MALAYSIA
GEOGRAPHY
Malaysia is located in the southeast of the Asian continent; therefore this region is often referred to as Southeast Asia. There are over 28 million inhabitants in the country (January 2012). Malaysia consists out two parts: Peninsular Malaysia, located between Thailand in the north and Singapore in the south, and the two provinces Sabah and Sarawak, located on Borneo. We also talk about Peninsular Malaysia and Borneo. Peninsular Malaysia is located just above the equator and Borneo just beneath it. The large island Borneo is shared with Indonesia (they call this island Kalimantan) and Brunei. To the north it borders the Philippines (that still has claims on parts of Borneo) via sea. The capital city is Kuala Lumpur, a metropolis with over 1.6 million inhabitants in the city center (suburbs like Subang, Petaling Jaya, Ampang Jaya, Alor Setar and Klang are not included).
HISTORY
The federal state of Malaysia is a multicultural and multi and multi-confessional country.
The majority, 61% professes Muslim religion, 20% Buddhism, 8% Christianity, 6% indù and the remaining part the traditional Chinese religion or other faiths. The number of atheists is very low due to their high discrimination, the irreligion, and the agnostics. Malaysian Islam is represented by Shafi’i; it was principally introduced by Arabian peninsula markets, but also by China and India during the 15th century. According to the constitution, Malaysia is a secular state, without national religion and free profession, but Islam is considered a Federation religion, to symbolize social importance. The majority of Chinese Malaysian practice Buddhism and Taoism. Indù includes Indian Malaysian, while Christianity affirmed itself especially in oriental Malaysia without a specific ethnical group. The state recognizes every religion, declaring national holiday the most important religious holiday of each faith.
SOCIAL CULTURE
Also if Malaysia considers itself multi- religious, Islam is the presumed Malaysian ethnicity’s official religion: none Malaysian can leave Islam. The government, however, believes the constitution expects a quite strong warranty for faith freedom and they think is not necessary to modify it. Also, the Malaysian ID reports If the citizen is Muslim or not. As it is ‘official religion’, the country guarantees financial support to Islamic institutions and imposes the religious form of Sunnism and the local federal governments have the power to impose or not the Islamic law to Muslim, offering also subsidies to private and public schools who declared themselves Islamic (in this schools is not compulsory to profess Islam, but it is expected an obligatory course for Muslim). The government forbids every publication to push racial or religious disharmony and that the most relevant religious issues wouldn’t be discussed in public. Local government has the legal power to nominee the mosques’ Imam, and they have decisional power on those. Today, the religious authority, are worried about the loss of religiosity in daily life especially in urban areas, where it’s happening a Westernization (jeans, bar, skirt, discos,…). While, in rural regions and less developed, religion plays an important role in society: Islam is very present in everyday life (prayers reproduced via a speaker, compulsory veil,…). Some believe Malaysia is quite losing its secularism at the expense of Islamization. All of this is much freer for not Malaysians, who are free to profess ed express their faith without limitations.
The Malaysian religious situation is very similar to the Italian one, in which religion plays a fundamental role in governing the country and in its administration, also if both countries profess hemselves secular and multi-religious. Within Italy and Malaysia, religious sites can be used as political ones passing their own messages through worship places.
Malaysia is a mix of ethnicity and cultures. The population is principally composed of Malaysians (50%) and Chineses (23%). Malaysians are the only ones who have full civil and political rights. Chinese live especially in urban areas and they stand out for commercial activities. Recent immigrations brought also Pakistans, Bangladeshi and Nepalese, who mainly work in handcraft and agriculture. This melting pot brings lots of holidays and manifestation, but also ethnical tension a few times extinguished but several times politically instrumentalization by the government. Malaysian is the official language, but it’s very present Chinese, Cantonese, Hokkien, and Indian Tamil. However, English is globally accepted and spoken especially in cities areas.
The real life’s cost in Malaysia still being accessible thanks to the favorable exchange rate, that mitigates the effects of inflation. But the exchange rate has been favorable for Europeans, not as the Thai Bath, so the life’s cost in Malaysia still being convenient for the Eurozone. According to Numbeo data, the most expensive city in Johor Bahru, on the border with Singapore. The index is a little more than 50%, this means that it cost half than NY and 40% less than Milan. Kuala Lumpur is the city with the highest rents, almost double the rest of the country. According to Numbeo, Malaysia is overall 8% more economic than Thailand.
