Malaysia has become increasingly wealthy in recent years, with a gross domestic product (GDP) that is expected to reach US$1.14 trillion by 2021. It is a middle-income country with the third-highest GDP per capita in Southeast Asia. The country is home to some of the world’s most successful entrepreneurs and has a vibrant economy driven by growth in several sectors, including tourism, manufacturing, and IT. Here we explore how wealthy Malaysia is and what factors contribute to its economic success.
Economic Overview
Malaysia has a market-based economy that is highly export-oriented and heavily reliant on foreign trade. The country has experienced rapid economic growth over the past few decades and is now the third-largest economy in ASEAN (Association of Southeast Asian Nations). It has a strong manufacturing sector and is home to some of the world’s leading exporters of electronics, electrical appliances, and automotives. The country is a major exporter of commodities such as palm oil, rubber, and timber.
The Malaysian economy is also driven by the services sector, which accounts for nearly two-thirds of GDP. The country has a strong financial sector, with the Kuala Lumpur Stock Exchange (KLSE) being the largest in Southeast Asia. The tourism sector is also an important contributor to the economy, with over 25 million visitors in 2019.
Malaysia’s economy is backed by a strong external environment, with a low and stable inflation rate, a large current account surplus, and a healthy foreign exchange reserve. The country has also attracted substantial foreign direct investment (FDI) in recent years, with inflows amounting to US$13.3 billion in 2019.
Income and Wealth
Malaysia is considered a middle-income country and has been able to reduce poverty significantly in recent years. The country’s GDP per capita is US$10,500, the third-highest in Southeast Asia. The country has one of the most equitable income distributions in the world, with the Gini coefficient (measuring income inequality) standing at 0.41 in 2018.
The country is also home to some of the wealthiest individuals in the world. According to Forbes, the country is home to three billionaires, with the richest being Robert Kuok, who is worth US$14.4 billion. The country is also home to many millionaires, with the most affluent being Ananda Krishnan, who is estimated to be worth US$11 billion.
Growth Drivers
The Malaysian economy has been growing steadily over the past few decades, powered by several key drivers. First, the country has implemented a number of successful economic policies, such as the New Economic Policy (NEP). This policy aims to reduce poverty, improve income distribution, and promote economic development.
Second, the government has made significant investments in infrastructure, with over US$20 billion invested in the past decade. This has improved the country’s connectivity and facilitated trade.
Third, the country has a well-developed financial sector, with the Kuala Lumpur Stock Exchange (KLSE) being the largest in Southeast Asia. The government has also introduced several incentives to attract foreign investment and promote economic growth.
Finally, the country has a vibrant tourism sector, with over 25 million visitors in 2019. Malaysia is home to some of the world’s most beautiful beaches and rainforests, making it a popular destination for tourists.
Conclusion
In conclusion, Malaysia is a wealthy country with a GDP per capita of US$10,500, the third-highest in Southeast Asia. The country has experienced rapid economic growth over the past few decades and is now home to some of the world’s most successful entrepreneurs. The economy is driven by exports, the services sector, and foreign investment. The government has also implemented several successful economic policies and made significant investments in infrastructure. Finally, the country’s vibrant tourism sector is an important contributor to the economy.