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Malaysia

Transforming microfinance through digital technology in Malaysia

Djauhari Sitorus's picture
Dato’ Seri Dr. Ahmad Zahid Hamidi, Deputy Prime Minister of Malaysia, launching the Virtual Teller Machine (VTM) at the National Savings Bank. Digital technologies such as the VTM are now changing the way microfinance works. Photo: The Star

Malaysia launches the world’s first green Islamic bond

Faris Hadad-Zervos's picture
The green sukuk, or Islamic bond, is a big step forward to fill gaps in green financing. Proceeds are used to fund environmentally sustainable infrastructure projects such as solar farms in Malaysia.
Photo: Aisyaqilumar/bigstock

Competitive Cities: A Game Changer for Malaysia

Judy Baker's picture
Photo: mozakim/bigstock


As an upper-middle income country with a majority of its population living in cities, Malaysia is situated among the countries that prove urbanization is key to achieving high-income status. Asking “How can we benefit further from urbanization?” Malaysian policymakers have identified competitive cities as a game changer in the 11th Malaysia Plan. To this end, the World Bank has worked with the government to better understand issues of urbanization and formulate strategies for strengthening the role of cities through the report, “Achieving a System of Competitive Cities in Malaysia.”

While Malaysia’s cities feature strong growth, low poverty rates, and wide coverage of basic services and amenities, challenges still remain. 

Its larger cities are characterized by urban sprawl, particularly in Kuala Lumpur, where population density is low for an Asian metropolis. This inefficient urban form results in high transport costs and negative environmental impacts. This is matched by low economic density, indicating Malaysia’s cities can do better in maximizing the economic benefits from urban agglomeration.  



A second challenge hampering Malaysia’s cities is the highly centralized approach to urban management and service delivery, a system that impedes the local level, and obstructs service delivery and effective implementation of urban and spatial plans.

Third is a growing recognition of the importance of promoting social inclusion to ensure that the benefits of urbanization are widely shared.

Vietnam studies Malaysia’s experience with facilitating state relationships

Jana Kunicova's picture
Photo: Sasin Tipchai/bigstock



Vietnam has a vision. By 2035, it aspires to become a prosperous, creative, equitable and democratic nation. Achieving this ambitious goal has set Vietnam on a path of transformation on multiple fronts – economic, social, and political.

At the core of this transformation is the re-orientation of the state’s role in economic management.  This requires adapting Vietnam’s economic governance so that the state becomes a skilled facilitator of three types of relationships: among government agencies, between the state and market, and between the state and citizens. 

Not too long ago, Malaysia walked in Vietnam’s shoes, implementing its own wide-ranging transformation. In 2009, Malaysia embarked on the National Transformation Program (NTP) that included focus on both government and economic transformations.  Malaysia had also adopted good practices that simplified regulations, which made it easier for firms to interact with the state.

Once Southeast Asia’s trading hub, Melaka strengthens urban planning for a sustainable future in Malaysia

Adeline Choy's picture
In the 15th century, few places in Southeast Asia rivalled Melaka as a trading hub – a strategic conduit for the bustling spice trade. As traders from the region settled in the area and contributed to a melting pot of cultures, Melaka transformed into a hub known for its diversity, resilience, and innovation.
 
Christ Church Melaka
Creative Commons Christ Church Melaka by Martin Pilát is licensed under CC BY-NC-ND 2.0


Melaka retains its reputation for openness, and is extending it beyond cultural heritage into development solutions. The Malaysian state is host to the country’s first solar farm and a large new port, and the Melaka City’s riverfront is being transformed into a picturesque tourist attraction.

The city’s recent launch of the first Sustainable City Development project in Malaysia  enhances this transformation.
 
In addition to being the first of its kind in Malaysia, this is also the first city-led project for the Global Partnership for Sustainable Cities, or GPSC, which strives to integrate sustainability into urban planning.

Three things to know about migrant workers and remittances in Malaysia

Isaku Endo's picture


Migrants represent 15% of Malaysia’s workforce, making the country home to the fourth largest number of migrants in the East Asia Pacific region. The migrant population is diverse, made up of workers from Indonesia, Bangladesh, Nepal, Myanmar, Vietnam, China and India, among many other countries.

Should a country limit unskilled immigrant workers to safeguard national productivity growth?

Sharmila Devadas's picture

There are about 245 million migrants worldwide – around 3% of the world population. Roughly one-fifth are tertiary educated. Middle-income countries have a smaller proportion of immigrants than high-income countries (about 1% versus 12%). But for a number of middle-income countries with more immigrants than others, there is uneasiness about relying on unskilled foreigners as they strive to leap from low-wage labor and imitation to high-skilled labor and innovation. There are palpable concerns in Malaysia, for example, with some 2.1 million registered immigrants – about 7% of its population - and likely over 1 million undocumented immigrants. Things reached a crescendo early last year when all new hiring of unskilled foreign workers was suspended as the Malaysian government re-evaluated the management and need for foreign workers. The freeze was subsequently lifted for select sectors amid complaints of labor shortages.

India, Malaysia share experiences how to support start-up SMEs

Mihasonirina Andrianaivo's picture



Both Malaysia and India are countries steeped in innovation with a strong desire to foster new, innovative start-up enterprises. 
 
With a global focus on providing more support to Small and Medium Scale Enterprises (SMEs) – and recognizing that start-ups play a crucial role in creating jobs, growth, exports and innovation within most economies – Asian countries are keen to learn from each other’s experiences. These efforts have taken on a greater priority in India under the leadership of Prime Minister Modi and his “Make in India” and “Start-Up India” campaigns.
 
The World Bank has been supporting India for several years in the area of MSME finance, which is one of the most widely recognized impediments to SMEs, particularly for start-up enterprises.  Through the $500 million MSME Growth Innovation and Inclusive Finance Project, the World Bank supports MSMEs in the service and manufacturing sectors as well as start-up financing for early stage entrepreneurs.  The start-up support under this project ($150 million) is for early stage debt funding (venture debt) which isn’t well evolved. (Unlike India’s market for early stage equity which is considered to already be reasonably well developed.)
 
As part of this project, the World Bank and the Small Industries Development Bank of India (SIDBI), recently held a workshop in Mumbai to allow market participants to learn from one another, and particularly about Malaysia’s successful support for innovative start-up SMEs. The workshop’s participants included banks, venture capital companies, entrepreneurs, fintech companies, seed funders and representatives from the Malaysian Innovation Agency (Agensi Inovasi Malaysia – AIM).

Tapping into Islamic finance for infrastructure development

Aijaz Ahmad's picture



Islamic finance assets represent only around 1% of the global financial market,[1] so how can tapping into these funds help close the $452 billion annual infrastructure finance gap in Emerging Markets and Developing Economies?[2] The percentage may be small now, but the Islamic finance market is growing at an impressive pace—and not just in Muslim-majority countries.


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