Poverty in Malaysia

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Poverty in Malaysia is a controversial economic issue. The definition of poverty and the poverty line for Malaysians has been disputed, and government policies to address poverty such as the Malaysian New Economic Policy have been met with political protest.[citation needed]



After Malaysian independence, significant chunks of the Malaysian economy were controlled by British colonial firms. Second economically to these monopolies were small-scale retail enterprises run by the Malaysian Chinese and small-scale moneylending businesses run by a few Malaysian Indians.[1]

New Economic Policy[edit]

After the May 13 Incident in 1969, where racial rioting broke out in the federal capital of Kuala Lumpur, the Malaysian New Economic Policy (NEP) was initiated. Its purpose was to narrow the disparities in wealth between the Malay and non-Malay communities in the country through aggressive affirmative action and state intervention in the economy.[2]

It has been suggested that although the NEP was initially successful in achieving its goal of reducing the economic gap between different communities in the country, its politicisation in the 1990s and 2000s (decade) hampered its implementation; during this period, intraethnic economic inequity amongst the Malays reportedly increased. Anecdotal evidence has been used to suggest that rural Malay communities have not been significantly uplifted economically by the NEP.[3]

Poverty Line Income[edit]

A nonacademic survey, however, found that the official poverty line at the time the UNDP figures were published, set at about RM1000, was unrealistically low; a group of factory workers surveyed suggested that to survive, their households would require a monthly income of about RM3000. A 3-room apartment in Malaysia near the town has a rent of between RM1500-RM4000 (according to 2010).[citation needed]

Household Income[edit]


The Economic Planning Unit, Prime Minister's Department Malaysia figures that the abject poor households in the Malaysia nation at 53.5%

In the abject poor households category comprise Malaysia peninsular has 35.1%, Sabah 53.6%, and Sarawak 11.4%.

In the poor households category comprise Malaysia peninsular has 49.0%, Sabah 39.3%, and Sarawak 11.7%. [4][5]

Industrialisation and urbanisation[edit]

As the country modernised, new forms of poverty appeared; one such problem was that of urban poverty. Economic development has been named as the cause of poverty amongst "single female headed households, the rural elderly, unskilled workers and migrant workers" by a local economist.[6]

The United Nations Development Programme has praised Malaysia for its reportedly successful poverty reduction programmes. Officially:

See also[edit]

Notes and references[edit]

  1. ^ Musa, M. Bakri (2007). Towards A Competitive Malaysia. Petaling Jaya: Strategic Information and Research Development Centre. p. 122. ISBN 978-983-3782-20-8. 
  2. ^ Musa, pp. 122–123.
  3. ^ Musa, p. 123.
  4. ^ Economic Planning Unit, Prime Minister's Department Malaysia
  5. ^ EPU re-affirms chronic poverty in Sabah
  6. ^ Johan, Musalmah (October 2005). "Eradicating Rural and Urban Poverty" (PDF). Malaysian Institute of Economic Research. Archived from the original on 26 July 2007. Retrieved 1 June 2007. 
  7. ^ "UNDP in Malaysia : Poverty Reduction". United Nations Development Programme. 2005. Retrieved 1 June 2007.