Population 31,186 million
GDP 9500 US$
Country risk assessment
Business Climate
Change country
Compare countries
You've already selected this country.
0 country geselecteerd
Clear all
Add a country
Add a country
Add a country
Add a country


major macro economic indicators

  2014  2015 2016 (e) 2017 (f)
GDP growth (%) 6.0 5.0 4.2 4.5
Inflation (yearly average) (%) 3.1 2.1 3.1 2.9
Budget balance (% GDP)* -2.7 -3.0 -3.3 -2.9
Current account balance (% GDP) 4.4 3.0 2.2 2.0
Public debt (% GDP) 55.6 57.4 55.8 55.0


(e) Estimate (f) Forecast


  • Diversified exports
  • Dynamic services sector
  • Good infrastructures, high level of R&D
  • Support for investment through expansion of the local financial market and increased access to FDI


  • Economy reliant on external demand
  • Budget revenues highly dependent on performance of oil and gas sector
  • Very high indebtedness of private sector
  • Deterioration of competitiveness due to rising labour costs
  • Continuing regional disparities


Growth rate to stabilise

Activity continued to slow in 2016 but growth is expected to improve slightly in 2017. Oil and gas exports should feel the benefits of the slight rise in prices, oil in particular. These will however remain low, thwarting any return to the growth rate recorded in 2014. The country also exports high value-added manufactured products. The depressed state of global demand however is likely to continue weighing on this segment with other exports suffering from lower levels of demand in China and the slowing of the US economy. Household consumption, despite the scale of indebtedness, is expected to remain strong, with unemployment and inflation under control. Poorer households will continue to benefit from significant social transfer and monetary policy is likely to remain relaxed. The stabilization of the Ringgit and lower food prices should help control price rises.
In addition, despite the budget consolidation efforts, infrastructure spending is expected to remain high and the impact of the economic transformation program will continue to be positive in terms of private and public investment, and specifically the construction of a high-speed rail link between Singapore and Kuala Lumpur.
Finally, tourism related sectors are likely to continue feeling the negative repercussions of the two inflight catastrophes involving Malaysian Airlines in 2014, as well as the worsening security situation in Borneo. The government is nevertheless set to continue with its plan to boost tourism and turn Kuala Lumpur into a hub for the airline sector.


Budget balance improves despite lower oil and gas prices, and external situation remains comfortable

Budget consolidation remains one of the government’s priority objectives. In 2017, the reduction in the budget deficit is likely to continue. Despite weak oil and gas prices and the cuts to corporation taxes which have eaten into its revenues, the government is aiming to boost its resources by reducing current expenditure, the additional revenue from the VAT introduced in 2015 and a rationalisation of administrative spending. The rebalancing of the budget balance should enable a reduction in the level of public debt which will however still be high. The Malaysian state is also exposed through contingent commitments that could amount to 15% of GDP.
In addition, the current account surplus is likely to shrink slightly because of a worsening in foreign trade, reflecting the depressed state of global trade and weak raw material prices.
The high level of foreign exchange reserves (almost 7 months’ imports) means that Malaysia has the capacity to withstand sudden capital outflows if the Ringgit suffers severe downwards pressures in the context of global financial turbulence or the scandals surrounding the state-owned investment fund, 1MDB, and extending to the Prime Minister. The slow rate at which the US Federal Reserve is tightening monetary policy is helping hold capital outflows in check. Finally, the banking sector remains adequately capitalised and liquid. The high level of household debt and the exposure of its banks to foreign assets do however represent risks.


Despite the scandals, the Prime Minister is likely to remain in office until the 2018 elections

Despite the victory of the Prime Minister’s Barisan Nasional (BN) party, the general elections in May 2013 confirmed the reordering of the political scene and the rise of the opposition as first indicated in the 2008 elections. The legitimacy of the Prime Minister, Najib Razak, was however confirmed by his victory during the party’s internal elections in October 2013. In addition, the opposition was weakened by an internal crisis around the appointment of the Chief Minister of Selangor State and the sentencing of its leader, Anwar Ibrahim, to a five-year jail term on sex related charges. Members of the party are calling for the Prime Minister’s resignation and he has dismissed his deputy as well as the country’s Attorney General, both implicated in the inquiry. He also carried out a ministerial reshuffle in June 2016 to bring in his most trusted supporters in the party. Despite this scandal, Najib Razak’s coalition is not likely to be confronted by a unified opposition in the 2018 elections as it has splintered since the imprisoning of its leader. Since this conviction, the opposition has struggled to reunite and is unable to take advantage of the fragility of the governing coalition. The BN in fact managed to win a number of partial parliamentary elections in June 2016.
Finally, governance should continue improving: the government seems to have decided to make the country even more attractive for investors.


Last update : January 2017 


Bank transfers, cash, and cheques are all popular means of payment in Malaysia. The country’s banking network is well developed and allows for payments to be made through various online channels. Letters of Credit are also commonly used in Malaysia.


As of the beginning of 2017, it is the Central Bank’s requirement that 75% of payments in foreign currencies are converted into the Malaysian ringgit automatically upon receipt. Payments for transactions within Malaysia are required to be made in the local currency.


Debt collection

Amicable phase

Amicable efforts in settling disputes and or debts are very common in Malaysia. This involves notifying and contacting buyers by way of letters, telephone and, where permissible, by visiting the buyer’s business premises. Negotiations often ensue before a final settlement can be reached. If there is no response from the buyer, a site visit and online searches are conducted to ascertain the operating status and legal status of the buyer. If the buyer continues to ignore and or neglect to settle the matter amicably, the supplier may begin legal proceedings to recover payments for goods sold and delivered. However, due diligence should be done to ensure that the buyer has sufficient assets to satisfy the debt before proceedings are initiated.


Malaysian court system

The hierarchy of courts in Malaysia starts with the Magistrates’ Court at the first level, followed by the Sessions Court, High Court, Court of Appeal and the Federal Court of Malaysia. The High Court, Court of Appeal and the Federal Court are superior courts, while the Magistrates’ Court and the Sessions Courts are subordinate courts. There are also various other courts outside of this hierarchy, e.g. Employment Admiralty, Shariah or Muslim matters.


Malaysian legal system

The Malaysian legal system is based upon the English common law system, which Malaysia inherited by virtue of a long history of colonization by the British. Central to the Malaysian legal system is a written constitution based upon the Westminster model. The jurisdiction and powers of courts under the Malaysian hierarchy of courts are contained principally in the Courts of Judicature Act 1964 (Act 91) for the superior courts and in the Subordinate Courts Act 1948 (Act 92) for the subordinate courts.


Claims in Magistrates’ court are limited up to MYR 100,000, whilst a Sessions Court may hear any civil matters where the amount in dispute does not exceed MYR 1,000,000. Where the amount claimed does not exceed MYR 5,000, a claim should be filed with the small claims division of the Magistrates’ Court. However, legal representation is not permitted. The High Court has the jurisdiction to try all civil matters and monetary claims exceeding MYR 1 million.


Legal Proceedings

An unpaid debt normally has a six-year statute of limitation period, from the day the cause of action arose  (e.g. a breach of contract). The creditor commences a writ action and serves the writ on the debtor within six months from the issue of the writ. When defendants are served with a writ, they have fourteen days after service of the writ (or 21 days if the writ was served outside of Malaysian jurisdiction) to file a Memorandum of Appearance with the court to indicate their intention to appear in court and defend the suit.


Before a writ can be issued, it must be endorsed with a statement of claim, or with a general endorsement consisting of a concise statement of the nature of the claim made and the requisite relief or remedy. When the writ only has a general endorsement, the statement of claim must be served before the expiration of fourteen days after the defendant enters an appearance.


When the defendant has entered appearance, he is required to file and serve his defence on the plaintiff fourteen days after the time limit for entering an appearance, or after service of the statement of claim, whichever is later. A defendant may make a counterclaim in the same action brought by the plaintiff. A plaintiff must serve on the defendant his reply and defence to a counterclaim, if any, within fourteen days after the defence (and counterclaim) has been served on him.


Proceedings may be resolved and/or otherwise summarily terminated and/or determined and/or disposed of at an early stage before the trial of the action


Fast Track

Failure to enter an appearance may result in a plaintiff proceeding to enter a judgment-in-default against a defendant. Ordinarily, when a defendant has filed an appearance and also a statement of defence subsequent to other procedures of filing of documents in support, the matter would be set for trial. If the defendant has entered an appearance and filed a defence, but it is clear that the defendant has no real defence to the claim, the plaintiff may apply to court for summary judgment against the defendant. To avoid summary judgment being entered, the defendant has to show that the dispute concerns a triable issue or that there is some other reason for trial.


Enforcement of a court decision


Writ of Seizure and Sale (WSS)

A WSS may be enforced against both movable and immovable property as well as against securities. When the property to be seized consists of immovable property or any registered interest, the seizure shall be made by an order prohibiting the judgment debtor from transferring, charging or leasing the property.


Garnishee Proceedings

A Judgment Creditor may garnish monies a Judgment Debtor is supposed to receive from a third party. If the garnishee does not attend court, then the order is made absolute. If the garnishee does attend, the court can either decide the matter summarily or fix the matter for trial.


Judgment Debtor Summons 

The objective of this summons is to give the judgment debtor an opportunity to pay the judgment debt in instalments to commensurate his means. Debtors themselves can apply for such a procedure. Alternatively, under Order 14 the defendant can admit the plaintiff’s claim and propose to pay by instalments, which the court can subsequently order if the plaintiff accepts the proposal.


