Sultan Nazrin Shah launched his book charting the economy: early 20th century Malaya and contemporary Malaysian contrasts at The St Regis Kuala Lumpur on 17 January 2017 - Announcements

Charting the Economy

Sultan Nazrin Shah launched his book Charting the Economy: Early 20th Century Malaya and Contemporary Malaysian Contrasts at The St Regis Kuala Lumpur on 17 January 2017.

Charting the Economy assesses the course of Malaya’s commodity-dependent economy during the first 40 years of the 20th century under British colonial control, contrasting it with economic growth and development in contemporary Malaysia.

Drawing on archival documents to derive estimates of Malaya’s GDP and analysing trends, it breaks new ground in understanding the dynamics of economic performance.

In the first half of the 20th century, most of the Malay Peninsula, like much of Southeast Asia, was under colonial rule. Colonialism facilitated the control of lands, institutions and peoples, as well as the exploitation of natural resources.

Malaya’s economy was largely agrarian, supported by two primary commodity pillars—tin and rubber—produced to meet the needs of the industries and people in Europe and North America.

Sultan Nazrin Shah eloquently articulates how the economy rode a commodity roller-coaster. Being small and open, it was exceedingly vulnerable to external shocks—World War I 1914–1918, the Roaring Twenties 1920–1929, and the Great Depression 1929–1932—which were the main causes of economic booms and busts.

This book makes a compelling case that the colonial laissez-faire economic system worked well for the agency houses that repatriated huge profits but paid small dividends to the masses. Development was highly uneven, with growth and prosperity concentrated in and benefitting the Peninsula’s west coast states, where most of the tin mines and rubber plantations were located.

After independence, national control over economic management was accompanied by a long-term vision for a socially just nation. Real GDP growth in post-independence Malaysia brought rapid advances in standards of living.

Review

Malaysia today is one of the world’s most successful developing economies with the potential to progress to high income status. How Malaysia achieved this success, a process that began over a century ago, is not well known.

This book by Sultan Nazrin Shah is a pioneering work that explains this history in depth, from an economy based on the growth of rubber and tin exports to a major producer and exporter of manufactures. The analysis is based on a unique reconstruction of the country’s economic performance. It is a major contribution to our understanding of world economic history as well as to our greater understanding of Malaysia.”

Dwight H. Perkins
Harvard University
Malaysia’s economic progress since World War II has been the best in Southeast Asia among those countries with significant rural populations. This progress was accomplished despite extraordinary dependence in the early part on two commodity exports— tin and rubber—and the severe volatility that was caused by such dependence.

This carefully researched volume by Sultan Nazrin Shah, based initially on his Harvard PhD dissertation but now substantially updated and broadened, contrasts the British colonial management of Malaya’s commodity-based economy with the much more diversified and increasingly stable economy of post-independence Malaysia. If any reader wants to know why economic history is relevant, this book provides a very clear answer.”

C. Peter Timmer
Harvard University
The economic impact of colonialism is a highly charged question, requiring country- specific investigation based on careful analysis of sound statistics. This scholarly study centres on its pioneering construction of national income figures for Malaya from 1900 to 1939. These figures not only delineate what happened in a country heavily dependent on two volatile export industries, but also permit illuminating comparisons. Further, they enable us to appreciate the achievements of the economy since Malaysian independence.

Methodological enthusiasts will focus on the construction of the national income figures; but those with wider interests in Malaysia or development economics will also be sure to enjoy important issues discussed with clarity and calm judgement.”

Richard G. Smethurst
University of Oxford
Carefully researched, innovative in methodology, measured in tone—a tough assessment of colonial economic management. Under the British, the Malayan economy expanded rapidly but the lives of the people improved only slightly.

Modern Malaysia has faced great difficulties—but it is the post-independence national governments, not the laissez-faire colonial administration, which lifted standards of living, promoted economic stability and reduced dangerous inequalities.”

Anthony Milner
Australian National University