Malaysia has a newly industrialized economy, which is relatively open and state oriented. Malaysia is the world’s largest Islamic Banking and financial centre. Manufacturing accounts for 40 percent of the total Gross Domestic Product (GDP) of the economy.
International trade has always been a significant factor for Malaysia’s economic growth as it is one of the three countries that control the Strait of Malacca. Malaysia experienced an economic boom during the late 20th Century period. Since then the economy has undergone rapid development and growth. The Malaysian economy is predicted to expand sustainably in the second half of the year following considerable export growth in July and a staggering 97.2 percent increase in approved foreign investment for the first half of 2019, said Finance Minister Lim Guan Eng. Despite market expectations, Malaysian exports for July rose by 1.7 percent to RM88 billion compared to RM86.5 billion last year. Asian economies are benefiting from the trade tensions between the United States and China which have slowed down the global economic growth and expected to cripple major economies if not addressed and tackled efficiently. The country’s export resilience has boosted Malaysia’s trade surplus for July, increasing by 75.6 percent to RM14.3 billion, from RM8.1 billion in the same month last year. The minister said Malaysia’s economy is also expected to sustainably grow in the third quarter of the year, following its rapid GDP growth at 4.9 percent in the second quarter.
A research study conducted by the American-Malaysian Chamber of Commerce in 2019 revealed that 76 percent of the companies surveyed planned to expand their investments in Malaysia within the next five years. So, the future of the Malaysian economy looks pretty solid in a time of a global economic crisis.