Lives in Malaysia

9. Lives in Malaysia



9.1 Student Visa for Malaysia

To apply for a visa to enter Malaysia

The Malaysian Government has introduced a simplified and hassle-free entry procedure to welcome foreign students. Though a visa is required but the procedure is very simple i.e. students DO NOT need to apply directly for the visa from the Malaysian Missions in your country in order to enter Malaysia instead the visa will be issued to them upon their arrival in Malaysia at the immigration check point.

To apply for a student pass for studies in Malaysia

The process to apply for a student pass is simple. The Malaysian educational institutions of higher learning which offer international students a place to study at their institutions will apply for the Student Pass on their behalf in Malaysia. Applications will be submitted by the educational institutions to the Director of Pass & Permit Division, Malaysia.

Students do not need to apply directly to the Immigration Department under this procedure. The prospective students will be informed of their application status by the Immigration Department in Malaysia through their educational institutions within 7 days of the application, irrespective of whether it has been successful or not.

Therefore, students are not required to apply for a visa/student pass from the Malaysian Embassy/consulate office abroad before proceeding to Malaysia. The educational institutions which enroll the students are responsible to make the necessary arrangement pertaining to immigration matters.

Documents required for applying student pass

The Immigration Department requires seven (7) days to process the application. The documents are as follows: –

  • An offer letter or letter of acceptance from the educational institution to the student
  • Student Pass Application Form (IMM14) in duplicate
  • Two photocopies of the students Passport / Travel Document
  • Two passport-sized photographs of the student
  • The educational institution is required to sign a ‘Personal Bond’ on behalf of the students. No fee is charged for the Personal Bond.

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9.2 Malaysia Visas & permits requirement

Foreigner nationals who plan to enter Malaysia for leisure, medical reasons, employment, religious purposes, mass media, business, investment, studies, permanent residency, etc. are required to apply for a visa from the Malaysian Immigration Department and the Malaysian Embassy or Consulate in their countries of current residence.

Malaysia Immigration

Most foreigners are not required a visa when the duration of the visit is less than a period of 1 month with the purpose of business or leisure. The Malaysian Immigration Department will check their passports and other travel documents upon arrival. It is also important for these foreign nationals to follow the conditions and laws governing foreign visits and immigration.

Immigration Laws

The Immigration Act of 1959/1963 is the main legislation in Malaysia handling immigration and foreign employment issues. Included in the legislation are admissions into and out of Malaysia, entry visas and permits, procedures upon arrival, in transit, removal from the country, and other offenses or special provisions for East Malaysia. Other rules and regulations are the Passport Act 1966 and the Immigration (Exemption) Order 1963.

Laws and statutes covering immigration are handled by a number of departments, namely:

•    The Malaysia Ministry of Home Affairs, which enforces immigration laws
•    The Immigration Department of Malaysia, or the Malaysia Ministry of Home Affairs. It functions to take out aliens who lie about their real intentions for entering the country, aliens with a criminal record, and aliens who cannot properly finance themselves.

Individuals classified under Section 8 of Immigration Act 1959/1963 are not allowed to enter Malaysia regardless of a valid passport, sufficient travel documents, adequate funds, and travel tickets.

Visa Immigration Services

Nationals of some countries are required by the Malaysian government to have visas at all times. Included in the list are citizens of Afghanistan, Nepal, Bangladesh, Bhutan, Botswana, Nigeria, Cameroon, Republic of Central Africa, Niger, Congo (Rep), Congo (Dem Rep), India, Liberia, Mali, Taiwan, Mozambique, Angola, China (PR), Burkina Faso, Pakistan, Rwanda, Sri Lanka, Myanmar, and Western Sahara.

Visa relaxation for transit in less than 5 days may be granted to nationals of the countries above if they possess confirmed onward airline tickets to a third country before arrival via a Malaysian International Airport.

British Overseas Citizens are also required a visa. Foreigners who intend to stay longer need to write to the Immigration Department at the Malaysian High Commission in the country where they are applying. Nationals of Serbia, Montenegro, and Israel are restricted entry into Thailand unless in transit or staying within airport premises. Foreign women who are 6 months pregnant or more and suspicious individuals may also be denied entry.

