Economics

1. Malaysia’s Economy Background

Malaysia is a South-East Asian country separated into two regions by the South China Sea. The two parts are Peninsular Malaysia and Malaysian Borneo. Kuala Lumpur is its capital city of Malaysia. As of 2010, Malaysia’s total population stands at over 28 million. In the 1970s Malaysia witnessed an economic boom, where it expand to become a multi-sector economy from being a raw materials producer. Sound developments in agriculture, forestry and mining ensured by the country’s rich natural resources. Strait of Malacca which is an important international shipping crossroad also contribute to the economic growth , where it has manage to promotes the country’s international trade. Malaysia’s well developed manufacturing sector produces a diverse range of goods.

The equity guidelines for investment in the manufacturing sector has been relaxed by the Government since. Foreign Direct Investment (FDI) has been the key to the country's remarkable success in recent years. Hundreds of international companies have so far established themselves in the country, attracted by the favorable investment environment has made Malaysia one of the world's top locations for offshore manufacturing operations.

Malaysia has experience ecnomic growth since 1998 after the economic crisis happened in Asia. The growth in Gross Domestic Product (GDP) has registered an average of 5.5% growth for the past 10 years, the unemployment rate is on average of 3.4% per year (as shown in Table 1).

Table 1 : Malaysia GDP Growth and Unemployement Rate

From 1998 - 2008

|Year |GDP Growth |Unemployment Rate |

|1998 |-7.4 |3.2 |

|1999 |6.1 |3.4 |

|2000 |8.7 |3.1 |

|2001 |3.7 |3.4 |...