rate stood at 25.3 per 1,000, while the death rate stood at 5.25 per 1,000. The estimated population growth rate is 2.01 percent and if the current trend remains unchanged, the population could reach 31 million by 2020. The population is very unevenly distributed, with almost 81 percent, or 17.5 million, living in Peninsular Malaysia, and 19 percent, or 4.2 million, living in East Malaysia. The population density is about 129 people per square kilometer (334 people per square mile) in Peninsular Malaysia and about 20 people per square kilometer (52 people per square mile) in East Malaysia.

Malaysia is a multinational and multicultural country with a very diverse population. Malays and several indigenous groups make up 58 percent of the population. Ethnic Chinese, the second-largest ethnic group, make up 26 percent of the population; Indian descendants make up 7 percent, and various other groups together account for the remaining 9 percent. The current ethnic structure was formed during the colonial era in the 19th and 20th centuries, when the British administration encouraged migration from India and especially from China. The Malaysian population is very young, with 35 percent below age 14 and just 4 percent of the population older than 65. Urbanization came to Malaysia relatively late. In 1970, just over 28.8 percent of Malaysians lived in urban areas. In 1999 over half of Malaysians—57 percent—were living in urban areas. It is expected that within the next 10 to 15 years more than 70 percent of the population will live in urban areas, mainly in the Peninsular Malaysia.

Religion plays a very important role in the country. Islam is the official national religion and nearly all Malays are Muslims. Most ethnic Chinese are Buddhist. The majority of Indians (comprising the descendants of migrants from what became India, Pakistan, and Bangladesh) are Hindu, although there are many Muslims among members of this community. The largest proportion of the Chinese community has traditionally lived in the urban areas, while Malays have often lived in the country's rural regions.

In 1960, the Malaysian population was about 8 million, and the country at one time had one of the highest

birth rates in Asia. The population doubled between 1960 and 1990, although population growth began to decline in the 1990s. The decline in population rates could be linked to the socio-economic changes in the economy that tightened the labor market and increased the number of women in the workforce, and the better education of women. Malaysia experienced an inflow of foreign workers employed mainly in the low-skill and low-wage construction and services sectors and in agricultural plantations. The Malaysian government would like to regulate the inflow of illegal migrants, who arrive mainly from neighboring Indonesia, as well as from Bangladesh and Burma, attracted by the geographical proximity and higher wages.

INDUSTRY

MINING.

Tin, oil, and gas are the major natural resources of export significance produced by the mining sector in Malaysia. The mining of tin was introduced during the colonial era and until the 1980s the country was the world's largest producer of tin, being overtaken in the early 1990s by Brazil and neighboring Indonesia. The major mines are situated in Peninsular Malaysia, making it easy to transport their products to the nearest seaports. Malaysia's exports of tin declined from 36,812 metric tons in 1994 to 22,376 metric tons in 1998, affected by fluctuations in the world market.

During recent decades, Malaysia has increased production of crude petroleum and natural gas. In 1999, it produced 693,000 barrels of crude oil per day and 3.8 billion cubic feet of liquefied natural gas (LNG). The high-quality oil is extracted mainly from offshore platforms in the states of Terengganu, Sabah, and Sarawak, with a total of about 40 oilfields in operation (1999). There are 5 oil refineries situated in Malaysia. The production of gas increased steadily in the 1990s to meet the rising demand in the domestic and international markets, with exports mainly going to Taiwan, South Korea, and Singapore. Malaysia was ranked thirteenth in the world in terms of gas reserves and twenty-second in oil reserves in 1999. The state-controlled petroleum corporation, Petronas, has been seeking a greater role in the international market, investing in promising new projects in the Middle East and Southeast Asia.

Overall, mining plays a declining role in the national economy of the country, contributing just under 7.3 percent of GDP and providing employment for 39,000 people or under 1 percent of the labor force (1998). However, there is great potential for development of this sector, since Malaysia has various relatively under-exploited mineral resources in East Malaysia (Sabah and Sarawak), including bauxite, iron ore, copper, ilmenite, and gold. Additionally, there are large offshore reserves of high-quality oil and gas.