Nationals of all ASEAN countries, except Myanmar, are not required a visa if staying for less than one (1) month. For stays exceeding one (1) month, a visa is required, except for Brunei and Singapore nationals. Israel nationals are required visas plus permission from the Ministry of Internal Security. Nationals of the Republic of Serbia and Republic of Montenegro are required visas and permission from the Ministry of Home Affairs.

Types of Visas

Single Entry Visa

Foreign nationals who require a visa to enter Malaysia for social visits are issued Single Entry Visas. These are usually valid for a period of three (3) months since the date of issuance. Individuals can only enter the country once. Additional visits will require reapplication at the Malaysian Embassy or Consulate at the applicant’s country of residence. Extensions may be provided after reporting to the Immigration Department at the Malaysian High Commission in the country of application.

Foreigners entering Malaysia not only must obtain a visa but also a pass at the point of entry. This pass is an endorsement on the passport allowing the holder an approved stay in Malaysia.

This matter was discussed in a post in Malaysia Expat Forum last September 3, 2009:

As far as Immigration is concerned, you have the same foreigner status as any other foreigner, assuming that you’re a UK citizen with a UK passport. I’d suggest googling the website for Malaysia Immigration to inquire about changing your citizenship. One important piece, though, that I do know: Malaysia does not recognize dual citizenship, so if you did get approved for Malaysian citizenship, you would need to give up your UK citizenship – probably not a good deal for you, honestly… Many Malaysians would love to get out and get a citizenship from another country – I’ve never heard of anyone doing it the other way around.

Multiple Entry Visa

Foreign nationals who require a visa to enter Malaysia for business or government-to-government concerns are issued Multiple Entry Visas. These are usually valid anywhere from three (3) to twelve (12) months since the date of issuance. Those in group tours are not eligible to apply for this type of visa.

Citizens of China (PR) and India are eligible to apply for Multiple Entry Visas for the purpose of social visits. Cost is RM50.00 for Indian Citizens and RM30.00 for Chinese Citizens. Multiple Entry Visas are valid for one (1) year, with each entry lasting 30 days only. Extensions are not allowed. There are two conditions for this type of visa:

•    The applicant must show proof of adequate funding for a Malaysian visit.
•    The applicant must possess a valid and confirmed return ticket to the country of residence.

Transit Visa

Foreign nationals who require a visa to enter Malaysia on transit to a third country are issued Transit Visas. However, the visa is not required for foreign nationals on transit who will not leave the airport premises and will proceed to their trip to the next destination with the same flight.

Foreign nationals need a valid passport or other travel documents recognized by the Malaysian government to properly carry out visa applications. Their passports need adequate pages for the embarkation stamp placed upon entering Malaysia. A passport validity of at least six (6) months at the date of entry is required. Travel documents need to be endorsed with a valid re-entry permit. Proof of adequate funds and the onward or return air or sea ticket are also needed.

Applications and queries should be addressed to the Malaysian High Commission. Application requirements include:

•    Passport valid for a minimum of six (6) months
•    2 passport-size photos
•    Fee (in cash or postal order only)
•    2 completed and signed application forms (£0.25 each)
•    Proof of sufficient funds (including the original and photocopy of your latest bank statement)
•    Onward or return air or sea travel ticket or itinerary from travel agent
•    Yellow fever vaccination certificates (required from all foreign nationals of infected areas as indicated by the World Health Organization)
•    Letter of introduction with a copy from the applicant’s employer, college, or university

Types of Permits

Employment Pass (EP)

This type of pass is issued to foreigners planning to work under contract for a minimum period of two (2) years and earning a monthly income of RM3,000 or more in Malaysia.

Visit Pass (Temporary Employment)

This pass is issued to foreigners planning to work for less than twenty-four (24) months in Malaysia.

Visit Pass (Professional)

This pass is issued to allow foreigners entering Malaysia to engage in short-term contracts with any agency. The validity varies but cannot exceed twelve (12) months at a time. The groups of foreigners eligible for application include:

•    Artists
•    Volunteers
•    Members of religious groups or institutions
•    Members of international organizations or agencies
•    Filmmakers, producers, photographers, actors, directors, etc.
•    Invited speakers, educators, and lecturers
•    Equipment installation or maintenance experts
•    Researchers recognized by the Government of Malaysia

Dependant Pass

This pass is issued to spouses and children of foreigners possessing an employment pass. The pass may be filed for application together with the employment pass application, or after approval of the employment pass. The maximum duration of the dependant pass should also be aligned with the duration of the employment pass (around 2 years).

