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The Economy of Malaysia

Malaysian Economy

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Economy - 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 2006-08. Although this has helped to hold down the price of imports, inflationary pressures began to build in 2007 - in 2008 inflation stood at nearly 6%, year-over-year. 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. 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. The central bank maintains healthy foreign exchange reserves and the regulatory regime has limited Malaysia's exposure to riskier financial instruments and the global financial crisis. Decreasing worldwide demand for consumer goods is expected to hurt economic growth, however.

GDP:

GDP - real growth rate: 5.1% (2008 est.) 6.3% (2007 est.) 5.8% (2006 est.)

GDP - per capita:

GDP - composition by sector: agriculture: 9.7% industry: 44.6% services: 45.7% (2008 est.)

Population below poverty line:

Household income or consumption by percentage share: lowest 10%: 1.4% highest 10%: 39.2% (2003 est.)

Distribution of family income - Gini index: 46.1 (2002)

Inflation rate (consumer prices):

Labor force: 11.2 million (2008 est.)

Labor force - by occupation: agriculture: 13% industry: 36% services: 51% (2005 est.)

Unemployment rate: 3.7% (2008 est.)

Budget: revenues: $44.32 billion expenditures: $55.01 billion (2008 est.)

Industries: Peninsular Malaysia - rubber and oil palm processing and manufacturing, light manufacturing, electronics, tin mining and smelting, logging, timber processing; Sabah - logging, petroleum production; Sarawak - agriculture processing, petroleum production and refining, logging

Industrial production growth rate: 4% (2008 est.)

Electricity - production: 102.9 billion kWh (2007 est.)

Electricity - production by source:

Electricity - consumption: 95.98 billion kWh (2006 est.)

Electricity - exports: 2.524 billion kWh (2006 est.)

Electricity - imports: 0 kWh (2007 est.)

Oil - production: 753,700 bbl/day (2008 est.)

Oil - consumption: 501,100 bbl/day (2006 est.)

Oil - exports: 546,300 bbl/day (2005)

Oil - imports: 308,500 bbl/day (2005)

Oil - proved reserves: 4 billion bbl (1 January 2008 est.)

Natural gas - production: 64.5 billion cu m (2007 est.)

Natural gas - consumption: 32.9 billion cu m (2007 est.)

Natural gas - exports: 31.6 billion cu m (2007 est.)

Natural gas - imports: 0 cu m (2007 est.)

Natural gas - proved reserves: 2.35 trillion cu m (1 January 2008 est.)

Agriculture - products: Peninsular Malaysia - rubber, palm oil, cocoa, rice; Sabah - subsistence crops, rubber, timber, coconuts, rice; Sarawak - rubber, pepper, timber

Exports: $195.7 billion f.o.b. (2008 est.)

Exports - commodities: electronic equipment, petroleum and liquefied natural gas, wood and wood products, palm oil, rubber, textiles, chemicals

Exports - partners: US 15.6%, Singapore 14.6%, Japan 9.1%, China 8.8%, Thailand 5%, Hong Kong 4.6% (2007)

Imports: $156.2 billion f.o.b. (2008 est.)

Imports - commodities: electronics, machinery, petroleum products, plastics, vehicles, iron and steel products, chemicals

Imports - partners: Japan 13%, China 12.9%, Singapore 11.5%, US 10.8%, Taiwan 5.7%, Thailand 5.3%, South Korea 4.9%, Germany 4.6%, Indonesia 4.2% (2007)

Debt - external: $54.11 billion (31 December 2008 est.)

Economic aid - recipient:

Currency:

Currency code:

Exchange rates: ringgits (MYR) per US dollar - 3.33 (2008 est.), 3.46 (2007), 3.6683 (2006), 3.8 (2005), 3.8 (2004)

Fiscal year: