Malaysia In The 1990s Case Analysis
A Western ban on timber may not hurt the country’s economy terribly in the beginning, since the primary focus for raw material exportation remains Japan and other Asian countries.
However, the future of the country’s economy depends on maintaining relationships with Western countries for investment and trade of finished goods. The continued destruction of the rainforests ensures that the economic future and the political stability of the country will take a turn for the worse.
A Western ban would also hurt the country’s reputation. There would be less interest from the US and Europe to invest in Malaysia.
There is a divide between Western Malaysia and Eastern Malaysia. The primary exports to Western countries come from finished goods out of Western Malaysia, whereas in Eastern Malaysia (Sarawak and Sabah) they primarily export raw materials to the Eastern world. 4. What is your hypothesis?
The Prime Minister has a few choices: * The Malaysian government rejects criticism and threats of the Western government and environmentalists, making no changes to current policies but keeping a close eye on fixing some of the problems, particularly in Eastern …show more content…
However, there is restricted entry into the market making it difficult for new industries to develop these products. The other issue is that despite incentives, it is more financially lucrative for Sarawak and Sabah to export raw materials. * In the 1980s and 1990s Sarawak has enjoyed high rates of growth in household income which correlates to the rates of growth in exports of lumber to Japan * Western Malaysia has a handle on exports of tropical timber. In 1985 the Malaysian government banned the export of unprocessed logs from peninsular Malaysia to encourage the domestic processing of wood. The problem lies in the ability for the Prime Minister to control the state run forests of Sarawak and Sabah. The government fully admits that the current rate of logging is unsustainable for an extended period of time. * The NEP is an interesting component to the government’s economic policy. Although it has produced its intended results economically, there is a risk of corruption. The prime minister should keep a watchful eye on