Spouse Permit

This permit is issued to foreign spouses married to a Malaysian Citizen. The duration is between six (6) months and two (2) years.

Student Pass

This Pass is issued to foreigners enrolled as students in any recognized and approved educational institution in Malaysia.

Training Pass

This pass is issued to foreigners entering Malaysia to undergo training for a period lasting no more than twelve (12) months.

Private Limited Company

The company is required to have at least two resident directors with a completely paid minimum capital of RM250,000. Additional requirements may be given such as specific licenses, additional fully paid capital, and a minimum Malaysian or Bumiputera equity depending on the number of employment passes needed and the activities of the company.

Representative Office

The Representative Office is owned by a foreign company approved and recognized to gather relevant information on investment opportunities in Malaysia. Included areas and activities are the manufacturing sector, Malaysian products export promotion, product research and development, and bilateral trade relations.

Regional Office

The Regional Office is owned by a foreign corporation and functions as the coordination center for the corporation’s affiliates, agents, and subsidiaries in Southeast Asia and the Asia Pacific. The office is responsible for specifically assigned activities by the corporation in the region where it is located and currently operates.

All applications for passes, except for the purpose of business or social visits, should be made before arriving in Malaysia. Sponsorship in Malaysia is required for all applications, with the sponsors agreeing to be responsible for the maintenance and repatriation of visitors if needed.

Besides a visa (if required), foreign nationals need to obtain a pass or permit at the point of entry to be allowed to temporarily stay in Malaysia. The pass serves as an endorsement in the passport indicating permission to stay over an approved purpose and duration of time.

Sources from : http://www.expatforum.com/articles/visas-permits-and-immigration/malaysia-visas-permits-and-immigration.html

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9.3 Malaysia My Second Home Program

Malaysia My Second Home Programme is promoted by the Government of Malaysia to allow foreigners who fulfill certain criteria, to stay in Malaysia for as long as possible on a multiple-entry social visit pass.

The Social Visit Pass is initially for a period of ten (10) years, and is renewable.

ELIGIBILITY

It is open to citizens of countries recognised by Malaysia, regardless of race, religion, gender or age. The programme allows applicants to bring with them their spouses, parents and children. Foreign spouses of Malaysians and expatriates who wish to retire in Malaysia after expiry of their Employment Passes are also eligible to apply to stay in Malaysia on this programme.

Applicants are allowed to bring their spouses, unmarried children below the age of 21 and parents above the age of 60 as dependants.

FINANCIAL REQUIREMENT

Applicants are expected to be financially capable of supporting themselves on this programme in Malaysia.

Upon application:

i. Applicants aged below 50 years are required to show proof of liquid assets worth a minimum of RM500,000 and offshore income of RM10,000 per month.

ii. Applicants aged 50 and above may comply with the financial proof of RM350,000 in liquid assets and off shore income of RM10,000 per month. For those who have retired, they are required to show proof of receiving pension from government approved funds of RM 10,000 per month.

iii. New applicants who have purchased properties worth at least RM 1 million qualify to place a lower fixed deposit amount upon approval.

UPON APPROVAL

Successful applicants are required to comply with the following financial criteria upon receipt of the `conditional approval letter’ from Immigration Department of Malaysia..

Upon Approval : Aged Below 50 years old

  • Open a fixed deposit account of RM300,000.00.
  • After a period of one year, the participant can withdraw up to RM150,000.00 for approved expenses relating to house purchase, education for children in Malaysia and medical purposes.
  • Must maintain a minimum balance of RM150,000.00 from second year onwards and throughout stay in Malaysia under this programme.

Approved participants who have purchased and own property which were bought at RM1 million and above in Malaysia may comply with the basic fixed deposit requirement of RM 150,000 on condition that the property has been fully paid and ownership documents such as grant and land title have already been issued. This amount may not be withdrawn until the participant decides to terminate his participation in MM2H programme.