The Social Welfare Departmentc Malaysia (JKMM) was established in 1946 and has been through several structural changes since. The department started with its involvement in managing problems that stemmed from World War II. From there, its roles and functions have expanded to preventive and rehabilitative services in social issues and the development of the community. It is one of the agencies under the administration of the Ministry of Women, Family and Community Development. One of the most interesting welfare strategies is the ‘funding for entrepreneurs: If you’re a budding entrepreneur, or you have recently started your business, you may be eligible to get some funding help from the government. For Bumiputera (native Malaysians), you are eligible to apply for the Superbe Scheme and have access to up to RM500,000 grants (more than 100,000 euros). In Malaysia, professional social work was introduced by the British Colonial Administration as early as the 1930s, but it was mainly focused on problems of migrant laborers from India and China. It was only after World War II, when social problems of displacement, juvenile delinquency, and poverty became more prominent, that a Department of Social Welfare was formerly established in 1946. Social work services were introduced in terms of financial aid for the needy, probation programs for juvenile delinquents, protection homes for women and girls, and residential care for the disabled and the aged. Nowadays the Malaysian Association of Medical Social Workers (MAMSW) is registered as an affiliate member of the International Federation of Social Workers (IFSW) and has a representative on the IFSW-Asia Pacific Executive Committee as Publications Secretary. Its members are also actively involved with the Asia Pacific Association of Social Work Educators and the International Association of Schools of Social Work.
POLITICS
Malaysia, a federal-state named also Great Malaysia federation, born in 1963, uniting the 11 states of the Malaysian Federation (independence since 1957). Until 1965, also Singapore was part of the federal state. Nowadays the country is composed of 13 states. Malaysia is an elective constitutional monarchy; more precisely it is a constitutional monarchy federation headed by the state supreme Chief, elected by the hereditary rulers of 9 on 13 states that compose the federation. His term is 5 years and he keeps executive and legislative power exercised with the parliament. The king has the role to appoint the prime minister who will be the leader of the Representative chamber. Every important decision (moving the borders, regarding the Islamic legislation,..) must be approved and checked by the Regnant conference formed by the hereditarian leaders plus 4 heads of state elected. The parliament is compiled by two chambers: the representatives and the congress. The first one owns the legislative power, while the Congress has got just the right and the power of removing and suspending the legislature. Senator is nominated by the king and by each state’s MPs have a 6-years term. Malaysia still adopting the death penalty. The member of the parliament of each state is elected by Universal suffrage with a 5-years term. At the local administration level, the control is in the hand of each municipality and town councils.
Today the Supreme chief position is vacant, from the 6th of January.
FROM THE II WORLD WAR UNTIL TODAY
Malaysia’s history starts in the 16th century when the country hosts Portugueses first and then Dutches. In 1881, an almost centenary English dynasty controlled a huge part of this islands’ land, but after the II World War, the family’s III heir has been constricted to cede the British control. In 1963 North Borneo states, Sabah and Sarawak get them united and created the Malaya, Malaysia, but a few years later, in 1969 a series of fights, caused by the tension between the Chinese and Malaysian communities, expand from Kuala Lumpur region thought the whole country. Starting from 1981 Malaysia has been subjected by strong economic-financing growth. In 2005 Malaysian authorities inflected a strong hit to illegal immigration, more than the others by the Indonesian, accused especially of narco traffic. Nowadays Malaysia represents a multicultural society in which live several cultures, religions, and political parties.
POLITICAL OUTLOOK
In 2019 elections, in May, the opposition parties alliance got the majority on the previous government, the United Malaysian National Organization (UMNO) in charge of the Malaysian independence in 1957. The defeat has been caused by the good and services tax applied in 2005. The new government has already started reforms aimed at population economic help, but they also stopped a huge project launched also thanks to Chinese funding and subsidies.
The government started a campaign to fight corruption and to promote transparency in public administration; it approved important institutional reforms to assure more independence and democracy to public agencies and institutions under parliamentary control. It announced to remove the death penalty and that Malaysia ONU’s conventions about human rights. There could be also some risks and threats for democracy: the political controversy between the two leaders that could damage the thin coalition’s balance and the economic situation linked to that.
ECONOMY
On the 2nd November 2018, the Malaysian Minister of economy presented the 2019 Balance Sheet, the new government’s first one. The financial position of the country, if on one hand has weakened by the public debt (up to 65,5% of GDP), the public deficit (expected to 3,7% of the GDP) and by the financial passivity not programmed increase, on the other hand, the Oil & Gas sector got stronger. The balance followed the launch of the ‘Malaysian Plan 11 (MP11)’ mid-term review by the Prime Minister Mahathir. The MP11 is a programming document on the development prospects of the country in the 2016-2020 period. The new version covers the 2018-2020 biennium and it previews suitable development objectives, inclusive growth, a country more competitive on a global level, investment promotion, infrastructure reinforcement, normative reforms to fight corruption, fiscal consolidation. The move is oriented to recover the public finance, put on risk by the past governments, to gradually ensure fiscal consolidation to bring the deficit/PIL ratio to 3,4 in 2019 and to 3,0 and 2,8 respectively in 2020 and 2021. The overall expenditure is expected to grow 8% compared to 2018, for a total of 314,5 billion. A quote of 54,7 billion is addressed to investments for the country’s development (development expenditure); 29,2 billion as economic subsidies for transport, trade, industry, energy, public service, and agriculture. The remaining quote is destined to operate expenditure. Between the ministries, the major equipment will be for education.
