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1. In this chapter, the word Bangkok usually refers to the Bangkok Metropolitan Area (BMA) or to Bangkok Proper, the area administered by the Bangkok Metropolitan Administration or Bangkok City Government. There are five provinces surrounding Bangkok, namely, Samut Prakan, Pathum Thani, Nakhon Pathom, Samut Sakhon, and Nonthaburi. These areas are referred to as the Five Provinces and the Vicinity. Together with the BMA, they have become the Bangkok Metropolitan Region (BMR), or Greater Bangkok. As may be seen later in the chapter, there is now an attempt to enlarge the sphere of benefits and influence of Bangkok even further by including other neighbouring provinces, namely Ayutthaya, Chachoengsao, Sara Buri, Chonburi, and Rayong to form the Extended Bangkok Metropolitan Region (EBMR). Sometimes, when the exact meaning is not critical, the word Bangkok is used to mean the BMR.

2. A sanitary district administration (SDA) is another form of local government that lies between a municipality and a provincial administrative organization (PAO). It lacks the element of local self-government in that its important administrators are not popularly elected by the local people. An SDA is administered by civil servants who are already administering the district office. For example, the head of SDA is the District Officer, and other SDA officials are drawn from other district-level government offices, with only four SDA board members popularly elected from the district.

3. In 1980, the next largest three cities were Chiang Mai, Haadyai, and Khon Kaen. In 1988, they were Nakorn Ratchasima, Haadyai, and Chiang Mail Cities around Bangkok Proper were not counted as they had been integrated into the system of Greater Bangkok City.

4. This section draws heavily upon the data and analyses of Teera (1990) and TDRI (1991).

5. A study by Atchana and Teerana (1989) of the income redistributive effect of the manufacturing exports of Thailand, using the computable general equilibrium (CGE) model, has shown quite conclusively that the increase in the manufacturing exports of Thailand in the past few years has worsened income distribution in the country.

6. For a summary of the assessment of infrastructure investments in these "core" city centres during the Sixth Plan, see Medhi (1990).

7. The research team at TDRI has attempted to measure the aggregate development of all the provincial cities in Thailand, including the BMA, for the purpose of ranking these provincial cities according to an established urban hierarchy. Twenty indicators were set up as measures of urban development, such as per capita GPP, per capita oil and electricity consumption, number of doctors per 1,000 population, and so on, and a system of weights was given to each of these indicators. The sum of these 20 weighted indices shows the potential for further economic and urban development of each city, or how "ready' it is for further growth. The score of Bangkok Metropolis was 177.03, which is much higher than the second-ranked Chonburi (outside the BMR area), which had a score of 48.16, and third-ranked Phuket with a score of 47.28 (see TDRI, Draft Final Report Area 3:Regional Economic Performance and Outcomes, National Urban Development Policy Framework Project, 1991).

8. Banasopit and Phanu (1990:18). Biochemical oxygen demand measures the amount of solid and non-solid waste dumped into the body of water in terms of its effect on the availability of dissolved oxygen. A body of water is anaerobic, that is, without oxygen and unable to support aquatic life, when the quantity of waste is so great that all of the dissolved oxygen in the water is consumed by the biochemical processes associated with breaking down the waste.

9. Water pollution is also caused by leachates from three huge open garbage dump sites in Bangkok. As the city administration is able to treat only about 1,280 tons per day of solid waste out of 4,100 tons collected, about 3,000 tons per day has to be managed by open dumping.

10. Lack of access to piped water and the unreliability and insufficiency of the piped water supply were not the only reasons for industry's heavy reliance on ground water. The lower cost of ground water vis--vis piped water is also a major reason. A survey by the Metropolitan Water Works Authority in 1988 discovered that, of 2,126 operating wells inspected, 1,871 wells (88 per cent) were within the MWA's distribution system. Of these, 1,345 wells (72 per cent) belonged to those who were already MWA's customers or served by MWA's piped water service.

