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Globalization of Malaysian Economy – With Special Focus on the Role of Growth Enclaves

Author

Listed:
  • Khondaker Mizanur Rahman

    (School of Business, Nanzan University, Japan)

  • Rafiuddin Ahmed

    (School of Business, James Cook University, Australia)

Abstract

This paper examines the process of the globalization of Malaysia, a country that has developed over four decades to become one of the top three globalized nations of Asia, after Singapore and Israel. Initially, its enormous primary resources supplied it with a comparative advantage. It pursued an export-oriented economic policy that attracted multinational company (MNC) foreign direct investment (FDI), and modern technology. Subsequently, industrial products from Malaysia made inroads into world markets. This was followed by the establishment of growth enclaves throughout the country and the offer of generous incentives to investors, particularly to MNCs. A further source of FDI was the various bilateral and multilateral investment agreements made with major investing countries. Similar agreements on trade and tariffs helped Malaysia to expand in industrial and primary product markets all over the world. All these efforts at industrial and economic development received further impetus from Malaysia’s increasing interests in joining regional, continental, and multinational trade, security, and economic blocs and forums. Malaysia entered into Economic Partnership Agreements (EPA) with a number of countries, which has further strengthened its trade and investment globalization. Underlying these agreements and partnerships has been a proliferation of economic development and modernization programs, plans, policies, and strategies from all Malaysia’s national and state administrative agencies and authorities. With a view to achieving a balanced and sustained national development, it formulated plans for all sectors of the economy that complemented a broad national development plan. The national Vision 2020 is for an all-encompassing development ranging from the social and ethnic to law and order issues, education, science and technology, industrialization, tele-communication, digitalization, and many other known and perceivable dimensions of development and modernization.

Suggested Citation

  • Khondaker Mizanur Rahman & Rafiuddin Ahmed, 2014. "Globalization of Malaysian Economy – With Special Focus on the Role of Growth Enclaves," International Journal of Economics and Empirical Research (IJEER), The Economics and Social Development Organization (TESDO), vol. 2(7), pages 274-287, July.
    • Handle: RePEc:ijr:journl:v:2:y:2014:i:7:p:274-287
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    References listed on IDEAS

    as
    1. Jayanthakumaran, Kankesu, 2002. "An Overview of Export Processing Zones: Selected Asian Countries," Economics Working Papers wp02-03, School of Economics, University of Wollongong, NSW, Australia.
    2. repec:ilo:ilowps:462479 is not listed on IDEAS
    3. Raymond Vernon, 1966. "International Investment and International Trade in the Product Cycle," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 80(2), pages 190-207.
    4. Warr, Peter G, 1989. "Export Processing Zones: The Economics of Enclave Manufacturing," The World Bank Research Observer, World Bank, vol. 4(1), pages 65-88, January.
    5. Madani, Dorsati, 1999. "A review of the role and impact of export processing zones," Policy Research Working Paper Series 2238, The World Bank.
    6. R. W. Jones, 1956. "Factor Proportions and the Heckscher-Ohlin Theorem," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 24(1), pages 1-10.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Foreign trade; free trade zones (FTZ); globalization; Malaysia;
    All these keywords.

    JEL classification:

    • P45 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - International Linkages

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