The Federated Malay States initially used the
Straits dollar issued by the
Board of Commissioners of Currency for the Straits Settlements. As the currency depreciated over time, it was pegged at two shillings four sterling pence in 1906. In 1939, the British government introduced a new currency, the Malayan dollar (
ringgit in Malay) for used in Malaya and Brunei replacing the Straits dollar at par value. It had denominations ranging from 1 cent to 1,000 Malayan dollars. The Federated Malay States main economic activities were agriculture and mining with emphasis on
rubber and
tin. The FMS and Malaya as a whole was the main supplier of these two commodities for British industrial needs. Rubber plantations were established in all four states and tin was mined primarily in the Klang valley in Selangor and the Kinta Valley in Perak. This labour-intensive economic activities prompted the British to bring in immigrant workers from southern India to work at the plantations and workers from southern China to mine the tin. The economic condition in the period can be viewed as self-sustainable, as the income of the federation was more than what was expended in terms of maintaining the administration and economic activities. In the later period, many resources were put into the development of
Kuala Lumpur, as the capital of the federation. This period also saw rapid growth in terms of communications infrastructure such as interstate roads, the expansion of the
Federated Malay States Railways'
narrow-gauge railway line between the Padang Besar and Singapore, and Port Swettenham (present-day
Port Klang). Public schools and academic institutions were also opened along with an improvement in public health. An area in the city was also gazetted as a settlement for the Malay called
Kampung Baru. Public buildings were also constructed such as the
Kuala Lumpur railway station, the
Government Offices of the FMS and
Masjid Jamek. The table and section below illustrated the economic growth of the federation and its member states. Note: All values are in
Straits dollars (One dollar fixed at two shillings and four pence sterling). Data for Pahang included only from 1890 onwards. Ref: Harrison, Cuthbert Woodville. An Illustrated Guide to the Federated Malay States. 1923.
Selangor The revenue of Selangor in 1875 amounted to $115,656; in 1905 it had increased to $8,857,793. Of this latter sum $3,195,318 was derived from duty on exported tin, $1,972,628 from finance, federal receipts, and $340,360 from land revenue. The trade balance was chiefly derived from the revenue farms, which included the right to collect import duty on opium and spirits. The expenditure for 1905 amounted to $7,186,146, of which sum $3,717,238 was on account of federal charges and $1,850,711 for public works. The value of the imports in 1905 was $24,643,619 and that of the exports was $26,683,316, making a total of $51,326,935 equivalent to £5,988,000. Tin was the principal export. The amount exported in 1905 was 17,254 tons. The total area of alienated mining land at the end of 1905 amounted to .
Perak The revenue of Perak in 1874 amounted to $226,333. That for 1905 amounted to $12,242,897. Of this latter sum $4,876,400 was derived from duty on exported tin, $2,489,300 from railway receipts, $505,300 from land revenue and $142,800 from postal and telegraphic revenue. The remainder is mainly derived from the revenue farms, which are leased for a short term of years, conveying to the lessee the right to collect import duties upon opium, wine and spirits, to keep pawnbroking shops, and to keep public licensed gambling-houses for the use of non-Malay only. The expenditure for 1905 amounted to $10,141,980. Of this sum $4,236,000 was spent on railway upkeep and construction and $2,176,100 on public works. The value of the imports into Perak during 1905 was over $20,000,000, and that of the exports exceeded $40,000,000, making a total of over $60,000,000, equivalent to about seven million sterling. The output of tin from Perak ranged between 18,960 tons, valued at $23,099,506 in 1899, and 26,600 tons, valued at $35,500,000, in 1905. The fluctuating output figure was due to the uncertainty of the labour supply. The mining population was recruited exclusively from the districts of southern China, and during certain years an increased demand for labourers in China itself, in French Indo-China, in the Dutch colonies, and in South Africa temporarily and adversely affected immigration to the Straits of Malacca. The output had, moreover, been affected from time to time by the price of tin, which was $32.20 per pikul in 1896, rose to $42.96 in 1898, to $74.15 in 1900, and averaged $80.60 in 1905. Excluding tin, the principal exports were $108,000 worth of Para rubber, $181,000 of copra, $54,000 of hides, $48,000 of patchouli, and considerable quantities of timber, rattans and other jungle produce.
Negeri Sembilan The revenue of the Negri Sembilan amounted to $223,435 in 1888. In 1898 it had increased to $701,334, in 1900 to $1,251,366, and in 1905 to $2,335,534. The revenue for 1905 was derived mainly as follows: customs $1,268,602, land revenue $145,475, land sales $21,407, while the revenue farms contributed $584,459. The expenditure in 1905 amounted to $2,214,093, of which $1,125,355 was spent on public works. The trade returns for 1905, which are not, however, complete, showed an aggregate value of about $13,000,000. The value of the tin exported during 1905 exceeded $6,900,000, and the value of the agricultural produce, of which gambier represented $211,000 and damar $80,000, amounted to $407,990.
Pahang The revenue of Pahang in 1899 amounted to $62,077; in 1900 to $419,150. In 1905 it was $528,368. The expenditure in 1905 amounted to $1,208,176. Of this sum $736,886 was spent on public works. Pahang is still a source of expense to the federation, its progress having been slowed by the disturbances which lasted from December 1891 until 1895, with short intervals of peace, but the revenue was steadily increasing, and the ultimate financial success of the state is considered to be secure. Pahang owed something over $3,966,500 to Selangor and $1,175,000 to Perak, which had financed it for some years out of surplus revenue. The value of the imports in 1905 was $1,344,346, that of the exports was $3,838,928, thus making a total trade value of $5,183,274. The most valuable export is tin, the value of which in 1905 amounted to $2,820,745. The value of the gutta exported exceeded $140,000, that of dried and salted fish amounted to nearly $70,000, and that of timber to $325,000. ==Education==