Malaysia vs. Thailand

The adoption of Islam in the 14th century saw the rise of a number of powerful sultanates on the Malay Peninsula and island of Borneo. The Portuguese in the 16^th century and the Dutch in the 17^th century were the first European colonial powers to establish themselves on the Malay Peninsula and Southeast Asia. However, it was the British who ultimately secured their hegemony across the territory and during the late 18th and 19th centuries established colonies and protectorates in the area that is now Malaysia. These holdings were occupied by Japan from 1942 to 1945. In 1948, the British-ruled territories on the Malay Peninsula except Singapore formed the Federation of Malaya, which became independent in 1957. Malaysia was formed in 1963 when the former British colonies of Singapore, as well as Sabah and Sarawak on the northern coast of Borneo, joined the Federation. The first several years of the country's independence were marred by a communist insurgency, Indonesian confrontation with Malaysia, Philippine claims to Sabah, and Singapore's withdrawal in 1965. During the 22-year term of Prime Minister MAHATHIR Mohamad (1981-2003), Malaysia was successful in diversifying its economy from dependence on exports of raw materials to the development of manufacturing, services, and tourism. Prime Minister MAHATHIR and a newly-formed coalition of opposition parties defeated Prime Minister Mohamed NAJIB bin Abdul Razak's United Malays National Organization (UMNO) in May 2018, ending over 60 years of uninterrupted rule by UMNO. MAHATHIR resigned in February 2020 amid a political dispute. King ABDULLAH then selected Tan Sri MUHYIDDIN Yassin as the new prime minister.

A unified Thai kingdom was established in the mid-14th century. Known as Siam until 1939, Thailand is the only Southeast Asian country never to have been colonized by a European power. A bloodless revolution in 1932 led to the establishment of a constitutional monarchy. After the Japanese invaded Thailand in 1941, the government split into a pro-Japan faction and a pro-Ally faction backed by the King. Following the war, Thailand became a US treaty ally in 1954 after sending troops to Korea and later fighting alongside the US in Vietnam. Thailand since 2005 has experienced several rounds of political turmoil including a military coup in 2006 that ousted then Prime Minister THAKSIN Chinnawat, followed by large-scale street protests by competing political factions in 2008, 2009, and 2010. THAKSIN's youngest sister, YINGLAK Chinnawat, in 2011 led the Puea Thai Party to an electoral win and assumed control of the government.

In early May 2014, after months of large-scale anti-government protests in Bangkok beginning in November 2013, YINGLAK was removed from office by the Constitutional Court and in late May 2014 the Royal Thai Army, led by Royal Thai Army Gen. PRAYUT Chan-ocha, staged a coup against the caretaker government. PRAYUT was appointed prime minister in August 2014. PRAYUT also serves as the head of the National Council for Peace and Order (NCPO), a military-affiliated body that oversees the interim government. This body created several interim institutions to promote reform and draft a new constitution, which was passed in a national referendum in August 2016. In late 2017, PRAYUT announced elections would be held by November 2018; he has subsequently suggested they might occur in February 2019. As of mid-December 2018, a previoulsy held ban on campaigning and political activity has been lifted and per parliamentary laws, an election must be held within 150 days. King PHUMIPHON Adunyadet passed away in October 2016 after 70 years on the throne; his only son, WACHIRALONGKON Bodinthrathepphayawarangkun, ascended the throne in December 2016. He signed the new constitution in April 2017. Thailand has also experienced violence associated with the ethno-nationalist insurgency in its southern Malay-Muslim majority provinces. Since January 2004, thousands have been killed and wounded in the insurgency.

Malaysia's multi-ethnic population consists of the bumiputera - Malays and other indigenous peoples - (62%), ethnic Chinese (21%), ethnic Indians (6%), and foreigners (10%).  The majority of Malaysia's ethnic Chinese and Indians trace their roots to the British colonialists' recruitment of hundreds of thousands of Chinese and Indians as mine and plantation workers between the early-19^th century and the 1930s.  Most Malays have maintained their rural lifestyle, while the entrepreneurial Chinese have achieved greater wealth and economic dominance.  In order to eradicate Malay poverty, the Malaysian Government in 1971 adopted policies that gave preference to the bumiputera in public university admissions, government jobs and contracts, and property ownership.  Affirmative action continues to benefit well-off urban bumiputera but has done little to alleviate poverty for their more numerous rural counterparts.  The policies have pushed ethnic Chinese and Indians to study at private or foreign universities (many do not return) and have created and sustained one of the world's largest civil services, which is 85-90% Malay. 

