Malaysia’s economy has grown rapidly since the 1970s, with a few temporary dips like those in 1997-1998 due to the Asian Financial Crisis, and more recently in 2014-2015. Overall, its GDP has grown from US$4 billion in 1970 to US$300 billion in 2017, tripling between 2000 and 2018.
As it has evolved from a producer of raw materials to a multi-sector economy, it has separated itself in many standard-of-living measures from the less mature countries in the region. Its 2018 GDP per capita of Int$31,800 was significantly ahead of those of Thailand and Vietnam. In the capital city of Kuala Lumpur, mega shopping malls and heavily trafficked premium retail spaces are everywhere you turn–on par with the ubiquity of temples in Thailand and a stark contrast to the small food stands in Vietnam’s cities. Malaysia is seeking to become a high-income, self-sufficient industrialized country. As it stands today, the economy is still heavily dependent on the exportation of commodities like gas and oil, and on the economies of its largest trade partners, China and Singapore. However, the country has indeed come a long way in the past half century.
In terms of ease of doing business, Malaysia is considered advanced among Asian countries, ranking 15th in the World Bank’s 2019 Ease of Doing Business Global Rankings, behind Singapore, Hong Kong, South Korea, and Taiwan. The official language in the country is Malay, but a majority of the 32 million Malaysians speaks English.
Looking forward, Malaysia’s economic growth rate is expected to slow in the coming decades, with projected GDP growth lagging the growth of Vietnam, India, Philippines, and Indonesia. The country therefore finds itself in a curious position, an economic steady-state in which it will no longer grow at the same rate as the countries “behind” it, but must continue to play catch-up to the countries that have pulled away from it. It currently has neither the massive populations of Indonesia (260 million people) or Vietnam (95 million people), nor the concentration of capital and news coverage of its continental counterparts Singapore and China. One way to speed up its economic advancement and gain ground regionally is through innovation and investment in high technology.