Malaysia

Malaysia’s location has long made it an important cultural, economic, historical, social, and trade link between the islands of Southeast Asia and the mainland. Through the Strait of Malacca, which separates the Malay Peninsula from the archipelago, flowed maritime trade and with it influences from China, India, the Middle East, and the east coast of Africa. Prior to the 14th century, several powerful maritime empires existed in what is modern-day Malaysia, including the Srivijayan, which controlled much of the southern part of the peninsula between the 7th and 13th centuries, and the Majapahit Empire, which took control over most of the peninsula and the Malay Archipelago between the 13th and 14th centuries.

The adoption of Islam between the 13th and 17th centuries also saw the rise of a number of powerful maritime states and sultanates on the Malay Peninsula and the island of Borneo, such as the port city of Malacca (Melaka), which at its height in the 15th century had a navy and hosted thousands of Chinese, Arab, Persian, and Indian merchants.

The Portuguese in the 16th century and the Dutch in the 17th century were the first European colonial powers to establish themselves on the Malay Peninsula and Southeast Asia. However, it was the British who ultimately secured their hegemony across the territory and during the late 18th and 19th centuries established colonies and protectorates in the area that is now Malaysia. These holdings were occupied by Japan from 1942 to 1945.

In 1948, the British-ruled territories on the Malay Peninsula except Singapore formed the Federation of Malaya, which became independent in 1957. Malaysia was formed in 1963 when the former British colonies of Singapore, as well as Sabah and Sarawak on the northern coast of Borneo, joined the Federation. The first several years of the country's independence were marred by a communist insurgency, Indonesian confrontation with Malaysia, Philippine claims to Sabah, and Singapore's expulsion in 1965.

During the 22-year term of Prime Minister MAHATHIR Mohamad (1981-2003), Malaysia was successful in diversifying its economy from dependence on exports of raw materials to the development of manufacturing, services, and tourism. Prime Minister MAHATHIR and a newly-formed coalition of opposition parties defeated Prime Minister Mohamed NAJIB bin Abdul Razak's United Malays National Organization (UMNO) in May 2018, ending over 60 years of uninterrupted rule by UMNO. MAHATHIR resigned in February 2020 amid a political dispute.

King ABDULLAH then selected Tan Sri MUHYIDDIN Yassin as the new prime minister. MUHYIDDIN resigned in August 2021 after losing a majority of support in parliament. King ABDULLAH next selected ISMAIL SABRI Yakoob as the successor prime minister.

Malaysia’s multi-ethnic population consists of the bumiputera – Malays and other indigenous peoples – (62%), ethnic Chinese (21%), ethnic Indians (6%), and foreigners (10%). The majority of Malaysia’s ethnic Chinese and Indians trace their roots to the British colonialists’ recruitment of hundreds of thousands of Chinese and Indians as mine and plantation workers between the early-19 th century and the 1930s.

Most Malays have maintained their rural lifestyle, while the entrepreneurial Chinese have achieved greater wealth and economic dominance. In order to eradicate Malay poverty, the Malaysian Government in 1971 adopted policies that gave preference to the bumiputera in public university admissions, government jobs and contracts, and property ownership.

Affirmative action continues to benefit well-off urban bumiputera but has done little to alleviate poverty for their more numerous rural counterparts. The policies have pushed ethnic Chinese and Indians to study at private or foreign universities (many do not return) and have created and sustained one of the world’s largest civil services, which is 85-90% Malay.

The country’s age structure has changed significantly since the 1960s, as fertility and mortality rates have declined. Malaysia’s total fertility rate (TFR) has dropped from 5 children per woman in 1970, to 3 in 1998, to 2.1 in 2015 as a result of increased educational attainment and labor participation among women, later marriages, increased use of contraception, and changes in family size preference related to urbanization.