The country's age structure has changed significantly since the 1960s, as fertility and mortality rates have declined.  Malaysia's total fertility rate (TFR) has dropped from 5 children per woman in 1970, to 3 in 1998, to 2.1 in 2015 as a result of increased educational attainment and labor participation among women, later marriages, increased use of contraception, and changes in family size preference related to urbanization.  The TFR is higher among Malays, rural residents (who are mainly Malay), the poor, and the less-educated.  Despite the reduced fertility rate, Malaysia's population will continue to grow, albeit at a decreasing rate, for the next few decades because of its large number of reproductive-age women.  The youth population has been shrinking, and the working-age population (15-64 year olds) has been growing steadily.  Malaysia's labor market has successfully absorbed the increasing number of job seekers, leading to sustained economic growth.  However, the favorable age structure is changing, and around 2020, Malaysia will start to become a rapidly aging society.  As the population ages, Malaysia will need to better educate and train its labor force, raise productivity, and continue to increase the number of women workers in order to further develop its economy.

More than 1.8 million Malaysians lived abroad as of 2015, including anywhere from 350,000 to 785,000 workers, more than half of whom have an advanced level of education.  The vast majority of emigrants are ethnic Chinese, seeking better educational and job opportunities abroad because of institutionalized ethnic discrimination favoring the Malays.  The primary destination country is nearby Singapore, followed by Bangladesh and Australia.  Hundreds of thousands of Malaysians also commute across the causeway to Singapore daily for work.

Brain drain is an impediment to Malaysia's goal of becoming a high-income country.  The situation is compounded by a migrant inflow that is composed almost entirely of low-skilled laborers who work mainly in manufacturing, agriculture, and construction.  Officially, Malaysia had about 1.8 million legal foreign workers as of mid-year 2017 - largely from Indonesia, Nepal, the Philippines, and Bangladesh - but as many as 3 to 4 million are estimated to be in the country illegally.  Immigrants outnumber ethnic Indians and could supplant the ethnic Chinese as Malaysia's second largest population group around 2035.

Thailand has experienced a substantial fertility decline since the 1960s largely due to the nationwide success of its voluntary family planning program.  In just one generation, the total fertility rate (TFR) shrank from 6.5 children per woman in 1960s to below the replacement level of 2.1 in the late 1980s.  Reduced fertility occurred among all segments of the Thai population, despite disparities between urban and rural areas in terms of income, education, and access to public services.  The country's "reproductive revolution" gained momentum in the 1970s as a result of the government's launch of an official population policy to reduce population growth, the introduction of new forms of birth control, and the assistance of foreign non-government organizations.  Contraceptive use rapidly increased as new ways were developed to deliver family planning services to Thailand's then overwhelmingly rural population.  The contraceptive prevalence rate increased from just 14% in 1970 to 58% in 1981 and has remained about 80% since 2000. 

Thailand's receptiveness to family planning reflects the predominant faith, Theravada Buddhism, which emphasizes individualism, personal responsibility, and independent decision-making.  Thai women have more independence and a higher status than women in many other developing countries and are not usually pressured by their husbands or other family members about family planning decisions.  Thailand's relatively egalitarian society also does not have the son preference found in a number of other Asian countries; most Thai ideally want one child of each sex.

Because of its low fertility rate, increasing life expectancy, and growing elderly population, Thailand has become an aging society that will face growing labor shortages.  The proportion of the population under 15 years of age has shrunk dramatically, the proportion of working-age individuals has peaked and is starting to decrease, and the proportion of elderly is growing rapidly.  In the short-term, Thailand will have to improve educational quality to increase the productivity of its workforce and to compete globally in skills-based industries.  An increasing reliance on migrant workers will be necessary to mitigate labor shortfalls.

Thailand is a destination, transit, and source country for migrants. It has 3-4 million migrant workers as of 2017, mainly providing low-skilled labor in the construction, agriculture, manufacturing, services, and fishing and seafood processing sectors.  Migrant workers from other Southeast Asian countries with lower wages - primarily Burma and, to a lesser extent, Laos and Cambodia - have been coming to Thailand for decades to work in labor-intensive industries.  Many are undocumented and are vulnerable to human trafficking for forced labor, especially in the fisheries industry, or sexual exploitation.  A July 2017 migrant worker law stiffening fines on undocumented workers and their employers, prompted tens of thousands of migrants to go home.  Fearing a labor shortage, the Thai Government has postponed implementation of the law until January 2018 and is rapidly registering workers.  Thailand has also hosted ethnic minority refugees from Burma for more than 30 years; as of 2016, approximately 105,000 mainly Karen refugees from Burma were living in nine camps along the Thailand-Burma border.

