Malaysia

Click here for more Asia Links and Resources

FITA helps you find
service providers for:

Market Research

Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of general economic information | Political outline

Economic indicators

Malaysia's two main economic growth factors are domestic demand and dynamic exports. Malaysia has one of the highest living standards in South-East Asia and the lowest unemployment rate. Despite the government's long-term efforts to improve the economic status of native Malays, the population of Chinese origin continues to maintain its customary dominance.

The GDP growth rate remained high until mid-2008 before suffering the effects of the global crisis and shrinking heavily in 2009.

Main indicators	2006	2007	2008	2009	2010
GDP (billions USD)	156.86	186.72	222.22	212.48	220.70
GDP (constant prices, annual % change)	5.8	6.3	4.6	-3.5e	1.3e
GDP per capita (USD)	5,943	6,956	8,141	7,654e	7,817e
Inflation rate (%)	3.6	2.0	5.4e	0.9	2.5
Unemployment rate (% of the labor force)	-	3.1	3.5	-	-
Current Account (billions USD)	26.19	28.70	38.76	27.34e	23.59e
Current Account (in % of GDP)	16.7	15.4	17.4e	12.9	10.7

Source: IMF - World Economic Outlook Database

Note: (e) Estimated data

Main sectors of industry

Agriculture employs around 15% of Malaysians and contributes 10% of the GDP. Malaysia is ranked amongst the world's main producers of palm oil, cocoa, and rubber. The country is also one of the main exporters of tropical wood. Malaysia has successfully developed an economy based on raw materials (the export of rubber and tin, it also has significant reserves of oil and gas, copper and bauxite).

Industry contributes around 40% of the GDP. Malaysia is one of the world's largest exporters of semi-conductor devices, electrical goods and appliances, and also the government has ambitious plans to make Malaysia a leading producer and developer of high-tech products, including software. Malaysia is a major outsourcing destination for components manufacturing, behind China and India. The country has attracted significant foreign investments which have played a major role in the transformation of Malaysia's economy.

The tertiary sector accounts for nearly half of the GDP, in particular the tourism sector. Malaysia has become one of South-East Asia's major tourist destinations.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Employment by sector (in % of total employment)	14.8	30.1	55.1
Value added (in % of GDP)	10.2	47.7	42.0
Value added (annual % change)	2.2	3.3	10.1

- last available data.

Monetary indicators	2004	2005	2006	2007	2008
Malaysian Ringgit (MYR) - Average annual exchange rate for 1 USD	3.80	3.79	3.67	3.44	3.34

Source: World Bank - World Development Indicators

Indicator of economic freedom

Score:: 64.6/100
Position:: moderately free
World Rank:: 58 out of 179
Regional Rank:: 9 out of 42

Distribution of Economic freedom in the world
Source: 2008 Index of Economic freedom, Heritage Foundation

Country risk

See the country risk analysis provided by Ducroire.

Foreign trade in figures

Malaysia is well known for its openness to international trade. Foreign trade accounts for more than double of the country’s GDP. The main three trade partners are the United States, Singapore and Japan, followed by China and the European Union.
The country mainly exports electric and electronic equipment, machinery, mineral fuels and hydrocarbons, animal and vegetable oils and fats, wood and charcoal. The country mainly imports electric and electronic equipment, machinery, fuels and oils, plastic products, iron and steel. In 2007 and in 2008 the country registered a surplus in its trade exchanges. The current crisis has not affected the earnings of the trade balance despite the fact that it has caused heavy reduction in external trade, with imports having reduced more that exports.

Foreign trade indicators	2003	2004	2005	2006	2007
Imports of goods (millions USD)	79,289	99,244	108,653	124,144	139,075
Exports of goods (millions USD)	104,999	126,817	141,808	160,842	176,403
Imports of services (millions USD)	17,532	19,269	21,956	23,720	27,986
Exports of services (millions USD)	13,577	17,111	19,576	21,831	28,272
Imports of goods and services (annual % change)	4.5	19.6	8.9	8.5	5.4
Exports of goods and services (annual % change)	5.1	16.1	8.3	7.0	4.2
Imports of goods and services (in % of GDP)	87.3	95.0	94.6	94.5	89.9
Exports of goods and services (in % of GDP)	106.9	115.4	117.5	116.7	110.2
Trade Balance (millions USD)	25,711	27,572	33,156	36,698	37,328
Trade Balance (including service) (millions USD)	21,757	25,415	30,776	34,809	37,613
Foreign trade (in % of GDP)	194.2	210.4	212.1	211.2	200.1

