Economy of Malaysia
Overview
Malaysia, a middle-income country, has transformed itself since the 1970s from a producer of raw materials into an emerging multi-sector economy. Since coming to office in 2003, Prime Minister ABDULLAH has tried to move the economy farther up the value-added production chain by attracting investments in high technology industries, medical technology, and pharmaceuticals. The Government of Malaysia is continuing efforts to boost domestic demand to wean the economy off of its dependence on exports. Nevertheless, exports - particularly of electronics - remain a significant driver of the economy. As an oil and gas exporter, Malaysia has profited from higher world energy prices, although the rising cost of domestic gasoline and diesel fuel forced Kuala Lumpur to reduce government subsidies. Malaysia "unpegged" the ringgit from the US dollar in 2005 and the currency appreciated 6% per year against the dollar in 2006-07. Although this has helped to hold down the price of imports, inflationary pressures began to build in 2007. Healthy foreign exchange reserves and a small external debt greatly reduce the risk that Malaysia will experience a financial crisis over the near term similar to the one in 1997. The government presented its five-year national development agenda in April 2006 through the Ninth Malaysia Plan, a comprehensive blueprint for the allocation of the national budget from 2006-10. With national elections expected within the year, ABDULLAH has unveiled a series of ambitious development schemes for several regions that have had trouble attracting business investment. Real GDP growth has averaged about 6% per year under ABDULLAH, but regions outside of Kuala Lumpur and the manufacturing hub Penang have not fared as well.
GDP
Real Growth Rate
6%
Per Capita
USD 14,400
From Agriculture
9%
From Industry
48%
From Services
44%
Labour Force
Available for Work
11
Working in Agriculture
13%
Working in Industry
36%
Working in Services
51%
Unemployment Rate
3%
Population Below Poverty Line
5%
Inflation Rate
2%
Investment as Percent of GDP
20%
Budget
Revenues
USD 41,010 (m)
Expenditures
USD 46,960 (m)
Public Debt
US$ 0.00 (m)
Agricultural Products
Peninsular Malaysia - rubber, palm oil, cocoa, rice; Sabah - subsistence crops, rubber, timber, coconuts, rice; Sarawak - rubber, pepper, timber.
Core Industries
Peninsular - rubber and oil palm processing and manufacturing, light manufacturing, electronics, tin mining and smelting, logging, timber processing; Sarawak - agriculture processing, petroleum production and refining, logging.
Exports
Value
USD 169,900 (m)
Commodities
electronic equipment, petroleum and liquefied natural gas, wood and wood products, palm oil, rubber, textiles, chemicals.
Partners
US 18.8%, Singapore 15.4%, Japan 8.9%, China 7.2%, Thailand 5.3%, Hong Kong 4.9% (2006).
Imports
Value
USD 132,700 (m)
Commodities
Electronics, machinery, petroleum products, plastics, vehicles, iron and steel products, chemicals.
Partners
Japan 13.3%, US 12.6%, China 12.2%, Singapore 11.7%, Thailand 5.5%, Taiwan 5.5%, South Korea 5.4%, Germany 4.4% (2006).
External Debt
USD 57,830 (m)
Fiscal Year
calendar year
