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Malaysia Economy Profile 2017

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Economy - overviewMalaysia, 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 farther 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 with the aim of 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 2015. The ringgit rebounded in early 2016, but hit new lows following U.S. presidential elections 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, 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.
GDP (purchasing power parity)$863 billion (2016 est.)
$828.2 billion (2015 est.)
$789 billion (2014 est.)
note: data are in 2016 dollars
GDP (official exchange rate)$302.7 billion (2016 est.)
GDP - real growth rate4.2% (2016 est.)
5% (2015 est.)
6% (2014 est.)
GDP - per capita (PPP)$27,200 (2016 est.)
$26,600 (2015 est.)
$25,700 (2014 est.)
note: data are in 2016 dollars
Gross national saving27.4% of GDP (2016 est.)
28.1% of GDP (2015 est.)
29.4% of GDP (2014 est.)
GDP - composition, by end usehousehold consumption: 55.2%
government consumption: 12.9%
investment in fixed capital: 26%
investment in inventories: 0.1%
exports of goods and services: 66.5%
imports of goods and services: -60.7% (2016 est.)
GDP - composition by sectoragriculture: 8.2%
industry: 37.8%
services: 54% (2016 est.)
Population below poverty line3.8% (2009 est.)
Labor force14.77 million (2016 est.)
Labor force - by occupationagriculture: 11%
industry: 36%
services: 53% (2012 est.)
Unemployment rate3.3% (2016 est.)
3.2% (2015 est.)
Unemployment, youth ages 15-24total: 10.2%
male: 9.3%
female: 11.6% (2014 est.)
Household income or consumption by percentage sharelowest 10%: 1.8%
highest 10%: 34.7% (2009 est.)
Distribution of family income - Gini index46.2 (2009)
49.2 (1997)
Budgetrevenues: $52.66 billion
expenditures: $63.01 billion (2016 est.)
Taxes and other revenues17.4% of GDP (2016 est.)
Budget surplus (+) or deficit (-)-3.4% of GDP (2016 est.)
Public debt55.1% of GDP (2016 est.)
54.5% of GDP (2015 est.)
note: this figure is based on the amount of federal government debt, RM501.6 billion ($167.2 billion) in 2012; this includes Malaysian Treasury bills and other government securities, as well as loans raised externally and bonds and notes issued overseas; this figure excludes debt issued by non-financial public enterprises and guaranteed by the federal government, which was an additional $47.7 billion in 2012
Inflation rate (consumer prices)2% (2016 est.)
2.1% (2015 est.)
note: approximately 30% of goods are price-controlled
Central bank discount rate3% (31 December 2011)
2.83% (31 December 2010)
Commercial bank prime lending rate4.4% (31 December 2016 est.)
4.57% (31 December 2015 est.)
Stock of narrow money$91.28 billion (31 December 2016 est.)
$83.97 billion (31 December 2015 est.)
Stock of broad money$478.7 billion (31 December 2014 est.)
$440.3 billion (31 December 2013 est.)
Stock of domestic credit$437.1 billion (31 December 2016 est.)
$390.7 billion (31 December 2015 est.)
Market value of publicly traded shares$383 billion (31 December 2015 est.)
$459 billion (31 December 2014 est.)
$500.4 billion (31 December 2013 est.)
Agriculture - productsPeninsular Malaysia - palm oil, rubber, cocoa, rice; Sabah - palm oil, subsistence crops; rubber, timber; Sarawak - palm oil, rubber, timber; pepper
IndustriesPeninsular Malaysia - rubber and oil palm processing and manufacturing, petroleum and natural gas, light manufacturing, pharmaceuticals, medical technology, electronics and semiconductors, timber processing; Sabah - logging, petroleum and natural gas production; Sarawak - agriculture processing, petroleum and natural gas production, logging
Industrial production growth rate4.2% (2016 est.)
Current Account Balance$6.067 billion (2016 est.)
$8.874 billion (2015 est.)
Exports$167.3 billion (2016 est.)
$175.7 billion (2015 est.)
Exports - commoditiessemiconductors and electronic equipment, palm oil, petroleum and liquefied natural gas, wood and wood products, palm oil, rubber, textiles, chemicals, solar panels
Exports - partnersSingapore 13.9%, China 13%, Japan 9.5%, US 9.4%, Thailand 5.7%, Hong Kong 4.7%, India 4.1% (2015)
Imports$139.5 billion (2016 est.)
$147.7 billion (2015 est.)
Imports - commoditieselectronics, machinery, petroleum products, plastics, vehicles, iron and steel products, chemicals
Imports - partnersChina 18.8%, Singapore 12%, US 8.1%, Japan 7.8%, Thailand 6.1%, South Korea 4.5%, Indonesia 4.5% (2015)
Reserves of foreign exchange and gold$97.38 billion (31 December 2016 est.)
$95.29 billion (31 December 2015 est.)
Debt - external$187.5 billion (31 December 2016 est.)
$186.5 billion (31 December 2015 est.)
Stock of direct foreign investment - at home$154.7 billion (31 December 2016 est.)
$144.7 billion (31 December 2015 est.)
Stock of direct foreign investment - abroad$155.6 billion (31 December 2016 est.)
$145.6 billion (31 December 2015 est.)
Exchange ratesringgits (MYR) per US dollar -
4.079 (2016 est.)
3.91 (2015 est.)
3.91 (2014 est.)
3.27 (2013 est.)
3.09 (2012 est.)
Fiscal yearcalendar year

Source: CIA World Factbook
This page was last updated on July 9, 2017

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