MANUFACTURING.

Malaysia has established a diverse and quickly-growing manufacturing sector that plays an increasing role in the Malaysian economy. Manufacturing contributes about 29 percent of the GDP, providing employment to 2.3 million people or 27 percent of the workforce (1999). From the late 1970s, the proportion of GDP provided by the manufacturing sector in Malaysia grew from 20.2 percent in 1979 to around 29 percent in 1999. The United States continues to be the single largest foreign investor in Malaysia's manufacturing sector, with approved new manufacturing investments totaling US$1.37 billion (RM5.2 billion) in 1999. The major investment projects were in the chemical, electronics, and electrical industries.

Malaysia built up its manufacturing sector mainly in the 1970s and 1980s, utilizing its long-established industrial centers on the island of Pinang and the Kelang Valley, its well-developed transportation infrastructure (including seaports and railways), and the entrepreneurial skills of its small and medium-sized businesses. The industrial sector initially consisted of oil refining, machinery assembly, and light industries (including foodstuff processing and textile manufacturing). However, as in neighboring Singapore, the Malaysian manufacturing sector was boosted in the 1970s and 1980s by the extensive growth of the electric assembly and electronics sectors. Malaysia became an important producer of radios, television sets, stereo equipment, and other related products. In the 1980s, the Malaysian government launched its national automobile project, the locally produced Proton car (in cooperation with Mitsubishi of Japan), and in the late 1980s, it started exporting the Proton to the international market. In the 1990s, there was further growth in the manufacturing sector, especially in export-oriented electronics production, including semiconductors, silicon wafers, and other items. Malaysia has become the world's third-largest producer, and one of the world's largest exporters, of semiconductors.

As in neighboring Singapore, the Malaysian government has played an active role in industrialization and economic development. In this regard, the Malaysian Industrial Development Agency (MIDA) has been instrumental in promoting the rapid development of targeted sectors of industries (especially knowledge-and technology-intensive sectors), since all industrial projects that involve foreign direct investments (FDIs) must be approved by the MIDA. The government also used direct investments and encouraged the inflow of FDIs, establishing special export-processing zones where investors were given access to well-developed infrastructure and enjoyed tax breaks and other privileges. Since the 1980s, the government has actively promoted the electronics, information technology, and multimedia sectors, and has encouraged the relocation of labor-intensive industries to Indonesia and Thailand.

Most of Malaysia's electrical and electronic products are produced for export to the United States, Europe, and other markets. This makes its manufacturing economy vulnerable to downturns in the regional and international market. Despite some restrictive measures and financial initiatives, Malaysia was negatively affected by the 1997 Asian financial crisis. In 1997 and 1998, its manufacturing sector experienced serious contraction; dozens of plants were closed and thousands of workers lost their jobs. In 1998 alone, the sector was reduced by about 10.9 percent across the board. However, in 1999 and 2000, Malaysia managed to reverse the recession in manufacturing, and this sector experienced an impressive growth of 12 percent per annum.

Malaysia is one of ASEAN's leading exporters of furniture, with total exports reaching about US$1.02 billion (RM3.9 billion) in 1999. Access to cheap local wood makes Malaysian furniture manufactures very competitive in the international market. In 1999, the United States was the largest single market for Malaysian wooden furniture (37 percent), followed by Japan (14 percent), Singapore (9 percent), and the United Kingdom (9 percent). If the rapid growth in this sector remains unchanged, by 2005 Malaysia could become one of the top ten furniture exporters in the world.

SERVICES

TOURISM.

Tourism is becoming an increasingly important sector of Malaysia economy. Together with the retail sector, it provides employment for almost 1.57 million people, or around 17 percent of the labor force. Roughly 7.5 million tourists visited the country in 1999, contributing RM10 billion to the national economy. This makes tourism one of Malaysia's top foreign exchange earners. According to the national authorities, the country has 1,426 hotels, the total room capacity of which almost doubled during the 1990s to about 110,000 in 2000. Most visitors have been from Singapore, Thailand, Indonesia, Japan, China, the United Kingdom, and Australia.

