Virtual Map of Malaysia map.virtualmalaysia/index.asp

Virtual Map of Malaysiahttp://map.virtualmalaysia.com/index.asphttp://www.windowstomalaysia.com.my/

13 states: LabuanFederal territories

Full country name: Federation of Malaysia Area: 329,750 sq km (204,445 sq mi) Population: 25 million Capital city: Kuala Lumpur (pop 1.5 million) People: 50% Malay, 33% Chinese, 9% Indian,plus indigenous tribes such as Orang Asli and Iban Language: Bahasa Malaysia, English, Chinese dialects, Tamil, indigenous dialects Religion: 52% Muslim, 17% Buddhist, 12% Taoist, 8% Christian, 8% Hindu, 2% tribal Government: Parliamentary monarchy GDP growth: 4-5% (2002), 6-6.5%(2003)Per capita income: 2002 RM14098(US$3710), Inflation rate: 1.9%Unemployment: 3.5%Malaysia - A glancehibiscus

- History

Colonial Malaysia 1511 AD - 1957 AD Melaka's wealth soon attracted European powers, and the Portuguese took control in 1511, followed by the Dutch in 1641. The British established a thriving port in Penang in 1786 and took over Melaka in 1795British colonised the peninsula when tin and rubber were discovered and developed, British also brought large numbers of Indians into the country, altering the peninsula's racial mix.Sarawak came into British hands via the adventurer Charles Brooke in 1841 after suppressing a revolt against the Sultan of Brunei and the North Borneo Company administered Sabah from 1882. Britain took formal control of both Sabah and Sarawak after WWII. The Japanese overran Malaya in WWIIIndependence and Onward: 1957 present day Malaya achieved independence in 1957. Sabah, Sarawak and Singapore combined with Malaya to establish Malaysia in 1963, but two years later Singapore withdrew from the confederation. 1963 had the 'Confrontation' with Indonesia. 1969, violent riots broke out between Malays and Chinese since then all races lived in relative peace together

Political System (http://www.windowstomalaysia.com.my/gov/20.htm)The Federation of Malaysia is a constitutional monarchy with a system of parliamentary democracy. Malaysia is a federal one, with each (13) state having its own legislature, but power is centralized in the national government. General elections are held every five years. The Barisan National, is a coalition of various political parties with the main party being UMNO, which continues to rule the government.

Malaysia Political Parties: Barisan Nasional() United Malay National Organisation (UMNO) Malaysian Chinese Association (MCA) People's Progressive Party of Malaysia (BARU) Pan Malaysian Islamic Party (PAS) Democratic Action Party (DAP) Malaysian People's Movement Party Parti Rakyat Malaysia Socialist Party of Malaysia Sabah Progressive Party (SAPP) Parti Liberal Demokratik-SABAH (LDP) Parti Bersatu Sabah (PBS) Sarawak United Peoples Party (SUPP) ) Parti Keadilan Nasional Malaysian Indian Congress

The Monarch - Head of State The Malaysian monarchy is a unique system as its King is rotational elected every 5 years and is not hereditary. Here the King or the Yang di-Pertauan Agong iselected every five years from 9 royal states. Unlike the traditional system where the Monarchascends the throne through lineage and remains until his abdication or death. Sultan of Perlis was elected as the 12th Yang di Pertuan Agong of Malaysia on 25th April 2002. Royal Head Dress (Royal Tiara) (Royal Short Keris) Royal Regalia

Head of Government Prime Minister Official &Cabinet Ministers of Malaysiahttp://www.virtualmalaysia.com/Malaysia/Ministries/Malaysia has undergone tremendous growth and prosperity, and has arguably made significant progress in race relations. Many attribute the country's success to the dynamic leadership of Prime Minister Mahathir bin Mohammed, who has led the country since 1981.He is scheduled to step down on the end of October 2002 to finish the longest 22-years government administration among the Asia. PERDANA PUTRA BUILDING (PRIME MINISTER'S OFFICE)Putrajaya the New Government City

Senators, whether appointed or elected, serve a six-year term,

House of Representatives are elected for a 5-year term in a single member constituency system

ReligionsIslam is the national religion, but freedom of religion is guaranteed.

Malays are usually Muslims.Chinese are predominatelyTaoists and Buddhists, some are Christians.Majority Malaysia's Indian are mainly Hindu, a small percentage are Muslims, Christians andalso Sikhs.

East Malaysia have converted to Christianity although others still follow theiranimist traditions.

Cultures have been meeting and mixing in MalaysiaMoslem New Year - Ma'al Hijrah / Awal Muharram (March) "Selamat Tahun Bahru!" - A happy New Year!