11. These strategies were derived in part from an influential study called the Seventh Plan Urban and Regional Transport (SPURT) study conducted by Halcrow Fox and Associates, Pak-Poy and Kneebone Pty, Ltd., and Asian Engineering Consultants Corp., Ltd. for NESDB.

12. Examples of these cities are: Level 1, every city in BMR, Chiang Mai, Khon Kaen; Level 2, Rayong, Sara Buri, Nakorn Sawan; Level 3, Chachoengsao, Ayutthaya, Udon Thani; Level 4, Lopburi, Nong Khai, Nakorn Sri Thammarat; Level 5, Nakorn Nayok, Narathiwat, Nakorn Phanom; Level 6, Chainat, Chumporn, Sukhothai.

13. The following recommended measures are mainly attributable to the work of Dr. Kraiyudht Dhiratayakinant. See Kraiyndht (1990) and Medhi et al. (1991b).


Atchana Wattananukit and Teerana Bhongmakapat (1989), "The Impact of the External Sector on the Thai Economy and Its Determinants." Paper presented at the TDRI Year-End Conference on Thailand in the International Economic Community, Pattaya.

Banasopit Mekvichai and Phanu Kritiporn (1990), "Urban Environmental Issues." Background Report No. 7-1, National Urban Development Framework (NUDF) Project. Bangkok: Thailand Development Research Institute (TDRI).

Douglass, Mike (1990a), "Urban and Regional Development Policy for the 7th Five-Year Plan in Thailand." Background Report No. 3-1, NUDF Project. Bangkok: TDRI.

_____(1990b), "Regional Inequality and Regional Policy in Thailand: An International Comparative Perspective." Background Report No. 3-3, NUDF Project. Bangkok: TDRI.

Jittapatr, Kruavan (1991), "Patterns and Trends of Employment by Location and Sector." Background Report No. 2-3, NUDF Project. Bangkok: TDRI.

Kraiyudht Dhiratayakinant (1990), "Urban Financing: Existing Situation and Future Alternatives." Background Paper No. 4-1 of the Urban Finance and Resource Mobilization Project, Thailand Development Research Institute.

Medhi Krongkaew (1990), "Review of Investment Expenditures on Infrastructure During the 6th Plan Periods, 1987-1991." Background Report No. 4-2, NUDF Project. Bangkok: TDRI.

Medhi Krongkaew, Vorawoot Hirunrak, and Orathai Arj-um (1987), "A Study on the Urban Poor in Thailand, Phase II." Research Report prepared for the NESDB, Bangkok, Thai Khadi Research Institute, Thammasat University.

Medhi Krongkaew, Pranee Tinakorn, and Suphat Suphachalasai (1991a), "Priority Issues and Policy Measures to Alleviate Rural Poverty: The Case of Thailand." Research Report prepared for the Economics and Development Resource Center, the Asian Development Bank, Manila.

Medhi Krongksew, Kraiyudht Dhiratayakinant, and Varakorn Samakoses (1991b), "Urban Finance and Resource Mobilization in Thailand." Final Report of Area 4 in the National Urban Development Policy Framework Project. Bangkok: TDRI.

Penporn Tirasawat (1990), "Patterns and Trends of Urbanization." Background Report No. 2-1, NUDF Project. Bangkok: TDRI.

Phisit Pakkasem (1988), Leading Issues in Thailand's Development Transformation, 1960-90. Bangkok: NESDB.

Rondinelli, Dennis A. (1991), "Asian Urban Development Policies in 1990s: From Growth Control to Urban Diffusion," World Development 19(7).

Suganya Hutaserani and Somchai Chitsuchon (1988), "Thailand's Income Distribution and Poverty Profile and Their Current Situation." Paper presented at the TDRI Year-End Conference, Pattaya.

TDRI [Thailand Development Research Institute] (1991), "Recommended Development Strategies and Investment Programs for the Seventh Economic and Social Development Plan (1992-96)." Draft Final Report, NUDF Project. Bangkok: TDRI.

