Mapping Malaysia's Resource Centres

02 Malaysia is one of the fastest growing economies in the Southeast Asian region, with a GDP growth year-on-year of over 4%. The Malaysian agricultural sector is supported by the country’s tropical climate and the availability of fertile soil that allows for the production of various agriculture commodities. Increasing per capita incomes and rising consumer spending is driving the growth of this sector. The country benefits from Free Trade Agreements (FTAs) with the ASEAN Economic Community (AEC) which enables the free flow of exports and investments. Agriculture has been key to Malaysia’s economic development, and the agriculture sector contributes approximately 7.5% to Malaysia’s GDP. The country is also undergoing various economic partnerships and is working to reduce or eliminate tariffs on agricultural and industrial products, especially with Chile, India, Japan and Pakistan. Palm oil (38.55%) is the major contributor to the agricultural sector’s GDP, followed by livestock (14.64%), fishing (12.71%), rubber (7.14%), forest and logging (2.66%), and others. Other prominent agriculture activities include the cultivation of paddy, fruits and vegetables. Commercial crops such as palm oil, rubber and cocoa are primarily grown by large companies while food crops are largely grown by smallholders. The Malaysian government provides a range of measures to support domestic agricultural producers including price support to crops, fertiliser subsidies, Research and Development (R&D) and marketing support, amongst others. Malaysia promotes the export of some products through tax or export duty exemptions; notably for processed palm oil. To encourage productivity increases, tax deductions and other incentives for companies applying bio-technology or investing in R&D have been made available. Institutions that are established to spearhead research and development in agricultural- related sector in Malaysia are Malaysian Agricultural Research Development Institute (MARDI), Rubber Research Institute of Malaysia (RRI), Malaysian Palm Oil Board (MPOB), Fisheries Research Institute of Malaysia (FRI) and local universities. Agriculture and R&D