Upon Approval : Aged 50 years and above

  • Can either choose to:
    – Open a fixed deposit account of RM150,000.00 ; OR
    – Show proof of government approved pension funds of RM10,000
  • After a period of one year, participant who fulfills the fixed deposit criterion can withdraw up to RM50,000.00 for approved expenses relating to house purchase, education for children in Malaysia and medical purposes.
  • Participant must maintain a minimum balance of RM100,000.00 from the second year onwards and throughout his/her stay in Malaysia under this programme.

Approved participants who have purchased and owned property which were bought at RM1 million and above in Malaysia may comply with the basic fixed deposit requirement of RM 100,000, on condition that the property has been fully paid and ownership documents such as grant and land title have already been issued.This amount may not be withdrawn until the participant decides to terminate his participation in MM2H programme.

MEDICAL REPORT

All applicants and their dependants are required to submit a medical report from any private hospital or registered clinic in Malaysia.

MEDICAL INSURANCE

Approved participants and their dependants must possess valid medical insurance coverage that is applicable in Malaysia from any insurance company.

However, exemptions may be given for participants who face difficulty in obtaining a medical insurance due to their age or medical condition.

SECURITY BOND (Direct Application only)

Applicants applying directly are required to fulfill the security bond condition. Please refer to Personal Bond for rate per person by nationality, ranging from RM200-RM2000.00.

PERSONAL BOND (Application Through Agent)

Licensed companies are required to provide the personal bond for their clients who have been approved under the MM2H Program.

Source: http://www.mm2h.gov.my

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9.4 Malaysia Culture

Geography
Area: 329,748 sq. km. (127,315 sq. mi.); slightly larger than New Mexico.
Cities: Capital–Kuala Lumpur. Other cities–Penang, Ipoh, Malacca, Johor Baru, Shah Alam, Klang, Kuching, Kota Kinabalu, Kota Baru, Kuala Terengganu, Miri, Petaling Jaya.
Terrain: Coastal plains and interior, jungle-covered mountains. The South China Sea separates peninsular Malaysia from East Malaysia on Borneo.
Climate: Tropical.

People
Nationality: Noun and adjective–Malaysian(s).
Population (2009): 28.3 million.
Annual growth rate: 2.0%.
Ethnic groups: Malay 53.3%, Chinese 26.0%, indigenous 11.8%, Indian 7.7%, others 1.2%.
Religions: Islam (60.4%), Buddhism (19.2%), Christianity (9.1%), Hinduism (6.3%), other/none (5.0%).
Languages: Bahasa Melayu (official), Chinese (various dialects), English, Tamil, indigenous.
Education: Years compulsory–6. Attendance–90.1% (primary), 60.0% (secondary). Literacy–93.5%.
Health: Infant mortality rate (2007)–6.7/1,000. Life expectancy (2007)–female 76.4 yrs., male 71.9 yrs.
Work force (10.89 million, 2007): Services–57%; industry–28% (manufacturing–19%, mining and construction–9%); agriculture–15%.

Government
Type: Federal parliamentary democracy with a constitutional monarch.
Independence: August 31, 1957. (Malaya, which is now peninsular Malaysia, became independent in 1957. In 1963 Malaya, Sabah, Sarawak, and Singapore formed Malaysia. Singapore became an independent country in 1965.)
Constitution: 1957.
Subdivisions: 13 states and three federal territories (Kuala Lumpur, Labuan Island, Putrajaya federal administrative territory). Each state has an assembly and government headed by a chief minister. Nine of these states have hereditary rulers, generally titled “sultans,” while the remaining four have appointed governors in counterpart positions.
Branches: Executive–Yang di-Pertuan Agong (head of state and customarily referred to as the king; has ceremonial duties), prime minister (head of government), cabinet. Legislative–bicameral parliament, comprising 70-member Senate (26 elected by the 13 state assemblies, 44 appointed by the king on the prime minister’s recommendation) and 222-member House of Representatives (elected from single-member districts). Judicial–Federal Court, Court of Appeals, high courts, session’s courts, magistrate’s courts, and juvenile courts. Sharia courts hear cases on certain matters involving Muslims only.
Political parties: Barisan Nasional (National Front)–a coalition comprising the United Malays National Organization (UMNO) and 12 other parties, most of which are ethnically based; Democratic Action Party (DAP); Parti Islam se Malaysia (PAS); Parti Keadilan Rakyat Malaysia (PKR). There are more than 30 registered political parties, including the foregoing, not all of which are represented in the federal parliament.
Suffrage: Universal adult (voting age 21).

