Malaysia, constitutional monarchy in Southeast Asia on the South China Sea. Malaysia is divided into two regions, known as West Malaysia and East Malaysia. West Malaysia, also known as Peninsular Malaysia, consists of the southern portion of the Malay Peninsula and nearby islands. Thailand borders West Malaysia on the north, and Singapore lies off the southern coastal tip. East Malaysia occupies the northern section of Borneo Island, as well as offshore islands. East Malaysia shares Borneo with Brunei, which lies on a small section of the northern coast, and with the Kalimantan region of Indonesia, which lies to the south. Malaysia is a federation of 13 states (Johor, Kedah, Kelantan, Melaka, Negeri Sembilan, Pahang, Perak, Pinang, Perlis, Sabah, Sarawak, Selangor, and Terengganu) and 2 federal territories (Kuala Lumpur and Labuan). Kuala Lumpur, coextensive with the federal territory, is the capital and largest city.
From the late 18th to the early 19th centuries, Britain gradually gained control of Peninsular Malaysia, and most of northern Borneo fell into private British hands. During the same period, the largely Malay population became diversified, as ethnic Chinese and Indians immigrated to work in Malaysia's tin and rubber industries. Since independence in 1957, ethnic tensions, especially between Chinese and Malays, have dominated political and economic issues. Despite the tensions, however, Malaysia has experienced rapid economic growth, particularly in the manufacturing sector, and economists include the country among Asia's “newly industrialized economies” (NIEs).
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