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(Federation of Malaysia)

Southeast Asia’s most developed country after Singapore, Malaysia is an upper middle income country which has proven itself resilient to economic shocks and rightly deserves its status as one of the most popular investment destinations in the region.

Malaysia consists of thirteen states and three federal territories separated by the South China Sea into two similarly sized regions, Peninsular Malaysia and the states of Sabah and Sarawak on the island of Borneo.

The capital city is Kuala Lumpur, while Putrajaya is the seat of the federal government. In 2010 the population exceeded 27.5 million, with over 20 million living on the Peninsula. In terms of development, there is a huge gap between Peninsula Malaysia and Malaysian Borneo. Agriculture, fisheries and extractive industries play a larger role in the latter.


One of the original Asian Tigers, the economy is characterised by a strong top-down approach which has worked well in some scenarios, but not in others.

Following the Asian Financial Crisis of 1997-8, its decision to impose currency controls was highly criticised by the international community, but was ultimately vindicated as the country quickly returned to business-as-normal, unlike its northern neighbour Thailand.

Other government initiatives have proved more costly and less successful, such as the choice to concentrate on the development of an indigenous automobile industry while Thailand became the regional centre for international car manufacturers.

Opportunities for international business exist in almost all sectors, including construction, energy, finance, IT, professional services and the creative industries.

English is widely spoken and its workforce generally has a high level of education making it a very attractive place for doing business.

Politics & Society

In contrast to its highly developed economy, the Malaysian political scene retains a strong third world character. Malaysia is a federal constitutional monarchy. While it is a stable democracy, it has been ruled by the same party for decades. Harassment of opposition parties and media censorship are routine, and the government generally shows little hesitation in taking a heavy handed approach to suppressing popular dissent.

Another form of resentment is caused by the so called bhumiputra policy, which gives preferential treatment to ethnic Malays, including the requirement that at least one director of all companies is reserved for Malays. Given the relative prosperity of the country’s Chinese community, this may appear justified as a form of positive discrimination were it not for the fact that it does not extend this to the severely deprived Tamil community.

International Relations

Malaysia is a founding member of the Association of Southeast Asian Nations (ASEAN) and the Organisation of Islamic Cooperation (OIC), and a member of Asia-Pacific Economic Cooperation (APEC), the Commonwealth of Nations, and the Non-Aligned Movement (NAM).


Population: 28,728,607
Capital City: Kuala Lumpur
Government: Federal State, Multi-party Democracy
State Languages: Malay
GDP per capita (PPP): $14,700
Growth Rate: 6%-8% per annum

External Links

  • http://www.mier.org.my/ (Maleysian Institute of Economy Research). An independent non-profit organization devoted to economic, financial and business research that serves as a think-tank for the government and the private sector.
  • http://www.btimes.com.my/ (Business Times). Free newspaper with interesting informations about Malaysian market regulations.

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