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Asia and Oceania
Malaysia |
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| Last reviewed: 13 May 2009 |
Country information
ECONOMY
Basic Economic Facts
GDP: US$195bn (2009 EIU estimate)
GDP per head (Nominal): US$6,721 (2007)
GDP per head (Purchasing Power Parity): US$13,314 (2009 estimate).
Annual Growth: 2007: 6.3% (actual); 2008: 4.6% (actual); 2009: 1 and 1% (Govt projected)
Inflation: 2007: 2.0% (actual); 2008: 5.4% (actual); 2009: 1.5-2% (Govt projected).
Major Industries: Electronics, Petroleum & LNG, Chemicals, Textiles, Palm Oil, Timber, Tourism
Major Trading Partners: USA, EU, Singapore, Japan and China
Exchange Rate: £1=5.26 Ringgit - variable (April 8, 2009)
Total Exports with UK: £1.84 bn; +7% on-year (Jan.-Dec 2008)
Total Imports with UK: £1.14 bn; +19% on-year (Jan.-Dec 2008)
Malaysia is one of South East Asia's more successful economies and one of UK Trade and Investment's High Growth Markets. Recent GDP growth has raised per capita income to US$6,721 in 2007 (close to double that in PPP terms based on 2009 estimates), transforming a commodities-based economy into one with a large, export-orientated manufacturing sector. Apart from a minor blip during the financial crisis of 1997-1998 the economy has continued to grow robustly since then: most recently by 6.3% in 2007 and 4.6% in 2008. Nowadays the services sector (rising to nearly 46.6% of GDP in 2007) is increasingly important; while both commodities (palm oil and rubber) and oil and gas remain substantial sectors and benefited from record high prices in 2008.
Since the Asian financial crisis, Malaysia has made good progress in reforming its banking and financial system. Local banks have been consolidated and there is phased liberalisation to allow greater competition. Malaysia has developed its Islamic Finance capability and is now a major hub in the Asia Pacific region. The Government has also progressively dismantled the exchange and other controls imposed during the Asia Crisis - including abandoning the Ringgit peg to the dollar in July 2005 in favour of a managed float.
The chief economic reform challenges facing Malaysia now are to improve the performance of Government Linked Companies (which still account for a large part of the economy); to achieve further progress in corporate governance and transparency, and to move up the value chain in response to the economic challenge posed by China and other low-cost manufacturing economies. The administration has made some changes to improve financial and political accountability, and is seeking to improve Malaysian competitiveness in sectors such as biotechnology.
