Economy of Malaysia

Economy of Malaysia
Kuala Lumpur, national capital of Malaysia, and its largest city
CurrencyRinggit (MYR, RM)
Calendar year
Trade organisations
APEC, ASEAN, IOR-ARC, WTO, JETRO, RCEP, CPTPP, EAS, AFTA
Country group
Statistics
PopulationIncrease 34,100,000 (2024)[3]
GDP
GDP rank
GDP growth
  • 3.6% (2023)
  • 5.1% (2024 est.)
  • 5.0% (2025 est.)[5]
GDP per capita
  • Increase $14,423 (nominal; 2025 est.)[4]
  • Increase $40,123 (PPP; 2025 est.)[4]
GDP per capita rank
GDP by sector
GDP by component
  • Household consumption: 60.4%
  • Government consumption: 12.0%
  • Investment in fixed capital: 19.2%
  • Investment in inventories: 3.3%
  • Exports of goods and services: 68.4%
  • Imports of goods and services: -63.4%
  • (2023 est.)[7]
Decrease 2.67% (2024)[4]
Population below poverty line
  • 6.2% (2021 est.)[8]
  • 2.3% on less than $6.85/day (2021)[9]
40.7 medium (2021)[10]
Labour force
  • Increase 17,307,639 (2023)[13]
  • 75.1% employment rate (2024)[14]
Labour force by occupation
 (2022)[15]}}
UnemploymentPositive decrease 2.925% (2025)[4]
Average gross salary
RM3,212 / US$729 monthly[16] (2022)
Main industries
Electronics, semiconductors, microchips, integrated circuits, rubber, oleochemicals, automotive, optical devices, pharmaceuticals, medical equipment, smelting, timber, wood pulp, Islamic finance, petroleum, liquified natural gas, petrochemicals, telecommunications
External
Exports
  • $270 billion (As of September 2024)
  • $310 billion (2023)
  • $352 billion (2022)[17]
Export goods
Electrical & electronic products, palm oil & palm oil based agriculture products, petroleum products, chemicals & chemical products, machinery, equipment & parts, manufactures of metal, optical & scientific equipment, liquified natural gas, palm oil-based manufactured products, processed food
Main export partners
Imports
  • $248 billion (As of September 2024)
  • $264 billion (2023)
  • $294 billion (2022)[19]
Import goods
Electrical & electronic products, petroleum products, machinery, equipment & parts, chemicals & chemical products, manufactures of metal, crude petroleum, transport equipment, processed food, optical & scientific equipment, iron & steel products
Main import partners
FDI stock
Increase $194 billion (2023 est.)[20]
Increase $13.148 billion (2024)[4]
Negative increase $273.9 billion (31 March 2022 est.)[8]
Public finances
Positive decrease 66.86% of GDP (2024)[4]
Positive decrease −4.36% of GDP (2024)[4]
Revenues66.44 billion (2024 est.)[8]
Expenses83.92 billion (2024 est.)[8]
Economic aid$40.5 million (2005 est.)
Increase US$119.7 billion (September 2024)
All values, unless otherwise stated, are in US dollars.


The economy of Malaysia is an emerging and developing, upper-middle income, highly industrialised, mixed economy. It ranks the 36th largest in the world in terms of nominal GDP, however, when measured by purchasing power parity, its GDP climbs to the 30th largest. Malaysia is forecasted to have a nominal GDP of nearly half a trillion US$ by the end of 2024. [24] The labour productivity of Malaysian workers is the third highest in ASEAN and significantly higher than Indonesia, Vietnam, and the Philippines.[25]

Malaysia excels above similar income group peers in terms of business competitiveness and innovation. Global Competitiveness Report 2024 ranks Malaysian economy as the 34th most competitive country economy in the world[26] while Global Innovation Index 2024 ranks Malaysia as the 33rd most innovative nation globally.[27]

Malaysia is the 35th most trade intensive economy globally; higher than Denmark, Norway, Germany, and Sweden with total trade activities at 132% of its GDP. [28] In addition, the Malaysian economy has developed vertical and horizontal integration across several export linked industry while capturing a significant global market share for manufactured products and commodities ranging from integrated circuit, semiconductor, palm oil to liquefied natural gas. Furthermore, Malaysia is an important nexus in the global semiconductor market and is the third largest exporter of semiconductor devices in the world.[29] Malaysia has unveiled plan to target over US$100 billion in investment for its semiconductor industry as it positions itself as a global manufacturing hub.[30]

By mid-2024, the country attracted large foreign direct investment centered on the global artificial intelligence boom with foreign technology companies like Google, Microsoft and ByteDance flocked to the country and invested US$2 billion,[31] US$2.2 billion,[32] and US$2.1 billion,[33] respectively, to capitalise on Malaysia's competitive advantage in the data center and hyperscale construction due to its highly educated workforce, cheap land acquisition, low water and electricity cost, and the absence of natural disasters.[34] This is expected to consolidate Malaysia position as a cloud computing hub for wider Asia, increasing its high value sector and propel its economy to meet the government high-income economy goal.