The TFR is higher among Malays, rural residents (who are mainly Malay), the poor, and the less-educated. Despite the reduced fertility rate, Malaysia’s population will continue to grow, albeit at a decreasing rate, for the next few decades because of its large number of reproductive-age women.

The youth population has been shrinking, and the working-age population (15-64 year olds) has been growing steadily. Malaysia’s labor market has successfully absorbed the increasing number of job seekers, leading to sustained economic growth. However, the favorable age structure is changing, and around 2020, Malaysia will start to become a rapidly aging society.

As the population ages, Malaysia will need to better educate and train its labor force, raise productivity, and continue to increase the number of women workers in order to further develop its economy.

More than 1.8 million Malaysians lived abroad as of 2015, including anywhere from 350,000 to 785,000 workers, more than half of whom have an advanced level of education. The vast majority of emigrants are ethnic Chinese, seeking better educational and job opportunities abroad because of institutionalized ethnic discrimination favoring the Malays.

The primary destination country is nearby Singapore, followed by Bangladesh and Australia. Hundreds of thousands of Malaysians also commute across the causeway to Singapore daily for work.

Brain drain is an impediment to Malaysia’s goal of becoming a high-income country. The situation is compounded by a migrant inflow that is composed almost entirely of low-skilled laborers who work mainly in manufacturing, agriculture, and construction. Officially, Malaysia had about 1.8 million legal foreign workers as of mid-year 2017 – largely from Indonesia, Nepal, the Philippines, and Bangladesh – but as many as 3 to 4 million are estimated to be in the country illegally. Immigrants outnumber ethnic Indians and could supplant the ethnic Chinese as Malaysia’s second largest population group around 2035.

party to:

Antarctic-Environmental Protection, Antarctic Treaty, Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Climate Change-Paris Agreement, Comprehensive Nuclear Test Ban, Desertification, Endangered Species, Hazardous Wastes, Law of the Sea, Marine Life Conservation, Nuclear Test Ban, Ozone Layer Protection, Ship Pollution, Tropical Timber 2006, Wetlands

signed, but not ratified:

none of the selected agreements

description:

bicameral Parliament of Malaysia or Parlimen Malaysia consists of:; Senate or Dewan Negara (70 seats; 44 members appointed by the king and 26 indirectly elected by 13 state legislatures; members serve 3-year terms); House of Representatives or Dewan Rakyat (222 seats; members directly elected in single-seat constituencies by simple majority vote to serve 5-year terms) (2019)

elections:

Senate - appointed; House of Representatives - last held on 9 May 2018 (next national elections are not scheduled until 2023 but are widely expected to be called in 2022)

election results:

Senate - appointed; composition - men 54, women 14, percent of women 20.6%;

• House of Representatives - percent of vote by party/coalition - PH 45.6%, BN 33.8%, PAS 16.9%, WARISAN 2.3%, other 1.4%;
• seats by party/coalition - PH 113, BN 79, PAS 18, WARISAN 8, USA 1, independent 3;
• composition - men 199, women 23, percent of women 10.4%;
• note - total Parliament percent of women 12.8%

note: as of 16 November 2019, seats by party - PH 129, BN 41, GS 18, GPS 18, WARISAN 9, GBS 3, UPKO 1, PSB 1, independent 1, vacant 1

National Front (Barisan Nasional) or BN:

Malaysian Chinese Association (Persatuan China Malaysia) or MCA [LIOW Tiong Lai]; Malaysian Indian Congress (Kongres India Malaysia) or MIC [S. SUBRAMANIAM]; United Malays National Organization or UMNO [Zahid HAMID]; ( Formerly - Coalition of Hope (Pakatan Harapan) or PH (formerly the People's Alliance, before former PM MAHATHIR resigns 24 February 2020):; Democratic Action Party (Parti Tindakan Demokratik) or DAP [LIM Guan Eng]; Malaysian United Indigenous Party (Parti Pribumi Bersatu Malaysia) or PPBM [Tan Sri MUHYIDDIN Yassin; note - former PM MAHATHIR stepped down 24 Feb 2020]; National Trust Party (Parti Amanah Negara) or AMANAH [Mohamad SABU]; People's Justice Party (Parti Keadilan Rakyat) or PKR [ANWAR Ibrahim]; Coalition Perikatan Nasional or PN, after Pakatan Harapan or PH coalition fell apart 24 February 2020; Malaysian United Indigenous Party (Parti Pribumi Bersatu Malaysia) or PPBM [Tan Sri MUHYIDDIN Yassin; note - former PM MAHATHIR steps down 24 Feb 2020]; United Malays National Organization or UMNO [Zahid HAMID]; People's Justice Party (Parti Keadilan Rakyat) or PKR [ANWAR Ibrahim]; Pan-Malaysian Islamic Party (Parti Islam se Malaysia) or PAS [Abdul HADI Awang]; Democratic Action Party (Parti Tindakan Demokratik) or DAP [TAN Kok Wai]; National Trust Party (Parti Amanah Negara) or AMANAH [Mohamad SABU]; Sabah Star [Datuk Seri Jeffrey Kitingan]; New - Fighters of the Nation Party (Parti Pejuang Tanah Air) or Pejuang [former PM MAHATHIR bin Mohamad; interim president Datuk Seri Mukhriz Mahathir note - started August 2020]

Other:

Pan-Malaysian Islamic Party (Parti Islam se Malaysia) or PAS [Abdul HADI Awang]; Progressive Democratic Party or PDP [TIONG King Sing]; Sabah Heritage Party (Parti Warisan Sabah) or WARISAN [SHAFIE Apdal]; Sarawak Parties Alliance (Gabungan Parti Sarawak) or GPS [ABANG JOHARI Openg] (includes PBB, SUPP, PRS, PDP); Sarawak People's Party (Parti Rakyat Sarawak) or PRS [James MASING]; Sarawak United People's Party (Parti Bersatu Rakyat Sarawak) or SUPP [Dr. SIM Kui Hian]; United Pasokmomogun Kadazandusun Murut Organization (Pertubuhan Pasko Momogun Kadazan Dusun Bersatu) or UPKO [Wilfred Madius TANGAU]; United Sabah Alliance or USA (Gabungan Sabah); United Sabah Party (Parti Bersatu Sabah) or PBS [Maximus ONGKILI]; United Sabah People's (Party Parti Bersatu Rakyat Sabah) or PBRS [Joseph KURUP]; United Traditional Bumiputera Party (Parti Pesaka Bumiputera Bersata) or PBB; note - PBB is listed under GPS above

name:

"Negaraku" (My Country)

lyrics/music:

collective, led by Tunku ABDUL RAHMAN/Pierre Jean DE BERANGER

note: adopted 1957; full version only performed in the presence of the king; the tune, which was adopted from a popular French melody titled "La Rosalie," was originally the anthem of Perak,

one of Malaysia's 13 states

Malaysia, an upper middle-income country, has transformed itself since the 1970s from a producer of raw materials into a multi-sector economy. Under current Prime Minister NAJIB, Malaysia is attempting to achieve high-income status by 2020 and to move further up the value-added production chain by attracting investments in high technology, knowledge-based industries and services.

NAJIB's Economic Transformation Program is a series of projects and policy measures intended to accelerate the country's economic growth. The government has also taken steps to liberalize some services sub-sectors. Malaysia is vulnerable to a fall in world commodity prices or a general slowdown in global economic activity.

The NAJIB administration is continuing efforts to boost domestic demand and reduce the economy's dependence on exports. Domestic demand continues to anchor economic growth, supported mainly by private consumption, which accounts for 53% of GDP. Nevertheless, exports - particularly of electronics, oil and gas, and palm oil - remain a significant driver of the economy.