Economy (2009)
Nominal GDP: $191.5 billion.
Annual real GDP growth rate: 5.9% (2006); 6.3% (2007); 4.6% (2008); -1.7% (2009).
Nominal per capita income (GNI): $ 6,897.
Natural resources: Petroleum, liquefied natural gas (LNG), tin, minerals.
Agricultural products: Palm oil, rubber, timber, cocoa, rice, tropical fruit, fish, coconut.
Industry: Types–electronics, electrical products, chemicals, food and beverages, metal and machine products, apparel.
Trade: Merchandise exports–$1167.7 billion: electronic products, manufactured goods, petroleum, palm oil, liquid natural gas, apparel, timber, rubber. Major markets— Singapore 14.0%, China 12.2%, U.S. 11.0%, Japan 9.8%. Merchandise imports–$131.8 billion: electronic products, machinery, chemicals, manufactured goods, petroleum products. Major suppliers— China 14.0%, Japan 12.5%, U.S. 11.2%, Singapore 11.1%.

PEOPLE
Malaysia’s multi-racial society contains many ethnic groups. Malays comprise a majority of just over 50%. By constitutional definition, all Malays are Muslim. About a quarter of the population is ethnic Chinese, a group which historically played an important role in trade and business. Malaysians of Indian descent comprise about 7% of the population and include Hindus, Muslims, Buddhists, and Christians. Non-Malay indigenous groups combine to make up approximately 11% of the population.

Population density is highest in peninsular Malaysia, home to some 20 million of the country’s 28 million inhabitants. The rest live on the Malaysian portion of the island of Borneo in the large but less densely-populated states of Sabah and Sarawak. More than half of Sarawak’s residents and about two-thirds of Sabah’s are from indigenous groups.

HISTORY
The early Buddhist Malay kingdom of Srivijaya, based at what is now Palembang, Sumatra, dominated much of the Malay peninsula from the 9th to the 13th centuries AD. The powerful Hindu kingdom of Majapahit, based on Java, gained control of the Malay peninsula in the 14th century. Conversion of the Malays to Islam, beginning in the early 14th century, accelerated with the rise of the state of Malacca under the rule of a Muslim prince in the 15th century. Malacca was a major regional commercial center, where Chinese, Arab, Malay, and Indian merchants traded precious goods.

Drawn by this rich trade, a Portuguese fleet conquered Malacca in 1511, marking the beginning of European expansion in Southeast Asia. The Dutch ousted the Portuguese from Malacca in 1641. The British obtained the island of Penang in 1786 and temporarily controlled Malacca with Dutch acquiescence from 1795 to 1818 to prevent it from falling to the French during the Napoleonic war. The British gained lasting possession of Malacca from the Dutch in 1824, through the Anglo-Dutch treaty, in exchange for territory on the island of Sumatra in what is today Indonesia.

In 1826, the British settlements of Malacca, Penang, and Singapore were combined to form the Colony of the Straits Settlements. From these strongholds, in the 19th and early 20th centuries the British established protectorates over the Malay sultanates on the peninsula. During their rule the British developed large-scale rubber and tin production and established a system of public administration. British control was interrupted by World War II and the Japanese occupation from 1941 to 1945.

Popular sentiment for independence swelled during and after the war. The territories of peninsular Malaysia joined together to form the Federation of Malaya in 1948 and eventually negotiated independence from the British in 1957. Tunku Abdul Rahman became the first prime minister. In 1963 the British colonies of Singapore, Sarawak, and Sabah joined the Federation, which was renamed Malaysia. Singapore’s membership was short-lived, however; it left in 1965 and became an independent republic.

Neighboring Indonesia objected to the formation of Malaysia and began a program of economic, political, diplomatic, and military “confrontation” against the new country in 1963, which ended only after the fall of Indonesia’s President Sukarno in 1966. Internally, local communists, nearly all Chinese, carried out a long, bitter insurgency both before and after independence, prompting the imposition of a state of emergency from 1948 to 1960. Small bands of guerrillas remained in bases along the rugged border with southern Thailand, occasionally entering northern Malaysia. These guerrillas finally signed a peace accord with the Malaysian Government in December 1989. A separate, small-scale communist insurgency that began in the mid-1960s in Sarawak also ended with the signing of a peace accord in October 1990.

