The economy has been recovering from the deep contraction in early 2011. Real GDP growth rose in seasonally adjusted terms in each of the last three quarters, limiting the full year decline in real GDP to 1.7 percent. Fixed investment, inventory restocking and, of late, exports, have been the main drivers of the recovery. At the sectorial level, manufacturing, which led the downturn, is making a strong contribution to growth. Although capacity utilization rates continue to rise, there remains considerable spare capacity. The official unemployment rate in average is 3.5 percent. The number of retrenchments has continued to fall, however, reaching pre-crisis levels. The continued pickup in manufacturing suggests that unemployment is trending lower, but it take longer for pre-crisis levels to return. Exports are recovering thanks to improved external demand and higher international commodity prices. Exports rose 37 percent year-on-year in January, with electrical and electronic products up 56 percent. Stronger demand from emerging East Asian economies has been particularly important, making the largest contribution to Malaysia’s export growth. Reflecting the integrated supply chains of much of the export-oriented manufacturing sector, imports used for processing – intermediate goods – have been rising in line with exports

 

Foreign investors have also returned. After the sharp rise in portfolio outflows in late 2008, in the heat of the global financial crisis, outflows shifted to sizeable inflows in the third and fourth quarters of 2011. Direct investment abroad also broadly returned to its previous trend. Overall, the current account surplus remained an oversized at 16.7 percent of GDP in 2011. The financial sector remains strong. Non-performing loans amount to 1.9 percent of the total, but there may be lags in the realization of any losses from the downturn. Capital adequacy ratio remains little changed at about 14.6 percent. Moreover, bank profitability appeared to start improving in the third quarter of 2011 after a long decline since early 2008. Bank lending is still largely concentrated on households, which remain in good financial health with moderate indebtedness. Lending activity is picking up, with credits to companies rising 20 percent year-on-year in the fourth quarter. .

 

Preliminary data indicates that the federal government deficit rose to about 7 percent of GDP in 2011 from 4.8 percent in 2010. The increase was due to lower revenues in line with the weaker activity and the stimulus spending. The Malaysian economy is expected to grow robustly by 6 percent in 2012, building on faster-than-expected growth in the fourth quarter of last year. The recovery will be driven largely by strong consumer spending and continued restocking. The contributions of net external demand will likely turn negative, as imports outpace exports given the stronger domestic demand. Unwinding of policy support through fiscal consolidation effort and further rate hikes are not expected to derail the recovery, as withdrawal of stimulus will be gradual. The growth outlook remains favorable for 2012 and 2013 with anticipated growth rates of 5.3 to 5.6 percent. The main near-term risk to the outlook is external and arises from the strength of the global recovery. The fundamental medium-term risk arises from the structural reform momentum under the New Economic Model (NEM). The NEM is expected to revitalize growth by promoting private sector investment, liberalizing and deregulating the economy and modernizing the country’s social protection mechanisms. Provided reform momentum picks up as under the NEM, Malaysia’s competitiveness should be enhanced as will growth prospects. .

Source: world bank, country profile.