Teera Ashakul (1990), "Regional and Provisional Urban and Rural Population Projections." Background Report No. 2-2, NUDF Project. Bangkok: TDRI.

Yongyuth Chalamwong (1990), "Review of Regional Economic Performance: Implications for Urban Development." Background Report No. 3-2, NUDF Project. Bangkok: TDRI.


Emerging urban trends and the globalizing economy in Malaysia

The nature and trends of the national urban system
Macro-population structure and change
The international dimension of economic activities
Economic structural change and urbanization
The impact of internationalism on the Kuala Lumpur Core Urban Region (KLCUR) - The leading mega-city
Policy implications

Lee Boon Thong


Although there is quite a sizeable literature pertaining to urban policies, urbanization, and urban planning in Malaysia, most of it deals with the local, regional, or national perspective, and the international dimensions pertinent to the evolution of the national urban system have been largely ignored.

Over the past three decades (1960-1990), Malaysia has seen a tremendous social and economic transformation. In the 1960s, the initial efforts at import substitution in industrial policy had begun to provoke the movement of people from rural areas to urban centres. In the 1970s, especially with the change in strategy to export-oriented industries, the country enjoyed a comparatively high rate of economic growth even though it was a time when primary commodities were subject to extra-national shocks. The nature of the country's economy had also begun to adjust to a realignment with international dealings as transnational flows of goods, services, capital, labour, and technology expanded quickly. Although the 1980s are often described as a "lost decade" for the developing countries (Karaosmanoglu, 1991), Malaysia had a rapidly industrializing economy. In other words, the many policy adjustments introduced in the 1980s in response to the changing world economy have been successful. However, policy adjustments such as enhancing the role of the private sector in generating economic growth; the privatization of government agencies and selected services; greater emphasis on the development of export-oriented industries and urban growth centres; and the people-prosperity strategy have led to greater urbanization in a few selected nodes, in particular the Kuala Lumpur Core Urban Region (KLCUR) - the main urban settlements in and around the Klang Valley, including its immediate "umbra!" hinterland. The unprecedented growth of KLCUR has important ramifications for other urban areas, the rural areas, as well as the lagging areas, all of which need to be studied in the light of the continued globalization of the Malaysian economy.

It is the intention of this chapter to examine the process of urbanization in Malaysia and analyse how the patterns of internationalization of the economy have led to the further accentuation of existing primal and macrocephalic tendencies in the urban system. Focusing on KLCUR, this chapter highlights the locational predilection of selected global economic activities, their spatial implications, and eventual effect on urban services and infrastructure. The irony of this is that what initially attracted and accelerated the globalization process may eventually erode the competitiveness of these very services and goods, which may then lead to a reduction in labour absorption and unemployment.

The nature and trends of the national urban system

Definition of urban population

The population censuses in Malaysia define "urban" as "gazetted areas" with a minimum population of 10,000. The term "gazetted area" refers to a local administrative unit with clearly defined boundaries (Malaysia, 1983). The 1970 and 1980 censuses also classified urban areas into three categories: "metropolitan," with a population in excess of 75,000; "large town," with a population size of 10,000 and over; and "small town," with a population size of 1,000 to 9,999 persons. "Small towns," however, are excluded from the consideration of urbanization levels. Based on this definition, there are 14 metropolitan areas, and 53 towns with a population of 10,000 to 75,000 (fig. 10.1)

Undoubtedly, there are problems associated with such a methodology and these difficulties have been discussed by Lee (1977) and Aziz Othman (1988). A good example is the reclassification of the local authority areas conducted in 1976. Before 1976, local authority areas were classified into five categories: municipality, town council, town board, local council, and new village. From 1976 onwards, they were reclassified into two categories: municipal council and district council. This regrouping has led to some 12 urban centres with their boundaries extended to incorporate neighbouring local authority areas. For example, in 1972 Kuala Lumpur annexed Jinjang, which had a population of more than 27,000.