Source: World Bank

Main partner countries

Main customers (% of exports)	2008
Singapore	14.7%
United States	12.5%
Japan	10.8%
China	9.5%
Thailand	4.8%
Hong Kong	4.3%
South Korea	3.9%
India	3.7%
Australia	3.7%
Netherlands	3.5%
Indonesia	3.1%
Germany	2.3%
United Arab Emirates	1.9%
Philippines	1.5%
United Kingdom	1.4%
Vietnam	1.2%
France	1.0%
Pakistan	0.9%
Mexico	0.8%
New-Zealand	0.5%
See more countries	47.7%

Main suppliers (% of imports)	2008
China	12.8%
Japan	12.5%
Singapore	10.9%
United States	10.8%
Thailand	5.6%
Indonesia	4.6%
South Korea	4.6%
Germany	4.3%
Hong Kong	2.6%
Australia	2.2%
India	2.0%
United Arab Emirates	1.6%
Vietnam	1.5%
United Kingdom	1.5%
France	1.5%
Saudi Arabia	1.4%
Philippines	1.3%
Ireland	1.0%
Italy	0.9%
Switzerland	0.8%
See more countries	47.3%

Source: Comtrade

Main products

Main exports (% of exports)	2008
Electrical machinery and equipment and parts...Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles	25.6%
Mineral fuels, mineral oils and products of their...Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes	18.3%
Nuclear reactors, boilers, machinery and...Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof	16.6%
Animal or vegetable fats and oils and their...Animal or vegetable fats and oils and their cleavage products; prepared edible fats; animal or vegetable waxes	8.3%
Rubber and articles thereofRubber and articles thereof	3.2%
Plastics and articles thereofPlastics and articles thereof	2.9%
Wood and articles of wood; wood charcoalWood and articles of wood; wood charcoal	2.4%
Optical, photographic, cinematographic, measuring,...Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical instruments and apparatus; parts and accessories thereof	2.2%
Organic chemicalsOrganic chemicals	1.7%
Miscellaneous chemical productsMiscellaneous chemical products	1.5%
Articles of iron or steelArticles of iron or steel	1.5%
Furniture; bedding, mattresses, mattress supports,...Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps and lighting fittings, not elsewhere specified or included; illuminated signs, illuminated name-plates and the like; prefabricated buildings	1.4%
Natural or cultured pearls, precious or...Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and articles thereof; imitation jewellery; coin	1.2%
Iron and steelIron and steel	1.2%
Copper and articles thereofCopper and articles thereof	0.8%
Vehicles other than railway or tramway...Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof	0.7%
Aluminium and articles thereofAluminium and articles thereof	0.6%
Cocoa and cocoa preparationsCocoa and cocoa preparations	0.5%
Glass and glasswareGlass and glassware	0.5%
Articles of apparel and clothing accessories,...Articles of apparel and clothing accessories, knitted or crocheted	0.4%
Paper and paperboard; articles of paper pulp, of...Paper and paperboard; articles of paper pulp, of paper or of paperboard	0.4%
Aircraft, spacecraft, and parts thereofAircraft, spacecraft, and parts thereof	0.4%
Soap, organic surface-active agents, washing...Soap, organic surface-active agents, washing preparations, lubricating preparations, artificial waxes, prepared waxes, polishing or scouring preparations, candles and similar articles, modelling pastes, 'dental waxes' and dental preparations with a basis of plaster	0.4%
Preparations of cereals, flour, starch or milk;...Preparations of cereals, flour, starch or milk; pastrycooks' products	0.4%
Fish and crustaceans, molluscs and other aquatic...Fish and crustaceans, molluscs and other aquatic invertebrates	0.3%
FertilizersFertilizers	0.3%
Tin and articles thereofTin and articles thereof	0.3%
Man-made filamentsMan-made filaments	0.3%
Articles of apparel and clothing accessories, not...Articles of apparel and clothing accessories, not knitted or crocheted	0.3%
Inorganic chemicals; organic or inorganic...Inorganic chemicals; organic or inorganic compounds of precious metals, of rare-earth metals, of radioactive elements or of isotopes	0.3%
Miscellaneous edible preparationsMiscellaneous edible preparations	0.3%
Tanning or dyeing extracts; tannins and their...Tanning or dyeing extracts; tannins and their derivatives; dyes, pigments and other colouring matter; paints and varnishes; putty and other mastics; inks	0.2%
Salt; sulphur; earths and stone; plastering...Salt; sulphur; earths and stone; plastering materials, lime and cement	0.2%
Dairy produce; birds' eggs; natural honey; edible...Dairy produce; birds' eggs; natural honey; edible products of animal origin, not elsewhere specified or included	0.2%
Beverages, spirits and vinegarBeverages, spirits and vinegar	0.2%
Residues and waste from the food industries;...Residues and waste from the food industries; prepared animal fodder	0.2%
Railway or tramway locomotives, rolling-stock and...Railway or tramway locomotives, rolling-stock and parts thereof; railway or tramway track fixtures and fittings and parts thereof; mechanical (including electro-mechanical) traffic signalling equipment of all kinds	0.2%
Ships, boats and floating structuresShips, boats and floating structures	0.2%
Printed books, newspapers, pictures and other...Printed books, newspapers, pictures and other products of the printing industry; manuscripts, typescripts and plans	0.2%
Tobacco and manufactured tobacco substitutesTobacco and manufactured tobacco substitutes	0.2%
Articles of stone, plaster, cement, asbestos, mica...Articles of stone, plaster, cement, asbestos, mica or similar materials	0.2%
Toys, games and sports requisites; parts and...Toys, games and sports requisites; parts and accessories thereof	0.2%
Miscellaneous articles of base metalMiscellaneous articles of base metal	0.1%
Ceramic productsCeramic products	0.1%
Essential oils and resinoids; perfumery, cosmetic...Essential oils and resinoids; perfumery, cosmetic or toilet preparations	0.1%
Tools, implements, cutlery, spoons and forks, of...Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal	0.1%
Man-made staple fibresMan-made staple fibres	0.1%
Clocks and watches and parts thereofClocks and watches and parts thereof	0.1%
Miscellaneous manufactured articlesMiscellaneous manufactured articles	0.1%
Footwear, gaiters and the like; parts of such...Footwear, gaiters and the like; parts of such articles	0.1%
See more products	28.1%

