Malaysia Economic Conditions and Population

By | June 6, 2022

In the heart, for several centuries, of one of the main world sea routes, and rich in mineral and energy resources, Malaysia is considered among the newly industrialized countries (the 30th in the world for gross domestic product, equal power purchase, in 2008). This milestone was achieved thanks to the manufacturing development policy and export promotion initiated in the 1970s on the Korean model and still ongoing (4.6% growth in 2008), which undermined the traditional economic structure based on agricultural production. and mining. The transformation, which essentially concerned Malaysia Peninsulare, while Borneo remained largely agricultural, at the same time limited the influence of the Chinese minority and impoverished the Indian one, concentrating economic power in the hands of the Malaysian majority, within which a robust bourgeois class was formed. Of the active population, 13% is employed in rural activities and produces 8.6% of the gross domestic product, 36% in the industrial sector (47.8%) and 51% in the tertiary sector (43.6%).

According to Homosociety, agriculture is still partly family-based, based on rice, cassava, peanuts and livestock; and partly heir to the colonial plantations of tea, coffee, sugar cane, cocoa and, above all, the rubber tree which was replaced by the oil palm in the last decades of the 20th century. Of this plant, introduced from West Africa to compensate for the low prices of rubber, Malaysia soon became the first world producer together with Indonesia (over 15 million t of oil from 38,000 ha cultivated in 2006): the new crop inherited from the previous one, the production and business models, with a coexistence of large capitalist plantations and small family producers. Since the beginning of the new millennium, growing interest is poured into Malaysia on palm oil as a possible source of raw material for the production of biofuels, in the country’s attempt to protect itself from the future depletion of fossil hydrocarbon reserves; but there is the risk of favoring a further extension of the palm groves, with serious environmental consequences and considerable demographic repercussions (immigration from abroad, internal redistribution of the population). Not negligible is silviculture, which the government is trying to control to protect the surviving forest mantle, including through reforestation. The economic importance of breeding is scarce, practiced mostly for self-consumption; on the other hand, fishing is noteworthy and is being modernized.

The extractive industries now account for only 7.3% of the gross domestic product: the exploitation of hydrocarbons, which began on a large scale in 1972, has only partially compensated for the collapse (1985) of the world market for tin, a traditional product of the for nearly two centuries. Bauxite and iron ore are also mined. The processing industry employs a third of the active population and produces 40% of the gross domestic product, showing how the era of an economy poorly based on plantations and mines has passed. Initially formed essentially by tin metallurgy and first processing of agricultural products (sugar, rubber, then palm oil), the secondary sector has rapidly diversified since the 1970s with the construction of oil refineries and then of textile and then electronic and mechanical industries, which constitute the core of the industrial agglomeration of Kuala Lumpur and produce most of the exports of Malaysia. In this process of industrial transformation, other traditional sectors, such as shipbuilding, have made remarkable progress.

The railway network (2000 km between Western and Eastern Malaysia, of which over 200 electrified), already started by the British colonial government, has now given way to the road network (50,200 km, of which almost 1500 of motorways), developed especially in the peninsular part starting from the 1970s on three main axes (two along each coast and one transversal connecting one, from Port Kelang to Kuantan). Major international airports are in Kuala Lumpur, Pinang and Johor Baharu. The most active ports are Port Kelang and Port Tanjung. Telecommunications infrastructures are well developed on the western coast of the peninsula, more backward elsewhere. The trade balance is clearly active, with exports of 169.9 billion US dollars in 2007 (main customers the United States, Singapore, Japan and China), against 132.7 billion imports (suppliers Japan, the United States, Singapore and China).).


Three main groups make up the population of Malaysia: that of the Malaysians and Proto-Malaysians (64%), spread throughout the national territory and legally defined by the 1964 Constitution as bumiputra (i.e. indigenous), the only ones to enjoy full rights of citizenship, active and passive, and long-standing immigrants, Chinese (27%, concentrated in the cities of the west coast of the peninsula) and Indians (8%). Recent immigrants, especially Indonesians, are estimated at nearly 2 million, and suffer from severe social discrimination and political marginalization. The distribution of the population is not regular, with higher densities in the western portion (80% of the total population), where Kuala Lumpur is located.(about 4.4 million residents, in the entire agglomeration in 2006) and the other major urban centers, including Subang Jaya, Kelang and Johor Baharu (between 1.2 million and 900,000 residents). The urban population is over 40%. The demographic growth rate is still high (1.8%), mainly due to the decrease in mortality (4.5%).

In addition to Malay, the official language, English and Chinese are widely used. Over 60% of the population is Muslim, about 19% Buddhist, 10% Christian, 6% Hindu.

Malaysia Economic Conditions