Chamber of Commerce Country Factsheet Last update: 12.07.2018
Your advisors at the Chamber of Commerce
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During the late 18th and 19th centuries, Great Britain established colonies and protectorates in the area of current Malaysia; these were occupied by Japan from 1942 to 1945. In 1948, the British-ruled territories on the Malay Peninsula except Singapore formed the Federation of Malaya, which became independent in 1957. Malaysia was formed in 1963 when the former British colonies of Singapore, as well as Sabah and Sarawak on the northern coast of Borneo, joined the Federation. The first several years of the country's independence were marred by a communist insurgency, Indonesian confrontation with Malaysia, Philippine claims to Sabah, and Singapore's withdrawal in 1965. During the 22-year term of Prime Minister MAHATHIR bin Mohamad (1981-2003), Malaysia was successful in diversifying its economy from dependence on exports of raw materials to the development of manufacturing, services, and tourism. Prime Minister Mohamed NAJIB bin Abdul Razak (in office since April 2009) has continued these pro-business policies.
Malaysia, an upper middle-income country, has transformed itself since the 1970s from a producer of raw materials into a multi-sector economy. Under current Prime Minister NAJIB, Malaysia is attempting to achieve high-income status by 2020 and to move further up the value-added production chain by attracting investments in high technology, knowledge-based industries and services. NAJIB's Economic Transformation Program is a series of projects and policy measures intended to accelerate the country's economic growth. The government has also taken steps to liberalize some services sub-sectors. Malaysia is vulnerable to a fall in world commodity prices or a general slowdown in global economic activity.
The NAJIB administration is continuing efforts to boost domestic demand and reduce the economy's dependence on exports. Domestic demand continues to anchor economic growth, supported mainly by private consumption, which accounts for 53% of GDP. Nevertheless, exports - particularly of electronics, oil and gas, and palm oil - remain a significant driver of the economy. In 2015, gross exports of goods and services were equivalent to 73% of GDP. The oil and gas sector supplied about 22% of government revenue in 2015, down significantly from prior years amid a decline in commodity prices and diversification of government revenues. Malaysia has embarked on a fiscal reform program aimed at achieving a balanced budget by 2020, including rationalization of subsidies and the 2015 introduction of a 6% value added tax. Sustained low commodity prices throughout the period not only strained government finances, but also shrunk Malaysia’s current account surplus and weighed heavily on the Malaysian ringgit, which was among the region’s worst performing currencies during 2013-17. The ringgit hit new lows following the US presidential election amid a broader selloff of emerging market assets.
Bank Negara Malaysia (the central bank) maintains adequate foreign exchange reserves; a well-developed regulatory regime has limited Malaysia's exposure to riskier financial instruments, although it remains vulnerable to volatile global capital flows. In order to increase Malaysia’s competitiveness, Prime Minister NAJIB raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but retreated in 2013 after he encountered significant opposition from Malay nationalists and other vested interests. In September 2013 NAJIB launched the new Bumiputra Economic Empowerment Program, policies that favor and advance the economic condition of ethnic Malays.
Malaysia signed the 12-nation Trans-Pacific Partnership (TPP) free trade agreement in February 2016, although the future of the TPP remains unclear following the US withdrawal from the agreement. Along with nine other ASEAN members, Malaysia established the ASEAN Economic Community in 2015, which aims to advance regional economic integration.
|Gross domestic product, constant prices|
|Gross domestic product, current prices|
U.S. dollars (Billions)
|Gross domestic product per capita, current prices|
U.S. dollars (Units)
|Inflation, average consumer prices|
|Volume of imports of goods and services|
|Volume of exports of goods and services|
Percent of total labor force
|Current account balance|
U.S. dollars (Billions)
|Current account balance|
Percent of GDP
Source: IMF Statistics - Malaysia
Luxembourg and the country
Existing conventions and agreements
Non double taxation agreement
In order to promote international economic and financial relations in the interest of the Grand Duchy of Luxembourg, the Luxembourg government negotiates bilateral agreements for the avoidance of double taxation and prevent fiscal evasion with respect to Taxes on Income and on fortune with third countries.
- Convention from 21.11.2002 (Memorial 2004, A No.80, p.1148)
- Effective as of 01.01.2005 (Memorial 2004, A No.80, p.1148)
Air Services agreement
- Agreement from 01.19.1979 (Memorial 1980, A, p. 475)
- Effective as of 05.14.1980
- New Agreement from 21.11.2002
The Statec Foreign Trade statistics provide information on the trade of goods - by product and by country. This information is collected respectively through the INTRASTAT declaration and on the basis of customs documents.
You can see the statistics on the website of the Statec.
Contact points in Malaysia
Embassy of the Grand Duchy of Luxembourg in Malaysia
Ambassador with residence in Bangkok: Mr Robert LAUER
Honorary Consul with jurisdiction in Malaysia: M. Dato’Kok Wee KIAT
14 Jalan Balau
50490 Kuala Lumpur
Tél.: (+60) 3 2094 6236
Fax: (+60) 3 2094 876
Economic and Commercial Attaché (AWEX) in charge of Brunei and Malaysia
Economic and Commercial Attaché: Mr Eric DE LAME
Suite 10-03, 10 th Floor
Menara Tan & Tan
207 Jalan Tun Razak
50400 Kuala Lumpur - Malaysia
Tel: +60-3-2168.8895 / 96 / 97
Country risk as defined by Office du Ducroire for Malaysia
Ducroire is the only credit insurer covering open account deals in over 200 countries. A rating on a scale from 1 to 7 shows the intensity of the political risk. Category 1 comprises countries with the lowest political risk and category 7 countries with the highest. Macroeconomics experts also assess the repayment climate for all buyers in a country.
Other Useful Links:
- CIA World Factbook on Malaysia
- Doing Business in Malaysia
- Das ist Malaysia
- La Malaisie sur le site de l'AWEX
- Economic Freedom index - Malaysia
The Chamber of Commerce and the country