Kuala Lumpur is also the political center of Malaysia, which is considered a Constitutional Monarchy, and home to its Ceremonial head of state. Retrieved 1 July A high number of endemic bird species are also found in Malaysian Borneo. According to a estimate, the population is increasing by 1. They play a dominant role politically.
Malaysia is a multinational and multicultural country with a very diverse population. Malays and several indigenous groups make up 58 percent of the population. Ethnic Chinese, the second-largest ethnic group, make up 26 percent of the population; Indian descendants make up 7 percent, and various other groups together account for the remaining 9 percent. The current ethnic structure was formed during the colonial era in the 19th and 20th centuries, when the British administration encouraged migration from India and especially from China.
The Malaysian population is very young, with 35 percent below age 14 and just 4 percent of the population older than Urbanization came to Malaysia relatively late. In , just over In over half of Malaysians—57 percent—were living in urban areas. It is expected that within the next 10 to 15 years more than 70 percent of the population will live in urban areas, mainly in the Peninsular Malaysia. Religion plays a very important role in the country.
Islam is the official national religion and nearly all Malays are Muslims. Most ethnic Chinese are Buddhist. The majority of Indians comprising the descendants of migrants from what became India, Pakistan, and Bangladesh are Hindu, although there are many Muslims among members of this community.
The largest proportion of the Chinese community has traditionally lived in the urban areas, while Malays have often lived in the country's rural regions. In , the Malaysian population was about 8 million, and the country at one time had one of the highest birth rates in Asia. The population doubled between and , although population growth began to decline in the s. The decline in population rates could be linked to the socio-economic changes in the economy that tightened the labor market and increased the number of women in the workforce, and the better education of women.
Malaysia experienced an inflow of foreign workers employed mainly in the low-skill and low-wage construction and services sectors and in agricultural plantations. The Malaysian government would like to regulate the inflow of illegal migrants, who arrive mainly from neighboring Indonesia, as well as from Bangladesh and Burma, attracted by the geographical proximity and higher wages. Tin, oil, and gas are the major natural resources of export significance produced by the mining sector in Malaysia.
The mining of tin was introduced during the colonial era and until the s the country was the world's largest producer of tin, being overtaken in the early s by Brazil and neighboring Indonesia. The major mines are situated in Peninsular Malaysia, making it easy to transport their products to the nearest seaports. Malaysia's exports of tin declined from 36, metric tons in to 22, metric tons in , affected by fluctuations in the world market.
During recent decades, Malaysia has increased production of crude petroleum and natural gas. In , it produced , barrels of crude oil per day and 3. The high-quality oil is extracted mainly from offshore platforms in the states of Terengganu, Sabah, and Sarawak, with a total of about 40 oilfields in operation There are 5 oil refineries situated in Malaysia.
The production of gas increased steadily in the s to meet the rising demand in the domestic and international markets, with exports mainly going to Taiwan, South Korea, and Singapore. Malaysia was ranked thirteenth in the world in terms of gas reserves and twenty-second in oil reserves in The state-controlled petroleum corporation, Petronas, has been seeking a greater role in the international market, investing in promising new projects in the Middle East and Southeast Asia.
Overall, mining plays a declining role in the national economy of the country, contributing just under 7. However, there is great potential for development of this sector, since Malaysia has various relatively under-exploited mineral resources in East Malaysia Sabah and Sarawak , including bauxite, iron ore, copper, ilmenite, and gold. Additionally, there are large offshore reserves of high-quality oil and gas. Malaysia has established a diverse and quickly-growing manufacturing sector that plays an increasing role in the Malaysian economy.
Manufacturing contributes about 29 percent of the GDP, providing employment to 2. From the late s, the proportion of GDP provided by the manufacturing sector in Malaysia grew from The major investment projects were in the chemical, electronics, and electrical industries.
Malaysia built up its manufacturing sector mainly in the s and s, utilizing its long-established industrial centers on the island of Pinang and the Kelang Valley, its well-developed transportation infrastructure including seaports and railways , and the entrepreneurial skills of its small and medium-sized businesses. The industrial sector initially consisted of oil refining, machinery assembly, and light industries including foodstuff processing and textile manufacturing.
However, as in neighboring Singapore, the Malaysian manufacturing sector was boosted in the s and s by the extensive growth of the electric assembly and electronics sectors. Malaysia became an important producer of radios, television sets, stereo equipment, and other related products.
In the s, the Malaysian government launched its national automobile project, the locally produced Proton car in cooperation with Mitsubishi of Japan , and in the late s, it started exporting the Proton to the international market. In the s, there was further growth in the manufacturing sector, especially in export-oriented electronics production, including semiconductors, silicon wafers, and other items.