GOVERNMENT
Malaysia is a constitutional monarchy, nominally headed by the Yang di-Pertuan Agong, customarily referred to as the king. The king is elected for 5-year terms from among the nine sultans of the peninsular Malaysian states. The king also is the leader of the Islamic faith in Malaysia.

Executive power is vested in the cabinet led by the prime minister; the Malaysian constitution stipulates that the prime minister must be a member of the lower house of parliament who, in the opinion of the Yang di-Pertuan Agong, commands a majority in parliament. The cabinet is chosen from among members of both houses of parliament and is responsible to that body.

The bicameral parliament consists of the Senate (Dewan Negara) and the House of Representatives (Dewan Rakyat). All 70 Senate members sit for 3-year terms, which are normally extended for an additional 3 years; 26 are elected by the 13 state assemblies, and 44 are appointed by the king following the prime minister’s recommendation. Representatives of the House are elected from single-member districts by universal adult suffrage. The 222 members of the House of Representatives are elected to parliamentary terms lasting up to 5 years. Legislative power is divided between federal and state legislatures.

The Malaysian legal system is based on English common law. The Federal Court reviews decisions referred from the Court of Appeal; it has original jurisdiction in constitutional matters and in disputes between states or between the federal government and a state. Peninsular Malaysia and the East Malaysian states of Sabah and Sarawak each have a high court.

The federal government has authority over external affairs, defense, internal security, justice (except civil law cases among Malays or other Muslims and other indigenous peoples, adjudicated under Islamic and traditional law), federal citizenship, finance, commerce, industry, communications, transportation, and other matters.

POLITICAL CONDITIONS
Malaysia’s predominant political party, the United Malays National Organization (UMNO), has held power in coalition with other parties continuously since independence in 1957. The UMNO coalition’s share of the vote declined in national elections held in May 1969, after which riots broke out in Kuala Lumpur and elsewhere, mainly between Malays and ethnic Chinese. Several hundred people were killed or injured. The government declared a state of emergency and suspended all parliamentary activities.

In the years that followed, Malaysia undertook several initiatives that became integral parts of its socioeconomic model. The New Economic Policy (NEP), launched in 1971, contained a series of affirmative action policies designed to benefit Malays and certain indigenous groups (together known as bumiputera or “sons of the soil”). The constitution was amended to limit dissent against the specially-protected and sensitive portions of the constitution pertaining to the social contract. The government identified intercommunal harmony as one of its official goals. The previous alliance of communally based parties was replaced with a broader coalition–the Barisan Nasional (BN) or National Front. The BN won large majorities in the 1974 federal and state elections.

Mahathir Mohamad was Prime Minister between 1981 and 2003, leading UMNO and BN to successive election victories. Mahathir emphasized economic development during his tenure, in particular the export sector, as well as large-scale infrastructure projects. Mahathir attributed the success of the Asian tiger economies to the “Asian values” of its people, which he believed were superior to those of the West. Mahathir sharply criticized the International Monetary Fund (IMF), international financiers such as George Soros, and Western governments during the sharp economic and financial crisis that affected Asia in 1997-1998, and denied that the downturn was due to the failures of corruption and “crony capitalism.”

The end of Mahathir’s tenure was marred by a falling out with his deputy and presumed successor, Anwar Ibrahim. In September 1998, Mahathir dismissed Anwar and accused him of immoral and corrupt conduct. Although Anwar was convicted on both charges in 1999 and 2000, the trials were viewed as seriously flawed. Malaysia’s Federal Court eventually freed Anwar after overturning his immoral conduct conviction in September 2004.

Mahathir stepped down as Prime Minister in October 2003 after 22 years in power, and his successor, Deputy Prime Minister Abdullah Ahmad Badawi, was sworn into office. Abdullah called elections and won an overwhelming victory in March 2004. Abdullah, an Islamic scholar, promoted the concept of “Islam Hadhari” or “civilizational Islam,” emphasizing the importance of education, social harmony, and economic progress. His relationship with Mahathir eventually soured, with Mahathir expressing regret at supporting Abdullah to be his successor.