In order to develop tourism, Malaysia has promoted its diverse cultural environment, hosting a number of cultural festivals and performances. It has also publicized its rich natural heritage, which includes tropical forests, coral reefs, unspoiled mountain ranges, rivers, and national parks. The country offers tax-free bargain shopping and excellent service, with top-class hotels such as Sheraton, Hilton, Intercontinental, and other well-established international chains opening branches. It offers a wide variety of activities, from eco-friendly and adventure tourism to scuba diving and relaxed family holidays on the numerous Malaysian islands and beaches. Additionally, Malaysia has signed visa-free regimes with most countries in Asia, the Americas, and Europe, enabling international tourists to travel to Malaysia without obtaining entry visas. In 1997, however, tourism suffered from the regional financial crisis and by the smog caused by several months of forest fires in Indonesia. The number of tourist arrivals declined significantly in 1997 and 1998; however, there was a strong recovery in arrivals in 1999 and 2000.

FINANCIAL SERVICES.

The financial service industry is another rapidly growing sector of Malaysia's economy. In terms of employment, it almost doubled from 230,900 people in 1988 to 447,200 people in 1998. Traditionally, this sector was built around the banking system, investments, insurance, and some other activities. For more than a decade until 1997, the financial service sector experienced rapid expansion fuelled by the inflow of Foreign Direct Investments (FDIs), reasonably cheap credits, and overall rapid economic growth in all sectors of the economy. Malaysia developed a sophisticated computerized banking payment system, encouraging development of electronic payment systems and electronic banking. The U.S.-based Motorola and Unisys have taken part in these projects as members of consortia that included local companies. Malaysia's government considered developing Kuala Lumpur into a regional financial center, competing with Singapore for this role, although it was slow to allow foreign brokers to operate at the Kuala Lumpur Stock Exchange (KLSE).

The 1997 regional financial crisis started with the collapse of the Thai currency (the Baht), which severely affected the Malaysian financial sector. Share and property prices declined significantly, provoking panic among local and international investors. Within a short time, the Malaysian ringgit had depreciated against major international currencies, especially the U.S. dollar. This inflicted considerable damage on local businesses, as a significant number of credits were in U.S. dollars and local companies faced extreme difficulties repaying those credits. The Kuala Lumpur Stock Exchange (KLSE) lost more than half its value, plunging from RM807 billion in the middle of 1996 to RM376 billion in the middle of 1997. In response to this crisis, the Malaysian government imposed currency and capital controls, locked in foreign investors' share holdings for 1 year, and initiated a share-buying scheme with the government-controlled funds. In 1999 and 2000, financial services began their recovery, and the government slowly eased various restrictions and state control in this sector.

RETAIL.

Traditionally, in Malaysia many small and medium-sized businesses were built around the retail sector and were often associated with small shops and cafés run by Chinese merchants. The retail sector grew, in terms of its size and quality of service, due to a general rise in income among the population and an increase in tourism arrivals. In the 1990s, major international retail chains such as Yaohan and SOGO of Japan, Marks and Spencer of the United Kingdom, MAKRO of France and fast-food franchises such as McDonald's, Kentucky Fried Chicken (KFC), and others opened outlets in Malaysia. However, there are still a number of small family-run traditional shops and cafés, selling both imported and locally-made products.

Tourists can also buy pirated products, including footwear, optical disks (CDs), and computer software. According to one study, piracy may have accounted for losses of US$84.2 million (RM320 million) in market value in 1999. In April 2000, the United States Trade Representative (USTR) placed Malaysia on the special Priority Watch List for its failure to reduce pirated optical disc production and export. In response to this, the Malaysian police regularly launch crackdowns on unlicensed software businesses.

DEPENDENCIES

Malaysia has no territories or colonies.

BIBLIOGRAPHY

Bank Negara Malaysia (Central Bank of Malaysia). "CurrentHighlights." <http://www.bnm.gov.my> . Accessed March 2001.

Department of Statistics, Malaysia. <http://www.statistics.gov.my> .Accessed March 2001.

