The Economy of Malaysia
Petronas, Oil and Gas
The state oil company Petronas, founded in 1974, is central to government finances and a global player in oil and gas.
Hydrocarbons underpin the budget.
Founding
Petronas was created in 1974 to own and manage the country’s oil and gas resources.
Government revenue
Dividends and taxes from Petronas fund a large part of the budget.
LNG
Malaysia is one of the world’s larger exporters of liquefied natural gas.
Sabah and Sarawak
These Borneo states, which produce much of the oil, have pressed for a greater share of revenues.
A budget link
When oil prices fall, government revenue shrinks and spending must adjust.
Ignoring the political side of oil revenue
States want a fair share.
Key takeaways
- Petronas manages hydrocarbons.
- It funds government finances.
- Malaysia exports LNG.
- Borneo states seek more revenue.
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