General Information
Official Name Federation of Malaysia
Capital Kuala Lumpur
Main Cities Kuala Lumpur, Subang Jaya, Klang, Johor Baru, Ampang Jaya
Languages Malay(official), Chinese, English, Tamil, Iban, Banjar
Government Federated constitutional monarchy
Independence Day From UK (31 August 1957)
Area 330,252 sq km
Population 29.6 million (2014)
Currency Ringgit
Source: National sources, 2014
Economic Information
  2009 2010 2011 2012 2013
Key Economic Indicator  
GDP Nominal, Current Price(US$, billion) 202.3 247.5 289.05 304.7 312.4
GDP Growth (%) -1.5 7.4 5.1 5.6 4.7
Current Account Balance(% of GDP) 15.5 10.9 11.6 6.1 3.6
Inflation, Consumer Prices(%) 0.6 1.7 3.2 1.6 2.1
Foreign Direct Investment(FDI) Inflows(US$, million) 1,453 9,060 12,197.6 10,073.9 11,853
General Government Balance (% of GDP) -6.7 -4.6 -3.7 -3.6 -4.6
Economic Growth (% real change)
Private Consumption 0.6 6.9 6.8 7.7 7.2
Government Consumption 4.9 3.4 15.8 5.1 6.0
Gross fixed Investment -2.7 11.9 6.2 19.9 8.2
Export of goods & Services -10.9 11.1 4.6 -0.1 0.6
Import of goods & Services -12.7 15.6 6.1 4.7 3.0
Structure of Economy (% of GDP)
Agriculture 9.31 10.5 11.99 10.95 10.3
Industry 41.37 41.49 40.68 41.25 41.50
Services 49.32 48.01 47.33 47.80 48.20
Economic Policy
Budget Balance(% of GDP) -6.7 -5.4 -4.8 -4.5 -4.2
Public Debt(% of GDP) 51 51 52 53 55
Money Market interest rate(%) 2.2 2.7 3.2 3.2 3.1
M2 Growth (% change) 10 7 15 10 8
Exchange Reate LCU to USD 3.5 3.2 3.1 3.1 3.1
Balance of Payments (US$, million)
Current Account Balance 22,548 18,764 23,380 9,152 -385
Trade Balance 31,478 34,067 39,421 31,234 22,875
Exports (Goods) 164,721 198,800 227,544 228,847 233,620
Imports (Goods) 133,243 164,733 188,123 197,613 210,745
Service Balance 820 -450 -2,029 -4,536 -5,025
Income Balance -4,170 -8,083 -7,128 -11,642 -11,793
Transfer Balance -5,580 -6,770 -6,884 -5,904 -6,442
Net direct investment flows -6,626 -4,464 -2,989 -7,148 -2,088
Net portfolio investment flows -291 14,994 8,678 18,928 775
Net debt flows -560 14,753 12,521 4,613 2,912
Other Capital Flows (* negative is flight) -19,139 -42,470 -24,624 -28,925 -18,579
Change in International reserves 5,185 9,812 27,093 6,106 -1,244
External Position(US$m)
Toral Foreign Debt 69,784 85,127 94,468 98,830 98,890
Short-term debt 23,695 35,076 43,704 43,885 44,949
Total debt service duw, incl. short-term debt 34,926 37,054 45,932 53,113 53,535
Total Foreign exchange reserves 95,432 104,884 131,780 137,784 136,660
International inverstment position 30,892 4,194 11,513 -4,815 -14,707
Total assets 261,650 308,151 357,564 400,168 415,238
Total liabilities 230,758 303,957 346,051 404,983 429,945
Population and Income
Population (Million) 28.1 28.6 28.9 29.3 29.6
GDP per capita at PPP(US$) 14,062 15,018 15,889 16,862 17,748
Unemployment Rate (% of total labor force) 3.6 3.3 3.05 3.025 3.1
Source: IMF, International Financial Statistics 2014
Malaysia Trade with World
US$ Mn. 2009 2010 2011 2012 2013
Export (fob) 164,721 198,800 227,544 228,847 233,620
Import (cif) 133,243 164,733 188,123 197,613 210,745
Trade Volume 297,964 363,533 415,667 426,460 444,364
Trade Balance 31,478 34,067 39,421 31,234 22,875
World Trade (US$ Bn) 24,949 28,143 35,397 36,355 36,774
Share 1.2% 1.3% 1.17% 1.17% 1.2%
Source: IMF, International Financial Statistics 2014
Malaysia Trade with D-8 Countries
US$ Mn. 2009 2010 2011 2012 2013
Export (fob) 10,026.8 13,301 15,231 15,419 17,401
Import (cif) 5,808.11 11,312 12,776 11,479 10,106
Trade Volume 15,834.91 24,613 28,007 26,898 27,507
Trade Balance 1,510.41 1,989 2,455 3,940 7,295
D-8 Intra Trade (US$ Mn) 66,947.62 101,139 129,493 148,191 133,064
Share 23.6% 24.3% 21.6% 18.1% 20.6%
Source: IMF, International Financial Statistics 2014
Malaysia Trade By 10 Main Commodities