Fig. 10.1 Urban centres in Malaysia with a population over 10,000 in 1980

Level of urbanization

From the earliest census available in 1911 until the last published census in 1980, the share of the urban population grew at a much faster rate than the natural rate of increase for Malaysia as a whole. Table 10.1 shows the level of urbanization for Peninsular Malaysia, Sabah, and Sarawak and for the country as a whole. It is clear from the table that the share of the urban population in the total population in Malaysia from 1911 to 1990 has been increasing, from 10.7 per cent in 1911 to 26.6 per cent in 1957, to 34.2 per cent in 1980 and 40.7 per cent in 1990 (Malaysia, 1986). Immediately after World War II, the urban population was just over 1 million. By 1957, it was 1.6 million and continued to grow to about 2.8 million in 1970, 4.75 million in 1980, and 5.91 million in 1985. During the period 1980-1990, the total urban population would have increased by 34.2 per cent to 7.3 million (40.7 per cent) - an increase that is much faster than the growth in the rural population. Peninsular Malaysia continues to be the most urbanized part of the country (37.5 per cent in 1980 and 44.7 per cent in 1990), with Selangor State having the largest urban population in the country.

Table 10.1 The urban population as a percentage of the total population in Malaysia, Peninsular Malaysia, Sabah, and Sarawak, 1911-1990







1911 - 10.7 - -
1921 - 14.1 - -
1931 - 15.1 - -
1947 - 18.9 - -
1957 - 26.6 - -
1970 26.7 28.8 16.5 15.5
1980 34.2 37.5 20.0 17.6
1985 37.4 41.1 22.6 19.2
1990 40.7 44.7 25.6 20.9

Sources: Census reports, 1911 to 1980; Malaysia (1986).

In Sabah, the share of the urban population increased from 16.5 per cent in 1970, to 20.0 per cent in 1980, and to 25.6 per cent in 1990. Its urban population of 205,000 is concentrated in only five urban centres, namely, Kota Kinabalu (59,500), Kudat (10,938), Sandakan (73,114), Tawau (45,249), and Lahad Datu (16,526) (fig. 10.1). The settlement system in Sabah is considered to be at an early stage of development because of poor road networks. The same might be said of Sarawak, where the proportion of urban population increased from 15.5 per cent in 1970, to 17.6 per cent in 1980, and to 20.9 per cent in 1990. Sabah's urbanization level in 1990 was far higher than Sarawak's level (25.6 per cent compared with 20.9 per cent). This may be attributed to the smaller urban population base in the 1960s and the impact of the in-migration of rural youths and young families in the past 20 years (Abdul Samad, 1989).

Rates of urbanization

Three phases of urbanization may be discerned in Malaysia in the past three decades. The first period was immediately after Independence in 1957 until 1970, when the rate of urbanization was rather slow (3.21 per cent per annum compared with 5.84 per cent between 1947 and 1957). This could be partially explained by the fact that the bulk of the Chinese population, having been resettled in new villages after the war, was substantially depleted. This immediate post-Independence period also witnessed the implementation of large land development schemes, which had the effect of redirecting some rural migrants to other rural areas (Lee and Bahrin, 1989).

The second discernible phase was from 1970 to 1980, when there was a resurgence in the rate of urbanization. Between 1970 and 1980, the level of urbanization rose from 26.7 per cent to 34.2 per cent, giving an annual rate of growth of 5.3 per cent, or 2.2 times faster than the national total population growth rate. This upsurge was primarily attributed to the growth in the construction, manufacturing, utilities, and service sectors, which offered increasing job opportunities. Regional development and the establishment of new growth centres also encouraged migration from rural areas (Kok, 1988). To assert that the urbanization rates had increased because of rural-urban migration alone may not be totally correct because other factors, too, such as natural increase, the expansion of the urban boundaries, and the reclassification of smaller centres into the urban spectrum were important (United Nations, 1986a). None the less, rural-urban migration was an important factor, especially with the implementation of the New Economic Policy (NEP) from 1970 onwards, which specifically encourages the involvement of the Bumiputras, who are largely rural based, in the industrial and commercial sectors of the economy. This has had a profound effect on the rate of urbanization in Malaysia because the Chinese rural base has been largely depleted.

