World City Guide

Business

Business Profile
After gaining independence in 1957, Malaysia and its capital city enjoyed decades of impressive growth, which was accompanied by a rapid transformation from a largely rural-based system into a progressive urban-based economy. The main industries today are petroleum oil production, forestry, manufacturing and palm oil production. Palm oil generated around 40% more export revenue in 2003 than it did in 2002 and Malaysia is the world’s largest producer.

The tourism and hi-tech industries have also come to the fore over the last decade and this will be a key focus of the economy with the continuing emergence of the Cyberjaya area. The 1997 regional recession, however, did hit Malaysia hard and many sectors of the economy are still recovering. As the national currency (the Ringgit) devalued, GNP fell to around - 7%. In Kuala Lumpur, major transport developments like the Express Rail Link (ERL), Sentral Station and the Monorail were put on hold.

Astute fiscal management has brought the country back on track quicker than many analysts expected. Although the economy is not expected to experience the same high levels of growth that it did in the heady pre-1997 days, it has weathered the storm and now seems to be working to more stable and realistic targets. Industry continues to be the main employer in Kuala Lumpur and the city’s unemployment rate at 3.9% in August 2003 is much the same as the country’s, which stood at 4.1% in August 2003. The massive Multimedia Super Corridor (MSC) development (part of former Prime Minister Dr Mahathir Mohamad’s Vision 2020) continues amid a series of delays and downsizing. Managed by the government-appointed Multimedia Development Corporation (website: www.mdc.com.my), this project’s ambitious goals are to attract the world’s leading multimedia organisations to a 15-kilometre wide and 50-kilometre long Multimedia Super Corridor, stretching from Kuala Lumpur City Centre to Kuala Lumpur International Airport. This would effectively place Malaysia and indeed the city at the forefront of technological excellence, innovation and research.

The worldwide downturn in the technology industry has left the MSC’s future uncertain, with many analysts suggesting a delayed implementation of the 20-year plan at best and a considerable downscaling at worst, though finally buildings are appearing and companies such as Ericsson are moving in. The post-Bali hysteria, which cut tourist numbers in the wake of the bombings, has died down, and, barring any further terrorist attacks in the region, Islamic terrorism may not emerge as the major threat to the increasingly important tourist industry that it appeared back in the dark days of October 2002. With Prime Minister Dr Mahathir finally retired, much of Malaysia and KL’s future economic fortunes will depend on the new balance of power and whether Abdullah Badawi can fill the big boots of the man who has led the country for so long.

The main business district in Kuala Lumpur is KLCC, which stands for Kuala Lumpur City Centre. The area around KLCC and Jalan Bukit Bintang, where many of the expensive five-star hotels and shopping malls are located, is collectively called ‘The Golden Triangle’. The development of Putrajaya, a purpose built administration centre on the way to the airport, continues apace though it will not replace the business and commercial functions of the KLCC, only many of the government and administrative roles. Petronas is the biggest company in the country, concentrating mainly in oil and related industries but increasingly diversifying into other sectors. Big domestic players are Bank Negara and Maybank in finance, and Gamuda, Ekovest and YTL in construction. Major international companies with a presence in Kuala Lumpur include Nestl, Carlsberg and Guinness. There are internet cafs dotted all over the city as well as email and web facilities in most four and five star hotels.

Business Etiquette
All business meetings, however informal, would be conducted at the office or in neutral venues such as restaurants. Business office hours are usually 0900-1700 Monday to Friday, although government departments tend to close earlier.

Despite the high humidity levels, suit and tie is the norm for men and smart dress for women, although concessions are usually made for visiting foreign businesspeople unused to the tropical conditions. English is the main business language in Kuala Lumpur, with most businesspeople (at all levels and in companies of all sizes) at least competent in English. Any attempts to use a few Bahasa Malaysian conversational words are greatly appreciated and can break the ice quickly. One key aspect to remember is that it is considered inappropriate to use the left hand for handshakes or handing over documents, as this is traditionally used for cleaning after toilet use. Business cards are also an essential prerequisite to any business meeting, no matter how informal, and should be handed over with both hands.

Malaysians are quite conservative when it comes to business and clients are not often invited home. As Malaysia is a Muslim country, many local businessmen and women will not drink alcohol during lunch or dinner meetings. However, it is acceptable for non-Muslims to do so, in moderation. It is also important for visitors to be careful when choosing gifts, as obvious things like spirit or wine are a definite non-starter and less obvious gifts like watches, associated with death by many ethnic Chinese, might also offend.