Main imports (% of imports)	2008
Electrical machinery and equipment and parts...Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles	30.9%
Nuclear reactors, boilers, machinery and...Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof	13.8%
Mineral fuels, mineral oils and products of their...Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes	10.9%
Iron and steelIron and steel	4.2%
Plastics and articles thereofPlastics and articles thereof	3.1%
Optical, photographic, cinematographic, measuring,...Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical instruments and apparatus; parts and accessories thereof	2.9%
Vehicles other than railway or tramway...Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof	2.6%
Articles of iron or steelArticles of iron or steel	2.3%
Natural or cultured pearls, precious or...Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and articles thereof; imitation jewellery; coin	2.1%
Organic chemicalsOrganic chemicals	1.9%
Copper and articles thereofCopper and articles thereof	1.8%
Rubber and articles thereofRubber and articles thereof	1.4%
FertilizersFertilizers	1.3%
Aluminium and articles thereofAluminium and articles thereof	1.3%
CerealsCereals	1.2%
Aircraft, spacecraft, and parts thereofAircraft, spacecraft, and parts thereof	1.1%
Paper and paperboard; articles of paper pulp, of...Paper and paperboard; articles of paper pulp, of paper or of paperboard	1.1%
Animal or vegetable fats and oils and their...Animal or vegetable fats and oils and their cleavage products; prepared edible fats; animal or vegetable waxes	1.0%
Cocoa and cocoa preparationsCocoa and cocoa preparations	0.8%
Inorganic chemicals; organic or inorganic...Inorganic chemicals; organic or inorganic compounds of precious metals, of rare-earth metals, of radioactive elements or of isotopes	0.7%
Miscellaneous chemical productsMiscellaneous chemical products	0.7%
Pharmaceutical productsPharmaceutical products	0.5%
Dairy produce; birds' eggs; natural honey; edible...Dairy produce; birds' eggs; natural honey; edible products of animal origin, not elsewhere specified or included	0.5%
Ores, slag and ashOres, slag and ash	0.5%
Residues and waste from the food industries;...Residues and waste from the food industries; prepared animal fodder	0.5%
Ships, boats and floating structuresShips, boats and floating structures	0.5%
Tanning or dyeing extracts; tannins and their...Tanning or dyeing extracts; tannins and their derivatives; dyes, pigments and other colouring matter; paints and varnishes; putty and other mastics; inks	0.4%
Essential oils and resinoids; perfumery, cosmetic...Essential oils and resinoids; perfumery, cosmetic or toilet preparations	0.4%
Tools, implements, cutlery, spoons and forks, of...Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal	0.4%
Furniture; bedding, mattresses, mattress supports,...Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps and lighting fittings, not elsewhere specified or included; illuminated signs, illuminated name-plates and the like; prefabricated buildings	0.4%
Glass and glasswareGlass and glassware	0.3%
Salt; sulphur; earths and stone; plastering...Salt; sulphur; earths and stone; plastering materials, lime and cement	0.3%
Sugars and sugar confectionerySugars and sugar confectionery	0.3%
Fish and crustaceans, molluscs and other aquatic...Fish and crustaceans, molluscs and other aquatic invertebrates	0.3%
Wood and articles of wood; wood charcoalWood and articles of wood; wood charcoal	0.3%
Clocks and watches and parts thereofClocks and watches and parts thereof	0.3%