Thailand has a significant amount of internal migration, most often from rural areas to urban centers, where there are more job opportunities.  Low- and semi-skilled Thais also go abroad to work, mainly in Asia and a smaller number in the Middle East and Africa, primarily to more economically developed countries where they can earn higher wages.

New - Fighters of the Nation Party (Parti Pejuang Tanah Air) or Pejuang [former PM MAHATHIR bin Mohamad; interim president Datuk Seri Mukhriz Mahathir note - started August 2020] 

Other:
Pan-Malaysian Islamic Party (Parti Islam se Malaysia) or PAS [Abdul HADI Awang]
Progressive Democratic Party or PDP [TIONG King Sing]
Sabah Heritage Party (Parti Warisan Sabah) or WARISAN [SHAFIE Apdal]
Sarawak Parties Alliance (Gabungan Parti Sarawak) or GPS [ABANG JOHARI Openg] (includes PBB, SUPP, PRS, PDP)
Sarawak People's Party (Parti Rakyat Sarawak) or PRS [James MASING]
Sarawak United People's Party (Parti Bersatu Rakyat Sarawak) or SUPP [Dr. SIM Kui Hian]
United Pasokmomogun Kadazandusun Murut Organization (Pertubuhan Pasko Momogun Kadazan Dusun Bersatu) or UPKO [Wilfred Madius TANGAU]
United Sabah Alliance or USA (Gabungan Sabah)
United Sabah Party (Parti Bersatu Sabah) or PBS [Maximus ONGKILI]
United Sabah People's (Party Parti Bersatu Rakyat Sabah) or PBRS [Joseph KURUP]
United Traditional Bumiputera Party (Parti Pesaka Bumiputera Bersata) or PBB; note - PBB is listed under GPS above

Malaysia, an upper middle-income country, has transformed itself since the 1970s from a producer of raw materials into a multi-sector economy. Under current Prime Minister NAJIB, Malaysia is attempting to achieve high-income status by 2020 and to move further up the value-added production chain by attracting investments in high technology, knowledge-based industries and services. NAJIB's Economic Transformation Program is a series of projects and policy measures intended to accelerate the country's economic growth. The government has also taken steps to liberalize some services sub-sectors. Malaysia is vulnerable to a fall in world commodity prices or a general slowdown in global economic activity.

The NAJIB administration is continuing efforts to boost domestic demand and reduce the economy's dependence on exports. Domestic demand continues to anchor economic growth, supported mainly by private consumption, which accounts for 53% of GDP. Nevertheless, exports - particularly of electronics, oil and gas, and palm oil - remain a significant driver of the economy. In 2015, gross exports of goods and services were equivalent to 73% of GDP. The oil and gas sector supplied about 22% of government revenue in 2015, down significantly from prior years amid a decline in commodity prices and diversification of government revenues. Malaysia has embarked on a fiscal reform program aimed at achieving a balanced budget by 2020, including rationalization of subsidies and the 2015 introduction of a 6% value added tax. Sustained low commodity prices throughout the period not only strained government finances, but also shrunk Malaysia's current account surplus and weighed heavily on the Malaysian ringgit, which was among the region's worst performing currencies during 2013-17. The ringgit hit new lows following the US presidential election amid a broader selloff of emerging market assets.

Bank Negara Malaysia (the central bank) maintains adequate foreign exchange reserves; a well-developed regulatory regime has limited Malaysia's exposure to riskier financial instruments, although it remains vulnerable to volatile global capital flows. In order to increase Malaysia's competitiveness, Prime Minister NAJIB raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but retreated in 2013 after he encountered significant opposition from Malay nationalists and other vested interests. In September 2013 NAJIB launched the new Bumiputra Economic Empowerment Program, policies that favor and advance the economic condition of ethnic Malays.

Malaysia signed the 12-nation Trans-Pacific Partnership (TPP) free trade agreement in February 2016, although the future of the TPP remains unclear following the US withdrawal from the agreement. Along with nine other ASEAN members, Malaysia established the ASEAN Economic Community in 2015, which aims to advance regional economic integration.

With a relatively well-developed infrastructure, a free-enterprise economy, and generally pro-investment policies, Thailand is highly dependent on international trade, with exports accounting for about two thirds of GDP. Thailand's exports include electronics, agricultural commodities, automobiles and parts, and processed foods. The industry and service sectors produce about 90% of GDP. The agricultural sector, comprised mostly of small-scale farms, contributes only 10% of GDP but employs about one third of the labor force. Thailand has attracted an estimated 3.0-4.5 million migrant workers, mostly from neighboring countries.

