IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Trade, Exchange Rate And Agricultural Policies In Malaysia

Listed author(s):
  • Glenn Jenkins


    (Queen's University, Kingston, On, Canada)

  • Andrew Lai

Malaysia, a country of approximately 16 million people which gained independence in 1957, relied heavily on trade to achieve substantial growth in GNP during the 1960s (6.7 percent per year) and 1970s (10.5 percent per year). In the period 1980-83, however, the rate slipped to 3.1 percent per year. Malaysia’s traditional exports are natural rubber and palm oil, but in the 1970s the country also became an important exporter of crude oil. During the study period (1960-83) government intervention through the taxation of natural rubber and palm oil has made the cultivation of these two products less profitable for farmers while also reducing foreign exchange earnings. At the same time, the government organized a research and replanting system for these crops that has dramatically increased their average yield, and as a consequence, farmers’ income. In contrast to its policies for natural rubber and palm oil, Malaysia steadily intervened in the price of rice during the study period to improve producer prices. Self sufficiency in rice-production has long being a goal, but one that has never been achieved, even though per capital consumption fell from 140 kg in 1960 to 104 kg in 1983. Direct intervention in rice prices has taken the form of a guaranteed minimum price which was raised substantially in the late 1970s. Agricultural pricing policies in Malaysia have been remarkably stable over time. They have ensured that the price of paddy relative to nonagricultural prices has increased slightly over time, while maintaining the real income of rubber and palm oil farmers through increases in productivity. Although the potential for political instability is always present in this ethnically diverse country, the government’s agricultural policies have helped to maintain a level of political stability that has allowed the economy to flourish.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by JDI Executive Programs in its series Development Discussion Papers with number 1989-04.

in new window

Length: 436 pages
Date of creation: Aug 1989
Handle: RePEc:qed:dpaper:81
Contact details of provider: Postal:
Kingston, Ontario, K7L 3N6

Phone: (613) 533-2250
Fax: (613) 533-6668
Web page:

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:qed:dpaper:81. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Bahman Kashi)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.