Malaysia has become the world's third-largest producer, and one of the world's largest exporters, of semiconductors. As in neighboring Singapore, the Malaysian government has played an active role in industrialization and economic development.
In this regard, the Malaysian Industrial Development Agency MIDA has been instrumental in promoting the rapid development of targeted sectors of industries especially knowledge-and technology-intensive sectors , since all industrial projects that involve foreign direct investments FDIs must be approved by the MIDA.
The government also used direct investments and encouraged the inflow of FDIs, establishing special export-processing zones where investors were given access to well-developed infrastructure and enjoyed tax breaks and other privileges.
Since the s, the government has actively promoted the electronics, information technology, and multimedia sectors, and has encouraged the relocation of labor-intensive industries to Indonesia and Thailand. Most of Malaysia's electrical and electronic products are produced for export to the United States, Europe, and other markets.
This makes its manufacturing economy vulnerable to downturns in the regional and international market. Despite some restrictive measures and financial initiatives, Malaysia was negatively affected by the Asian financial crisis.
In and , its manufacturing sector experienced serious contraction; dozens of plants were closed and thousands of workers lost their jobs. In alone, the sector was reduced by about However, in and , Malaysia managed to reverse the recession in manufacturing, and this sector experienced an impressive growth of 12 percent per annum.
Access to cheap local wood makes Malaysian furniture manufactures very competitive in the international market. In , the United States was the largest single market for Malaysian wooden furniture 37 percent , followed by Japan 14 percent , Singapore 9 percent , and the United Kingdom 9 percent.
If the rapid growth in this sector remains unchanged, by Malaysia could become one of the top ten furniture exporters in the world. Tourism is becoming an increasingly important sector of Malaysia economy. Together with the retail sector, it provides employment for almost 1. This makes tourism one of Malaysia's top foreign exchange earners. According to the national authorities, the country has 1, hotels, the total room capacity of which almost doubled during the s to about , in In order to develop tourism, Malaysia has promoted its diverse cultural environment, hosting a number of cultural festivals and performances.
It has also publicized its rich natural heritage, which includes tropical forests, coral reefs, unspoiled mountain ranges, rivers, and national parks. The country offers tax-free bargain shopping and excellent service, with top-class hotels such as Sheraton, Hilton, Intercontinental, and other well-established international chains opening branches.
It offers a wide variety of activities, from eco-friendly and adventure tourism to scuba diving and relaxed family holidays on the numerous Malaysian islands and beaches. Additionally, Malaysia has signed visa-free regimes with most countries in Asia, the Americas, and Europe, enabling international tourists to travel to Malaysia without obtaining entry visas. In , however, tourism suffered from the regional financial crisis and by the smog caused by several months of forest fires in Indonesia.
The number of tourist arrivals declined significantly in and ; however, there was a strong recovery in arrivals in and The financial service industry is another rapidly growing sector of Malaysia's economy. In terms of employment, it almost doubled from , people in to , people in Traditionally, this sector was built around the banking system, investments, insurance, and some other activities. For more than a decade until , the financial service sector experienced rapid expansion fuelled by the inflow of Foreign Direct Investments FDIs , reasonably cheap credits, and overall rapid economic growth in all sectors of the economy.
Malaysia developed a sophisticated computerized banking payment system, encouraging development of electronic payment systems and electronic banking. Malaysia's government considered developing Kuala Lumpur into a regional financial center, competing with Singapore for this role, although it was slow to allow foreign brokers to operate at the Kuala Lumpur Stock Exchange KLSE.
The regional financial crisis started with the collapse of the Thai currency the Baht , which severely affected the Malaysian financial sector. Share and property prices declined significantly, provoking panic among local and international investors. Within a short time, the Malaysian ringgit had depreciated against major international currencies, especially the U. This inflicted considerable damage on local businesses, as a significant number of credits were in U.
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Location of Kuala Lumpur on a map. Kuala Lumpur is the capital city of Malaysia. It has a population of 1,,, and is located on a latitue of and longitude of Malaysia is divided into two regions, with a total of thirteen states based on Malay Kingdoms, and three federal territories. East Malaysia, or the part of the country on the island of Borneo, is home to the states of Sabah, Sarawak, and Labuan, a federal territory. It is the location of the 4, m (13, ft) high Mount Kinabalu, the tallest mountain in Malaysia. Mount Kinabalu is located in the Kinabalu National Park, which is protected as one of the four UNESCO World Heritage Sites in Malaysia.