Over the last few decades, Thailand has reduced poverty substantially. In 2013, the Thai Government implemented a nationwide 300 baht (roughly $10) per day minimum wage policy and deployed new tax reforms designed to lower rates on middle-income earners.

Thailand's economy is recovering from slow growth during the years since the 2014 coup. Thailand's economic fundamentals are sound, with low inflation, low unemployment, and reasonable public and external debt levels. Tourism and government spending - mostly on infrastructure and short-term stimulus measures - have helped to boost the economy, and The Bank of Thailand has been supportive, with several interest rate reductions.

Over the longer-term, household debt levels, political uncertainty, and an aging population pose risks to growth.

one of the most advanced telecom networks in the developing world; strong commitment to developing a technological society; Malaysia is promoting itself as an information tech hub in the Asian region; closing the urban rural divide; 4G and 5G networks with strong competition, mobile dominance over fixed-broadband; government development of five-year fiber and connectivity plan; some of Malaysia's key exports are integrated circuits and broadcasting equipment to North America and China; importer of integrated circuits from Singapore and China (2021)

high-quality system, especially in urban areas; mobile and mobile broadband penetration are on the increase; FttH has strong growth in cities; 4G-LTE available with adoption of 5G services; seven smart cities with aim for 100 smart cities by 2024; one of the biggest e-commerce markets in Southeast Asia; fixed-broadband and mobile marketplace on par with other developed Asian markets; development of Asian data center underway; Internet connectivity supported by international bandwidth to Singapore, Malaysia, and Hong Kong, and terrestrial cables with neighboring countries; two more submarine cables under construction with anticipated landings in 2022; government restricts Internet and freedom of press, with additional constraints in response to pandemic-related criticism in 2020; importer of broadcasting equipment and integrated circuits from China and export of same to neighboring countries in Asia (2021)

while the 2002 "Declaration on the Conduct of Parties in the South China Sea" has eased tensions over the Spratly Islands, it is not the legally binding "code of conduct" sought by some parties, which is currently being negotiated between China and ASEAN; Malaysia was not party to the March 2005 joint accord among the national oil companies of China, the Philippines, and Vietnam on conducting marine seismic activities in the Spratly Islands; disputes continue over deliveries of fresh water to Singapore, Singapore's land reclamation, bridge construction, and maritime boundaries in the Johor and Singapore Straits; in 2008, ICJ awarded sovereignty of Pedra Branca (Pulau Batu Puteh/Horsburgh Island) to Singapore, and Middle Rocks to Malaysia, but did not rule on maritime regimes, boundaries, or disposition of South Ledge; land and maritime negotiations with Indonesia are ongoing, and disputed areas include the controversial Tanjung Datu and Camar Wulan border area in Borneo and the maritime boundary in the Ambalat oil block in the Celebes Sea; separatist violence in Thailand's predominantly Muslim southern provinces prompts measures to close and monitor border with Malaysia to stem terrorist activities; Philippines retains a dormant claim to Malaysia's Sabah State in northern Borneo; per Letters of Exchange signed in 2009, Malaysia in 2010 ceded two hydrocarbon concession blocks to Brunei in exchange for Brunei's sultan dropping claims to the Limbang corridor, which divides Brunei; piracy remains a problem in the Malacca Strait

separatist violence in Thailand's predominantly Malay-Muslim southern provinces prompt border closures and controls with Malaysia to stem insurgent activities; Southeast Asian states have enhanced border surveillance to check the spread of avian flu; talks continue on completion of demarcation with Laos but disputes remain over several islands in the Mekong River; despite continuing border committee talks, Thailand must deal with Karen and other ethnic rebels, refugees, and illegal cross-border activities; Cambodia and Thailand dispute sections of boundary; in 2011, Thailand and Cambodia resorted to arms in the dispute over the location of the boundary on the precipice surmounted by Preah Vihear temple ruins, awarded to Cambodia by ICJ decision in 1962 and part of a planned UN World Heritage site; Thailand is studying the feasibility of jointly constructing the Hatgyi Dam on the Salween river near the border with Burma; in 2004, international environmentalist pressure prompted China to halt construction of 13 dams on the Salween River that flows through China, Burma, and Thailand; approximately 100,000 mostly Karen refugees fleeing civil strife, political upheaval and economic stagnation in Burma live in remote camps in Thailand near the border