Export by 10 Principal Commodities, (million US$)
No. Commodity 2009 2010 2011 2012 2013
1. Electrical, electronic equipment 45,187 55,775 61,350 59,316 60,737
2. Mineral fuels, oils, distillation products, etc 23,251 31,513 40,277 46,431 5,0788
3. Machinery, nuclear reactors, boilers, etc 26,229 29,927 25,234 24,834 24,116
4. Animal, vegetable fats and oils, cleavage products, etc 11,979 16,201 22,719 19,475 15,895
5. Rubber and articles thereof 4,824 7,862 10,289 9,082 8,295
6. Plastics and articles thereof 4,703 6,182 7,007 6,884 6,837
7. Optical, photo, technical, medical, etc apparatus 3,625 5,560 5,998 7,456 6,675
8. Organic Chemicals 2,491 3,731 4,552 4,504 4,421
9. Wood and articles of wood, wood charcoal 3,766 4,318 4,489 4,373 4,372
10. Miscellaneous chemical products 2,195 3,078 3,919 3,554 3,887
Import by 10 Principal commodities, (million US$)
No. Commodity 2009 2010 2011 2012 2013
1. Electrical, electronic equipment 37,387 51,234 50,712 50,213 51,260
2. Machinery, nuclear reactors, boilers, etc 18,813 21,293 22,733 23,414 23,227
3. Mineral fuels, oils, distillation products, etc 10,148 16,403 22,056 27,842 33,390
4. Vehicles other than railway, tramway 3,844 5,716 5,872 7,114 7,168
5. Iron and Steel 3,649 5,420 6,296 6,062 6,010
6. Plastics and articles thereof 3,786 5,175 6,056 5,966 6,373
7. Copper and articles thereof 1,885 3,128 3,668 3,389 5,559
8. Aircraft, spacecraft, and parts thereof 1,630 1,880 3,497 4,254 5,491
9. Pearls, precious stones, metals, coins, etc 2,596 3,687 4,978 5,058 5,409
9. Opticle, photo, technical, medical apparatusetc. 3,621 4,794 5,354 5,500 5,202
Source: WTO, International Trade Centre 2014
Export and Import by Main Destination Country
Export by Main Destination Country (% of total)
2009 2010 2011 2012 2013
Singapore 14 13.4 12.7 13.6 13.9
China 12.2 12.6 13.1 12.6 13.5
USA 11 9.5 8.3 8.7 8.1
Japan 9.8 10.4 11.5 11.9 11.1
Thailand 5.4 5.3 5.1 5.4 5.5
Other 47.6 48.8 49.7 47.8 47.9
Source: WTO, International Trade Centre 2014
Import by Main Destination Country (% of total)
2009 2010 2011 2012 2013
China 14 12.6 13.2 15.1 16.4
USA 11.2 10.7 9.4 8.1 7.9
Singapore 11 11.4 12.8 13.2 12.3
Thailand 6.1 6.2 6 5.9 6
Japan 12.5 12.6 11.4 10.3 8.7
Other 45.2 46.5 47.2 47.4 48.7
Source: WTO, International Trade Centre 2014
Foreign Direct Investment (Overview, selected years)
US$(Mn.) FDI Flows FDI Stocks
2009 2010 2011 2012 2013 2009 2010 2011 2012 2013
Inward 1,453 9,060 12,197 10,074 12,305 78,994 101,620 115,064 132,399 144,705
Outward 7,784.3 13,399 15,249 17,114 13,600 79,662 96,964 106,448 120,395 133,996
Source: UNCTAD, 2014
Agriculture: Food Commodities
US$ Mn 2009 2010 2011 2012 2013
Export 13,130 17,638 24,498 21,405 17,954
Import 5,183 6,864 9,365 8,796 7,310
Trade Volume 18,313 24,502 33,863 30,201 25,264
Trade Balance 7,947 10,774 15,133 12,609 10,644
Malaysia's Total Trade 297,964 363,533 415,667 426,460 444,364
Share to Malaysia's Total Trade 6.15% 6.74% 8.15% 7.1% 5.7%
Source: WTO,FAO 2014
Energy
Oil/Petroleum(Thousand Barrels per Day)
2009 2010 2011 2012 2013
Total Oil Production 701 703 640 670 657
Consumption 679 689 718 712 725
Refinery 514 514 539 539 539
Proved Reserved(Billion barrels) 3.6 3.7 3.7 3.7 3.7
Natural Gas
Natural Gas(Billion Cubic Feet/Day) 2009 2010 2011 2012 2013
Total Production 6.1 6.3 6.3 6.4 6.7
Consumption 3.2 3.4 3.1 3.3 3.3
Proved Reserved(Trillion cubic meters,TCM) 1.1 1.1 1.1 1.1 1.1
Others Energy
Energy Year
2009 2010 2011 2012 2013
Biofuels production (Thousand barrels daily) 4.5 2 2 1 1
Electricity Generation (Terawatt-hours) 107.1 116.8 119.1 124.9 131.6
Renewable Energy (Installed Capacity) Geothermal (mega-watts) - - - - -
Solar (maga-watts) 11 13 14 31 73
Wind (mega-watts) - - - - -
Source: BP statistics, 2014