BUSINESS OPPORTUNITIES
HOW TO OPEN A COMPANY
The solutions most commonly used by foreign companies, which intend to carry out entrepreneurial activities in Malaysia, include the establishment of a Malaysian company, the use of joint venture agreements with local partners, the opening of a branch or that of an office of representation. Company law in Malaysia is governed by the Companies Act, issued in 1965. There are three different types of companies, depending on the different degree of liability imposed on the shareholders for any obligations contracted by the company:
- Companies limited by shares: in which the shareholders’ liability is limited to the nominal value of the shares held
- Companies limited by guarantee: in which the shareholders agree to guarantee up to a pre- established limit in the event of dissolution of the company
- Unlimited companies: where there is no limit to the personal liability of shareholders.
However, there are some specific sectors in which the obligatory participation of local subjects is required: among these, it is worth remembering, the financial and banking sector, the oil sector, tourism, education, and the agricultural sector. Given the continuous legislative interventions of the Government, aimed at favoring the entry of foreign capital into the country, through measures aimed at increasingly liberalizing the market, the above list is subject to continuous updates. Recently a new type of company was introduced, by the Companies Commission of Malaysia, expressly governed by the Limited Liability Partnerships Act of 2012, in order to provide entrepreneurs with an alternative tool for carrying out their business. This new corporate form is characterized, in fact, by a greater simplicity of the constitution, management and liquidation procedures. Joint Ventures Corporate joint ventures can be structured either using the type of partnerships, that is, partnerships, whose shareholders respond jointly and unlimitedly to social obligations, or consortia, that is, associations of two or more corporations. A foreign company, which wishes to operate in the Malaysian territory, may also decide to open its own branch to carry out entrepreneurial activities on the spot (provided that it is not wholesale or retail). However, prior registration with the business register is required, so that the branch can be legally authorized to carry out its activities in the territory. The registration takes place following the filing of the requested documents, following local regulations and the consequent approval by the competent authorities.
INTERNATIONAL RELATIONS
On the international stage, Malaysia proposes itself as an Islamic country model and open to progress. In 2010, the prime minister Najib proposed to ONU a ‘moderates global movement’ to merge the forces open to every religion dialogue and marginalize every kind of extremists. This idea got success in 2012 when in Kuala Lumpur the GMM organized the first conference. Malaysia still being a projection of regional external politic with a relevant role in Mindanao and Kuala Lumpur.
Relations with Asian countries
Malaysia is a member of ASEAN. It is also one of the 54 self-governing member states of the Commonwealth (formally the British Commonwealth of Nations). Malaysian soldiers have participated in peacekeeping mission in Bosnia, Somalia, Lebanon, Cambodia and the southern Philippines.
Relations with many Asian countries have improved as a result of growing trade, but Chinese, Indonesian, and Philippine authorities have expressed concern about official and societal treatment of fellow ethnics within Malaysia. Malaysia continued to lead efforts to stymie the efforts of the Association of Southeast Asian Nations Committee on Migrant Workers to negotiate a legally binding instrument for the protection and promotion of the rights of migrant workers. In 2006, Malaysia was chair of the 57-nation Organization of Islamic Conference (OIC) and the Non-Aligned Nations. Malaysia is a visa-free travel destination for citizens from most Muslim countries. Malaysia, which is 60 percent Muslim and strongly supports the Palestinian people, does not recognize Israel and maintains no diplomatic ties with the state. It has also supported Iran’s nuclear program. In welcoming Iran’s controversial leader Mahmoud Ahmadinejad to Kuala Lumpur, Malaysian foreign minister said, “We hold the position that nuclear technology to be used for energy—for peaceful purposes—should be allowed.”
Relations with China
Malaysia has fairly close ties with China. It agreed to a request by Beijing to summarily return to China a group of ethnic Uighurs in Malaysia despite the likelihood that they would face torture and ill-treatment. Eleven were sent back while five remain in Malaysia. Chinese have expressed concern about official and societal treatment of fellow ethnics within Malaysia. China imports palm oil, rubber and natural gas from Malaysia. China was Malaysia’s fourth-largest trading partner in 2004 after the United States, Japan and the European Union; bilateral trade jumped 33 percent that year, to 71.4 billion ringgit, or $18.9 billion.
Malaysia & EU
Europe and euro-zone countries are a real important marketplace for the south East Asia state. Netherland is the most important talking about commercial and trade relationships with Malaysia. It is followed by Germany, UK, France, ITALY, Belgium, Spain, Ireland, Austria, and Finland.
Malaysia & Italy
Malaysia offers relevant opportunities for Italian enterprises. The country can guarantee a constant and solid presence in the entire region. Many important Italian societies elected Malaysia as the neuralgic center for their economic activities in south-east Asia. The strong made-in-Italy recognition and the Italian know-how gave to Italy and Italian company the push needed to invest, create and consolidate strong relationships with Malaysia. There is about 100 Italian enterprises on the territory. The Italian exportation to Malaysia amounts to 1,06€ billion, with an increase of 11% on the previous year, while the importation amount to 958 million. So the import-export balance is 104 million positive.