Soap, organic surface-active agents, washing...Soap, organic surface-active agents, washing preparations, lubricating preparations, artificial waxes, prepared waxes, polishing or scouring preparations, candles and similar articles, modelling pastes, 'dental waxes' and dental preparations with a basis of plaster	0.3%
Oil seeds and oleaginous fruits; miscellaneous...Oil seeds and oleaginous fruits; miscellaneous grains, seeds and fruit; industrial or medicinal plants; straw and fodder	0.3%
Edible vegetables and certain roots and tubersEdible vegetables and certain roots and tubers	0.3%
Preparations of cereals, flour, starch or milk;...Preparations of cereals, flour, starch or milk; pastrycooks' products	0.3%
Miscellaneous articles of base metalMiscellaneous articles of base metal	0.3%
Miscellaneous edible preparationsMiscellaneous edible preparations	0.3%
Meat and edible meat offalMeat and edible meat offal	0.3%
Tobacco and manufactured tobacco substitutesTobacco and manufactured tobacco substitutes	0.2%
Printed books, newspapers, pictures and other...Printed books, newspapers, pictures and other products of the printing industry; manuscripts, typescripts and plans	0.2%
Railway or tramway locomotives, rolling-stock and...Railway or tramway locomotives, rolling-stock and parts thereof; railway or tramway track fixtures and fittings and parts thereof; mechanical (including electro-mechanical) traffic signalling equipment of all kinds	0.2%
Beverages, spirits and vinegarBeverages, spirits and vinegar	0.2%
CottonCotton	0.2%
Coffee, tea, maté and spicesCoffee, tea, maté and spices	0.2%
Products of the milling industry; malt; starches;...Products of the milling industry; malt; starches; inulin; wheat gluten	0.2%
Tin and articles thereofTin and articles thereof	0.2%
Edible fruit and nuts; peel of citrus fruits or...Edible fruit and nuts; peel of citrus fruits or melons	0.2%
Articles of apparel and clothing accessories, not...Articles of apparel and clothing accessories, not knitted or crocheted	0.2%
Toys, games and sports requisites; parts and...Toys, games and sports requisites; parts and accessories thereof	0.1%
Man-made filamentsMan-made filaments	0.1%
Articles of stone, plaster, cement, asbestos, mica...Articles of stone, plaster, cement, asbestos, mica or similar materials	0.1%
Pulp of wood or of other fibrous cellulosic...Pulp of wood or of other fibrous cellulosic material; recovered (waste and scrap) paper or paperboard	0.1%
Ceramic productsCeramic products	0.1%
Knitted or crocheted fabricsKnitted or crocheted fabrics	0.1%
Footwear, gaiters and the like; parts of such...Footwear, gaiters and the like; parts of such articles	0.1%
Articles of apparel and clothing accessories,...Articles of apparel and clothing accessories, knitted or crocheted	0.1%
Other made-up textile articles; sets; worn...Other made-up textile articles; sets; worn clothing and worn textile articles; rags	0.1%
Zinc and articles thereofZinc and articles thereof	0.1%
Preparations of vegetables, fruit, nuts or other...Preparations of vegetables, fruit, nuts or other parts of plants	0.1%
Albuminoidal substances; modified starches; glues;...Albuminoidal substances; modified starches; glues; enzymes	0.1%
Miscellaneous manufactured articlesMiscellaneous manufactured articles	0.1%
Articles of leather; saddlery and harness; travel...Articles of leather; saddlery and harness; travel goods, handbags and similar containers; articles of animal gut (other than silkworm gut)	0.1%
See more products	37.1%

