Comparison of Household Income

Distribution by race, West Malaysia, 1970

Monthly Income	Malay	Chinese	Indian
$1-$399	92.4%	71.2%	82.1%
$400-$1,499	7.2%	26.2%	16.1%
$1,500 and over	0.4%	2.6%	1.8%

Calculated from Mid-Term Review, 2nd Malaysia Plan, 1971-1975.

It's the foreign capitalists by continuing to own large chunks of the plantation, manufacturing and commercial sectors, can truly be said to dominate the Malaysian economy. However, to most Malays, who do not have access to these basic facts, their personal experiences appears to confirm the myth of Chinese economic domination. The towns, inhabited mainly by Chinese, are like islands of prosperity surrounded by a sea of rural poverty, where most of the Malays live. While in countryside, many shopkeepers are Chinese, whose standard of material living is often higher than the Malay customers.

This distorted picture of the real world (in which the vast majority of Chinese are workers not businessmen) is a reflection of the distorted development of the Malayan economy under British rule. Being primarily interested in the tin, rubber and straits of Malacca, the British "developed" that part of Malaya, and imported imigrant labour there.

To extract the primary produce and to sell their manufactured goods, the British needed a network of collection and distribution stretching into every town and village in the country. Very soon, Chinese traders whose capital was too small to compete successfully in the towns because shopkeepers in the Malay villages, performing a middleman's role between the Malay peasants at the one end and the giant British agency house at the other. The middle man is able to manipulate prices (though only around levels set by the agency houses), and to his Malay customers he is seen as an expoliter, buying cheap and selling dear.

The distortion in the Malay's perception of the Chinese as exploiters and businessmen was worsened by colonial policies which effectively segregated the races along the races were separated by an invisible wall, with inter-racial interaction taking place only at a limited and superficial level. In such circumstances distorted racial stereotypes inevitably abounded.