Malaysia Fest is a two-week affair held in September

Hari Raya Puasa: (Ramadan or festival of break-fast-time). It is a celebration marking the end of Muslim month of fasting and abstinence. (October- November)

Hari Raya Haji - the pilgrimage to Mecca (February)The Malay people and the Islam in Malaysia: Though Islam originates from Saudi ArabiaThe Malays do not accept all cultural values from the Arab, there is a difference between the Islam how it is practised in the Arab States in Middle East (so-called "desert-Islam") and in Malaysia, the "tropical Islam".

Chinese New Year, Dragon Boat Festival, Moon-cake Festival Opera, Lion Dance and othersChinese Culture in Malaysia

Indians Thaipusam: a day of consecration to the Hindu deity. A feature is carrying a frame decorated with colorful papers, tinsels, fresh flowers, and fruits as a form of penance (January/February)The Panguni Utthiram Festival This is an auspicious date for worship on the full moon day of the Tamil month Panguni (March-April). Indian New Year (April)

Guidelines on the Do's & Don'ts Take off your shoes when entering a place of worship or a Malaysian home.

Impolite to cross your legs with shoes facing other person.Dont point your finger to others in most situation

Avoid liquor and dishes which contain pork to serve Muslims. If your guest is an Indian Hindu, avoid serving him beef.

Use right hand to shake hands, but kissing hand or cheek should be avoided. Muslim women prefer not to shake hands, a simple nod and smile is sufficient.

Visitors should dress modestly in the conservative rural areas. Impolite to wear shorts to a place of worship or a function, exceptbeach party.

Some Malay expressionsTerima kasih. (Thank you.) Sama-sama. (You're welcome)Tolong (Please!)Apa khabar? (How are you?) Selamat pagi. (Good morning) Maafkan saya. (Excuse me/I'm sorry)Berapakah harganya? (How much is it?) Tak apa (It's okay)

Malaysia Special Tropical Fruits and Agriculture "The King of the fruits Durian"The Queen of the fruits" MangosteenRubberPalm Oil JackfruitcocoaRambutan

Malaysia Economic System

The core of Malaysian economic system is free market with private enterprises. Government also plays an active role in development planning to promote balanced economic growth and social progress.

Malaysia is essentially a trade-oriented and open economy with exports and imports for over 176% of the GNP in the early 1990s. Exports play a dominant role and important determinant of the state of economic activity over the short and medium terms.

Malaysia Economic Development and PoliciesPhase 1: 1957~1970 After Independence Policy: Self-sufficiency, open, market-oriented economy with min. interventionsRubber and Tin are the major products (Shared 85% of total exports)

1st and 2nd 5-year economy plans: Reforms on land and diversify agricultural outputs, i.e. palm oil, cocoa, pepper, timber, etc Restructure the reliance on rubber and tin production (colonial industries) Encourage manufacturing by using Import-substitution policy

Shares of GDP (%)195519601965197019751980198519901994Agriculture40.240.531.530.827.722.820.718.714.8Mining6.36.19.06.34.610.010.49.87.5Manufacturing8.28.610.413.416.420.019.626.931.5Services & others45.344.849.151.349.547.249.346.148.8Source: Malaysia Statisitcs Dept.

Rural development plan:

(1) Diversify agriculture products - introduce technology to produce industry crops, i.e. palm oil, coco, pepper, coconut, coffee, etc. - provide agricultural training

(2) Setup the production standard for rubber to keep the leadership of productions and exports

(3) Green reforms among rural areas

(4) Centralize purchase price of major agriculture

(5) Land reform: Setup FELDA to provide to farmers, 4 arcs for each migrated farmer to new areas. Use 3.2 arcs for rubber and 0.8 arc for others. Also provide financial support and fertilizer to farmers until harvesting

(5a) Later years introduce palm oil planting and encourage cooperate and merge to large farming.