The third phase is after 1980. When compared with the 1970s, the rate of urbanization has slackened slightly from 5.3 per cent per annum to 4.3 per cent per annum. This is despite an overall increase in the proportion of the urban population. In Peninsular Malaysia, the rate declined from 5.3 per cent to 4.2 per cent, in Sabah from 6.7 per cent to 6.1 per cent, and in Sarawak from 4.6 per cent to 4.3 per cent. The declining urban population growth rate may be due to the economic slowdown of the 1980s, which affected the pace of economic development to some extent (Chan, 1987). Although the rate of urbanization has slackened slightly, the percentage and absolute growth of the urban population can be expected to be maintained in the 1990s. The United Nations (1986b) projects an increase in Malaysia's urban population from 7.32 million to 10.32 million between 1990 and 2000, giving estimated urban proportions of 42.3 per cent and 50.4 per cent, respectively.

Trends in urbanization

The year 1970 is also significant from the viewpoint of an accentuated directional bias since Independence. This may be expressed as the increasing growth of the urban population in the metropolitan areas, defined in the Census as urban centres having populations of more than 75,000. The proportion of the total population living in metropolitan areas was 45.1 per cent in 1957, increasing to 58.5 per cent in 1970. By 1980, almost three-quarters of the urban population were living in the 14 metropolitan centres of the country.

In a sense, a large portion of the increase may be attributed to the growing number of metropolitan areas being reclassified in the 1980 Census compared with 1957 or 1970. In fact, the number of such centres increased from 4 in 1957 to 8 in 1970 and to 14 in 1980. Even by holding towns constant without reclassifying the various categories over the three censal years, the proportion of the urban population in the metropolitan-size category increased from 47 per cent to 58 per cent, and between 1970 and 1980 increased by six percentage points, whereas the other size categories showed negligible increases (Lee, 1985).

This increasing polarization in the metropolises is, of course, not new and has been happening over the past 30 years or so, but its primal tendencies have become more apparent over the past one and a half decades. This pronounced tendency towards a preponderance of population in a few cities may be largely due to the fact that it is more economical to centralize production to avoid the high costs of infrastructural development. The existence of net benefits in urban areas therefore encourages people to move towards those areas (Tolley, 1987).

One significant trend in the process of urbanization in Malaysia in the period 1960-1990 is the increasing dominance of Kuala Lumpur vis--vis other cities in Malaysia (Lee, 1987a). In 1957, Georgetown was about three-quarters the size of Kuala Lumpur in terms of population, but in 1980 it was only one-third (table 10.2). A simple four-city primacy index showing the quotient of the population in the largest city divided by the combined population in the second-, third-, and fourth-largest cities shows an increase from 0.75 to 1.17 over the period from 1957 to 1980. Other measures of primacy also reveal the dominance of the capital region of Kuala Lumpur. It is in view of this pattern of urbanization that a National Urbanization Policy is being formulated to guide and manage urban development throughout the whole country in a systematic and orderly manner.

Table 10.2 The next four largest towns in relation to Kuala Lumpur

  1957 1970 1980
Kuala Lumpur 100.00 100.00 100.00
Georgetown 71.80 59.60 32.00
Ipoh 38.50 54.90 27.00
Klang 23.10 25.10 20.90
Johore Bahru 22.90 30.20 26.80
2-city primacy index 1.39 1.68 3.13
4-city primacy index 0.75 0.69 1.17
11-city primacy index 0.80 0.74 0.94

Sources: Census reports, 1957, 1970, 1980; Lee and Bahrin (1989); Kok (1988).