Malaysia held national elections in March 2008. UMNO and its coalition allies in the BN won a simple majority of the seats in the national parliament, but for the first time in history failed to gain the two-thirds majority necessary to amend the constitution. A loose coalition of opposition parties, called the Pakatan Rakyat or People’s Alliance, led by Anwar Ibrahim, won 82 of 222 seats in parliament and took control of the state-level assemblies in five of Malaysia’s thirteen states. However, in February 2009 the opposition Alliance lost control of one of the states through defections of its assembly members to the BN.. In Parliament, several opposition members of Parliament also defected to the BN , bringing down the opposition strength to 79 members while the BN representation increased to 143 members. Prime Minister Abdullah, taking responsibility for his party’s poor showing in the March 2008 general election, stepped down as Prime Minister in a carefully timed transfer of power to his deputy, Najib Tun Razak, in April 2009.

ECONOMY
Since it became independent, Malaysia’s economic record has been one of Asia’s best. Real gross domestic product (GDP) grew by an average of 6.5% per year from 1957 to 2005. Performance peaked in the early 1980s through the mid-1990s, as the economy experienced sustained rapid growth averaging almost 8% annually. High levels of foreign and domestic investment played a significant role as the economy diversified and modernized. Once heavily dependent on primary products such as rubber and tin, Malaysia today is a middle-income country with a multi-sector economy based on services and manufacturing. Malaysia is one of the world’s largest exporters of semiconductor devices, electrical goods, and information and communication technology (ICT) products.

The government continues to actively manage the economy. Malaysia’s New Economic Policy (NEP), first established in 1971, was a 10-year plan that sought to rectify a situation whereby ethnic Malays and indigenous peoples (“bumiputera”), who comprised nearly 60% of the population, held less than 3% of the nation’s wealth. Policy makers implemented a complex network of racial preferences intended to promote the acquisition of economic assets by bumiputera. In 1981 when the racial preferences were set to expire, the government extended the NEP for another 10 years, stating that its goals had not been achieved. The policies again were extended in 1991 and in 2001. The Malaysian Government plans to release a new economic model in 2010 which will modify and in some cases eliminate NEP measures in an effort to stimulate higher levels of investment and GDP growth over the next decade.

The Malaysian economy went into sharp recession in 1997-1998 during the Asian financial crisis, which affected countries throughout the region, including South Korea, Indonesia, and Thailand. Malaysia’s GDP contracted by more than 7% in 1998. Malaysia narrowly avoided a return to recession in 2001 when its economy was negatively impacted by the bursting of the dot-com bubble (which hurt the ICT sector) and slow growth or recession in many of its important export markets. The global financial crisis threw Malaysia into recession again in 2009, and the government expects a contraction in GDP of around 3% for the year. Economists expect Malaysia to return to a positive growth path in 2010.

In July 2005, the government removed the 7-year-old peg linking the ringgit’s value to the U.S. dollar at an exchange rate of RM 3.8/U.S. $1.0. The dollar peg was replaced by a managed float against an undisclosed basket of currencies. The new exchange rate policy was designed to keep the ringgit more broadly stable and to avoid uncertain currency swings which could harm exports.

The Malaysian financial system exhibited noteworthy resilience to the 2008 global financial crisis. Malaysian banks are well capitalized and have no measurable exposure to the U.S. sub-prime market. The central bank maintains a conservative regulatory environment, having prohibited some of the riskier assets in vogue elsewhere. However, decreasing demand in the U.S. and elsewhere is taking a toll on Malaysian exports, resulting in negative GDP growth for 2009 with recovery expected in 2010.

FOREIGN RELATIONS
Regional cooperation is a cornerstone of Malaysia’s foreign policy. It was a founding member of the Association of Southeast Asian Nations (ASEAN) and served as the group’s chair most recently in 2005-2006. It hosted the ASEAN Summit and East Asia Summit in December 2005, as well as the ASEAN Ministerial and the ASEAN Regional Forum in July 2006.

Malaysia is an active member of the Asia Pacific Economic Cooperation (APEC) forum, the Organization of the Islamic Conference (OIC), the Non-Aligned Movement (NAM), and the United Nations. It was chair of the OIC until March 2008 and has also chaired the NAM.

Malaysia is a frequent contributor to UN and other peacekeeping and stabilization missions, including recent deployments to Lebanon, Timor-Leste, Philippines, Indonesia, Pakistan, Sierra Leone, Sudan, West Sahara, Nepal and Kosovo.

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