Phase 2: 1971~ 1990: Authoritarian PolicyNew Economic Policy (NEP):Increase overall income, increase job opportunities, poverty eradication - Directly subsidies and preferential to Malays, - Encourage Malays to establish business, - Enlarge the education opportunities for Malays

(2) Income re-distribution and balance economic power among races - Restructure employment ratio: 54% Malay, 35% Chinese, 10% Indian, - Restructure ownership shares to 30: 40: 30 for foreign, non-Malay and Malay - Target 30% of companies are owned by Malays in 1990

(3) Export-oriented policy: - Free Trade Zones (FTZs), Export process Zone (EPZs), - Exemption on Licenses manufacturing warehouse (LMWs) - 8 yrs Tax Free for foreign investors - Expand the petroleum industryManufacturing sector accounts for 30.4% of GDP, and make up 86.5% of the country's total exports. The world's largest producer of palm oil, rubber and tin, also one of the world's leading exporters of semiconductor devices, computer hard disk drives, audio and video products, and room air-conditioners

Source: Table10.9, 13.4, Drabble, An Economic History of Malaysia, c.1800-1990

Income differentials ratio by race and locations in Malaysia1957/81970197619841989Chinese/Malay2.152.292.281.761.70Indian/Malay1.701.761.561.281.29Chinese/Indian1.261.301.461.371.32Urban/Rural1.852.142.111.871.72

Ownership Restructuring under NEP, 1970-901970198019851990Malay (a) Individuals (b) Trust agencies1.60.85.86.711.77.420.3Chinese27.237.533.444.9Indian1.11.21.21.0Foreigners63.442.92625.1

(4) 1981 Look East Resource-Base industrialization policy, - want know-how, dont want show-how heavy industries: auto (Proton), steel, oil & gas, paper, chemical fertilizer, setup HICOM for centralize management, coordinate and monitor- infrastructures: highway, sea-port, airport, telecommunications network - Industrial Parks, Specialized parks, etc.

The Economy Video Clipshttp://www.windowstomalaysia.com.my/vid_eco.htmPhase 3: 1990 ~ 1997New Development Policy (NDP)

Stress on economic growth and balance developmentStress on harmonious and cooperation(3) Liberalize investment regulations for non-MalayThe Government has instituted significant reforms by dismantling many state-run enterprises and encouraging private enterprise to undertake many of the country's development projects. Through promoting a free market in some areas, the Government is also an investor in the economy (usually as a minority partner) and controls prices on some key commodities such as fuel and rice. Malaysia Real GDP growth rate before 1997

198719881989199019911992199319941995199687-965.4%8.9%8.7%9.8%8.7%7.8%8.5%8.6%8.3%9.4%8.4%

Malaysia Tax structures

Company Tax: 0 - 28% Petroleum Income Tax: 38%Personal Income Tax: 1- 28%Resident individuals with chargeable income of RM30,000 (US$7,895) and above per annum (after deduction of personal reliefs)Sales Tax: 0 - 25%The general sales tax is 10%. Certain essential goods, foodstuffs and building materials are taxed at 5%, whilst cigarettes and liquor are taxed at 15% and 25% respectively.Service Tax: 5%Goods include food, drinks or tobacco products provided in restaurants, bars, snack bars, coffee houses, private clubs, etc. Services include services provided by professionals (such as lawyers, engineers, architects, surveyors, consultants), advertising firms, private hospitals, insurance companies, communication companies, hotels and restaurants.Import duty: Ad Valorem. Last few years, import duties on a wide range of raw materials, components and machinery has abolished. Committed to the ASEAN Common Effective Preferential Tariffs (CEPT): Import duties on most goods from ASEAN countries will be reduced to between 0% - 5% by the year 2003.

Central Provident Fund System (1957-present)

Statutory contributions under the Employees Provident Fund Act 1991 Employers Min. of 12% of the employees monthly wages (before 1991 is 10%) Employees Min. of 11% of the employees monthly wages (before 1991 is 5%)

Until 55-year-old employees can withdraw from the central provident fund.Labor welfare and social security

Human Resources DevelopmentHigh Priority on Education Education shared about 15% of total public expenditure allocated under Malaysia's five-year development plans.

There are 18 public and 15 private universities, 4 oversea U. branches, and various polytechnics and industrial training institutes

Total enrolment in public institutions of higher learning alone is projected to reach over 250,000 in 2003, with more than half in the science and technical disciplines. HKBU-Economics2003 Malaysia Field Trip http://www.hkbu.edu.hk/~eecon/2003Malaysia/2003Malaysia01.html

Economic statisticshttp://www.statistics.gov.my/English/framesetKeystats.htm

Chart5

8.7137638589

11.5944970199

30.7598641345

3.2641900408

3.6743500459

13.762790797

6.6298519579

11.4203926428

6.7590950845

Malaysia Economic Structure of GDP (2002-Q4)

Sheet1

GDP93622

81588.78.711.630.83.33.713.86.611.46.87.3

1085511.6

2879830.8

30563.3

34403.7

1288513.8

62076.6

1069211.4

63286.8

68427.3

Sheet1

Malaysia Economic Structure of GDP (2002-Q4)

Sheet2

Sheet3

59.9 16.8 10.2 9.2 2.3 0.7 0.6 0.2 0.0 100

Malaysia Prior to the Crisis

Causes for concern:Economic growth above the potential output2. Loss of efficiency in the economyRising current account deficitsExcessive Credit Expansion to the Non-Tradable Sectors

Exchange Rates: National currencies against US DollarThe Ringgit, which had been one of the region's strongest and most stable currencies, plunged in value from RM2.5 to the US dollar to almost RM5 to the dollar, before the Government fixed it at RM3.8 in September 1998.

