Poverty in Malaysia
Encyclopedia
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.
colonial firms. Second economically to these monopolies were small-scale retail enterprises run by the Malaysian Chinese
and small-scale moneylending businessess run by a few Malaysian Indians.
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.
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 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.
The United Nations Development Programme
has praised Malaysia for its reportedly successful poverty reduction programmes. Officially:
1000, 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).
The official figure for urban poverty is given as 2%; critics have argued that this significantly underestimates urban poverty, as the poverty line is set at RM
500 per month for a family of four — a monthly income which has been argued as unrealistically low for a family of four to meet its needs. A survey of Kuala Lumpur has suggested that about a quarter of the population lives in squatter settlements, which commentators like Bakri Musa have argued is a more reasonable estimate of the poverty rate. However,as of December 2007, the squatter settlement has been totally eradicated in the state of Selangor.
Prior to urbanisation, urban poverty was largely a problem confined to the non-Malay communities, as they were significantly urbanised at the time of independence. However, as Malay villagers migrated to the cities, the proportion of Malay poor has likewise increased.
Poverty
Poverty is the lack of a certain amount of material possessions or money. Absolute poverty or destitution is inability to afford basic human needs, which commonly includes clean and fresh water, nutrition, health care, education, clothing and shelter. About 1.7 billion people are estimated to live...
and the poverty line for Malaysians has been disputed, and government policies to address poverty such as the Malaysian New Economic Policy
Malaysian New Economic Policy
The Malaysian New Economic Policy , was an ambitious and controversial socio-economic restructuring affirmative action program launched by the Malaysian government in 1971 under the then Prime Minister Tun Abdul Razak. The NEP ended in 1990, and was succeeded by the National Development Policy in...
have been met with political protest.
Independence
After Malaysian independence, significant chunks of the Malaysian economy were controlled by BritishUnited Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
colonial firms. Second economically to these monopolies were small-scale retail enterprises run by the Malaysian Chinese
Malaysian Chinese
Malaysian Chinese is a Malaysian of Chinese origin. Most are descendants of Chinese who arrived between the fifteenth and the mid-twentieth centuries. Within Malaysia, they are usually simply referred to as "Chinese" in all languages. The term Chinese Malaysian is also sometimes used to refer to...
and small-scale moneylending businessess run by a few Malaysian Indians.
New Economic Policy
After the May 13 IncidentMay 13 Incident
The 13 May Incident is a term for the Sino-Malay sectarian violences in Kuala Lumpur , Malaysia, which began on 13 May 1969...
in 1969, where racial rioting broke out in the federal capital of Kuala Lumpur
Kuala Lumpur
Kuala Lumpur is the capital and the second largest city in Malaysia by population. The city proper, making up an area of , has a population of 1.4 million as of 2010. Greater Kuala Lumpur, also known as the Klang Valley, is an urban agglomeration of 7.2 million...
, the Malaysian New Economic Policy
Malaysian New Economic Policy
The Malaysian New Economic Policy , was an ambitious and controversial socio-economic restructuring affirmative action program launched by the Malaysian government in 1971 under the then Prime Minister Tun Abdul Razak. The NEP ended in 1990, and was succeeded by the National Development Policy in...
(NEP) was initiated. Its purpose was to narrow the disparities in wealth between the Malay
Malay people
Malays are an ethnic group of Austronesian people predominantly inhabiting the Malay Peninsula, including the southernmost parts of Thailand, the east coast of Sumatra, the coast of Borneo, and the smaller islands which lie between these locations...
and non-Malay communities in the country through aggressive affirmative action
Affirmative action
Affirmative action refers to policies that take factors including "race, color, religion, gender, sexual orientation or national origin" into consideration in order to benefit an underrepresented group, usually as a means to counter the effects of a history of discrimination.-Origins:The term...
and state intervention in the economy.
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 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.
Industrialisation and urbanisation
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.The United Nations Development Programme
United Nations Development Programme
The United Nations Development Programme is the United Nations' global development network. It advocates for change and connects countries to knowledge, experience and resources to help people build a better life. UNDP operates in 177 countries, working with nations on their own solutions to...
has praised Malaysia for its reportedly successful poverty reduction programmes. Officially:
Poverty line
An unacademic survey, however, found that the official poverty line at the time the UNDP figures were published, set at about RMRinggit
Ringgit mostly refers to the Malaysian ringgit, which is the local currency in Malaysia, but it can also refer to the Brunei dollar or Singapore dollar in the Malay language. The word ringgit was originally used to refer to the serrated edges of Spanish silver dollars widely circulated in the area...
1000, 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).
Urban and rural poverty
Although the apparent focus of government policy has been on addressing poverty in rural communities, commentators have argued that due to urbanisation — the proportion of Malaysians living in urban areas increasing from 27% in 1970 to 62% in 2000 — the urban communities have been unfairly neglected.The official figure for urban poverty is given as 2%; critics have argued that this significantly underestimates urban poverty, as the poverty line is set at RM
Ringgit
Ringgit mostly refers to the Malaysian ringgit, which is the local currency in Malaysia, but it can also refer to the Brunei dollar or Singapore dollar in the Malay language. The word ringgit was originally used to refer to the serrated edges of Spanish silver dollars widely circulated in the area...
500 per month for a family of four — a monthly income which has been argued as unrealistically low for a family of four to meet its needs. A survey of Kuala Lumpur has suggested that about a quarter of the population lives in squatter settlements, which commentators like Bakri Musa have argued is a more reasonable estimate of the poverty rate. However,as of December 2007, the squatter settlement has been totally eradicated in the state of Selangor.
Prior to urbanisation, urban poverty was largely a problem confined to the non-Malay communities, as they were significantly urbanised at the time of independence. However, as Malay villagers migrated to the cities, the proportion of Malay poor has likewise increased.