Economist Intelligence Unit. Country Profile: Malaysia. London: Economist Intelligence Unit, 2000.

Economist Intelligence Unit. Country Report: Malaysia. London: Economist Intelligence Unit, November 2000.

Gomez, Terence E., and K.S. Jomo. Malaysia's Political Economy: Politics, Patronage and Profits , New York: Cambridge University Press, 1997.

The Government of Malaysia. Prime Minister's Office. <http:// www.smpke.jpm.my> . Accessed March 2001.

Grouch, H. Government and Society in Malaysia. Singapore:Cornell University Press, 1996.

International Financial Statistics Yearbook, 1999. InternationalMonetary Fund, 1999.

Jomo, K. S., and Greg Felker. Technology, Competitiveness, and the State: Malaysia's Industrial Technology Policies. London: Routledge, 1999.

Khoo, B. T. Paradoxes of Mahathirism. New York: Oxford University Press, 1995.

Kuala Lumpur Stock Exchange. <http://www.klse-ris.com.my> .Accessed March 2001.

Lucas, Robert E. B., and Donald Verry. Restructuring the Malaysian Economy: Development and Human Resources. London: MacMillan Press, 1999.

Malaysian External Trade Development Corporation. <http:// www.matrade.gov.my> . Accessed March 2001.

The New Straits Times. <http://www.nstp.com.my> . AccessedMarch 2001.

U.S. Central Intelligence Agency. CIA World Factbook 2000: Malaysia. <http://www.cia.gov/cia/publications/factbook/geos/my.html> . Accessed March 2001.

—Rafis Abazov

CAPITAL:

Kuala Lumpur.

MONETARY UNIT:

Malaysian ringgit (also known as the Malaysian dollar). One Malaysian ringgit (RM1) equals 100 sens. There are coins of 1, 5, 10, 20, and 50 sens. Paper currency is in denominations of RM2, 5, 20, 50, and 100.

CHIEF EXPORTS:

Electronic equipment, petroleum and liquefied natural gas, chemicals, palm oil, wood and wood products, rubber, textiles.

CHIEF IMPORTS:

Machinery and equipment, chemicals, food, fuel, lubricants.

GROSS DOMESTIC PRODUCT:

US$229.1 billion (at purchasing power parity, 1999 est.).

BALANCE OF TRADE:

Exports: US$83.5 billion (1999 est.). Imports: US$61.5 billion (1999 est.).

User Contributions:

Ali
Report this comment as inappropriate
Dec 23, 2009 @ 2:14 pm
Hello:

I am planning our family holiday for 2011 and am considering visiting Malaysia, likely in January - March 2011.

Could you tell me where the tourist attractions are and what the year round climate / weather is like.

Thank you.

Ali
Rose
Report this comment as inappropriate
Jan 18, 2010 @ 6:06 am
Hi Ali. Malaysia climate is quite stable..it will be humid and rainy all year round. On February there will be Chinese New Year festival so you can expect to see a major sale on all products in supermarket way from January onwards, so bring more money for shopping spree. Normally on festivity such as Chinese New Year and other festivities there will be "Open House" by ministers in the country where every citizen and tourist can go there and have a free feast. This event is a must go activity for you :). Visit Melaka, Langkawi and Penang for historical piece. Kuala Lumpur, Genting Highlands and Sunway Lagoon for entertainment. Sabah or Sarawak for cultural enjoyment and eco tourism. Kelantan and Terengganu for batik and cultural atmosphere.. But do enjoy lifestyle like night market and mamak stall for a change.. Check Tourism Malaysia for better information
Report this comment as inappropriate
Jul 4, 2010 @ 7:07 am
im doing some survey.can u tell me about composition in malaysia e.g varios ethnic group,culture and language in malaysia
Report this comment as inappropriate
Jul 12, 2010 @ 7:19 pm
in malaysia it is good for a visit.here we have chinese , malay,indian, natives, we all speak in their own languages, and english is very common.
Report this comment as inappropriate
Jan 12, 2011 @ 1:01 am
Salam Ali,
Thank you for your plan to visit Malaysia.
The good place to bring your family are;
1. Pulau Tioman off coast of Pahang, an Island with clear water that you can see corals 3-4 day is enough. The can be reach by boat from Mersing, Johor or from Rompin Pahang. Tioman also can be reach by air from Kuala Lumpur.