Asian Financial Crisis:

Malaysia has been seriously affected by the Asian financial crisis with GDP shrinking by 7.5 per cent by the end of 1998. The decline in output was mostly observed in the construction, manufacturing and agricultural sectors. The Ringgit depreciated by 56 per cent and the stock market fell by 50 per cent between mid-1997 and January 1998.

The financial crisis had cost Malaysia about US$50 billion in terms of purchasing power of imports and US$150 billion in market capitalisation.

Several Government-funded mega-projects were put on hold following the implementation of the National Economic Recovery Plan (NERP), drawn up by the National Economic Action Council (NEAC), to counter the negative effects of the Ringgit depreciation and the collapse of the stock market. Economic Recovery Plan after 1997http://mir.com.my/lb/econ_plan/index.htmMalaysia Budget Keynesian Approachhttp://mir.com.my/lb/budget2002/index.htm

Six Objectives of the Economy Recovery Plan and Actions after the Asian CrisisStabilizing the Ringgit : a. Appropriate choice of exchange rate regime b. Increase external reserves c. Reduce an over-dependence on the US dollar d. Adopt a balanced interest rate policy 2. Restoring the market confidence a. Improve transparency and the regulatory environment b. Establish rules for assisting industries and companies c. Increase the consistency of government policies d. Adopt liberal market-based policies e. Improve public relations f. Improve the dissemination of economic information

3. Maintaining Financial Market Stability a. Preserve the integrity of the banking system b. Establish agencies along the lines of the Resolution Trust Corporation (RTC) and the Federal Deposit Insurance Corporation (FDIC) c. Recapitalise the banking sector d. Monitor closely overall credit expansion e. Improve the capital market f. Develop the private debt securities (PDS) market 4. Stranghtening Economic Fundamentals a. Increase the quality of investments b. Improve the balance of payments c. Maintain a balanced public sector financial position d. Maintain an appropriate monetary policy e. Maintain price stability f. Increase labor competitiveness

5. Continuing the Equity and Socio-economic Agenda a. Ameliorate the hardship from poverty b. Address Bumiputera equity ownership c. Expand employment opportunities d. Meet the challenge of expanding tertiary education e. Address graduate unemployment f. Control the influx of foreign workers g. Gear up state corporations to face the crisis h. Revamp cooperatives and cooperative banks i. Protect the Environment 6. Restoring adversely affected Sectors Address and restore the following sectors: Primary commodities and resource-based industries , Mining and petroleum Manufacturing , Information Technology and the Multimedia Super Corridor Motor industry , Construction , Property , Infrastructure , Transport Freight Forwarding , Tourism , Banking , Insurance and Reinsurance

The Malaysia Government has responded immediately by putting in place measures to prevent further deterioration in the economy. Steps are being taken to reduce dependency on external trade, while more attention is given to domestic economic activities as well as the new markets, which will be expected to lead in the nation's economic growth in 2002 and the years ahead.

Liberalisation of Equity Policy in the Manufacturing SectorAfter July 1998, foreign investors are allowed to hold 100% of the equity in all manufacturing projects, with the exception of 7 activities and products comprising paper packaging, plastic packaging, plastic injection moulded components, metal stamping and metal fabrication, wire harness, printing and steel service centers

Since Jun 2003, to further improve the investment climate, the government has decided to fully liberalise equity holdings in all manufacturing projects, irrespective of the level of exports and without any product/activity being excluded.

Liberalisation Policy on the Employment of Expatriates in the Manufacturing Sector.To address the need for high level expertise in the manufacturing sector, the Government has further liberalized the policy on the employment of expatriates in the manufacturing sector.

Automatic approval for up to 10 expatriate posts, including 5 key posts.Expatriates can be employed for up to a maximum of 10 years for executive posts, and 5 years for non-executive posts.

Recovery in Malaysia

Challenges Remain

Salaries of Executives in the Manufacturing Sector (2001)

Salaries of Non-Executives in the Manufacturing Sector (2001)

House PriceRM 300,000 700,000