Malaysia Economy and Environment


Given the climatic conditions, the prevailing vegetation cover is the luxuriant and very rich rainforest, which covers the mountain slopes up to 1800 m for Malaysia, to 2500 m for the territories in Borneo; the dense undergrowth abounds in epiphytes: among other things, it hosts over eight hundred species of orchids. They are the ubiquitous bamboo, the pandanus and wicker furniture, a climbing palm. In many areas, human intervention has degraded the rainforest where crops and savannah have taken over or the secondary forest. Mangrove formations develop considerably along the coasts and river belts. In the country there are numerous species of mammals, including the elephant, the tiger, the leopard, the deer, the rhinoceros and the orangutan, numerous types of birds (parrot, pheasant) and various reptiles (python, gecko, crocodile, sea ‚Äč‚Äčturtle). Protected areas cover 13.9% of the territory and include 20 national parks, as well as numerous wildlife and forest reserves; UNESCO declared Gunung Mulu National Park and Kinabalu Park a World Heritage Site in 2000. The main environmental problems are deforestation resulting from the massive exploitation of the forest heritage (some species of the local flora may have been irreversibly damaged) and considerable air and water pollution. There are also smoke clusters caused by forest fires in Indonesia. In 2004, the tsunami that devastated South Asia also caused serious environmental damage in Malaysia and caused the death of more than 5,000 people in the country.


The original development model adopted by Malaysia, with a careful and profound planning intervention by the State, associated with a wide freedom granted to companies, in particular, to foreign ones, has produced particularly sustained economic growth. The economic dynamic has continued positively for a long time, first by virtue of the great natural wealth and then (starting from the 1980s) thanks to the growing weight of transformation activities carried out locally and the consolidation of the financial sector. Economic growth has also made use of massive foreign investments, attracted both by low labor costs and by lean and effective legislation and, in some cases, by the local availability of raw materials. Governments have structured, since 1971, development plans aimed at supporting and directing economic progress. The result was an average annual increase of 6.5% in the period between independence and 2005; despite the demographic growth, the increase in GDP also had repercussions on the distribution of per capita wealth, which rose by 7% per year. In the second half of the 1990s, Malaysia was heavily affected, albeit to a lesser extent than other countries in the area, from the repercussions deriving from the financial crisis, which hit Southeast Asia, starting with Thailand (1997); The effects of the 1998 Indonesian crisis were also noteworthy, which led to the devaluation of the currency (to maintain competitiveness in exports), to the removal of a large number of immigrant workers and the suspension of important infrastructural interventions. The decisive and dynamic foreign policy of Malaysia, which at times has made its relations with some countries problematic (starting with United States and, in part, from Japan, among the main investors) and exposes the country to retaliation with very serious effects, has made it possible to open new markets for national productions and to entertain fruitful relations with a growing number of States, well beyond the regional framework of South-East Asia, with the result of more differentiating partners and investors. In the early years of the 21st century, coinciding with the international political crisis and the tensions due to the spread of SARS, the country has seen growth slow. Furthermore, the Malaysian economy, linked to the export of electronic components, was affected in the years 2001-2002 by the collapse of the sector.

According to Smber, the annual growth rates in the 2000-2005 period appeared to be fluctuating but still high, without reaching the levels of the 1990s. In 2008, GDP reached US $ 222,219 million, with a per capita value of US $ 8,141, one of the highest in the ASEAN economies., preceded only by the incomes of Singapore and Brunei. Significant structural problems remain, such as sensitive social and territorial inequalities (which correspond to significant political turbulence), which are particularly worrying when they are associated with ethnic claims or differentiations (for example, rivalries between Malaysians and Chinese or between Muslims and non-Muslims). However, the economic indicators are generally positive: intending to become a fully-fledged developed country by 2020, Malaysia established a program in 1991, called Vision 2020, which summarizes the economic and social efforts necessary to achieve the goal. Concerned also about the competition of the more recently developed markets (in particular the Chinese and Indian ones), the country also intends to increase the competitiveness of production, strengthen the high quality standards of the products and improve the quality of life.

Malaysia Economy

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