International Business Environment

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International Business Environment

International Business Environment


Spread across the South China Sea is the divided land of Malaysia. Part of the country lies on the Malay Peninsula, which hangs off the corner of mainland Southeast Asia, but the states of Sarawak and Sabah are on the island of Borneo to the east. More than 24 million people live in the country, most of them in the rapidly growing cities on the peninsula. Every five years Malaysia gets a new head of state: nine sultans, who each rule one of the states that make up the country, take it in turns to be king. Almost half the population of Malaysia is Malays. About one-third are Chinese; the rest are either descendants of settlers from the Indian Subcontinent or local tribe's people. This mix of peoples has led to racial conflict in the past.

Malaysia is rich in natural resources, with large oil and gas reserves off the coast of Sarawak. The country is the world's top producer of palm oil, used to make soap and for cooking, and the third biggest producer of natural rubber. The rainforests of Sarawak are rich in hardwood trees, but experts are worried that the timber industry is cutting down trees faster than the forest can renew itself. Hidden inside the bark of the rubber tree is white liquid, called latex that is used to make natural rubber. Rubber trees grow in hot, moist climates and flourish on the lower slopes of the mountains that run down the length of the Malay Peninsula. Collected latex is sent to a local factory. There, it is mixed with water, and acid in a large pan to sheet.

In 1970, Malaysia had few factories, and most of its raw materials, such as rubber and tin, were exported to be manufactured into finished goods abroad. Today, Malaysia's economy is one of the most successful in the world. Malaysia continues to produce bulky amounts of raw materials, and its manufacturing sector has grown dramatically. Three-quarters of all exports are now finished goods, such as cars, electronics, textiles, and foods (Hill, 2008, p. 55).

In 1414, the people of Malacca (modern-day Melaka) converted to Islam when their ruler married a Muslim princess from Sumatra. The new faith spread rapidly throughout the country. Today, more than half the population of Malaysia is Muslim. Islamic law is widely obeyed, and many women wear a head-dress in the street. In 1857, a group of miners in search of tin set up a camp where the Kelang and Gombak rivers join. They called their settlement Kuala Lumpur, which is Malay for “muddy meeting place”. The camp soon grew in size and importance as a centre the tin mining and rubber industries. Today it is Malaysia's biggest city and home to more than 1.5 million people.

Faced with the problem of building on the banks of rivers or next to the sea, villagers developed an ingenious solution - they built their houses on stilts. Villages of these houses, called kampungs, are found throughout Southeast Asia. The wooden houses stand high enough above the water to ...
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