Source: Comtrade

See more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of general economic information

Ministries: Ministry of Finance
Ministry of International Trade and Industry
Central Bank
Statistical Office: Department of Statistics Malaysia
Central Bank: Central Bank of Malaysia
Stock Exchange: Kuala Lumpur Stock Exchange
Search Engines: Cari
Ada
Catcha
FounderNet
Malaysia Directory
Economic portals: Business Times

Political outline

Executive Power: The head of state is the Paramount Ruler, commonly referred to as the King. The King is selected from nine hereditary rulers (called Sultans) of the Malay states to serve a five-year term; the other four states (which have titular Governors) do not participate in the selection. Following legislative elections, the leader of the party that wins most seats in the lower house of the parliament becomes the Prime Minister to serve a five-year term, subject to approval by the King. The Prime Minister is the head of the government and holds the executive powers which include implementation of the law and running the day-to-day affairs of the country . The Cabinet is appointed by the Prime minister from among the members of parliament with the consent of the Paramount Ruler.
Legislative Power: The legislature in Malaysia is bicameral. The parliament consists of: the Senate (the upper house) having 69 seats, out of which 43 appointed by the Paramount Ruler and 26 appointed by the 13 state assemblies to serve six-year terms; and the House of Representatives (the lower house) having 219 seats. Its members are elected by popular vote to serve five-year terms. The King can dissolve parliament if he wishes but usually only does so upon the advice of the Prime Minister. In general, more power is vested in the executive branch of government than in the legislative. The legislative power is divided between federal and state legislatures. Each state has its own government, a cabinet with executive authority, and a legislature that deals with matters not reserved for the federal parliament. The people of Malaysia have limited political rights.
Main political parties: Malaysia is a country with one dominant party. The UMNO (National Organization for a United Malaysia) is the largest political party in the country. It has ruled the country uninterruptedly since its independence from the UK in 1957. UMNO is known for being a major proponent of Malaysian nationalism and Islamic ideology. UMNO rules the country through a coalition called BN (National Front); its other two prominent members are:
- MCA (Malaysian Chinese Association) – a party of Chinese who are citizens or long-term residents of Malaysia;
- MIC (Malaysian Indian Congress) – representing the Indian community in Malaysia;
- Opposition parties are allowed, but are widely considered to have no real chance of gaining power.
Current political leaders: Paramount Ruler: Sultan MIZAN Zainal Abidin (since 13 December 2006)
Prime Minister: Mohamed NAJIB bin Abdul Razak (since April 2009) – UMNO, heading the BN coalition government
Next election dates: Paramount Ruler: December 2011

Indicator of freedom of the press

World Rank:: 132/173
Evolution:: 8 places down compared to 2007

Source: Worldwide Press Freedom Index 2007, Reporters Without Borders

Indicator of political freedom

Ranking:: Partly Free
Political freedom:: 4/7
Civil liberties:: 4/7

Map of freedom 2007
Source: Freedom House

Any comments about this content? Report it to us.