2. Pulau Redang and Pulau Perhentian, two island off coast Besut Terengganu. Good for fishing. These island can be reach from Kuala Besut by boat.

3. Taman Negara (National park) is the perfect place to visit fo "Tropikal jungle lovers - trees and wildlife". There are 4 stations to enter Taman Negara: Kuala Tahan, Pahang; Sungai Relau, Merapoh Pahang; Mentong, Hulu Terengganu and Kuala Koh, Hulu Kelantan. You can climb Gunung Tahan (height 7,130 feet) from these stations. Contact Wildlife Department for the details. The cost not expensive compare to sail to islands off coast.

4. Putrajaya is the ideal place if you are of 50s. Not much energy need for you to tour this city. This city is a few kilometers from Kuala Lumpur International Airport. The hotels: Shangrila on top of a hill just beside Royal, The IOI Resort or a budget hotel near Dengkil are ready for the visitors.

Selamat datang to Malaysia.
Report this comment as inappropriate
Feb 17, 2011 @ 11:11 am
really intresting to learn about countries like malaysia because iam a CPM student who has to leard about the ASEAN business.
Report this comment as inappropriate
Feb 21, 2011 @ 10:22 pm
how biotechnology, tourism, and telecommunication can affect a stock market share in a economic today?.
Report this comment as inappropriate
Mar 17, 2011 @ 11:23 pm
could you please update this information? I am working as a tour leader ,Iranian tour leader,I am looking for recent information :)
kingsley
Report this comment as inappropriate
May 2, 2011 @ 11:11 am
i am writting an assignment and i want to know how many fast food resturant are there in Kuala Lumpur. i am asked to analyze the fast food market in KL.
Sonia
Report this comment as inappropriate
Jun 5, 2011 @ 2:14 pm
Is any US MIlitary Forces Base close to Malaysia? It's how close they are and the names?
Report this comment as inappropriate
Jun 30, 2011 @ 3:03 am
Hello!
i am very interested abour malaysia and i want to sudy. I can speak Uzbek Tajik Russian English German and can read write in Arabic. Please help me to go To Malaysia. I was in Usa so I want to be in Malaysia.
Report this comment as inappropriate
Jul 4, 2011 @ 11:23 pm
Sonia: There are none US Military Forces Base that close to Malaysia.

Nodir: Regarding this issue i would also like to help but studying in Malaysia need alot of paperworks to be done.

and to all viewer, Malaysia is a developing country. ^^
Report this comment as inappropriate
Jul 5, 2011 @ 6:06 am
Sonia: There are none US Military Forces Base that close to Malaysia.

Nodir: Regarding this issue i would also like to help but studying in Malaysia need alot of paperworks to be done.

and to all viewer, Malaysia is a developing country. ^^
shanuu
Report this comment as inappropriate
Sep 6, 2011 @ 7:07 am
helo, we are like to come malaysia for singapore airline ground staff so please give the details about there like climate, reilgion,culture...
mele
Report this comment as inappropriate
Feb 10, 2012 @ 6:18 pm
i am studying Malaysia so i am finding some imformation
Jade
Report this comment as inappropriate
May 22, 2012 @ 11:11 am
i am doing a project on malaysia and this is a great website
matt
Report this comment as inappropriate
Jun 19, 2012 @ 2:02 am
update this is from 2000 i need the infomation for assigments
NG
Report this comment as inappropriate
Feb 23, 2013 @ 3:03 am
How many population now in whole Malaysia?
How many population now in Muar only?
BANWAR
Report this comment as inappropriate
May 15, 2013 @ 6:06 am
SO IN THE MOMENT WHAT IS THE POPULATION OF MALAYSIA?HOW MANY ISLANDS DOES MALAYSIA HAVE IN THE PRESENT?

Comment about this article, ask questions, or add new information about this topic:

CAPTCHA


Malaysia forum