Bankruptcy Proceedings

If the total judgment of debt exceeds MYR 30,000, bankruptcy proceedings can be triggered if the judgment debtor has not complied with the judgment or order made against him. Once a debtor has been adjudged bankrupt, other creditors are also entitled to file the Proof of Debt form and Proxy in order to be entitled to share in any distribution from the estate of the bankrupt. The distribution of the estate is according to the priority of the creditors' claim


Writ of Possession

Once the application is granted, the order commands the sheriff to enter the property of the debtor and take possession of all immovable property The writ may also include provisions for enforcing the payment of money – usually rental arrears and legal cost – and for that purpose, the writ will command seizure and sale of any movable property of the defendant to satisfy the party of the monetary judgment


Writ of Distress

The relationship of landlord and tenant must exist, both when the rent becomes due and when the distress is levied and the rent must be in arrears. Warrants of distress need not be served on the tenant. The writ of distress is addressed to the bailiff for execution and the entire process is carried out ex parte. The element of surprise is expected because if the order is made known, the execution might not be fruitful.


Writ of Delivery

This writ is used for the recovery of movable property or its assessed value where a judgment or order for the delivery of any movable property or payment of their assessed value to the judgment creditor has not been complied with. Writs of delivery may include provisions for enforcing the payment of any money adjudged or ordered to be paid by the judgment.


Enforcement of Foreign Judgments/ Reciprocal Enforcement of Judgments (Order 67 Rules of Court 2012)

The Reciprocal Enforcement of Judgments Act 1958 (REJA 1958) applies to judgements given in the superior courts of reciprocating countries specified in the first schedule to the Act (section 3). REJA 1958 applies to foreign judgments or order given or made in any civil or criminal proceedings for payment of a sum of money in respect of compensation or damages to the injured party and in the case of Commonwealth countries or territories, includes an arbitration award (section 2). A judgment is deemed final and conclusive even if there is an appeal pending against or if it is subject to appeal.


The fact of registration does not transform the judgment into a Malaysian judgment so that the court may sit to inquire into its regularity or validity for certainty or the want of it. If the judgment debtor wishes to impeach the judgment for uncertainty or irregularity or non-conformity with the rules of court, he should proceed to do so in the original court.

When the judgment debtor has no assets in Malaysia, leaving the judgment creditor unable to enforce his judgment in Malaysia, the creditor may be able to enforce it in a country where the debtor does have assets. He might do so by beginning new proceedings or, if possible, by registering his Malaysian judgment in the foreign country (on the basis of reciprocity of enforcement between the two countries).


Any decision rendered by a foreign country must be recognized as a domestic judgment in order to become enforceable through an exequatur procedure. Malaysia has reciprocal Recognition and Enforcement Agreements with some countries, including Hong Kong, India, and New Zealand.


Insolvency proceedings

There are several insolvency and restructuring procedures available. Under the Companies Act, the available insolvency proceedings include:

  • Compulsory and voluntary winding-up of companies
  • Appointment of receivers and managers
  • Restructuring mechanisms



In a compulsory winding-up, the court can wind up a company on a number of grounds under the Companies Act. The most common of these is the company’s inability to pay its debts. The creditor initiates this process by filing a winding-up petition with the court. If an order is made, the court will appoint a liquidator to oversee the liquidation process.


A voluntary winding-up can be either a members’ or creditors’ winding-up. In a members’ winding-up, the shareholders can voluntary wind up their own company if their company is solvent. Shareholders appoint a liquidator, at which point the directors’ powers cease and any transfer of shares or any alteration in the statutes of members will be void. If the liquidator discovers that the company is insolvent, he must convert the members’ voluntary winding-up into a creditors’ winding-up.


Appointment of receivers and managers

Court-appointed receivers will either manage the company’s operations as normal, or take custody and possession of the assets of the company. Alternatively, receivers appointed by debenture holders based on the terms of the debenture agreement (privately-appointed receivers), may take possession of the company’s assets subject to the floating charge that has since crystallized in the debenture.


Restructuring mechanisms

There are three restructuring mechanisms:

  • Scheme of arrangement: A company can enter into a scheme of arrangement with the approval of 75% of the creditors in value and a simple majority. After creditors approve the scheme, the court must sanction it before it can be implemented. Debtors can apply for an order restraining all proceedings against it while it develops its scheme.
  • Special administration: it involves the appointment of a special administrator. The appointment must serve the public interest.
  • Conservatorship: The Malaysia Deposit Insurance Corporation takes control of a non-viable financial institution or acquires and takes control of non-performing loans that are outstanding between the financial institution, borrowers and security providers. 
Naar boven
  • Nederlands