Macro-population structure and change

Size and growth of the population

In 1957, Peninsular Malaysia had a population of slightly more than 6 million. With the formation of Malaysia in 1963, the population came close to 9 million, of which 85 per cent were in Peninsular Malaysia, 6 per cent in Sabah, and 9 per cent in Sarawak. In less than 30 years, the population doubled to reach about 18 million in 1990. Although Malaysia's population density of 54 persons per km2 may be considered sparse when compared with the Philippines (200/km2), Thailand (105/km2) or Indonesia (92/km2), there are obvious regional variations. In Peninsular Malaysia it is about 110 persons per km2 as against 21/km2 in Sabah and 14/km2 in Sararak. The current rate of population growth is about 2.4 per cent per annum.

Employment structure and shifts

Table 10.3 shows the sectoral distribution of employment for 19701988. Several distinctive characteristics may be highlighted. First, there was a major structural shift of employment from the primary sector to the secondary sector, particularly to manufacturing and construction in the period from 1970 to the 1980s (Kamal Salih and Young, 1988). Whereas agriculture, fishing, and forestry accounted for more than half of the total workforce in 1970, it represented only about 35 per cent in 1988. Because of the closure of a large number of tin mines and the retrenchment of workers in the mines, the mining sector, as part of the primary sector, accounted for only 1 per cent of total employment.

Second, the decline in employment in the primary sector was compensated by the growth in the secondary sector, which grew from 12 per cent in 1970 to 22 per cent in 1985. In the secondary sector, the manufacturing sector created the most jobs, especially in the 1970s. Its share in total employment increased from 9 per cent in 1970 to 16 per cent in 1980, primarily in the labour-intensive electronics and textiles industries.

Third, because of large public sector investment in infrastructure as well as construction activities in high-cost housing, offices, hotels, etc., the construction sector experienced severe labour shortages resulting in the use of Indonesian labour.

Fourth, table 10.3 also shows that the share of employment in the service sector increased from 20.6 per cent in 1970 to 27.0 per cent in 1985. Another important sector in employment is the commerce sector, including wholesale and retail trade, hotels and restaurants, finance and insurance, real estate and business services, and other services.

Fifth, the government was a major source of employment creation in the 1970s and the 1980s as a result of the massive recruitment drive to fill vacancies in the public sector. For instance, in 1979, the tertiary sector formed the largest component (77 per cent) in the employment structure in Inner Kuala Lumpur. One out of every five employees was a government servant, indicating the significance of the administrative functions in the capital city. The principal areas where employment is likely to increase are professional and business services, finance, insurance, and real estate (because the city centre is able to provide specialized metropolitan services), commercial and business activities for foreign and local companies, central and local government activities, specialized and convenience shopping, hotel and recreational services, and an expanding range of entertainment, utility, and urban transportation services.

Table 10.3 The sectoral distribution of employment in Malaysia, 1970-1988

















Agriculture, forestry and fishing 1,776 53.1 1,915 47.6 1,911 39.7 1,903 34.8 2,056 35.3
Mining 87 2.6 88 2.2 80 1.7 61 1.1 56 1.0
Primary sector 1,863 55.8 2,003 49.8 1,991 41.4 1,964 35.9 2,112 36.3
Manufacturing 301 9.0 448 11.1 789 16.4 828 15.1 845 14.5
Construction 91 2.7 160 4.0 270 5.6 379 6.9 356 6.1
Secondary sector 392 11.7 608 15.1 1,059 21.9 1,207 22.1 1,201 20.6
Transport and communication 133 4.0 181 4.5 210 4.4 267 4.9 279 4.8
Commerce 554 16.6 709 17.6 901 18.7 1,214 22.2 1,376 23.6
Service sector 687 20.6 890 22.1 1,111 23.1 1,481 27.1 1,655 28.4
Government services 399 12.0 520 13.0 658 13.7 820 15.0 852 14.6
Total employment 3,340 100.0 4,021 100.0 4,819 100.0 5,472 100.0 5,820 100.0
Labour force 3,610   4,320   5,109   5,917   6,425  
Unemployment (%)   7.5   6.9   5.7   7.5   9.4

Source: Kamal Salih and Young (1988).

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