In 2015, gross exports of goods and services were equivalent to 73% of GDP. The oil and gas sector supplied about 22% of government revenue in 2015, down significantly from prior years amid a decline in commodity prices and diversification of government revenues. Malaysia has embarked on a fiscal reform program aimed at achieving a balanced budget by 2020, including rationalization of subsidies and the 2015 introduction of a 6% value added tax.

Sustained low commodity prices throughout the period not only strained government finances, but also shrunk Malaysia’s current account surplus and weighed heavily on the Malaysian ringgit, which was among the region’s worst performing currencies during 2013-17. The ringgit hit new lows following the US presidential election amid a broader selloff of emerging market assets.

Bank Negara Malaysia (the central bank) maintains adequate foreign exchange reserves; a well-developed regulatory regime has limited Malaysia's exposure to riskier financial instruments, although it remains vulnerable to volatile global capital flows. In order to increase Malaysia’s competitiveness, Prime Minister NAJIB raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but retreated in 2013 after he encountered significant opposition from Malay nationalists and other vested interests.

In September 2013 NAJIB launched the new Bumiputra Economic Empowerment Program, policies that favor and advance the economic condition of ethnic Malays.

Malaysia signed the 12-nation Trans-Pacific Partnership (TPP) free trade agreement in February 2016, although the future of the TPP remains unclear following the US withdrawal from the agreement. Along with nine other ASEAN members, Malaysia established the ASEAN Economic Community in 2015, which aims to advance regional economic integration.

general assessment:

• one of the most advanced telecom networks in the developing world;
• strong commitment to developing a technological society;
• Malaysia is promoting itself as an information tech hub in the Asian region;
• closing the urban rural divide;
• 4G and 5G networks with strong competition, mobile dominance over fixed-broadband;
• government development of five-year fiber and connectivity plan;
• some of Malaysia’s key exports are integrated circuits and broadcasting equipment to North America and China;
• importer of integrated circuits from Singapore and China (2020)

domestic:

fixed-line 20 per 100 and mobile-cellular teledensity exceeds 140 per 100 persons; domestic satellite system with 2 earth stations (2019)

international:

• country code - 60;
• landing points for BBG, FEA, SAFE, SeaMeWe-3 & 4 & 5, AAE-1, JASUKA, BDM, Dumai-Melaka Cable System, BRCS, ACE, AAG, East-West Submarine Cable System, SEAX-1, SKR1M, APCN-2, APG, BtoBe, BaSICS, and Labuan-Brunei Submarine and MCT submarine cables providing connectivity to Asia, the Middle East, Southeast Asia, Australia and Europe;
• satellite earth stations - 2 Intelsat (1 Indian Ocean, 1 Pacific Ocean);
• launch of Kacific-1 satellite in 2019 (2019)

note: the COVID-19 pandemic continues to have a significant impact on production and supply chains globally; since 2020, some aspects of the telecom sector have experienced downturn, particularly in mobile device production;

many network operators delayed upgrades to infrastructure; progress towards 5G implementation was postponed or slowed in some countries; consumer spending on telecom services and devices was affected by large-scale job losses and the consequent restriction on disposable incomes;

the crucial nature of telecom services as a tool for work and school from home became evident, and received some support from governments

Malaysian Armed Forces (Angkatan Tentera Malaysia, ATM): Malaysian Army (Tentera Darat Malaysia), Royal Malaysian Navy (Tentera Laut Diraja Malaysia, TLDM), Royal Malaysian Air Force (Tentera Udara Diraja Malaysia, TUDM); Ministry of Home Affairs: the Royal Malaysian Police (PRMD, includes the General Operations Force, a paramilitary force with a variety of roles, including patrolling borders, counter-terrorism, maritime security, and counterinsurgency) (2021)

note - Malaysia created a National Special Operations Force in 2016 for combating terrorism threats; the force is comprised of personnel from the Armed Forces, the Royal Malaysian Police, and the Malaysian Maritime Enforcement Agency (Malaysian Coast Guard)