Opening of World Bank office in Kuala Lumpur has practical and symbolic importance
Over the past 60 years, Malaysia has transformed from being an international aid recipient, with high levels of poverty, to one of Southeast Asia's leading economies and a mentor for other developing nations.
Recently, however, Malaysia has encountered economic turbulence, but its international importance is demonstrated practically and symbolically by plans to open a new World Bank office in the country's capital, Kuala Lumpur.
The World Bank Group Office in Malaysia will be an operational hub where the country's rich development experiences will be shared with developing countries around the world. In addition, Malaysia will have access to international knowledge and expertise to help it transition into an advanced, high-income economy.
Housed in Sasana Kijang - Malaysia's centre of excellence in knowledge and learning in central banking and financial services, which was set up by Bank Negara - the office will carry out innovative development policy research and analytical work on regional and global issues, including assessments of business and investment across countries.
After signing the agreement to set up the office, Johari Abdul Ghani, Malaysia's deputy minister of finance, said: "Malaysia is globally recognised for its progress and achievements in economic planning and development, poverty reduction, provision of modern financial services, as well as public sector performance. We look forward to working closely with the World Bank Group to use this experience to benefit other countries."
Malaysia is one of 13 countries identified by the World Bank to have recorded average growth of more than 7 per cent per year for 25 years or more. Economic growth was inclusive, as Malaysia succeeded in nearly eradicating poverty, with the share of households living below the national poverty line falling from over 50 per cent in the 1960s to below 1 per cent today.
Economic development has been particularly rapid during the early years of the 21st century. Life expectancy in Malaysia has risen to 75, and Gross National Income (GNI) per capita almost doubled over eight years, from US$5,830 in 2006 to US$10,760 in 2014, World Bank figures show. Today, Malaysian GNI per capita is almost twice that of East Asia and Pacific emerging economies as a whole.
Classified as an upper middle-income country by the World Bank, Malaysia is the third largest economy in the Association of Southeast Asian Nations (Asean), with a GDP of US$326.9 billion in 2014.
Malaysia was placed 18th in the World Bank's Doing Business 2016 report of 189 global economies. The country was strong in several areas, such as starting a business and getting electricity, and was placed fourth best country in the world for protecting minority investors from corporate abuse.
Building on decades of rapid development, and despite a challenging global economic environment, Malaysia's government is confident it can attain its declared goal of achieving high-income country status by 2020.
"Malaysia is a remarkable success story that many developing countries look to for inspiration," says World Bank country director Ulrich Zachau. "The new World Bank Group office will allow Malaysia and the World Bank Group to work closely as partners to share Malaysia's extensive expertise and experience in building prosperity and reducing poverty with countries around the world."
Malaysia's importance as a regional economic power is also reflected in it chairing Asean, where it has taken a pivotal role in coordinating efforts to bring about regional integration in the US$600 billion Asean Economic Community, during 2015. And, in 2014, Malaysia became a full partner and contributor to the International Development Association, the World Bank's fund for the poorest nations.
The development of Malaysia as a financial centre features high among the government's list of priorities as part of its transition into an advanced economy. The country's central bank, Bank Negara Malaysia, is midway through implementing the Financial Sector Blueprint for 2011/2020, which aims to develop a "financial ecosystem that will best serve a high value-added, high-income Malaysian economy, while also having an increasingly important role in meeting the growing financial needs of emerging Asia", according to its website.