Overall, the Malaysian economy is highly robust and diversified with the export value of high-tech products in 2022 standing around US$66 billion, the third highest in ASEAN.[35] Malaysia exports the second largest volume and value of palm oil products globally, after Indonesia.[36]

Malaysians enjoy a relatively affluent lifestyle compared to many of its neighbours in Southeast Asia. This is due to a fast-growing export-oriented economy, a relatively low national income tax, highly affordable local food and transport fuel, as well as a fully subsidized single-payer public healthcare system. Malaysia has a newly industrialised market economy, which is relatively open and state-oriented.[37][38]

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  4. ^ a b c d e f g h i "World Economic Outlook Database, October 2023". IMF.org. International Monetary Fund. Archived from the original on 21 November 2023. Retrieved 21 November 2023.
  5. ^ "WORLD ECONOMIC OUTLOOK 2022 OCT Countering the Cost-of-Living Crisis". www.imf.org. International Monetary Fund. p. 43. Retrieved 11 October 2022.
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  8. ^ a b c d "The World Factbook". CIA.gov. Central Intelligence Agency. Archived from the original on 8 November 2021. Retrieved 21 October 2024.
  9. ^ "Poverty headcount ratio at $6.85 a day (2017 PPP) (% of population) - Malaysia". data.worldbank.org. World Bank. Archived from the original on 12 June 2020. Retrieved 3 October 2019.
  10. ^ "GINI index (World Bank estimate)". data.worldbank.org. World Bank. Archived from the original on 12 January 2018. Retrieved 16 May 2023.
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  12. ^ "Inequality-adjusted Human Development Index (IHDI)". hdr.undp.org. HDRO (Human Development Report Office) United Nations Development Programme. Archived from the original on 12 December 2020. Retrieved 5 November 2022.
  13. ^ "Labor force, total - Malaysia". data.worldbank.org. World Bank. Archived from the original on 9 December 2022. Retrieved 21 October 2024.
  14. ^ "Employment to population ratio, 15+, total (%) (national estimate) - Malaysia". data.worldbank.org. World Bank. Archived from the original on 22 September 2022. Retrieved 3 October 2019.
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  18. ^ a b "Trade Performance 2024 - MATRADE". Archived from the original on 23 October 2023. Retrieved 24 October 2024.
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  27. ^ "Global Innovation Index 2024". World Intellectual Property Organization (WIPO). Retrieved 28 September 2024.
  28. ^ "Malaysia - Trade (% Of GDP)". data.worldbank.org. Retrieved 20 June 2024.
  29. ^ "Semiconductor Devices". Observatory for Economics Complexity. Retrieved 20 June 2024.
  30. ^ "Malaysia targets over $100 bln in semiconductor industry investment". reuters.com. Retrieved 20 June 2024.
  31. ^ "Google to invest $2 billion in Malaysia and build data center to capture rising AI demand". www.cnbc.com. 30 May 2024. Retrieved 20 June 2024.
  32. ^ "Microsoft announces US$2.2 billion investment to fuel Malaysia's cloud and AI transformation". news.microsoft.com. 2 May 2024. Retrieved 20 June 2024.
  33. ^ "TikTok owner ByteDance to expand Malaysia data center footprint in $2.1bn AI deal". datacenterdynamics.com. Retrieved 20 June 2024.
  34. ^ "Analyst: Malaysia a 'magnet' for data centers due to low likelihood of natural disasters, cheap electricity and land". www.nst.com.my/business/corporate. 23 May 2024. Retrieved 20 June 2024.
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  36. ^ "OEC - Palm Oil (HS92: 1511) Product Trade, Exporters and Importers". Archived from the original on 30 August 2017. Retrieved 19 August 2017.
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  38. ^ "Malaysia, A Statist Economy". Infernalramblings.com. Archived from the original on 7 October 2010. Retrieved 1 November 2010.