The beer market in Malaysia is expected to show a recovery in the second half of this year following a drop of 3% to 4% in 2001. Last year, the legal beer market totalled around 100m litres, representing sales of almost MR1.0 billion. However, a further 20m litres of beer were estimated to have been sold through illegal channels.

Chairman of Carlsberg Brewery Malaysia, Michael Iuul, is reported to have predicted a recovery in the market in the second half of 2002 provided that the government does not raise duties on beer. Malaysian brewers have generally blamed high duties for the prevalence of smuggling.